Document:

ex10-2.htm

    Exhibit
10.2

    

    

    ESCROW
AGREEMENT

    

    THIS
ESCROW AGREEMENT (this “Agreement”) is made
and entered into as of the 27th day of
July, 2009, by and among GreenMan Alternative Energy, Inc., an Iowa corporation
(the “Buyer”),
American Power Group, Inc., an Iowa corporation (the “Seller”), GreenMan
Technologies, Inc., a Delaware corporation (the “Parent”) and Morse,
Barnes-Brown & Pendleton, P.C. (the “Escrow
Agent”).

    

    WHEREAS,
the Seller and the Parent have entered into an Exclusive Patent License
Agreement dated as of June 17, 2009 (the “License”), pursuant
to which the Seller has licensed  to the Parent certain Patent Rights
(as such term is defined in the License) in exchange for the issuance by the
Parent of shares of the Parent’s common stock and the obligation of Parent to
make certain cash payments to the Seller;

    

    WHEREAS,
the Buyer, the Seller and, for certain limited purposes, the Parent have entered
into an Asset Purchase Agreement dated as of July 27, 2009 (the “Purchase Agreement”),
pursuant to which the Buyer is purchasing certain assets, subject to certain
liabilities, from the Seller;

    

    WHEREAS, the Purchase Agreement
contemplates the establishment of an escrow arrangement to secure rights to
indemnification of the Buyer under the Purchase Agreement;

    

    NOW,
THEREFORE, in consideration of the
premises and the mutual covenants, agreements and provisions set forth in this
Agreement, the parties hereto agree as follows:

    

    

    ARTICLE I

    

    DEFINED
TERMS

     

    Section
1.1   Defined Terms. Capitalized terms used in this Agreement and
not otherwise defined shall have the meanings given to them in the Purchase
Agreement.

    

    

    ARTICLE
II

    

    ESCROW
AND INDEMNIFICATION

    

    Section
2.1   Funding of
Escrow.  Pursuant to Section 5.03 of the Purchase Agreement,
Parent, on behalf of Buyer, may from time to time deposit certain funds, which
would otherwise be due and payable to Seller under the License Agreement, with
the Escrow Agent as security for the indemnification provided for in Article V
of the Purchase Agreement (such amounts, collectively, the “Escrow
Funds”).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    Section
2.2   Deposit of Escrow
Funds.  The Escrow Agent shall deposit the Escrow Funds in a
federally insured, interest-bearing separately designated account or sub-account
(the “Escrow
Account”) at Citizens Bank, Massachusetts, USA, or at such other bank or
financial institution as the Escrow Agent may use from time to time as a
depository for its own funds. Interest income from such deposit shall be held by
the Escrow Agent in the Escrow Account and shall be considered part of the
Escrowed Funds.

    

    Section
2.3   Release of Escrow
Funds.  The Escrow Agent shall not release any portion of the
Escrow Funds to Buyer, Seller or Parent except (i) upon receipt of written
directions signed on behalf of Buyer, Seller and Parent (an “Escrow Certificate”)
or (ii) in the absence of an Escrow Certificate, in accordance with the written
determination of the arbitrator as provided in Section 7.06 of the Purchase
Agreement (an “Arbitration Award”).
The Escrow Agent shall be entitled to rely on either such Escrow Certificate or
such determination and shall distribute cash from the Escrow Fund in accordance
with the terms thereof.

    

    Section
2.4   Trust Fund. The
Escrow Funds shall be held as a trust fund and shall not be subject to any lien,
attachment, trustee process or any other judicial process of any creditor of any
party hereto. The Escrow Agent shall hold and safeguard the Escrow Funds until
the Escrow Funds are released pursuant to Section 2.3 upon the delivery of an
Escrow Certificate or  Arbitration Award.

    

    Section
2.5   Escrow Non-Exclusive.
The escrow created under this Agreement shall be for the convenience of the
parties, but neither this Agreement, nor any provision hereof, nor the existence
of the Escrow Funds, shall be deemed to limit the right of the Buyer to
indemnification in any amount under the Purchase Agreement.

    

    

    ARTICLE
III

    

    
      
        	
                CONCERNING
      THE ESCROW AGENT

              

      

    

    

    Section
3.1   Fees and
Expenses.

    

    (a)           The
Escrow Agent will be entitled to reasonable compensation for its ordinary
services under this Agreement, such services to be charged at the Escrow Agent’s
then-prevailing standard hourly rates for legal services. The Escrow Agent shall
be entitled to reimbursement for reasonable and documented out-of-pocket
expenses incurred in the performance of its duties hereunder. All such fees and
expenses shall be paid by the Parent.

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    (b)           In
the event that the Escrow Agent renders any services jointly requested by the
Seller, on the one hand, and the Buyer or the Parent, on the other hand, that
are not provided for in this Agreement or there is any assignment of any
interest in the subject matter of this escrow or modification of any interest,
the Escrow Agent will be reasonably compensated for such extraordinary services
(to be charged at its then-prevailing standard hourly rates for legal services),
and will be reimbursed for all reasonable costs, third-party, unaffiliated
attorneys’ fees and expenses occasioned thereby, which compensation, costs, fees
and expenses shall be paid by the party requesting such additional service or
whose interest is assigned or modified.

    

    Section
3.2   Responsibility of
the Escrow Agent.

    

    (a)           If any party to this Agreement disagrees
on anything connected with this escrow, (i) the Escrow Agent will not have to
settle the matter, (ii) the Escrow Agent may wait for a settlement by
appropriate legal proceedings or other means it may require, and in such event
it will not be liable for interest or damages, and (iii) the Escrow Agent is
entitled to hold the Escrow Funds in the Escrow Account pending settlement of
the disagreement by any of the above means.

    

    (b)           The Escrow Agent is to act as a
depository agent only and is hereby relieved of any liability in connection
with any representations made by the other parties hereto or any of their
agents.

    

    Section
3.3   Limitation of
Escrow Agent’s Liability.

    

    (a)           The
Escrow Agent undertakes to perform such duties as are specifically set forth in
this Agreement only and shall have no duty under any other agreement or document
(other than the Purchase Agreement), and no implied covenants or obligations
shall be read into this Agreement against the Escrow Agent. The Escrow Agent
shall incur no liability with respect to any action taken by it or for any
inaction on its part in reliance upon any notice, direction, instruction,
consent, statement or other document believed by it in good faith to be genuine
and duly authorized, nor for any other action or inaction except for its own
gross negligence or willful misconduct. In all questions arising under this
Agreement, the Escrow Agent may rely on the advice of counsel, and for anything
done, omitted or suffered in good faith by the Escrow Agent based upon such
advice the Escrow Agent shall not be liable to anyone. In no event shall the
Escrow Agent be liable for incidental, punitive or consequential
damages.

    

    (b)           The
Seller, the Buyer and the Parent hereby jointly and severally agree to indemnify
the Escrow Agent and its shareholders, officers, directors, employees and agents
for, and hold it and them harmless against, any loss, liability or expense
arising under this Agreement, including, but not limited to reasonable
attorneys’ fees and expenses, unless such loss, liability or expense is due to
the gross negligence or willful misconduct on the part of the Escrow Agent. This
right of indemnification shall survive the termination of this Agreement and the
resignation of the Escrow Agent.

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

    Section
3.4   Acknowledgement and Waiver
of Potential Conflict. The Seller acknowledges and agrees that (a) the
Escrow Agent has served as legal counsel to the Buyer and Parent in connection
with the negotiation and execution of the Purchase Agreement and the other
agreements and documents executed in connection therewith and the transactions
contemplated thereby; (b) the Escrow Agent may be deemed to have a conflict of
interest in serving as Escrow Agent hereunder; and (c) the Escrow Agent has
agreed to serve as Escrow Agent hereunder at the mutual request of, and as an
accommodation to, the Seller, the Buyer and the Parent. Accordingly, the Seller,
the Buyer and the Parent each (i) irrevocably waive any such conflict, and any
objection thereto, to the fullest extent of the law, and (ii) agree not to raise
any objection to the existence of such conflict of interest in connection with
the performance of this Escrow Agreement or any dispute among the parties with
respect thereto.

    

    Section
3.5   Successor Escrow
Agent. In the event the Escrow Agent becomes unavailable or unwilling to
continue as escrow agent under this Agreement, the Escrow Agent may resign and
be discharged from its duties and obligations hereunder by giving its written
resignation to the Seller, the Buyer and the Parent. Such resignation shall take
effect not less than 30 days after such notice is given. In such event, the
Parent may appoint a successor Escrow Agent. If the Parent fails to appoint a
successor Escrow Agent within 15 days after receiving the Escrow Agent’s written
resignation, the Escrow Agent shall have the right to apply to a court of
competent jurisdiction for the appointment of a successor Escrow Agent. The
successor Escrow Agent shall execute and deliver to the Escrow Agent an
instrument accepting such appointment, and the successor Escrow Agent shall,
without further acts, be vested with all the estates, property rights, powers
and duties of the predecessor Escrow Agent as if originally named as Escrow
Agent herein. The Escrow Agent shall act in accordance with written instructions
from the Parent as to the transfer of the Escrow Funds to a successor escrow
agent.

    

    

    
      	
               
      

            	
              ARTICLE
      IV

            

    

    

    
      	
               
      

            	
              GENERAL
      PROVISIONS; ADDITIONAL AGREEMENTS

            

    

    

    Section
4.1   Termination. This
Agreement shall terminate upon the earlier to occur of (a) the repayment in full
of the principal amount of the Goodwill Gross-up Note and the Goodwill True-up
Note, if any, together with all interest accrued thereon, or (b) the prior
written agreement of the parties.

    

    Section
4.2   Notices. Any notices,
waivers, correspondences or other communications required under or pertaining to
this Agreement shall be in writing and shall be delivered by hand, or sent by a
reputable overnight mail service (e.g., Federal Express), or by first class mail
(certified or registered), or by facsimile confirmed by one of the foregoing
methods, to the other party. Notices will be deemed effective (a) three (3)
working days after deposit, postage prepaid, if mailed, (b) the next day if sent
by overnight mail, or (c) the same day if sent by facsimile and confirmed as set
forth above or delivered by hand.  Unless changed in writing in
accordance with this Section, the notice address for each of the Parties shall
be as follows:

    
      
         

      

      
        4

        
          

        

      

      
         

      

    

    If
to the Buyer or the Parent:

    

    GreenMan Technologies,
Inc.

    7 Kimball Lane

    Lynnfield, Massachusetts
01940

    Attention:
Mr. Charles E. Coppa

    Telephone:
(781) 224-2411

    Facsimile:
(781) 224-0114

    

    If
to the Seller:

    

    Rick
Kremer

    9159
St. Rt. 118

    Ansonia,
OH  45303

    Telephone:
(937) 547-9633

    Facsimile:
______________

    

    If
to the Escrow Agent:

    

    Morse,
Barnes-Brown & Pendleton, P.C.

    Reservoir Place

    1601 Trapelo Road

    Waltham, Massachusetts
02451

    Attention: Carl F. Barnes

    Telephone:
(781) 622-5930

    Facsimile:
(781) 622-5933

    

    Any
party may change its address for receiving notices by giving written notice of
such change to the other party in accordance with this Section 4.2.

    

    Section
4.3   Waiver of Jury Trial.
If this Agreement is found to be not subject to arbitration, each party
irrevocably agrees that all legal proceedings will be tried in a court of
competent jurisdiction by a judge without a jury. Each party waives any right to
a jury trial in any such proceeding and agrees to take, or not to take, such
action as is appropriate to give effect to this provision.

    

    Section
4.4   Counterparts. This
Agreement may be executed in one or more counterparts, all of which shall
constitute one in the same instrument.

    

    Section
4.5   Amendment; Waiver.
This Agreement may be amended,
modified or supplemented by a writing signed by the parties against whom
enforcement of any amendment is sought. Any party hereto may, by a written
signed instrument, extend the time for or waive the performance of any of the
obligations of any other party hereto or waive compliance by such other party
with any of the covenants or conditions contained herein.

    
      
         

      

      
        5

        
          

        

      

      
         

      

    

    Section
4.6   Entire Agreement.
This Agreement, together with the Purchase Agreement, constitutes the entire
agreement among the parties, and there are no agreements, understandings,
restrictions, warranties, or representations between the parties other than
those set forth or provided for in this Agreement relating to the subject matter
hereof.

    

    Section
4.7   Succession
and Assignment. This
Agreement shall be binding upon and inure to the benefit of the parties named
herein and their respective successors and permitted assigns. Neither
this Agreement nor any of the parties’ rights hereunder shall be assignable by
any party without the prior written consent of the other parties.

    

    Section
4.8   Headings. The
headings contained in this Agreement are for convenience of reference only,
shall not be deemed to be a part of this Agreement and shall not be referred to
in connection with the construction or interpretation of this
Agreement.

     

    Section
4.9   Severability. If any
term or other provision of this Agreement is invalid, illegal or incapable of
being enforced by any law or public policy, all other conditions and provisions
of this Agreement shall nevertheless remain in full force and effect so long as
the economic or legal substance of the transactions contemplated hereby is not
affected in any manner adverse to any party. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in a mutually
acceptable manner in order that the transactions contemplated hereby be
consummated as originally contemplated to the greatest extent
possible.

    

    Section
4.10   Governing Law. This
Agreement shall be governed in all respects, including validity, interpretation
and effect, by the internal laws of the Commonwealth of Massachusetts without
regard to principles of conflicts of laws.

    

    Section
4.11   No Presumption. This
Agreement shall be construed without regard to any presumption or rule requiring
construction or interpretation against the party drafting or causing any
instrument to be drafted.

    

    Section
4.12   No Third-Party
Beneficiaries. This Agreement shall not confer any rights or remedies
upon any person other than the parties and their respective successors and
permitted assigns.

    

    Section
4.13   Tax Reporting Information
and Certification of Tax Identification Numbers.

    

    (a)           The
parties hereto agree that, for tax reporting purposes, all interest on or other
income, if any, attributable to the Escrow Funds which shall not have been
distributed pursuant to Section 2.3 in respect to any tax year shall be
allocable 50% to the Buyer and 50% to the Seller.

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    (b)           The
Buyer and the Seller agree to provide the Escrow Agent with certified tax
identification numbers for each of them by furnishing appropriate Forms W-9 (or
Forms W-8, in the case of non-U.S. persons) and any other forms and documents
that the Escrow Agent may reasonably request (collectively, “Tax Reporting
Documentation”) to the Escrow Agent within 30 days after the date hereof.
The parties hereto understand that, if such Tax Reporting Documentation is not
so furnished to the Escrow Agent, the Escrow Agent shall be required by the
Internal Revenue Code of 1986, as amended, to withhold a portion of any interest
or other income earned on the investment of monies or other property held by the
Escrow Agent pursuant to this Agreement, and to immediately remit such
withholding to the Internal Revenue Service.

    

    
      	
              [The
      remainder of this page has intentionally been left
  blank.]

            

    

    

     

    
      
         

      

      
        7

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
under seal as of the date first written above.

    

    

    THE
PARENT:

    

    GREENMAN
TECHNOLOGIES, INC.

    

    

    By:   
/s/ Charles E. Coppa

    Charles
E. Coppa,

    Chief
Financial Officer

    

    

    COMMONWEALTH
OF MASSACHUSETTS, ESSEX COUNTY, SS:

    

    On this 27th day of July, 2009, before
me, the undersigned, a Notary Public in and for said County and State,
personally appeared Charles E. Coppa, to me personally known, who being by me
duly sworn, did say that he is the Chief Financial Officer of said corporation;
that said instrument was signed on behalf of said corporation by authority of
its Board of Directors; and that the said Charles E. Coppa as such officer,
acknowledged the execution of said instrument to be the voluntary act and deed
of said corporation by it and by them voluntarily executed.

    

    

    
      	 
      	
              /s/
      Cynthia A. Gray

            
	 
      	
              NOTARY
      PUBLIC IN AND FOR THE

            
	 
      	
              COMMONWEALTH
      OF MASSACHUSETTS

            

    

    

    

    

    [SEAL]

    

    

    

    

    [Escrow
Agreement]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    THE
BUYER:

    

    GREENMAN
ALTERNATIVE ENERGY, INC.

    

    

    By:   
 /s/ Charles E. Coppa

    Charles
E. Coppa

    Treasurer

    

    

    COMMONWEALTH
OF MASSACHUSETTS, ESSEX COUNTY, SS:

    

    On this 27th day of
July, 2009, before me, the undersigned, a Notary Public in and for said County
and State, personally appeared Charles E. Coppa, to me personally known, who
being by me duly sworn, did say that he is the Treasurer of said corporation;
that said instrument was signed on behalf of said corporation by authority of
its Board of Directors; and that the said Charles E. Coppa as such officer,
acknowledged the execution of said instrument to be the voluntary act and deed
of said corporation by it and by them voluntarily executed.

    

    

    

    
      	 
      	
              /s/
      Cynthia A. Gray

            
	 
      	
              NOTARY
      PUBLIC IN AND FOR THE

            
	 
      	
              COMMONWEALTH
      OF MASSACHUSETTS

            

    

    

    

    [SEAL]

    

    

    [Escrow
Agreement]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    THE
SELLER:

    

    AMERICAN
POWER GROUP, INC.

    

    

    By:  
 /s/ Rick Kremer

    Rick
Kremer, President

    

    

    STATE
OF OHIO, DARKE COUNTY, SS:

    

    On this 27th day of July, 2009, before
me, the undersigned, a Notary Public in and for said County and State,
personally appeared Rick Kremer, to me personally known, who being by me duly
sworn, did say that he is the President of said corporation; that said
instrument was signed on behalf of said corporation by authority of its Board of
Directors; and that the said Rick Kremer as such officer, acknowledged the
execution of said instrument to be the voluntary act and deed of said
corporation by it and by them voluntarily executed.

    

    

    

    
      	 
      	
              /s/
      Wendy Aultman

            
	 
      	
              NOTARY
      PUBLIC IN AND FOR THE

            
	 
      	
              STATE
      OF OHIO

            

    

    

    

    

    

    [SEAL]

    

    

    

    [Escrow
Agreement]

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    THE
ESCROW AGENT:

    

    MORSE,
BARNES-BROWN & PENDLETON, P.C.

    

    

    By:
/s/ Carl F. Barnes

    Carl
F. Barnes, Vice President

    

    

    COMMONWEALTH
OF MASSACHUSETTS, MIDDLESEX COUNTY, SS:

    

    On this 27th day of July, 2009, before
me, the undersigned, a Notary Public in and for said County and Commonwealth,
personally appeared Carl F. Barnes, to me personally known, who being by me duly
sworn, did say that he is the Vice President of said corporation; that said
instrument was signed on behalf of said corporation by authority of its Board of
Directors; and that the said Carl F. Barnes as such officer, acknowledged the
execution of said instrument to be the voluntary act and deed of said
corporation by it and by them voluntarily executed.

    

    

    

    
      	 
      	
              /s/
      Kevin M. Johnson

            
	 
      	
              NOTARY
      PUBLIC IN AND FOR THE

            
	 
      	
              COMMONWEALTH
      OF MASSACHUSETTS

            

    

    

    

    

    

    [SEAL]

    

    

    Escrow
Agreement]Amended and Restated 2005 Equity Incentive Plan

 Exhibit 10.1 
 PDL BIOPHARMA, INC. 
 2005 EQUITY
INCENTIVE PLAN 
 (AMENDED AND RESTATED
EFFECTIVE JUNE 4, 2009) 

 PDL BIOPHARMA, INC. 
 2005 EQUITY INCENTIVE PLAN 
 (AMENDED AND RESTATED EFFECTIVE JUNE 4, 2009) 
 TABLE OF CONTENTS 
  

			
	 	  	Page
	 1.     Establishment, Purpose and Term of Plan
	  	1
	 1.1    Establishment
	  	1
	 1.2    Purpose
	  	1
	 1.3    Term of Plan
	  	1
		
	 2.     Definitions and Construction
	  	1
	 2.1    Definitions
	  	1
	 2.2    Construction
	  	7
		
	 3.     Administration
	  	7
	 3.1    Administration by the Committee
	  	7
	 3.2    Authority of Officers
	  	7
	 3.3    Administration with Respect to Insiders
	  	7
	 3.4    Committee Complying with Section 162(m)
	  	7
	 3.5    Powers of the Committee
	  	7
	 3.6    Option or SAR Repricing
	  	8
	 3.7    Indemnification
	  	8
		
	 4.     Shares Subject to Plan
	  	9
	 4.1    Maximum Number of Shares Issuable
	  	9
	 4.2    Share Accounting
	  	9
	 4.3    Adjustments for Changes in Capital Structure
	  	9
		
	 5.     Eligibility, Participation and Award Limitations
	  	10
	 5.1    Persons Eligible for Awards
	  	10
	 5.2    Participation in Plan
	  	10
	 5.3    Award Limitations
	  	10
		
	 6.     Stock Options
	  	12
	 6.1    Exercise Price
	  	12
	 6.2    Exercisability and Term of Options
	  	12
	 6.3    Payment of Exercise Price
	  	12
	 6.4    Effect of Termination of Service
	  	13
	 6.5    Transferability of Options
	  	13
		
	 7.     Stock Appreciation Rights
	  	14
	 7.1    Types of SARs Authorized
	  	14
	 7.2    Exercise Price
	  	14
	 7.3    Exercisability and Term of SARs
	  	14
	 7.4    Exercise of SARs
	  	14
	 7.5    Deemed Exercise of SARs
	  	15
	 7.6    Effect of Termination of Service
	  	15
	 7.7    Nontransferability of SARs
	  	15
		
	 8.     Restricted Stock Awards
	  	15
	 8.1    Types of Restricted Stock Awards Authorized
	  	15
	 8.2    Purchase Price
	  	15
	 8.3    Purchase Period
	  	15
	 8.4    Payment of Purchase Price
	  	15
	 8.5    Vesting and Restrictions on Transfer
	  	16
	 8.6    Voting Rights; Dividends and Distributions
	  	16
	 8.7    Effect of Termination of Service
	  	16
	 8.8    Nontransferability of Restricted Stock Award Rights
	  	16

  

 i 

			
	 	  	Page
	 9.     Restricted Stock Unit Awards
	  	17
	 9.1    Grant of Restricted Stock Unit Awards
	  	17
	 9.2    Purchase Price
	  	17
	 9.3    Vesting
	  	17
	 9.4    Voting Rights, Dividend Equivalent Rights and Distributions
	  	17
	 9.5    Effect of Termination of Service
	  	18
	 9.6    Settlement of Restricted Stock Unit Awards
	  	18
	 9.7    Nontransferability of Restricted Stock Unit Awards
	  	18
		
	 10.   Performance Awards
	  	18
	 10.1    Types of Performance Awards Authorized
	  	18
	 10.2    Initial Value of Performance Shares and Performance Units
	  	18
	 10.3    Establishment of Performance Period, Performance Goals and Performance Award Formula
	  	19
	 10.4    Measurement of Performance Goals
	  	19
	 10.5    Settlement of Performance Awards
	  	20
	 10.6    Voting Rights; Dividend Equivalent Rights and Distributions
	  	21
	 10.7    Effect of Termination of Service
	  	22
	 10.8    Nontransferability of Performance Awards
	  	22
		
	 11.   Cash-Based Awards and Other Stock-Based Awards
	  	22
	 11.1    Grant of Cash-Based Awards
	  	22
	 11.2    Grant of Other Stock-Based Awards
	  	23
	 11.3    Value of Cash-Based and Other Stock-Based Awards
	  	23
	 11.4    Payment or Settlement of Cash-Based Awards and Other Stock-Based Awards
	  	23
	 11.5    Voting Rights; Dividend Equivalent Rights and Distributions
	  	23
	 11.6    Effect of Termination of Service
	  	23
	 11.7    Nontransferability of Cash-Based Awards and Other Stock-Based Awards
	  	23
		
	 12.   Standard Forms of Award Agreement
	  	24
	 12.1    Award Agreements
	  	24
	 12.2    Authority to Vary Terms
	  	24
		
	 13.   Change in Control
	  	24
	 13.1    Effect of Change in Control on Awards
	  	24
	 13.2    Federal Excise Tax Under Section 4999 of the Code
	  	25
		
	 14.   Compliance with Securities Law
	  	25
		
	 15.   Tax Withholding
	  	26
	 15.1    Tax Withholding in General
	  	26
	 15.2    Withholding in Shares
	  	26
		
	 16.   Amendment or Termination of Plan
	  	26
		
	 17.   Compliance with Section 409A
	  	26
	 17.1    Awards Subject to Section 409A
	  	26
	 17.2    Deferral and/or Distribution Elections
	  	27
	 17.3    Subsequent Elections
	  	27
	 17.4    Distributions Pursuant to Deferral Elections
	  	27
	 17.5    Unforeseeable Emergency
	  	28
	 17.6    Disabled
	  	28
	 17.7    Death
	  	28
	 17.8    No Acceleration of Distributions
	  	29

  

 ii 

			
	 	  	Page
	 18.   Miscellaneous Provisions
	  	29
	 18.1    Repurchase Rights
	  	29
	 18.2    Forfeiture Events
	  	29
	 18.3    Provision of Information
	  	29
	 18.4    Rights as Employee, Consultant or Director
	  	29
	 18.5    Rights as a Stockholder
	  	29
	 18.6    Delivery of Title to Shares
	  	30
	 18.7    Fractional Shares
	  	30
	 18.8    Retirement and Welfare Plans
	  	30
	 18.9    Beneficiary Designation
	  	30
	 18.10  Severability
	  	30
	 18.11  No Constraint on Corporate Action
	  	30
	 18.12  Unfunded Obligation
	  	30
	 18.13  Choice of Law
	  	31

  

 iii 

 PDL BIOPHARMA, INC. 
 2005 EQUITY INCENTIVE PLAN 
 (AMENDED AND RESTATED EFFECTIVE JUNE 4, 2009) 
 1.     Establishment, Purpose and Term of Plan. 
 1.1    Establishment. The PDL BioPharma, Inc. 2005 Equity Incentive Plan (the “Plan”) is
hereby established effective as of June 8, 2005, the date of its approval by the stockholders of the Company (the “Effective Date”). 
 1.2    Purpose. The purpose of the Plan is to advance the interests of the Participating Company Group and its stockholders by
providing an incentive to attract, retain and reward persons performing services for the Participating Company Group and by motivating such persons to contribute to the growth and profitability of the Participating Company Group. The Plan seeks to
achieve this purpose by providing for Awards in the form of Options, Stock Appreciation Rights, Restricted Stock Purchase Rights, Restricted Stock Bonuses, Restricted Stock Units, Performance Shares, Performance Units, Cash-Based Awards and Other
Stock-Based Awards. 
 1.3    Term of Plan. The Plan shall continue in effect until its termination by the
Committee; provided, however, that all Awards shall be granted, if at all, within ten (10) years from the Effective Date. 
 2.    Definitions and Construction. 
 2.1    Definitions. Whenever
used herein, the following terms shall have their respective meanings set forth below: 
 (a)    “Affiliate” means (i) an entity, other than a Parent Corporation, that directly, or indirectly through one or more intermediary entities, controls the Company or
(ii) an entity, other than a Subsidiary Corporation, that is controlled by the Company directly, or indirectly through one or more intermediary entities. For this purpose, the term “control” (including the term “controlled
by”) means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of the relevant entity, whether through the ownership of voting securities, by contract or otherwise; or shall have such
other meaning assigned such term for the purposes of registration on Form S-8 under the Securities Act. 
 (b)    “Award” means any Option, Stock Appreciation Right, Restricted Stock Purchase Right, Restricted Stock Bonus, Restricted Stock Unit, Performance Share, Performance Unit,
Cash-Based Award or Other Stock-Based Award granted under the Plan. 
 (c)    “Award
Agreement” means a written or electronic agreement between the Company and a Participant setting forth the terms, conditions and restrictions of the Award granted to the Participant. 
 (d)    “Board” means the Board of Directors of the Company. 
 (e)    “Cash-Based Award” means an Award denominated in cash and granted pursuant to Section 11.

 (f)    “Cause” means, unless such term or an equivalent term is otherwise
defined with respect to an Award by the Participant’s Award Agreement or by a written contract of employment or service, any of the following: (i) the Participant’s theft, dishonesty, willful misconduct, breach of fiduciary duty for
personal profit, or falsification of any Participating Company documents or records; (ii) the Participant’s material failure to abide by a Participating Company’s code of conduct or other policies (including, without limitation,
policies relating to confidentiality and reasonable workplace conduct); (iii) the Participant’s unauthorized use, misappropriation, destruction or diversion of any tangible or intangible asset or corporate opportunity of a Participating
Company (including, without limitation, the Participant’s improper use or disclosure of a Participating Company’s 

  

 1 

 
confidential or proprietary information); (iv) any intentional act by the Participant which has a material detrimental effect on a Participating
Company’s reputation or business; (v) the Participant’s repeated failure or inability to perform any reasonable assigned duties after written notice from a Participating Company of, and a reasonable opportunity to cure, such failure
or inability; (vi) any material breach by the Participant of any employment, service, non-disclosure, non-competition, non-solicitation or other similar agreement between the Participant and a Participating Company, which breach is not cured
pursuant to the terms of such agreement; or (vii) the Participant’s conviction (including any plea of guilty or nolo contendere) of any criminal act involving fraud, dishonesty, misappropriation or moral turpitude, or which impairs the
Participant’s ability to perform his or her duties with a Participating Company. 
 (g)    “Change
in Control” means, unless such term or an equivalent term is otherwise defined with respect to an Award by the Participant’s Award Agreement or by a written contract of employment or service, the occurrence of any of the
following: 
 (i)    any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act)
acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person) “beneficial ownership” (as defined in Rule 13d-3 promulgated under the Exchange Act), directly or indirectly, of
securities of the Company possessing thirty-five percent (35%) or more of the total combined voting power of the Company’s then-outstanding securities entitled to vote generally in the election of Directors; provided,
however, that the following acquisitions shall not constitute a Change in Control: (1) an acquisition by any such person who prior to such acquisition is the beneficial owner of thirty-five percent (35%) or more of such voting
power, (2) any acquisition directly from the Company, including, without limitation, a public offering of securities, (3) any acquisition by the Company, (4) any acquisition by a trustee or other fiduciary under an employee benefit
plan of a Participating Company or (5) any acquisition by an entity owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of the voting securities of the Company; or 

(ii)    an Ownership Change Event or series of related Ownership Change Events (collectively, a
“Transaction”) in which the stockholders of the Company immediately before the Transaction do not retain immediately after the Transaction direct or indirect beneficial ownership of more than fifty percent
(50%) of the total combined voting power of the outstanding voting securities of the Company or, in the case of an Ownership Change Event described in Section 2.1(bb)(iii), the entity to which the assets of the Company were transferred
(the “Transferee”), as the case may be; or 
 (iii)    a liquidation or
dissolution of the Company. 
 For purposes of the preceding sentence, indirect beneficial ownership shall include, without limitation, an interest resulting
from ownership of the voting securities of one or more corporations or other business entities which own the Company or the Transferee, as the case may be, either directly or through one or more subsidiary corporations or other business entities.
The Committee shall have the right to determine whether multiple sales or exchanges of the voting securities of the Company or multiple Ownership Change Events are related, and its determination shall be final, binding and conclusive.
Notwithstanding the foregoing, to the extent that any amount constituting Section 409A Deferred Compensation would become payable under this Plan by reason of a Change in Control, such amount shall become payable only if the event constituting
a Change in Control would also constitute a change in ownership or effective control of the Company or a change in the ownership of a substantial portion of the assets of the Company within the meaning of Section 409A. 
 (h)    “Code” means the Internal Revenue Code of 1986, as amended, and any applicable
regulations or administrative guidelines promulgated thereunder. 
 (i)    “Committee” means the Compensation Committee and such other committee or subcommittee of the Board, if any, duly appointed to administer the Plan and having such powers in
each 

  

 2 

 
instance as shall be specified by the Board. If, at any time, there is no committee of the Board then authorized or properly constituted to administer the
Plan, the Board shall exercise all of the powers of the Committee granted herein, and, in any event, the Board may in its discretion exercise any or all of such powers. 
 (j)    “Company” means PDL BioPharma, Inc., a Delaware corporation, or any successor corporation thereto. 
 (k)    “Consultant” means a person engaged to provide consulting or advisory services (other
than as an Employee or a member of the Board) to a Participating Company, provided that the identity of such person, the nature of such services or the entity to which such services are provided would not preclude the Company from offering or
selling securities to such person pursuant to the Plan in reliance on registration on a Form S-8 Registration Statement under the Securities Act. 
 (l)    “Covered Employee” means any Employee who is or may reasonably be expected to become a “covered employee” as defined in Section 162(m), or any
successor statute, and who is designated, either as an individual Employee or a member of a class of Employees, by the Committee no later than (i) the date ninety (90) days after the beginning of the Performance Period, or (ii) the
date on which twenty-five percent (25%) of the Performance Period has elapsed, as a “Covered Employee” under this Plan for such applicable Performance Period. 
 (m)    “Director” means a member of the Board. 
 (n)    “Disability” means the permanent and total disability of the Participant, within the
meaning of Section 22(e)(3) of the Code. 
 (o)    “Dividend Equivalent”
means a credit, made at the discretion of the Committee or as otherwise provided by the Plan, to the account of a Participant in an amount equal to the cash dividends paid on one share of Stock for each share of Stock represented by an Award held by
such Participant. 
 (p)    “Employee” means any person treated as an employee
(including an Officer or a member of the Board who is also treated as an employee) in the records of a Participating Company and, with respect to any Incentive Stock Option granted to such person, who is an employee for purposes of Section 422
of the Code; provided, however, that neither service as a member of the Board nor payment of a director’s fee shall be sufficient to constitute employment for purposes of the Plan. The Company shall determine in good faith and in
the exercise of its discretion whether an individual has become or has ceased to be an Employee and the effective date of such individual’s employment or termination of employment, as the case may be. For purposes of an individual’s
rights, if any, under the terms of the Plan as of the time of the Company’s determination of whether or not the individual is an Employee, all such determinations by the Company shall be final, binding and conclusive as to such rights, if any,
notwithstanding that the Company or any court of law or governmental agency subsequently makes a contrary determination as to such individual’s status as an Employee. 
 (q)    “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
 (r)    “Fair Market Value” means, as of any date, the value of a share of Stock or other
property as determined by the Committee, in its discretion, or by the Company, in its discretion, if such determination is expressly allocated to the Company herein, subject to the following: 
 (i)    Except as otherwise determined by the Committee, if, on such date, the Stock is listed on a national or regional securities
exchange or market system, the Fair Market Value of a share of Stock shall be the closing price of a share of Stock (or the mean of the closing bid and asked prices of a share of Stock if the Stock is so quoted instead) as quoted on the NASDAQ Stock
Market or such other national or regional securities exchange or market system constituting the primary market for the Stock, as reported in The Wall Street Journal 

  

 3 

 
or such other source as the Company deems reliable. If the relevant date does not fall on a day on which the Stock has traded on such securities exchange or
market system, the date on which the Fair Market Value shall be established shall be the last day on which the Stock was so traded prior to the relevant date, or such other appropriate day as shall be determined by the Committee, in its discretion.

 (ii)    Notwithstanding the foregoing, the Committee may, in its discretion, determine the Fair Market Value on the
basis of the opening, closing, or average of the high and low sale prices of a share of Stock on such date or the preceding trading day, the actual sale price of a share of Stock received by a Participant, any other reasonable basis using actual
transactions in the Stock as reported on a national or regional securities exchange or market system and consistently applied, or on any other basis consistent with the requirements of Section 409A. The Committee may also determine the Fair
Market Value upon the average selling price of the Stock during a specified period that is within thirty (30) days before or thirty (30) days after such date, provided that, with respect to the grant of an Option or SAR, the
commitment to grant such Award based on such valuation method must be irrevocable before the beginning of the specified period and such valuation method must be used consistently for grants of Options and SARs under the same and substantially
similar programs. The Committee may vary its method of determination of the Fair Market Value as provided in this Section for different purposes under the Plan to the extent consistent with the requirements of Section 409A. 
 (iii)    If, on such date, the Stock is not listed on a national or regional securities exchange or market system, the Fair Market
Value of a share of Stock shall be as determined by the Committee in good faith without regard to any restriction other than a restriction which, by its terms, will never lapse. 
 (s)    “Full Value Award” means any Award settled in Stock, other than (i) an Option,
(ii) a Stock Appreciation Right, (iii) a Restricted Stock Purchase Right or an Other Stock-Based Award under which the Company will receive monetary consideration equal to the Fair Market Value (determined as of the date of grant) of the
shares subject to such Award or (iv) an Other Stock-Based award based on appreciation in the Fair Market Value of the Stock. 
 (t)    “Incentive Stock Option” means an Option intended to be (as set forth in the Award Agreement) and which qualifies as an incentive stock option within the meaning of
Section 422(b) of the Code. 
 (u)    “Insider” means an Officer, Director or
any other person whose transactions in Stock are subject to Section 16 of the Exchange Act. 
 (v)    “Net-Exercise” means a procedure by which the Participant will be issued a number of shares of Stock upon the exercise of an Option determined in accordance with the following
formula: 
  

	 	N =	X(A-B)/A, where 

	 	  	“N” = the number of shares of Stock to be issued to the Participant upon exercise of the Option; 

	 	  	“X” = the total number of shares with respect to which the Participant has elected to exercise the Option; 

	 	  	“A” = the Fair Market Value of one (1) share of Stock determined on the exercise date; and 

	 	  	“B” = the exercise price per share (as defined in the Participant’s Award Agreement) 

 (w)    “Nonstatutory Stock Option” means an Option not intended to be (as set forth in the
Award Agreement) an incentive stock option within the meaning of Section 422(b) of the Code. 
 (x)    “Officer” means any person designated by the Board as an officer of the Company. 
 (y)    “Option” means an Incentive Stock Option or a Nonstatutory Stock Option granted pursuant to Section 6. 
  

 4 

 (z)    “Other Stock-Based Award” means an
Award denominated in shares of Stock and granted pursuant to Section 11. 
 (aa)    “Outside
Director” means a Director who is neither an Employee nor a Consultant, 
 (bb)    “Ownership Change Event” means the occurrence of any of the following with respect to the Company: (i) the direct or indirect sale or exchange in a single or series of
related transactions by the stockholders of the Company of more than fifty percent (50%) of the voting stock of the Company; (ii) a merger or consolidation in which the Company is a party; or (iii) the sale, exchange or transfer of
all or substantially all of the assets of the Company (other than a sale, exchange or transfer to one or more subsidiaries of the Company). 
 (cc)    “Parent Corporation” means any present or future “parent corporation” of the Company, as defined in Section 424(e) of the Code. 
 (dd)    “Participant” means any eligible person who has been granted one or more Awards.

 (ee)    “Participating Company” means the Company or any Parent Corporation,
Subsidiary Corporation or Affiliate. 
 (ff)    “Participating Company Group”
means, at any point in time, all entities collectively which are then Participating Companies. 
 (gg)    “Performance Award” means an Award of Performance Shares or Performance Units. 
 (hh)    “Performance Award Formula” means, for any Performance Award, a formula or table established by the Committee pursuant to Section 10.3 which
provides the basis for computing the value of a Performance Award at one or more threshold levels of attainment of the applicable Performance Goal(s) measured as of the end of the applicable Performance Period. 
 (ii)    “Performance-Based Compensation” means compensation under an Award that satisfies the requirements
of Section 162(m) for certain performance-based compensation paid to Covered Employees. 
 (jj)    “Performance Goal” means a performance goal established by the Committee pursuant to Section 10.3. 
 (kk)    “Performance Period” means a period established by the Committee pursuant to
Section 10.3 at the end of which one or more Performance Goals are to be measured. 
 (ll)    “Performance Share” means a right granted to a Participant pursuant to Section 10 to receive a payment equal to the value of a Performance Share, as determined by the
Committee, based on performance. 
 (mm)    “Performance Unit” means a right
granted to a Participant pursuant to Section 10 to receive a payment equal to the value of a Performance Unit, as determined by the Committee, based upon performance. 
 (nn)    “Restricted Stock Award” means an Award of a Restricted Stock Bonus or a Restricted
Stock Purchase Right. 
 (oo)    “Restricted Stock Bonus” means Stock granted to a
Participant pursuant to Section 8. 
  

 5 

 (pp)    “Restricted Stock Purchase Right”
means a right to purchase Stock granted to a Participant pursuant to Section 8. 
 (qq)    “Restricted Stock Unit” or “Stock Unit” means a right granted to a Participant pursuant to Section 9, respectively, to receive a share of
Stock on a date determined in accordance with the provisions of Section 9, as applicable, and the Participant’s Award Agreement. 
 (rr)    “Restriction Period” means the period established in accordance with Section 8.5 during which shares subject to a Restricted Stock Award are subject to Vesting
Conditions. 
 (ss)    “Rule 16b-3” means Rule 16b-3 under the Exchange Act,
as amended from time to time, or any successor rule or regulation. 
 (tt)    “SAR” or “Stock Appreciation Right” means a right granted to a Participant pursuant to Section 7 to receive payment of an amount
equal to the excess, if any, of the Fair Market Value of a share of Stock on the date of exercise of the SAR over the exercise price. 
 (uu)    “Section 162(m)” means Section 162(m) of the Code. 
 (vv)    “Section 409A” means Section 409A of the Code. 
 (ww)    “Section 409A Deferred Compensation” means compensation provided pursuant to the Plan that constitutes deferred compensation subject to and not exempted from the requirements of
Section 409A. 
 (xx)    “Securities Act” means the Securities Act of 1933,
as amended. 
 (yy)    “Service” means a Participant’s employment or service
with the Participating Company Group, whether in the capacity of an Employee, a Director or a Consultant. Unless otherwise provided by the Committee, a Participant’s Service shall not be deemed to have terminated merely because of a change in
the capacity in which the Participant renders such Service or a change in the Participating Company for which the Participant renders such Service, provided that there is no interruption or termination of the Participant’s Service.
Furthermore, a Participant’s Service shall not be deemed to have terminated if the Participant takes any military leave, sick leave, or other bona fide leave of absence approved by the Company. However, unless otherwise provided by the
Committee, if any such leave taken by a Participant exceeds ninety (90) days, then on the ninety-first (91st) day following the commencement of such leave the Participant’s Service shall be deemed to have terminated, unless the
Participant’s right to return to Service is guaranteed by statute or contract. Notwithstanding the foregoing, unless otherwise designated by the Company or required by law, an unpaid leave of absence shall not be treated as Service for purposes
of determining vesting under the Participant’s Award Agreement. A Participant’s Service shall be deemed to have terminated either upon an actual termination of Service or upon the entity for which the Participant performs Service ceasing
to be a Participating Company. Subject to the foregoing, the Company, in its discretion, shall determine whether the Participant’s Service has terminated and the effective date of such termination. 
 (zz)    “Stock” means the common stock of the Company, as adjusted from time to time in
accordance with Section 4.3. 
 (aaa)    “Subsidiary Corporation” means any
present or future “subsidiary corporation” of the Company, as defined in Section 424(f) of the Code. 
 (bbb)    “Ten Percent Owner” means a Participant who, at the time an Option is granted to the Participant, owns stock possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of a Participating Company (other than an Affiliate) within the meaning of Section 422(b)(6) of the Code. 
  

 6 

 (ccc)    “Trading Compliance Policy” means the
written policy of the Company pertaining to the purchase, sale, transfer or other disposition of the Company’s equity securities by Directors, Officers, Employees or other service providers who may possess material, nonpublic information
regarding the Company or its securities. 
 (ddd)    “Vesting Conditions”
mean those conditions established in accordance with the Plan prior to the satisfaction of which shares subject to an Award remain subject to forfeiture or a repurchase option in favor of the Company exercisable for the Participant’s purchase
price for such shares upon the Participant’s termination of Service. 
 2.2    Construction. Captions and
titles contained herein are for convenience only and shall not affect the meaning or interpretation of any provision of the Plan. Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the
singular. Use of the term “or” is not intended to be exclusive, unless the context clearly requires otherwise. 
 3.    Administration. 
 3.1    Administration by the Committee. The
Plan shall be administered by the Committee. All questions of interpretation of the Plan or of any Award shall be determined by the Committee, and such determinations shall be final and binding upon all persons having an interest in the Plan or such
Award. In addition, any and all actions, decisions and determinations taken or made by the Committee in the exercise of its discretion pursuant to the Plan, including, without limitation, pursuant to Section 3.5 below, or Award Agreement or
other agreement thereunder shall be final, binding and conclusive upon all persons having an interest therein. 
 3.2    Authority of Officers. The Chief Executive Officer shall have the authority to act on behalf of the Company with respect to any matter, right, obligation, determination or election which is the
responsibility of or which is allocated to the Company herein. 
 3.3    Administration with Respect to Insider.
With respect to participation by Insiders in the Plan, at any time that any class of equity security of the Company is registered pursuant to Section 12 of the Exchange Act, the Plan shall be administered in compliance with the requirements, if
any, of Rule 16b-3. 
 3.4    Committee Complying with Section 162(m). If the Company is a
“publicly held corporation” within the meaning of Section 162(m), the Board may establish a Committee of “outside directors” within the meaning of Section 162(m) to approve the grant of any Award intended to result in
the payment of Performance-Based Compensation. 
 3.5    Powers of the Committee. In addition to any other
powers set forth in the Plan and subject to the provisions of the Plan, the Committee shall have the full and final power and authority, in its discretion: 
 (a)    to determine the persons to whom, and the time or times at which, Awards shall be granted and the number of shares of Stock, units or monetary value to be subject to each Award; 

(b)    to determine the type of Award granted; 
 (c)    to determine the Fair Market Value of shares of Stock or other property; 
 (d)    to determine the terms, conditions and restrictions applicable to each Award (which need not be identical) and any shares acquired pursuant thereto, including, without limitation, (i) the exercise or purchase
price of shares pursuant to any Award, (ii) the method of payment for shares purchased pursuant to any Award, (iii) the method for satisfaction of any tax withholding obligation arising in connection with any Award, 

  

 7 

 
including by the withholding or delivery of shares of Stock, (iv) the timing, terms and conditions of the exercisability or vesting of any Award or any
shares acquired pursuant thereto, (v) the Performance Measures, Performance Period, Performance Award Formula and Performance Goals applicable to any Award and the extent to which such Performance Goals have been attained, (vi) the time of
the expiration of any Award, (vii) the effect of the Participant’s termination of Service on any of the foregoing, and (viii) all other terms, conditions and restrictions applicable to any Award or shares acquired pursuant thereto not
inconsistent with the terms of the Plan; 
 (e)    to determine whether an Award will be settled in shares of Stock,
cash, or in any combination thereof; 
 (f)    to approve one or more forms of Award Agreement; 
 (g)    to amend, modify, extend, cancel or renew any Award or to waive any restrictions or conditions applicable to any Award or any
shares acquired pursuant thereto; 
 (h)    to accelerate, continue, extend or defer the exercisability or vesting of
any Award or any shares acquired pursuant thereto, including with respect to the period following a Participant’s termination of Service; 
 (i)    without the consent of the affected Participant and notwithstanding the provisions of any Award Agreement to the contrary, to unilaterally substitute at any time a Stock Appreciation Right providing for settlement
solely in shares of Stock in place of any outstanding Option, provided that such Stock Appreciation Right covers the same number of shares of Stock and provides for the same exercise price (subject in each case to adjustment in accordance
with Section 4.3) as the replaced Option and otherwise provides substantially equivalent terms and conditions as the replaced Option, as determined by the Committee; 
 (j)    to prescribe, amend or rescind rules, guidelines and policies relating to the Plan, or to adopt sub-plans or supplements to,
or alternative versions of, the Plan, including, without limitation, as the Committee deems necessary or desirable to comply with the laws or regulations of, or to accommodate the tax policy, accounting principles or custom of, foreign jurisdictions
whose citizens may be granted Awards; and 
 (k)    to correct any defect, supply any omission or reconcile any
inconsistency in the Plan or any Award Agreement and to make all other determinations and take such other actions with respect to the Plan or any Award as the Committee may deem advisable to the extent not inconsistent with the provisions of the
Plan or applicable law. 
 3.6    Option or SAR Repricing. Without the affirmative vote of holders of a majority
of the shares of Stock cast in person or by proxy at a meeting of the stockholders of the Company at which a quorum representing a majority of all outstanding shares of Stock is present or represented by proxy, the Board shall not approve either
(a) the cancellation of outstanding Options or SARs and the grant in substitution therefor of new Options or SARs having a lower exercise price or (b) the amendment of outstanding Options or SARs to reduce the exercise price thereof. This
paragraph shall not be construed to apply to “issuing or assuming a stock option in a transaction to which Section 424(a) applies,” within the meaning of Section 424 of the Code. 
 3.7    Indemnification. In addition to such other rights of indemnification as they may have as members of the Board or the
Committee or as officers or employees of the Participating Company Group, members of the Board or the Committee and any officers or employees of the Participating Company Group to whom authority to act for the Board, the Committee or the Company is
delegated shall be indemnified by the Company against all reasonable expenses, including attorneys’ fees, actually and necessarily incurred in connection with the defense of any action, suit or proceeding, or in connection with any appeal
therein, to which they or any of them may be a party by reason of any action taken or failure to act under or in connection with the 

  

 8 

 
Plan, or any right granted hereunder, and against all amounts paid by them in settlement thereof (provided such settlement is approved by independent legal
counsel selected by the Company) or paid by them in satisfaction of a judgment in any such action, suit or proceeding, except in relation to matters as to which it shall be adjudged in such action, suit or proceeding that such person is liable for
gross negligence, bad faith or intentional misconduct in duties; provided, however, that within sixty (60) days after the institution of such action, suit or proceeding, such person shall offer to the Company, in writing, the
opportunity at its own expense to handle and defend the same. 
 4.    Shares Subject to Plan. 

4.1    Maximum Number of Shares Issuable. Subject to adjustment as provided in Sections 4.2 and 4.3, the
maximum aggregate number of shares of Stock that may be issued under the Plan shall be equal to five million two hundred thousand (5,200,000) shares, and shall consist of authorized but unissued or reacquired shares of Stock or any combination
thereof. 
 4.2    Share Accounting. If an outstanding Award for any reason expires or is terminated or canceled
without having been exercised or settled in full, or if shares of Stock acquired pursuant to an Award subject to forfeiture or repurchase are forfeited or repurchased by the Company for an amount not greater than the Participant’s original
purchase price, the shares of Stock allocable to the terminated portion of such Award or such forfeited or repurchased shares of Stock shall not again be available for issuance under the Plan. In addition, Shares withheld or reacquired by the
Company in satisfaction of tax withholding obligations pursuant to Section 15.3 shall not again be available for issuance under the Plan. Shares of Stock shall not be deemed to have been issued pursuant to the Plan with respect to any portion
of an Award, other than an Option or SAR, that is settled in cash. Upon payment in shares of Stock pursuant to the exercise of an SAR, the number of shares available for issuance under the Plan shall be reduced by the gross number of shares for
which the SAR is exercised. If the exercise price of an Option is paid by tender to the Company, or attestation to the ownership, of shares of Stock owned by the Participant, or by means of a Net-Exercise, the number of shares available for issuance
under the Plan shall be reduced by the gross number of shares for which the Option is exercised. 
 4.3    Adjustments
for Changes in Capital Structure. Subject to any required action by the stockholders of the Company and the requirements of Section 409A to the extent applicable, in the event of any change in the Stock effected without receipt of
consideration by the Company, whether through merger, consolidation, reorganization, reincorporation, recapitalization, reclassification, stock dividend, stock split, reverse stock split, split-up, split-off, spin-off, combination of shares,
exchange of shares, or similar change in the capital structure of the Company, or in the event of payment of a dividend or distribution to the stockholders of the Company in a form other than Stock (excepting normal cash dividends) that has a
material effect on the Fair Market Value of shares of Stock, appropriate and proportionate adjustments shall be made in the number and kind of shares subject to the Plan and to any outstanding Awards, in the Award limits set forth in
Section 5.3 and in the exercise or purchase price per share under any outstanding Award in order to prevent dilution or enlargement of Participants’ rights under the Plan. For purposes of the foregoing, conversion of any convertible
securities of the Company shall not be treated as “effected without receipt of consideration by the Company.” If a majority of the shares which are of the same class as the shares that are subject to outstanding Awards are exchanged for,
converted into, or otherwise become (whether or not pursuant to an Ownership Change Event) shares of another corporation (the “New Shares”), the Committee may unilaterally amend the outstanding Awards to provide
that such Awards are for New Shares. In the event of any such amendment, the number of shares subject to, and the exercise or purchase price per share of, the outstanding Awards shall be adjusted in a fair and equitable manner as determined by the
Committee, in its discretion. Any fractional share resulting from an adjustment pursuant to this Section shall be rounded down to the nearest whole number, and in no event may the exercise or purchase price under any Award be decreased to an amount
less than the par value, if any, of the stock subject to such Award. The Committee, in its sole discretion, may also make such adjustments in the terms of any Award to reflect, or related to, such changes in the capital structure of the Company or
distributions as it deems appropriate, including modification of Performance Goals, Performance Award Formulas and 

  

 9 

 
Performance Periods. The adjustments determined by the Committee pursuant to this Section shall be final, binding and conclusive. 
 The Committee may, without affecting the number of Shares reserved or available hereunder, authorize the issuance or assumption of benefits under this
Plan in connection with any merger, consolidation, acquisition of property or stock, or reorganization upon such terms and conditions as it may deem appropriate, subject to compliance with Sections 409A and 422 and any related guidance issued
by the U.S. Treasury Department, where applicable. 
 5.    Eligibility, Participation and Award
Limitations. 
 5.1    Persons Eligible for Awards. Awards may be granted only to Employees,
Consultants and Outside Directors. 
 5.2    Participation in Plan. Awards are granted solely at the
discretion of the Committee. Eligible persons may be granted more than one Award. However, eligibility in accordance with this Section shall not entitle any person to be granted an Award, or, having been granted an Award, to be granted an additional
Award. 
 5.3    Award Limitations. 
 (a)    Incentive Stock Option Limitations. 
 (i)    Maximum Number of Shares Issuable Pursuant to Incentive Stock Options. Subject to adjustment as provided
in Section 4.3, the maximum aggregate number of shares of Stock that may be issued under the Plan pursuant to the exercise of Incentive Stock Options shall not exceed five million two hundred thousand (5,200,000) shares. The maximum
aggregate number of shares of Stock that may be issued under the Plan pursuant to all Awards other than Incentive Stock Options shall be the number of shares determined in accordance with Section 4.1, subject to adjustment as provided in
Section 4.2 and Section 4.3. 
 (ii)    Persons Eligible. An Incentive Stock Option may be
granted only to a person who, on the effective date of grant, is an Employee of the Company, a Parent Corporation or a Subsidiary Corporation (each being an “ISO-Qualifying Corporation”). Any person who is not
an Employee of an ISO-Qualifying Corporation on the effective date of the grant of an Option to such person may be granted only a Nonstatutory Stock Option. An Incentive Stock Option granted to a prospective Employee upon the condition that such
person become an Employee of an ISO-Qualifying Corporation shall be deemed granted effective on the date such person commences Service as an Employee of an ISO-Qualifying Corporation, with an exercise price determined as of such date in accordance
with Section 6.1. 
 (iii)    Fair Market Value Limitation. To the extent that options designated as
Incentive Stock Options (granted under all stock option plans of the Participating Company Group, including the Plan) become exercisable by a Participant for the first time during any calendar year for stock having a Fair Market Value greater than
one hundred thousand dollars ($100,000), the portion of such options which exceeds such amount shall be treated as Nonstatutory Stock Options. For purposes of this Section, options designated as Incentive Stock Options shall be taken into account in
the order in which they were granted, and the Fair Market Value of stock shall be determined as of the time the option with respect to such stock is granted. If the Code is amended to provide for a limitation different from that set forth in this
Section, such different limitation shall be deemed incorporated herein effective as of the date and with respect to such Options as required or permitted by such amendment to the Code. If an Option is treated as an Incentive Stock Option in part and
as a Nonstatutory Stock Option in part by reason of the limitation set forth in this Section, the Participant may designate which portion of such Option the Participant is exercising. In the absence of such designation, the Participant shall be
deemed to have exercised the Incentive Stock Option portion of the Option first. Upon exercise, shares issued pursuant to each such portion shall be separately identified. 
  

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 (b)    Aggregate Limit on Full Value Awards. In no event shall more
than fifty percent (50%) of the maximum aggregate number of shares of Stock that may be issued under the Plan, determined in accordance with Sections 4.1, 4.2 and 4.3, be issued pursuant to Full Value Awards. 
 (c)    Aggregate Limit on Full Value Awards Without Minimum Vesting. Notwithstanding any provision of the Plan to the
contrary, no more than ten percent (10%) of the maximum aggregate number of shares of Stock that may be issued under the Plan, determined in accordance with Sections 4.1, 4.2 and 4.3, shall be issued pursuant to Full Value Awards having
Vesting Conditions which (i) if based upon a Service requirement, provide for vesting more rapid than annual pro rata vesting over a period of three (3) years or (ii) if based upon the attainment of one or more Performance Goals,
provide for a Performance Period of less than twelve (12) months; provided, however, that such limitations shall not preclude the acceleration of vesting of any such Award upon the death, disability, retirement or involuntary
termination of Service of the Participant or upon or following a Change in Control, as determined by the Committee in its discretion. 
 (d)    Maximum Annual Aggregate Award Limits. Subject to adjustment as provided in Section 4.3, no Participant shall be granted within any fiscal year of the Company, other than the fiscal year in
which such Participant’s Service with the Company commences, one or more Awards that may be settled in Stock which in the aggregate are for more than a number of shares equal to nine percent (9%) of the maximum aggregate number of shares
of Stock that may be issued under the Plan as set forth in Section 4.1. 
 (e)    Section 162(m) Award Limits. The following limits shall apply to the grant of any Award intended to qualify for treatment as Performance-Based Compensation: 
 (i)    Options and SARs. Subject to adjustment as provided in Section 4.3, no Employee shall be granted within any
fiscal year of the Company one or more Options or Freestanding SARs which in the aggregate are for more than one million six hundred thousand (1,600,000) shares. 
 (ii)    Restricted Stock Awards and Restricted Stock Unit Awards. Subject to adjustment as provided in Section 4.3, no Employee shall be granted within any fiscal year of the Company
one or more Restricted Stock Awards or Restricted Stock Unit Awards for more than seven hundred and fifty thousand (750,000) shares. 
 (iii)    Performance Awards. Subject to adjustment as provided in Section 4.3, no Employee shall be granted (1) Performance Shares which could result in such Employee receiving more than one hundred
thousand (100,000) shares for each full fiscal year of the Company contained in the Performance Period for such Award, or (2) Performance Units which could result in such Employee receiving more than two million dollars ($2,000,000) for
each full fiscal year of the Company contained in the Performance Period for such Award. 
 (iv)    Cash-Based Awards
and Other Stock-Based Awards. Subject to adjustment as provided in Section 4.3, no Employee shall be granted (1) Cash-Based Awards in any fiscal year of the Company which could result in such Employee receiving more than two million
dollars ($2,000,000) for each full fiscal year of the Company contained in the Performance Period for such Award, or (2) Other Stock-Based Awards in any fiscal year of the Company which could result in such Employee receiving more than one
hundred thousand (100,000) shares for each full fiscal year of the Company contained in the Performance Period for such Award. 
  

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 6.    Stock Options. 
 Options shall be evidenced by Award Agreements specifying the number of shares of Stock covered thereby, in such form as the Committee shall from time to
time establish. Award Agreements evidencing Options may incorporate all or any of the terms of the Plan by reference and shall comply with and be subject to the following terms and conditions: 
 6.1    Exercise Price. The exercise price for each Option shall be established in the discretion of the Committee;
provided, however, that (a) the exercise price per share shall be not less than the Fair Market Value of a share of Stock on the effective date of grant of the Option and (b) no Incentive Stock Option granted to a Ten Percent
Owner shall have an exercise price per share less than one hundred ten percent (110%) of the Fair Market Value of a share of Stock on the effective date of grant of the Option. Notwithstanding the foregoing, an Option (whether an Incentive
Stock Option or a Nonstatutory Stock Option) may be granted with an exercise price lower than the minimum exercise price set forth above if such Option is granted pursuant to an assumption or substitution for another option in a manner qualifying
under the provisions of Section 424(a) of the Code. 
 6.2    Exercisability and Term of Options. Options
shall be exercisable at such time or times, or upon such event or events, and subject to such terms, conditions, performance criteria and restrictions as shall be determined by the Committee and set forth in the Award Agreement evidencing such
Option; provided, however, that (a) no Option shall be exercisable after the expiration of seven (7) years after the effective date of grant of such Option and (b) no Incentive Stock Option granted to a Ten Percent Owner
shall be exercisable after the expiration of five (5) years after the effective date of grant of such Option. Subject to the foregoing, unless otherwise specified by the Committee in the grant of an Option, each Option shall terminate seven
(7) years after the effective date of grant of the Option, unless earlier terminated in accordance with its provisions. 
 6.3    Payment of Exercise Price. 
 (a)    Forms of Consideration
Authorized. Except as otherwise provided below, payment of the exercise price for the number of shares of Stock being purchased pursuant to any Option shall be made (i) in cash or by check or cash equivalent, (ii) by tender to the
Company, or attestation to the ownership, of shares of Stock owned by the Participant having a Fair Market Value not less than the exercise price, (iii) by delivery of a properly executed notice of exercise together with irrevocable
instructions to a broker providing for the assignment to the Company of the proceeds of a sale or loan with respect to some or all of the shares being acquired upon the exercise of the Option (including, without limitation, through an exercise
complying with the provisions of Regulation T as promulgated from time to time by the Board of Governors of the Federal Reserve System) (a “Cashless Exercise”), (iv) by delivery of a properly executed
notice electing a Net-Exercise, (v) by such other consideration as may be approved by the Committee from time to time to the extent permitted by applicable law, or (vi) by any combination thereof. The Committee may at any time or from time
to time grant Options which do not permit all of the foregoing forms of consideration to be used in payment of the exercise price or which otherwise restrict one or more forms of consideration. 
 (b)    Limitations on Forms of Consideration. 
 (i)    Tender of Stock. Notwithstanding the foregoing, an Option may not be exercised by tender to the Company, or
attestation to the ownership, of shares of Stock to the extent such tender or attestation would constitute a violation of the provisions of any law, regulation or agreement restricting the redemption of the Company’s stock. Unless otherwise
provided by the Committee, an Option may not be exercised by tender to the Company, or attestation to the ownership, of shares of Stock unless such shares either have been owned by the Participant for more than six (6) months (or such other
period, if any, as the Committee may permit) and not used for another Option exercise by attestation during such period, or were not acquired, directly or indirectly, from the Company. 
  

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 (ii)    Cashless Exercise. The Company reserves, at any and all times, the
right, in the Company’s sole and absolute discretion, to establish, decline to approve or terminate any program or procedures for the exercise of Options by means of a Cashless Exercise, including with respect to one or more Participants
specified by the Company notwithstanding that such program or procedures may be available to other Participants. 
 6.4    Effect of Termination of Service. 
 (a)    Option
Exercisability. Subject to earlier termination of the Option as otherwise provided herein and unless otherwise provided by the Committee in the grant of an Option and set forth in the Award Agreement, an Option shall terminate immediately
upon the Participant’s termination of Service to the extent that it is then unvested and shall be exercisable after the Participant’s termination of Service to the extent it is then vested only during the applicable time period determined
in accordance with this Section and thereafter shall terminate: 
 (i)    Disability. If the Participant’s
Service terminates because of the Disability of the Participant, the Option, to the extent unexercised and exercisable on the date on which the Participant’s Service terminated, may be exercised by the Participant (or the Participant’s
guardian or legal representative) at any time prior to the expiration of twelve (12) months after the date on which the Participant’s Service terminated, but in any event no later than the date of expiration of the Option’s term as
set forth in the Award Agreement evidencing such Option (the “Option Expiration Date”). 
 (ii)    Death. If the Participant’s Service terminates because of the death of the Participant, the Option, to the extent unexercised and exercisable on the date on which the Participant’s Service
terminated, may be exercised by the Participant’s legal representative or other person who acquired the right to exercise the Option by reason of the Participant’s death at any time prior to the expiration of twelve (12) months after
the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date. The Participant’s Service shall be deemed to have terminated on account of death if the Participant dies within three
(3) months after the Participant’s termination of Service. 
 (iii)    Other Termination of Service. If
the Participant’s Service terminates for any reason, except Disability or death, the Option, to the extent unexercised and exercisable by the Participant on the date on which the Participant’s Service terminated, may be exercised by the
Participant at any time prior to the expiration of three (3) months after the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date. 
 (b)    Extension if Exercise Prevented by Law. Notwithstanding the foregoing, if the exercise of an Option within the
applicable time periods set forth in Section 6.4(a) is prevented by the provisions of Section 14 below, the Option shall remain exercisable until thirty (30) days after the date such exercise would no longer be prevented by such
provisions, but in any event no later than the Option Expiration Date. 
 6.5    Transferability of Options.
During the lifetime of the Participant, an Option shall be exercisable only by the Participant or the Participant’s guardian or legal representative. An Option shall not be subject in any manner to anticipation, alienation, sale, exchange,
transfer, assignment, pledge, encumbrance, or garnishment by creditors of the Participant or the Participant’s beneficiary, except transfer by will or by the laws of descent and distribution. Notwithstanding the foregoing, to the extent
permitted by the Committee, in its discretion, and set forth in the Award Agreement evidencing such Option, a Nonstatutory Stock Option shall be assignable or transferable subject to the applicable limitations, if any, described in the General
Instructions to Form S-8 under the Securities Act. 
  

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 7.    Stock Appreciation Rights. 
 Stock Appreciation Rights shall be evidenced by Award Agreements specifying the number of shares of Stock subject to the Award, in such form as the
Committee shall from time to time establish. Award Agreements evidencing SARs may incorporate all or any of the terms of the Plan by reference and shall comply with and be subject to the following terms and conditions: 
 7.1    Types of SARs Authorized. SARs may be granted in tandem with all or any portion of a related Option (a “Tandem
SAR”) or may be granted independently of any Option (a “Freestanding SAR”). A Tandem SAR may only be granted concurrently with the grant of the related Option. 
 7.2    Exercise Price. The exercise price for each SAR shall be established in the discretion of the Committee;
provided, however, that (a) the exercise price per share subject to a Tandem SAR shall be the exercise price per share under the related Option and (b) the exercise price per share subject to a Freestanding SAR shall be not
less than the Fair Market Value of a share of Stock on the effective date of grant of the SAR. 
 7.3    Exercisability and Term of SARs. 
 (a)    Tandem SARs. Tandem
SARs shall be exercisable only at the time and to the extent, and only to the extent, that the related Option is exercisable, subject to such provisions as the Committee may specify where the Tandem SAR is granted with respect to less than the full
number of shares of Stock subject to the related Option. The Committee may, in its discretion, provide in any Award Agreement evidencing a Tandem SAR that such SAR may not be exercised without the advance approval of the Company and, if such
approval is not given, then the Option shall nevertheless remain exercisable in accordance with its terms. A Tandem SAR shall terminate and cease to be exercisable no later than the date on which the related Option expires or is terminated or
canceled. Upon the exercise of a Tandem SAR with respect to some or all of the shares subject to such SAR, the related Option shall be canceled automatically as to the number of shares with respect to which the Tandem SAR was exercised. Upon the
exercise of an Option related to a Tandem SAR as to some or all of the shares subject to such Option, the related Tandem SAR shall be canceled automatically as to the number of shares with respect to which the related Option was exercised.

 (b)    Freestanding SARs. Freestanding SARs shall be exercisable at such time or times, or upon such
event or events, and subject to such terms, conditions, performance criteria and restrictions as shall be determined by the Committee and set forth in the Award Agreement evidencing such SAR; provided, however, that no Freestanding SAR
shall be exercisable after the expiration of seven (7) years after the effective date of grant of such SAR. 
 7.4    Exercise of SARs. Upon the exercise (or deemed exercise pursuant to Section 7.7) of an SAR, the Participant (or the Participant’s legal representative or other person who acquired the right to
exercise the SAR by reason of the Participant’s death) shall be entitled to receive payment of an amount for each share with respect to which the SAR is exercised equal to the excess, if any, of the Fair Market Value of a share of Stock on the
date of exercise of the SAR over the exercise price. Payment of such amount shall be made (a) in the case of a Tandem SAR, solely in shares of Stock in a lump sum as soon as practicable following the date of exercise of the SAR and (b) in
the case of a Freestanding SAR, in cash, shares of Stock, or any combination thereof as determined by the Committee in compliance with Section 409A. Unless otherwise provided in the Award Agreement evidencing a Freestanding SAR, payment shall
be made in a lump sum as soon as practicable following the date of exercise of the SAR. The Award Agreement evidencing any Freestanding SAR may provide for deferred payment in a lump sum or in installments in compliance with Section 409A. When
payment is to be made in shares of Stock, the number of shares to be issued shall be determined on the basis of the Fair Market Value of a share of Stock on the date of exercise of the SAR. For purposes of this Section 7, an SAR shall be deemed
exercised on the date on which the Company receives notice of exercise from the Participant or as otherwise provided in Section 7.7. 
  

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 7.5    Deemed Exercise of SARs. If, on the date on which an SAR would
otherwise terminate or expire, the SAR by its terms remains exercisable immediately prior to such termination or expiration and, if so exercised, would result in a payment to the holder of such SAR, then any portion of such SAR which has not
previously been exercised shall automatically be deemed to be exercised as of such date with respect to such portion. 
 7.6    Effect of Termination of Service. Subject to earlier termination of the SAR as otherwise provided herein and unless otherwise provided by the Committee in the grant of an SAR and set forth in the Award
Agreement, an SAR shall be exercisable after a Participant’s termination of Service only to the extent and during the applicable time period determined in accordance with Section 6.4 (treating the SAR as if it were an Option) and
thereafter shall terminate. 
 7.7    Nontransferability of SARs. During the lifetime of the Participant, an SAR
shall be exercisable only by the Participant or the Participants guardian or legal representative. An SAR shall not be subject in any manner to anticipation, alienation, sale, exchange, transfer, assignment, pledge, encumbrance, or garnishment by
creditors of the Participant or the Participants beneficiary, except transfer by will or by the laws of descent and distribution. Notwithstanding the foregoing, to the extent permitted by the Committee, in its discretion, and set forth in the Award
Agreement evidencing such Award, a Tandem SAR related to a Nonstatutory Stock Option or a Freestanding SAR shall be assignable or transferable subject to the applicable limitations, if any, described in the General Instructions to FormS8 under the
Securities Act. 
 8.    Restricted Stock Awards. 
 Restricted Stock Awards shall be evidenced by Award Agreements specifying whether the Award is a Restricted Stock Bonus or a Restricted Stock Purchase
Right and the number of shares of Stock subject to the Award, in such form as the Committee shall from time to time establish. Award Agreements evidencing Restricted Stock Awards may incorporate all or any of the terms of the Plan by reference and
shall comply with and be subject to the following terms and conditions: 
 8.1    Types of Restricted Stock
Awards Authorized. Restricted Stock Awards may be granted in the form of either a Restricted Stock Bonus or a Restricted Stock Purchase Right; provided that Outside Directors shall be eligible for Restricted Stock Awards only in the form
of Restricted Stock Bonus. Restricted Stock Awards may be granted upon such conditions as the Committee shall determine, including, without limitation, upon the attainment of one or more Performance Goals described in Section 10.4. If either
the grant of a Restricted Stock Award or the lapsing of the Restriction Period is to be contingent upon the attainment of one or more Performance Goals, the Committee shall follow procedures substantially equivalent to those set forth in
Sections 10.3 through 10.5(a). 
 8.2    Purchase Price. The purchase price for shares of Stock issuable
under each Restricted Stock Purchase Right shall be established by the Committee in its discretion. No monetary payment (other than applicable tax withholding) shall be required as a condition of receiving shares of Stock pursuant to a Restricted
Stock Bonus, the consideration for which shall be services actually rendered to a Participating Company or for its benefit. Notwithstanding the foregoing, if required by applicable state corporate law, the Participant shall furnish consideration in
the form of cash or past services rendered to a Participating Company or for its benefit having a value not less than the par value of the shares of Stock subject to a Restricted Stock Award. 
 8.3    Purchase Period. A Restricted Stock Purchase Right shall be exercisable within a period established by the Committee,
which shall in no event exceed thirty (30) days from the effective date of the grant of the Restricted Stock Purchase Right. 
 8.4    Payment of Purchase Price. Except as otherwise provided below, payment of the purchase price for the number of shares of Stock being purchased pursuant to any Restricted Stock Purchase Right shall be made
(a) in cash or by check or cash equivalent, (b) by such other consideration as may be approved by the Committee 

  

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from time to time to the extent permitted by applicable law, or (c) by any combination thereof. The Committee may at any time or from time to time grant
Restricted Stock Purchase Rights which do not permit all of the foregoing forms of consideration to be used in payment of the purchase price or which otherwise restrict one or more forms of consideration. 
 8.5    Vesting and Restrictions on Transfer. Subject to Section 5.4(c), Shares issued pursuant to any Restricted Stock
Award may (but need not) be made subject to Vesting Conditions based upon the satisfaction of such Service requirements, conditions, restrictions or performance criteria, including, without limitation, Performance Goals as described in
Section 10.4, as shall be established by the Committee and set forth in the Award Agreement evidencing such Award. During any Restriction Period in which shares acquired pursuant to a Restricted Stock Award remain subject to Vesting Conditions,
such shares may not be sold, exchanged, transferred, pledged, assigned or otherwise disposed of other than pursuant to an Ownership Change Event or as provided in Section 8.8. The Committee, in its discretion, may provide in any Award Agreement
evidencing a Restricted Stock Award that, if the satisfaction of Vesting Conditions with respect to any shares subject to such Restricted Stock Award would otherwise occur on a day on which the sale of such shares would violate the Company’s
Trading Compliance Policy, then satisfaction of the Vesting Conditions automatically shall be determined on the next trading day on which the sale of such shares would not violate the Trading Compliance Policy. Upon request by the Company, each
Participant shall execute any agreement evidencing such transfer restrictions prior to the receipt of shares of Stock hereunder and shall promptly present to the Company any and all certificates representing shares of Stock acquired hereunder for
the placement on such certificates of appropriate legends evidencing any such transfer restrictions. 
 8.6    Voting Rights; Dividends and Distributions. Except as provided in this Section, Section 8.5 and any Award Agreement, during any Restriction Period applicable to shares subject to a Restricted Stock
Award, the Participant shall have all of the rights of a stockholder of the Company holding shares of Stock, including the right to vote such shares and to receive all dividends and other distributions paid with respect to such shares. However, in
the event of a dividend or distribution paid in shares of Stock or other property or any other adjustment made upon a change in the capital structure of the Company as described in Section 4.3, any and all new, substituted or additional
securities or other property (other than normal cash dividends) to which the Participant is entitled by reason of the Participant’s Restricted Stock Award shall be immediately subject to the same Vesting Conditions as the shares subject to the
Restricted Stock Award with respect to which such dividends or distributions were paid or adjustments were made. Notwithstanding the foregoing, and except as may be provided in the applicable Award Agreement, any cash dividends and distributions
paid with respect to the shares subject to the Restricted Stock Award of an Outside Director shall be accumulated and paid to the Outside Director on the earlier of (i) the satisfaction of the Vesting Conditions for the shares subject to the
Restricted Stock Award and (ii) March 15th following the year in which the
dividend or distribution was paid to stockholders generally. 
 8.7    Effect of Termination of Service. Unless
otherwise provided by the Committee in the Award Agreement evidencing a Restricted Stock Award, if a Participant’s Service terminates for any reason, whether voluntary or involuntary (including the Participant’s death or disability), then
(a) the Company shall have the option to repurchase for the purchase price paid by the Participant any shares acquired by the Participant pursuant to a Restricted Stock Purchase Right which remain subject to Vesting Conditions as of the date of
the Participant’s termination of Service and (b) the Participant shall forfeit to the Company any shares acquired by the Participant pursuant to a Restricted Stock Bonus which remain subject to Vesting Conditions as of the date of the
Participant’s termination of Service. The Company shall have the right to assign at any time any repurchase right it may have, whether or not such right is then exercisable, to one or more persons as may be selected by the Company. 

8.8    Nontransferability of Restricted Stock Award Rights. Rights to acquire shares of Stock pursuant to a Restricted
Stock Award shall not be subject in any manner to anticipation, alienation, sale, exchange, transfer, assignment, pledge, encumbrance or garnishment by creditors of the Participant or the 

  

 16 

 
Participant’s beneficiary, except transfer by will or the laws of descent and distribution. All rights with respect to a Restricted Stock Award granted
to a Participant hereunder shall be exercisable during his or her lifetime only by such Participant or the Participant’s guardian or legal representative. 
 9.    Restricted Stock Unit Awards. 
 Restricted Stock Unit Awards shall
be evidenced by Award Agreements specifying the number of Restricted Stock Units subject to the Award, in such form as the Committee shall from time to time establish. Award Agreements evidencing Restricted Stock Units may incorporate all or any of
the terms of the Plan by reference and shall comply with and be subject to the following terms and conditions: 
 9.1    Grant of Restricted Stock Unit Awards. Restricted Stock Unit Awards may be granted upon such conditions as the Committee shall determine, including, without limitation, upon the attainment of one or more
Performance Goals described in Section 10.4. If either the grant of a Restricted Stock Unit Award or the Vesting Conditions with respect to such Award is to be contingent upon the attainment of one or more Performance Goals, the Committee shall
follow procedures substantially equivalent to those set forth in Sections 10.3 through 10.5(a). 
 9.2    Purchase Price. No monetary payment (other than applicable tax withholding, if any) shall be required as a condition of receiving a Restricted Stock Unit Award, the consideration for which shall be services
actually rendered to a Participating Company or for its benefit. Notwithstanding the foregoing, if required by applicable state corporate law, the Participant shall furnish consideration in the form of cash or past services rendered to a
Participating Company or for its benefit having a value not less than the par value of the shares of Stock issued upon settlement of the Restricted Stock Unit Award. 
 9.3    Vesting. Subject to Section 5.4(c), Restricted Stock Unit Awards may (but need not) be made subject to Vesting Conditions based upon the satisfaction of such Service
requirements, conditions, restrictions or performance criteria, including, without limitation, Performance Goals as described in Section 10.4, as shall be established by the Committee and set forth in the Award Agreement evidencing such Award.
The Committee, in its discretion, may provide in any Award Agreement evidencing a Restricted Stock Unit Award that, if the satisfaction of Vesting Conditions with respect to any shares subject to the Award would otherwise occur on a day on which the
sale of such shares would violate the provisions of the Trading Compliance Policy, then the satisfaction of the Vesting Conditions automatically shall be determined on the first to occur of (a) the next trading day on which the sale of such
shares would not violate the Trading Compliance Policy or (b) the later of (i) the last day of the calendar year in which the original vesting date occurred or (ii) the last day of the Company’s taxable year in which the original
vesting date occurred. 
 9.4    Voting Rights, Dividend Equivalent Rights and Distributions. Participants shall
have no voting rights with respect to shares of Stock represented by Restricted Stock Units until the date of the issuance of such shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of
the Company). However, the Committee, in its discretion, may provide in the Award Agreement evidencing any Restricted Stock Unit Award that the Participant shall be entitled to receive Dividend Equivalents with respect to the payment of cash
dividends on Stock during the period beginning on the date such Award is granted and ending, with respect to the particular shares subject to the Award, on the earlier of the date the Award is settled or the date on which it is terminated. Such
Dividend Equivalents, if any, shall be paid by crediting the Participant with additional whole Restricted Stock Units as of the date of payment of such cash dividends on Stock. The number of additional Restricted Stock Units (rounded to the nearest
whole number) to be so credited shall be determined by dividing (a) the amount of cash dividends paid on such date with respect to the number of shares of Stock represented by the Restricted Stock Units previously credited to the Participant by
(b) the Fair Market Value per share of Stock on such date. Such additional Restricted Stock Units shall be subject to the same terms and conditions and shall be settled in the same manner and at the same time (or as soon thereafter as
practicable) as the Restricted Stock Units originally subject to the Restricted Stock Unit Award. In 

  

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the event of a dividend or distribution paid in shares of Stock or other property or any other adjustment made upon a change in the capital structure of the
Company as described in Section 4.3, appropriate adjustments shall be made in the Participant’s Restricted Stock Unit Award so that it represents the right to receive upon settlement any and all new, substituted or additional securities or
other property (other than normal cash dividends) to which the Participant would entitled by reason of the shares of Stock issuable upon settlement of the Award, and all such new, substituted or additional securities or other property shall be
immediately subject to the same Vesting Conditions as are applicable to the Award. 
 9.5    Effect of Termination of
Service. Unless otherwise provided by the Committee and set forth in the Award Agreement evidencing a Restricted Stock Unit Award, if a Participant’s Service terminates for any reason, whether voluntary or involuntary (including the
Participant’s death or disability), then the Participant shall forfeit to the Company any Restricted Stock Units pursuant to the Award which remain subject to Vesting Conditions as of the date of the Participant’s termination of Service.

 9.6    Settlement of Restricted Stock Unit Awards. The Company shall issue to a Participant on the date on
which Restricted Stock Units subject to the Participant’s Restricted Stock Unit Award vest or on such other date determined by the Committee, in its discretion, and set forth in the Award Agreement one (1) share of Stock (and/or any other
new, substituted or additional securities or other property pursuant to an adjustment described in Section 9.4) for each Restricted Stock Unit then becoming vested or otherwise to be settled on such date, subject to the withholding of
applicable taxes. If permitted by the Committee, subject to the provisions of Section 17 with respect to Section 409A, the Participant may elect in accordance with terms specified in the Award Agreement to defer receipt of all or any
portion of the shares of Stock or other property otherwise issuable to the Participant pursuant to this Section, and such deferred issuance date(s) elected by the Participant shall be set forth in the Award Agreement. Notwithstanding the foregoing,
the Committee, in its discretion, may provide for settlement of any Restricted Stock Unit Award by payment to the Participant in cash of an amount equal to the Fair Market Value on the payment date of the shares of Stock or other property otherwise
issuable to the Participant pursuant to this Section. 
 9.7    Nontransferability of Restricted Stock Unit
Awards. The right to receive shares pursuant to a Restricted Stock Unit Award shall not be subject in any manner to anticipation, alienation, sale, exchange, transfer, assignment, pledge, encumbrance, or garnishment by creditors of the
Participant or the Participant’s beneficiary, except transfer by will or by the laws of descent and distribution. All rights with respect to a Restricted Stock Unit Award granted to a Participant hereunder shall be exercisable during his or her
lifetime only by such Participant or the Participant’s guardian or legal representative. 
 10.    Performance
Awards. 
 Performance Awards shall be evidenced by Award Agreements in such form as the Committee shall from time to time establish.
Award Agreements evidencing Performance Awards may incorporate all or any of the terms of the Plan by reference and shall comply with and be subject to the following terms and conditions: 
 10.1    Types of Performance Awards Authorized. Performance Awards may be granted in the form of either Performance Shares or
Performance Units. Each Award Agreement evidencing a Performance Award shall specify the number of Performance Shares or Performance Units subject thereto, the Performance Award Formula, the Performance Goal(s) and Performance Period applicable to
the Award, and the other terms, conditions and restrictions of the Award. 
 10.2    Initial Value of Performance
Shares and Performance Units. Unless otherwise provided by the Committee in granting a Performance Award, each Performance Share shall have an initial monetary value equal to the Fair Market Value of one (1) share of Stock, subject to
adjustment as provided in Section 4.3, on the effective date of grant of the Performance Share, and each Performance Unit shall have an initial monetary value established by the Committee at the time of grant. The final value payable to the
Participant in settlement of a 

  

 18 

 
Performance Award determined on the basis of the applicable Performance Award Formula will depend on the extent to which Performance Goals established by the
Committee are attained within the applicable Performance Period established by the Committee. 
 10.3    Establishment
of Performance Period, Performance Goals and Performance Award Formula. In granting each Performance Award, the Committee shall establish in writing the applicable Performance Period, Performance Award Formula and one or more Performance Goals
which, when measured at the end of the Performance Period, shall determine on the basis of the Performance Award Formula the final value of the Performance Award to be paid to the Participant. Unless otherwise permitted in compliance with the
requirements under Section 162(m) with respect to each Performance Award intended to result in the payment of Performance-Based Compensation, the Committee shall establish the Performance Goal(s) and Performance Award Formula applicable to each
Performance Award no later than the earlier of (a) the date ninety (90) days after the commencement of the applicable Performance Period or (b) the date on which twenty-five percent (25%) of the Performance Period has elapsed,
and, in any event, at a time when the outcome of the Performance Goals remains substantially uncertain. Once established, the Performance Goals and Performance Award Formula applicable to a Covered Employee shall not be changed during the
Performance Period. The Company shall notify each Participant granted a Performance Award of the terms of such Award, including the Performance Period, Performance Goal(s) and Performance Award Formula. 
 10.4    Measurement of Performance Goals. Performance Goals shall be established by the Committee on the basis of targets to
be attained (“Performance Targets”) with respect to one or more measures of business or financial performance (each, a “Performance Measure”), subject to the
following: 
   (a)    Performance Measures. Performance Measures shall have the
same meanings as used in the Company’s financial statements, or, if such terms are not used in the Company’s financial statements, they shall have the meaning applied pursuant to generally accepted accounting principles, or as used
generally in the Company’s industry. Performance Measures shall be calculated with respect to the Company and each Subsidiary Corporation consolidated therewith for financial reporting purposes or such division or other business unit as may be
selected by the Committee. For purposes of the Plan, the Performance Measures applicable to a Performance Award shall be calculated in accordance with generally accepted accounting principles, if applicable, but prior to the accrual or payment of
any Performance Award for the same Performance Period and excluding the effect (whether positive or negative) of any change in accounting standards or any extraordinary, unusual or nonrecurring item, as determined by the Committee, occurring after
the establishment of the Performance Goals applicable to the Performance Award. Each such adjustment, if any, shall be made solely for the purpose of providing a consistent basis from period to period for the calculation of Performance Measures in
order to prevent the dilution or enlargement of the Participant’s rights with respect to a Performance Award. Performance Measures may be one or more of the following, as determined by the Committee: 
   (i) revenue; 
   (ii) sales; 
   (iii) expenses; 
   (iv) operating income; 
   (v) gross margin; 
   (vi) operating margin; 
   (vii) earnings before any one or more of: stock-based compensation expense, interest, taxes, depreciation and amortization; 
  

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   (viii) pre-tax profit; 
   (ix) net operating income; 
   (x) net income; 
   (xi) economic value added; 
   (xii) free cash flow; 
   (xiii) operating cash flow; 
   (xiv) stock price; 
   (xv) earnings per share; 
   (xvi) return on stockholder equity; 
   (xvii) return on capital; 
   (xviii) return on assets; 
   (xix) return on investment; 
   (xx) employee satisfaction; 
   (xxi) employee retention; 
   (xxii) balance of cash, cash equivalents and marketable securities; 
   (xxiii) market share; 
   (xxiv) product regulatory approvals; 
   (xxv) projects in development; 
   (xxvi) regulatory filings; 
   (xxvii) research and development expenses; and 
   (xxviii) completion of a joint venture or other corporate transaction. 
   (b)    Performance Targets. Performance Targets may include a minimum, maximum, target level and intermediate levels of performance, with the final value of a Performance Award determined under
the applicable Performance Award Formula by the level attained during the applicable Performance Period. A Performance Target may be stated as an absolute value or as a value determined relative to an index, budget or other standard selected by the
Committee. 
 10.5    Settlement of Performance Awards. 
   (a) Determination of Final Value. As soon as practicable following the completion of the Performance Period applicable to a
Performance Award, the Committee shall certify in writing the extent to 

  

 20 

 
which the applicable Performance Goals have been attained and the resulting final value of the Award earned by the Participant and to be paid upon its
settlement in accordance with the applicable Performance Award Formula. 
   (b)    Discretionary
Adjustment of Award Formula. In its discretion, the Committee may, either at the time it grants a Performance Award or at any time thereafter, provide for the positive or negative adjustment of the Performance Award Formula applicable to a
Performance Award granted to any Participant who is not a Covered Employee to reflect such Participant’s individual performance in his or her position with the Company or such other factors as the Committee may determine. If permitted under a
Covered Employee’s Award Agreement, the Committee shall have the discretion, on the basis of such criteria as may be established by the Committee, to reduce some or all of the value of the Performance Award that would otherwise be paid to the
Covered Employee upon its settlement notwithstanding the attainment of any Performance Goal and the resulting value of the Performance Award determined in accordance with the Performance Award Formula. No such reduction may result in an increase in
the amount payable upon settlement of another Participant’s Performance Award that is intended to result in Performance-Based Compensation. 
   (c)    Effect of Leaves of Absence. Unless otherwise required by law or a Participant’s Award Agreement, payment of the final value, if any, of a Performance Award held by a Participant who
has taken in excess of thirty (30) days in unpaid leaves of absence during a Performance Period shall be prorated on the basis of the number of days of the Participant’s Service during the Performance Period during which the Participant
was not on a leave of absence. 
   (d)    Notice to Participants. As soon as practicable
following the Committee’s determination and certification in accordance with Sections 10.5(a) and (b), the Company shall notify each Participant of the determination of the Committee. 
   (e)    Payment in Settlement of Performance Awards. As soon as practicable following the Committee’s
determination and certification in accordance with Sections 10.5(a) and (b), but in any event within the Short-Term Deferral Period described in Section 17.1 (except as otherwise provided below or consistent with the requirements of
Section 409A), payment shall be made to each eligible Participant (or such Participant’s legal representative or other person who acquired the right to receive such payment by reason of the Participant’s death) of the final value of
the Participant’s Performance Award. Payment of such amount shall be made in cash, shares of Stock, or a combination thereof as determined by the Committee. Unless otherwise provided in the Award Agreement evidencing a Performance Award,
payment shall be made in a lump sum. If permitted by the Committee, the Participant may elect, consistent with the requirements of Section 409A, to defer receipt of all or any portion of the payment to be made to Participant pursuant to this
Section, and such deferred payment date(s) elected by the Participant shall be set forth in the Award Agreement. If any payment is to be made on a deferred basis, the Committee may, but shall not be obligated to, provide for the payment during the
deferral period of Dividend Equivalents or interest. 
   (f)    Provisions Applicable to
Payment in Shares. If payment is to be made in shares of Stock, the number of such shares shall be determined by dividing the final value of the Performance Award by the value of a share of Stock determined by the method specified in the
Award Agreement. Such methods may include, without limitation, the closing market price on a specified date (such as the settlement date) or an average of market prices over a series of trading days. Shares of Stock issued in payment of any
Performance Award may be fully vested and freely transferable shares or may be shares of Stock subject to Vesting Conditions as provided in Section 8.5. Any shares subject to Vesting Conditions shall be evidenced by an appropriate Award
Agreement and shall be subject to the provisions of Sections 8.5 through 8.8 above. 
 10.6    Voting Rights;
Dividend Equivalent Rights and Distributions. Participants shall have no voting rights with respect to shares of Stock represented by Performance Share Awards until the date of the issuance of such shares, if any (as evidenced by the appropriate
entry on the books of the Company or of a duly authorized transfer agent of the Company). However, the Committee, in its discretion, may provide in the Award 

  

 21 

 
Agreement evidencing any Performance Share Award that the Participant shall be entitled to receive Dividend Equivalents with respect to the payment of cash
dividends on Stock during the period beginning on the date the Award is granted and ending, with respect to the particular shares subject to the Award, on the earlier of the date on which the Performance Shares are settled or the date on which they
are forfeited. Such Dividend Equivalents, if any, shall be credited to the Participant in the form of additional whole Performance Shares as of the date of payment of such cash dividends on Stock. The number of additional Performance Shares (rounded
to the nearest whole number) to be so credited shall be determined by dividing (a) the amount of cash dividends paid on the dividend payment date with respect to the number of shares of Stock represented by the Performance Shares previously
credited to the Participant by (b) the Fair Market Value per share of Stock on such date. Dividend Equivalents may be paid currently or may be accumulated and paid to the extent that Performance Shares become nonforfeitable, as determined by
the Committee. Settlement of Dividend Equivalents may be made in cash, shares of Stock, or a combination thereof as determined by the Committee, and may be paid on the same basis as settlement of the related Performance Share as provided in
Section 10.5. Dividend Equivalents shall not be paid with respect to Performance Units. In the event of a dividend or distribution paid in shares of Stock or other property or any other adjustment made upon a change in the capital structure of
the Company as described in Section 4.3, appropriate adjustments shall be made in the Participant’s Performance Share Award so that it represents the right to receive upon settlement any and all new, substituted or additional securities or
other property (other than normal cash dividends) to which the Participant would entitled by reason of the shares of Stock issuable upon settlement of the Performance Share Award, and all such new, substituted or additional securities or other
property shall be immediately subject to the same Performance Goals as are applicable to the Award. 
 10.7    Effect
of Termination of Service. Unless otherwise provided by the Committee and set forth in the Award Agreement evidencing a Performance Award, the effect of a Participant’s termination of Service on the Performance Award shall be as follows:

   (a)    Death or Disability. If the Participants Service terminates because of the death or
Disability of the Participant before the completion of the Performance Period applicable to the Performance Award, the final value of the Participants Performance Award shall be determined by the extent to which the applicable Performance Goals have
been attained with respect to the entire Performance Period and shall be prorated based on the number of days of the Participants Service during the Performance Period. Payment shall be made following the end of the Performance Period in any manner
permitted by Section 10.5. 
   (b)    Other Termination of Service. If the Participant’s
Service terminates for any reason except death or Disability before the completion of the Performance Period applicable to the Performance Award, such Award shall be forfeited in its entirety. 
 10.8    Nontransferability of Performance Awards. Prior to settlement in accordance with the provisions of the Plan, no
Performance Award shall be subject in any manner to anticipation, alienation, sale, exchange, transfer, assignment, pledge, encumbrance, or garnishment by creditors of the Participant or the Participant’s beneficiary, except transfer by will or
by the laws of descent and distribution. All rights with respect to a Performance Award granted to a Participant hereunder shall be exercisable during his or her lifetime only by such Participant or the Participant’s guardian or legal
representative. 
 11.    Cash-Based Awards and Other Stock-Based Awards. 
 Cash-Based Awards and Other Stock-Based Awards shall be evidenced by Award Agreements in such form as the Committee shall from time to time establish.
Award Agreements evidencing Cash-Based Awards and Other Stock-Based Awards may incorporate all or any of the terms of the Plan by reference and shall comply with and be subject to the following terms and conditions: 
 11.1    Grant of Cash-Based Awards. Subject to the provisions of the Plan, the Committee, at any time and from time to time,
may grant Cash-Based Awards to Participants in such amounts and upon such terms and conditions, including the achievement of performance criteria, as the Committee may determine. 
  

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 11.2    Grant of Other Stock-Based Awards. The Committee may grant other types
of equity-based or equity-related Awards not otherwise described by the terms of this Plan (including the grant or offer for sale of unrestricted securities, stock-equivalent units, stock appreciation units, securities or debentures convertible into
common stock or other forms determined by the Committee) in such amounts and subject to such terms and conditions as the Committee shall determine. Such Awards may involve the transfer of actual shares of Stock to Participants, or payment in cash or
otherwise of amounts based on the value of Stock and may include, without limitation, Awards designed to comply with or take advantage of the applicable local laws of jurisdictions other than the United States. 
 11.3    Value of Cash-Based and Other Stock-Based Awards. Each Cash-Based Award shall specify a monetary payment amount or
payment range as determined by the Committee. Each Other Stock-Based Award shall be expressed in terms of shares of Stock or units based on such shares of Stock, as determined by the Committee. Subject to Section 5.4(c), the Committee may
require the satisfaction of such Service requirements, conditions, restrictions or performance criteria, including, without limitation, Performance Goals as described in Section 10.4, as shall be established by the Committee and set forth in
the Award Agreement evidencing such Award. If the Committee exercises its discretion to establish performance criteria, the final value of Cash-Based Awards or Other Stock-Based Awards that will be paid to the Participant will depend on the extent
to which the performance criteria are met. The establishment of performance criteria with respect to the grant or vesting of any Cash-Based Award or Other Stock-Based Award intended to result in Performance-Based Compensation shall follow procedures
substantially equivalent to those applicable to Performance Awards set forth in Section 10. 
 11.4    Payment or
Settlement of Cash-Based Awards and Other Stock-Based Awards. Payment or settlement, if any, with respect to a Cash-Based Award or an Other Stock-Based Award shall be made in accordance with the terms of the Award, in cash, shares of Stock or
other securities or any combination thereof as the Committee determines. The determination and certification of the final value with respect to any Cash-Based Award or Other Stock-Based Award intended to result in Performance-Based Compensation
shall comply with the requirements applicable to Performance Awards set forth in Section 10. To the extent applicable, payment or settlement with respect to each Cash-Based Award and Other Stock-Based Award shall be made in compliance with
requirements of Section 409A. 
 11.5    Voting Rights; Dividend Equivalent Rights and Distributions.
Participants shall have no voting rights with respect to shares of Stock represented by Other Stock-Based Awards until the date of the issuance of such shares of Stock (as evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company), if any, in settlement of such Award. However, the Committee, in its discretion, may provide in the Award Agreement evidencing any Other Stock-Based Award that the Participant shall be entitled to receive
Dividend Equivalents with respect to the payment of cash dividends on Stock during the period beginning on the date such Award is granted and ending, with respect to the particular shares subject to the Award, on the earlier of the date the Award is
settled or the date on which it is terminated. Such Dividend Equivalents, if any, shall be paid in accordance with the provisions set forth in Section 9.4. Dividend Equivalent rights shall not be granted with respect to Cash-Based Awards.

 11.6    Effect of Termination of Service. Each Award Agreement evidencing a Cash-Based Award or Other
Stock-Based Award shall set forth the extent to which the Participant shall have the right to retain such Award following termination of the Participant’s Service. Such provisions shall be determined in the sole discretion of the Committee,
need not be uniform among all Cash-Based Awards or Other Stock-Based Awards, and may reflect distinctions based on the reasons for termination. 
 11.7    Nontransferability of Cash-Based Awards and Other Stock-Based Awards. Prior to the payment or settlement of a Cash-Based Award or Other Stock-Based Award, the Award shall not be subject in any manner to
anticipation, alienation, sale, exchange, transfer, assignment, pledge, encumbrance, or garnishment by creditors of the Participant or the Participants beneficiary, except transfer by will or by the laws 

  

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of descent and distribution. The Committee may impose such additional restrictions on any shares of Stock issued in settlement of Cash-Based Awards and Other
Stock-Based Awards as it may deem advisable, including, without limitation, minimum holding period requirements, restrictions under applicable federal securities laws, under the requirements of any stock exchange or market upon which such shares of
Stock are then listed and/or traded, or under any state securities laws applicable to such shares of Stock. 
 12.    Standard Forms of Award Agreement. 
 12.1    Award Agreements.
Each Award shall comply with and be subject to the terms and conditions set forth in the appropriate form of Award Agreement approved by the Committee and as amended from time to time. No Award or purported Award shall be a valid and binding
obligation of the Company unless evidenced by a fully executed Award Agreement, which execution may be evidenced by electronic means or transmission. Any Award Agreement may consist of an appropriate form of Notice of Grant and a form of Agreement
incorporated therein by reference, or such other form or forms, including electronic media, as the Committee may approve from time to time. 
 12.2    Authority to Vary Terms. The Committee shall have the authority from time to time to vary the terms of any standard form of Award Agreement either in connection with the grant or amendment of an individual
Award or in connection with the authorization of a new standard form or forms; provided, however, that the terms and conditions of any such new, revised or amended standard form or forms of Award Agreement are not inconsistent with the
terms of the Plan. 
 13.    Change in Control. 
 13.1    Effect of Change in Control on Awards. Subject to the requirements and limitations of Section 409A if applicable,
the Committee may provide for any one or more of the following: 
   (a)    Accelerated Vesting.
The Committee may, in its discretion, provide in any Award Agreement or, in the event of a Change in Control, may take such actions as it deems appropriate to provide for the acceleration of the exercisability, vesting and/or settlement in
connection with such Change in Control of each or any outstanding Award or portion thereof and shares acquired pursuant thereto upon such conditions, including termination of the Participant’s Service prior to, upon, or following such Change in
Control, to such extent as the Committee shall determine. 
   (b)    Assumption, Continuation or
Substitution. In the event of a Change in Control, the surviving, continuing, successor, or purchasing corporation or other business entity or parent thereof, as the case may be (the “Acquiror”), may,
without the consent of any Participant, either assume or continue the Company’s rights and obligations under each or any Award or portion thereof outstanding immediately prior to the Change in Control or substitute for each or any such
outstanding Award or portion thereof a substantially equivalent award with respect to the Acquiror’s stock, as applicable. For purposes of this Section, if so determined by the Committee, in its discretion, an Award denominated in shares of
Stock shall be deemed assumed if, following the Change in Control, the Award confers the right to receive, subject to the terms and conditions of the Plan and the applicable Award Agreement, for each share of Stock subject to the Award immediately
prior to the Change in Control, the consideration (whether stock, cash, other securities or property or a combination thereof) to which a holder of a share of Stock on the effective date of the Change in Control was entitled; provided,
however, that if such consideration is not solely common stock of the Acquiror, the Committee may, with the consent of the Acquiror, provide for the consideration to be received upon the exercise or settlement of the Award, for each share of
Stock subject to the Award, to consist solely of common stock of the Acquiror equal in Fair Market Value to the per share consideration received by holders of Stock pursuant to the Change in Control. Any Award or portion thereof which is neither
assumed or continued by the Acquiror in connection with the Change in Control nor exercised or settled as of the time of consummation of the Change in Control shall terminate and cease to be outstanding effective as of the time of consummation of
the Change in Control. 
  

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   (c)    Cash-Out of Outstanding Stock-Based Awards. The
Committee may, in its discretion and without the consent of any Participant, determine that, upon the occurrence of a Change in Control, each or any Award denominated in shares of Stock or portion thereof outstanding immediately prior to the Change
in Control and not previously exercised or settled shall be canceled in exchange for a payment with respect to each vested share (and each unvested share, if so determined by the Committee) of Stock subject to such canceled Award in (i) cash,
(ii) stock of the Company or of a corporation or other business entity a party to the Change in Control, or (iii) other property which, in any such case, shall be in an amount having a Fair Market Value equal to the Fair Market Value of
the consideration to be paid per share of Stock in the Change in Control, reduced by the exercise or purchase price per share, if any, under such Award. In the event such determination is made by the Committee, the amount of such payment (reduced by
applicable withholding taxes, if any) shall be paid to Participants in respect of the vested portions of their canceled Awards as soon as practicable following the date of the Change in Control and in respect of the unvested portions of their
canceled Awards in accordance with the vesting schedules applicable to such Awards. 
 13.2    Federal Excise Tax
Under Section 4999 of the Code. 
   (a)    Excess Parachute Payment. In the event that
any acceleration of vesting pursuant to an Award and any other payment or benefit received or to be received by a Participant would subject the Participant to any excise tax pursuant to Section 4999 of the Code due to the characterization of
such acceleration of vesting, payment or benefit as an “excess parachute payment” under Section 280G of the Code, the Participant may elect, in his or her sole discretion and in compliance with the requirements of Section 409A,
to reduce the amount of any acceleration of vesting called for under the Award in order to avoid such characterization. 
   (b)    Determination by Independent Accountants. To aid the Participant in making any election called for under Section 13.2(a), no later than the date of the occurrence of any event that
might reasonably be anticipated to result in an “excess parachute payment” to the Participant as described in Section 13.2(a), the Company shall request a determination in writing by independent public accountants selected by the
Company (the “Accountants”). As soon as practicable thereafter, the Accountants shall determine and report to the Company and the Participant the amount of such acceleration of vesting, payments and benefits
which would produce the greatest after-tax benefit to the Participant. For the purposes of such determination, the Accountants may rely on reasonable, good faith interpretations concerning the application of Sections 280G and 4999 of the Code. The
Company and the Participant shall furnish to the Accountants such information and documents as the Accountants may reasonably request in order to make their required determination. The Company shall bear all fees and expenses the Accountants may
reasonably charge in connection with their services contemplated by this Section. 
 14.    Compliance with
Securities Law. 
 The grant of Awards and the issuance of shares of Stock pursuant to any Award shall be subject to compliance with
all applicable requirements of federal, state and foreign law with respect to such securities and the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, no Award may be exercised or shares
issued pursuant to an Award unless (a) a registration statement under the Securities Act shall at the time of such exercise or issuance be in effect with respect to the shares issuable pursuant to the Award or (b) in the opinion of legal
counsel to the Company, the shares issuable pursuant to the Award may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. The inability of the Company to obtain from any
regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance and sale of any shares hereunder shall relieve the Company of any liability in respect of the failure to
issue or sell such shares as to which such requisite authority shall not have been obtained. As a condition to issuance of any Stock, the Company may require the Participant to satisfy any qualifications that may be necessary or appropriate, to
evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company. 
  

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 15.    Tax Withholding. 
 15.1    Tax Withholding in General. The Company shall have the right to deduct from any and all payments made under the Plan,
or to require the Participant, through payroll withholding, cash payment or otherwise, to make adequate provision for, the federal, state, local and foreign taxes, if any, required by law to be withheld by the Participating Company Group with
respect to an Award or the shares acquired pursuant thereto. The Company shall have no obligation to deliver shares of Stock, to release shares of Stock from an escrow established pursuant to an Award Agreement, or to make any payment in cash under
the Plan until the Participating Company Group’s tax withholding obligations have been satisfied by the Participant. 
 15.2    Withholding in Shares. The Company shall have the right, but not the obligation, to deduct from the shares of Stock issuable to a Participant upon the exercise or settlement of an Award, or to accept from
the Participant the tender of, a number of whole shares of Stock having a Fair Market Value, as determined by the Company, equal to all or any part of the tax withholding obligations of the Participating Company Group. The Fair Market Value of any
shares of Stock withheld or tendered to satisfy any such tax withholding obligations shall not exceed the amount determined by the applicable minimum statutory withholding rates. 
 16.    Amendment or Termination of Plan. 
 The Committee may amend, suspend or terminate the Plan at any time. However, without the approval of the Company’s stockholders, there shall be (a) no increase in the maximum aggregate number of shares of
Stock that may be issued under the Plan (except by operation of the provisions of Section 4.3), (b) no change in the class of persons eligible to receive Incentive Stock Options, and (c) no other amendment of the Plan that would
require approval of the Company’s stockholders under any applicable law, regulation or rule, including the rules of any stock exchange or market system upon which the Stock may then be listed. No amendment, suspension or termination of the Plan
shall affect any then outstanding Award unless expressly provided by the Committee. Except as provided by the next sentence, no amendment, suspension or termination of the Plan may adversely affect any then outstanding Award without the consent of
the Participant. Notwithstanding any other provision of the Plan to the contrary, the Committee may, in its sole and absolute discretion and without the consent of any Participant, amend the Plan or any Award Agreement, to take effect retroactively
or otherwise, as it deems necessary or advisable for the purpose of conforming the Plan or such Award Agreement to any present or future law, regulation or rule applicable to the Plan, including, but not limited to, Section 409A. 
 17.    Compliance with Section 409A. 
 17.1    Awards Subject to Section 409A. The provisions of this Section 17 shall apply to any Award or portion
thereof that is or becomes subject to Section 409A, notwithstanding any provision to the contrary contained in the Plan or the Award Agreement applicable to such Award. Awards subject to Section 409A include, without limitation:

   (a)    Any Nonstatutory Stock Option or SAR that permits the deferral of compensation other than the
deferral of recognition of income until the exercise of the Award. 
   (b)    Any Restricted Stock Unit
Award, Performance Award, Cash-Based Award or Other Stock-Based Award if either (i) the Award provides by its terms for settlement of all or any portion of the Award on one or more dates following the Short-Term Deferral Period (as defined
below) or (ii) the Committee permits or requires the Participant to elect one or more dates on which the Award will be settled. 
 Subject to any applicable U.S. Treasury Regulations promulgated pursuant to Section 409A or other applicable guidance, the term “Short-Term Deferral Period” means the period
ending on the later of (i) the fifteenth (15th) day of the third
(3rd) month following the end of the Company’s fiscal year in which the
applicable portion of the Award is no longer subject to a substantial risk of forfeiture or (ii) the fifteenth 

  

 26 

 
(15th) day of the third (3rd) month following
the end of the Participant’s taxable year in which the applicable portion of the Award is no longer subject to a substantial risk of forfeiture. For this purpose, the term “substantial risk of forfeiture” shall have the meaning set
forth in any applicable U.S. Treasury Regulations promulgated pursuant to Section 409A or other applicable guidance. 
 17.2    Deferral and/or Distribution Elections. Except as otherwise permitted or required by Section 409A or any applicable U.S. Treasury Regulations promulgated pursuant to Section 409A or other
applicable guidance, the following rules shall apply to any deferral and/or distribution elections (each, an “Election”) that may be permitted or required by the Committee pursuant to an Award subject to
Section 409A: 
   (a)    All Elections must be in writing and specify the amount of the distribution in
settlement of an Award being deferred, as well as the time and form of distribution as permitted by this Plan. 
   (b)    All Elections shall be made by the end of the Participant’s taxable year prior to the year in which services commence for which an Award may be granted to such Participant; provided,
however, that if the Award qualifies as “performance-based compensation” for purposes of Section 409A and is based on services performed over a period of at least twelve (12) months, then the Election may be made no later
than six (6) months prior to the end of such period. 
   (c)    Elections shall continue in effect until
a written election to revoke or change such Election is received by the Company, except that a written election to revoke or change such Election must be made prior to the last day for making an Election determined in accordance with
paragraph (b) above or as permitted by Section 17.3. 
 17.3    Subsequent Elections. Except as
otherwise permitted or required by Section 409A or any applicable U.S. Treasury Regulations promulgated pursuant to Section 409A or other applicable guidance, any Award subject to Section 409A which permits a subsequent Election to
delay the distribution or change the form of distribution in settlement of such Award shall comply with the following requirements: 
   (a)    No subsequent Election may take effect until at least twelve (12) months after the date on which the subsequent Election is made; 
   (b)    Each subsequent Election related to a distribution in settlement of an Award not described in this
Section 17.3(b), 17.4(b), or 17.4(f) must result in a delay of the distribution for a period of not less than five (5) years from the date such distribution would otherwise have been made; and 
   (c)    No subsequent Election related to a distribution pursuant to Section 17.4(d) shall be made less than twelve
(12) months prior to the date of the first scheduled payment under such distribution. 
 17.4    Distributions
Pursuant to Deferral Elections. Except as otherwise permitted or required by Section 409A or any applicable U.S. Treasury Regulations promulgated pursuant to Section 409A or other applicable guidance, no distribution in settlement of
an Award subject to Section 409A may commence earlier than: 
   (a)    Separation from service (as
determined by the Secretary of the United States Treasury); 
   (b)    The date the Participant becomes
Disabled (as defined below); 
   (c)    Death; 
   (d)    A specified time (or pursuant to a fixed schedule) that is either (i) specified by the Committee upon the
grant of an Award and set forth in the Award Agreement evidencing such Award or (ii) specified by the Participant in an Election complying with the requirements of Section 17.2 and/or 17.3, as applicable; 
  

 27 

   (e)    To the extent provided by the Secretary of the U.S. Treasury, a
change in the ownership or effective control or the Company or in the ownership of a substantial portion of the assets of the Company; or 
   (f)    The occurrence of an “Unforeseeable Emergency” (as defined by applicable U.S. Treasury Regulations promulgated pursuant to Section 409A). 
 Notwithstanding anything else herein to the contrary, to the extent that a Participant is a “Specified Employee” (as defined in
Section 409A(a)(2)(B)(i) of the Code) of the Company, no distribution pursuant to Section 17.4(a) in settlement of an Award subject to Section 409A may be made before the date (the “Delayed Payment
Date”) which is six (6) months after such Participant’s date of separation from service, or, if earlier, the date of the Participant’s death. All such amounts that would, but for this paragraph, become payable
prior to the Delayed Payment Date shall be accumulated and paid on the Delayed Payment Date. 
 17.5    Unforeseeable
Emergency. The Committee shall have the authority to provide in the Award Agreement evidencing any Award subject to Section 409A for distribution in settlement of all or a portion of such Award in the event that a Participant establishes,
to the satisfaction of the Committee, the occurrence of an Unforeseeable Emergency. In such event, the amount(s) distributed with respect to such Unforeseeable Emergency cannot exceed the amounts necessary to satisfy such Unforeseeable Emergency
plus amounts necessary to pay taxes reasonably anticipated as a result of such distribution(s), after taking into account the extent to which such hardship is or may be relieved through reimbursement or compensation by insurance or otherwise, by
liquidation of the Participant’s assets (to the extent the liquidation of such assets would not itself cause severe financial hardship) or by cessation of deferrals under the Award. All distributions with respect to an Unforeseeable Emergency
shall be made in a lump sum as soon as practicable following the Committee’s determination that an Unforeseeable Emergency has occurred. 
 The occurrence of an Unforeseeable Emergency shall be judged and determined by the Committee. The Committee’s decision with respect to whether an Unforeseeable Emergency has occurred and the manner in which, if at all, the distribution
in settlement of an Award shall be altered or modified, shall be final, conclusive, and not subject to approval or appeal. 
 17.6    Disabled. The Committee shall have the authority to provide in any Award subject to Section 409A for distribution in settlement of such Award in the event that the Participant becomes Disabled. A
Participant shall be considered “Disabled” if either: 
   (a)    the Participant is unable to
engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, or

   (b)    the Participant is, by reason of any medically determinable physical or mental impairment which
can be expected to result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement benefits for a period of not less than three (3) months under an accident and health
plan covering employees of the Participant’s employer. 
 All distributions payable by reason of a Participant becoming Disabled shall
be paid in a lump sum or in periodic installments as established by the Participant’s Election, commencing as soon as practicable following the date the Participant becomes Disabled. If the Participant has made no Election with respect to
distributions upon becoming Disabled, all such distributions shall be paid in a lump sum as soon as practicable following the date the Participant becomes Disabled. 
 17.7    Death. If a Participant dies before complete distribution of amounts payable upon settlement of an Award subject to Section 409A, such undistributed amounts shall be distributed
to his or her beneficiary under the distribution method for death established by the Participant’s Election as soon as administratively possible 

  

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following receipt by the Committee of satisfactory notice and confirmation of the Participant’s death. If the Participant has made no Election with
respect to distributions upon death, all such distributions shall be paid in a lump sum as soon as practicable following the date of the Participant’s death. 
 17.8    No Acceleration of Distributions. Notwithstanding anything to the contrary herein, this Plan does not permit the acceleration of the time or schedule of any distribution under an
Award subject to Section 409A, except as provided by Section 409A and/or the Secretary of the U.S. Treasury. 
 18.    Miscellaneous Provisions. 
 18.1    Repurchase Rights. Shares
issued under the Plan may be subject to one or more repurchase options, or other conditions and restrictions as determined by the Committee in its discretion at the time the Award is granted. The Company shall have the right to assign at any time
any repurchase right it may have, whether or not such right is then exercisable, to one or more persons as may be selected by the Company. Upon request by the Company, each Participant shall execute any agreement evidencing such transfer
restrictions prior to the receipt of shares of Stock hereunder and shall promptly present to the Company any and all certificates representing shares of Stock acquired hereunder for the placement on such certificates of appropriate legends
evidencing any such transfer restrictions. 
 18.2    Forfeiture Events. 
   (a)    The Committee may specify in an Award Agreement that the Participant’s rights, payments, and benefits with
respect to an Award shall be subject to reduction, cancellation, forfeiture, or recoupment upon the occurrence of specified events, in addition to any otherwise applicable vesting or performance conditions of an Award. Such events may include, but
shall not be limited to, termination of Service for Cause or any act by a Participant, whether before or after termination of Service, that would constitute Cause for termination of Service. 
   (b)    If the Company is required to prepare an accounting restatement due to the material noncompliance of the Company,
as a result of misconduct, with any financial reporting requirement under the securities laws, any Participant who knowingly or through gross negligence engaged in the misconduct, or who knowingly or through gross negligence failed to prevent the
misconduct, and any Participant who is one of the individuals subject to automatic forfeiture under Section 304 of the Sarbanes-Oxley Act of 2002, shall reimburse the Company the amount of any payment in settlement of an Award earned or accrued
during the twelve- (12-) month period following the first public issuance or filing with the United States Securities and Exchange Commission (whichever first occurred) of the financial document embodying such financial reporting requirement.

 18.3    Provision of Information. Each Participant shall be given access to information concerning the Company
equivalent to that information generally made available to the Company’s common stockholders. 
 18.4    Rights
as Employee, Consultant or Director. No person, even though eligible pursuant to Section 5, shall have a right to be selected as a Participant, or, having been so selected, to be selected again as a Participant. Nothing in the Plan or any
Award granted under the Plan shall confer on any Participant a right to remain an Employee, Consultant or Director or interfere with or limit in any way any right of a Participating Company to terminate the Participant’s Service at any time. To
the extent that an Employee of a Participating Company other than the Company receives an Award under the Plan, that Award shall in no event be understood or interpreted to mean that the Company is the Employee’s employer or that the Employee
has an employment relationship with the Company. 
 18.5    Rights as a Stockholder. A Participant shall have no
rights as a stockholder with respect to any shares covered by an Award until the date of the issuance of such shares (as evidenced by the appropriate entry 

  

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on the books of the Company or of a duly authorized transfer agent of the Company). No adjustment shall be made for dividends, distributions or other rights
for which the record date is prior to the date such shares are issued, except as provided in Section 4.3 or another provision of the Plan. 
 18.6    Delivery of Title to Shares. Subject to any governing rules or regulations, the Company shall issue or cause to be issued the shares of Stock acquired pursuant to an Award and shall deliver such shares to
or for the benefit of the Participant by means of one or more of the following: (a) by delivering to the Participant evidence of book entry shares of Stock credited to the account of the Participant, (b) by depositing such shares of Stock
for the benefit of the Participant with any broker with which the Participant has an account relationship, or (c) by delivering such shares of Stock to the Participant in certificate form. 
 18.7    Fractional Shares. The Company shall not be required to issue fractional shares upon the exercise or settlement of any
Award. 
 18.8    Retirement and Welfare Plans. Neither Awards made under this Plan nor shares of Stock or cash
paid pursuant to such Awards may be included as “compensation” for purposes of computing the benefits payable to any Participant under any Participating Company’s retirement plans (both qualified and non-qualified) or welfare benefit
plans unless such other plan expressly provides that such compensation shall be taken into account in computing a Participant’s benefit. 
 18.9    Beneficiary Designation. Subject to local laws and procedures, each Participant may file with the Company a written designation of a beneficiary who is to receive any benefit under the Plan to which the
Participant is entitled in the event of such Participant’s death before he or she receives any or all of such benefit. Each designation will revoke all prior designations by the same Participant, shall be in a form prescribed by the Company,
and will be effective only when filed by the Participant in writing with the Company during the Participant’s lifetime. If a married Participant designates a beneficiary other than the Participant’s spouse, the effectiveness of such
designation may be subject to the consent of the Participant’s spouse. If a Participant dies without an effective designation of a beneficiary who is living at the time of the Participant’s death, the Company will pay any remaining unpaid
benefits to the Participant’s legal representative. 
 18.10    Severability. If any one or more of the
provisions (or any part thereof) of this Plan shall be held invalid, illegal or unenforceable in any respect, such provision shall be modified so as to make it valid, legal and enforceable, and the validity, legality and enforceability of the
remaining provisions (or any part thereof) of the Plan shall not in any way be affected or impaired thereby. 
 18.11    No Constraint on Corporate Action. Nothing in this Plan shall be construed to: (a) limit, impair, or otherwise affect the Company’s or another Participating Company’s right or power to make
adjustments, reclassifications, reorganizations, or changes of its capital or business structure, or to merge or consolidate, or dissolve, liquidate, sell, or transfer all or any part of its business or assets; or (b) limit the right or power
of the Company or another Participating Company to take any action which such entity deems to be necessary or appropriate. 
 18.12    Unfunded Obligation. Participants shall have the status of general unsecured creditors of the Company. Any amounts payable to Participants pursuant to the Plan shall be unfunded and unsecured obligations
for all purposes, including, without limitation, Title I of the Employee Retirement Income Security Act of 1974. No Participating Company shall be required to segregate any monies from its general funds, or to create any trusts, or establish
any special accounts with respect to such obligations. The Company shall retain at all times beneficial ownership of any investments, including trust investments, which the Company may make to fulfill its payment obligations hereunder. Any
investments or the creation or maintenance of any trust or any Participant account shall not create or constitute a trust or fiduciary relationship between the Committee or any Participating Company and a Participant, or otherwise create any vested
or beneficial interest in any Participant or the Participant’s creditors in any assets of any Participating Company. The Participants shall have no claim against 

  

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any Participating Company for any changes in the value of any assets which may be invested or reinvested by the Company with respect to the Plan. 

18.13    Choice of Law. Except to the extent governed by applicable federal law, the validity, interpretation, construction
and performance of the Plan and each Award Agreement shall be governed by the laws of the State of California, without regard to its conflict of law rules. 
  

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