Document:

Exhibit
10.42

Synopsys, Inc. 

Form Of
Restricted Stock Unit Grant Notice and Award Agreement

(2006 Employee Equity Incentive Plan)

Synopsys, Inc.
(the “Company”),
pursuant to Section 7(b) of the Company’s 2006 Employee Equity Incentive Plan
(the “Plan”),
hereby awards to Participant a Restricted Stock Unit Award covering the number
of restricted stock units (the “Restricted Stock Units”)
set forth below (the “Award”).  This Award is subject to all of the terms and
conditions as set forth in this Restricted
Stock Unit Grant Notice and Award Agreement (the “Agreement”) and the
Plan, which is attached hereto and incorporated herein in its entirety.

	
  Participant:

  	
   

  	
   

  	
   

  
	
  Date of Grant:

  	
   

  	
   

  	
   

  
	
  Vesting Commencement Date:

  	
   

  	
   

  	
   

  
	
  Number of Restricted Stock Units:

  	
   

  	
   

  	
   

  
	
  Payment for Common Stock:

  	
   

  	
   

  	
   

  

 

Vesting
Schedule:  The
Restricted Stock Units shall vest as follows:

Additional
Conditions to Vesting: In order for
Restricted Stock Units to vest on a vesting date, Participant’s Continuous
Service must not have terminated prior to such vesting date. If Restricted
Stock Units vest on a day that does not occur during a “window period,” vesting
shall be delayed as provided in Section 2 of the Award Agreement.

Delivery
Schedule:  The Company
shall deliver one share of Common Stock for each Restricted Stock Unit which
vests on an applicable vesting date.

Additional
Terms/Acknowledgements: 
Participant acknowledges receipt of, and understands and agrees to, this
Agreement and the Plan.  Participant
further acknowledges that as of the Date of Grant, the Agreement and the Plan
set forth the entire understanding between Participant and the Company
regarding the award of the Restricted Stock Units and the underlying Common
Stock and supersede all prior oral and written agreements on that subject with
the exception of (i) Awards previously granted and delivered to Participant
under the Plan, and (ii) the following agreements only:

OTHER AGREEMENTS:

ATTACHMENTS:   2006
Employee Equity Incentive Plan

 

Synopsys, Inc. (the “Company”) has awarded you a Restricted
Stock Unit Award pursuant to Section 7(b) of the Company’s 2006 Employee Equity
Incentive Plan (the “Plan”)
for the number of Restricted Stock Units (collectively, the “Award”) as indicated
on the first page of this Agreement. 
Defined terms not explicitly defined in this Agreement but defined in
the Plan shall have the same definitions as in the Plan.  Subject to adjustment and the terms and
conditions as provided herein and in the Plan, each Restricted Stock Unit shall
represent the right to receive one (1) share of Common Stock.

The details of your Award, in
addition to those set forth above, are as follows.

1.             NUMBER OF
RESTRICTED STOCK UNITS AND SHARES OF COMMON STOCK.

(a)           The number of Restricted Stock Units subject to your
Award and the number of shares of Common Stock deliverable with respect to such
Restricted Stock Units may be adjusted from time to time for Capitalization
Adjustments as described in Section 9(a) of the Plan.  You shall receive no benefit or adjustment to
your Award with respect to any cash dividend or other distribution that does
not result in a Capitalization Adjustment pursuant to Section 9(a) of the Plan;
provided, however, that this sentence
shall not apply with respect to any shares of Common Stock that are delivered
to you in connection with your Award after such shares have been delivered to
you.

(b)           Any additional
Restricted Stock Units, shares of Common Stock, cash or other property that
becomes subject to the Award pursuant to this Section 1 shall be subject, in a
manner determined by the Board, to the same forfeiture restrictions,
restrictions on transferability, and time and manner of delivery as applicable
to the other Restricted Stock Units and Common Stock covered by your Award.

(c)           Notwithstanding the
provisions of this Section 1, no fractional Restricted Stock Units or rights
for fractional shares of Common Stock shall be created pursuant to this Section
1.  The Board shall, in its discretion,
determine an equivalent benefit for any fractional Restricted Stock Units or
fractional shares that might be created by the adjustments referred to in this
Section 1.

2.             VESTING.

(a)           The Restricted Stock Units shall vest, if at all,
as provided in the Vesting Schedule set forth in this Agreement and the Plan,
provided that vesting shall cease upon the termination of your Continuous
Service. Notwithstanding the foregoing, in the event that you are subject to
the Company’s Insider Trading Policy (or
any successor policy) and any Restricted Stock Units covered by your
Award would vest (and underlying shares of Common Stock would therefore be
deliverable to you) on a day (the “Original Vest Date”)
that does not occur during a “window period” applicable to you as determined by
the Company in accordance with such policy, then such units shall not vest (and
such underlying shares of Common Stock shall not be delivered) on such Original
Vest Date and shall instead vest and be delivered on the earliest to occur of
the following: (i) the first day of the next “window period” applicable to you
pursuant to 

 

such policy; (ii) your
Involuntary Termination Without Cause (as defined in Section 2(b) below)
after the Original Vest Date; or (iii) the day that is sixty (60) days after
the Original Vest Date.

(b)           For
purposes of this Agreement, “Involuntary Termination
Without Cause” shall mean the Company’s termination of your
Continuous Service unless such termination was on account of the occurrence of
any of the following: (i) your commission of an act of dishonesty in
connection with your responsibilities as an Employee or Consultant; (ii) your
commission of a felony or any act of moral turpitude; (iii) you commit any
willful or grossly negligent act that constitutes gross misconduct and/or
injures, or is reasonably likely to injure, the Company or any Affiliate; or
(iv) you willfully and materially violate (A) any written policies or
procedures of the Company or any Affiliate, or (B) your obligations to the
Company or any Affiliate.  The determination
that your Continuous Service was terminated due to an Involuntary Termination
Without Cause shall be made by the Company in its sole discretion.  Any such determination by the Company for the
purposes of this Agreement shall have no effect upon any determination of the
rights or obligations of you or the Company for any other purpose.

3.             DISTRIBUTION OF SHARES OF
COMMON STOCK.  Subject to the provisions of this Agreement
and the Plan, in the event one or more Restricted Stock Units vests, the Company
shall deliver to you one (1) share of Common Stock for each Restricted Stock Unit that vests.  The delivery to you of the appropriate number
of shares of Common Stock shall be made on the applicable vesting date.
The form of such delivery (e.g., a stock certificate or electronic entry
evidencing such shares) shall be determined by the Company.

4.             PAYMENT BY YOU.  This
Award was granted in consideration of your services to the Company.  Subject to Section 10 below, except as
otherwise provided herein, you will not be required to make any payment to the
Company (other than your past and future services with the Company) with
respect to your receipt of the Award, vesting of the Restricted Stock Units, or
the delivery of the shares of Common Stock underlying the Restricted Stock
Units.

5.             SECURITIES LAW COMPLIANCE.  You may
not be issued any Common Stock under your Award unless the shares of Common
Stock are either (i) then registered under the Securities Act of 1933, as
amended (the “Securities Act”), or (ii) the
Company has determined that such issuance would be exempt from the registration
requirements of the Securities Act.  Your
Award must also comply with other applicable laws and regulations governing the
Award, and you shall not receive such Common Stock if the Company determines
that such receipt would not be in material compliance with such laws and
regulations.

6.             RESTRICTIVE LEGENDS.  The Common Stock issued under your Award
shall be endorsed with appropriate legends, if any, determined by the Company.

7.             TRANSFER RESTRICTIONS.  Prior to the time that shares of Common Stock
have been delivered to you, you may not transfer, pledge, sell or otherwise
dispose of the shares in respect of your Award. 
For example, you may not use shares that may be issued in respect of
your Restricted Stock Units as security for a loan, nor may you transfer,
pledge, sell or otherwise dispose of such shares.  This restriction on transfer will lapse upon
delivery to you of shares in respect of your vested Restricted Stock Units.  Your Award is not transferable, except by
will or by the laws of descent and distribution.

 

8.             AWARD NOT A SERVICE
CONTRACT.  Your Award is not an employment or service
contract, and nothing in your Award shall be deemed to create in any way whatsoever
any obligation on your part to continue in the service of the Company or any
Affiliate, or on the part of the Company or any Affiliate to continue such
service.  In addition, nothing in your
Award shall obligate the Company or any Affiliate, their respective
stockholders, boards of directors or employees to continue any relationship
that you might have as an Employee or Consultant of the Company or any
Affiliate. Finally, your
participation in the Plan shall not create a right to further employment or service
with the Employer and shall not interfere with the ability of the Employer to
terminate your employment or service relationship at any time with or without
cause.

9.             UNSECURED OBLIGATION.  Your
Award is unfunded, and even as to any Restricted Stock Units which vest, you
shall be considered an unsecured creditor of the Company with respect to the
Company’s obligation, if any, to issue Common Stock pursuant to this
Agreement.  You shall not have voting or
any other rights as a stockholder of the Company with respect to the Common
Stock acquired pursuant to this Agreement until such Common Stock is issued to
you pursuant to Section 3 of this Agreement.  
Upon such issuance, you will obtain full voting and other rights as a
stockholder of the Company with respect to the Common Stock so issued.  Nothing contained in this Agreement, and no
action taken pursuant to its provisions, shall create or be construed to create
a trust of any kind or a fiduciary relationship between you and the Company or
any other person.

10.          WITHHOLDING OBLIGATIONS.

(a)           On or before the time you receive a distribution
of Common Stock pursuant to your
Award, or at any time thereafter as requested by the Company, you hereby
authorize any required withholding from the Common Stock issuable to you and
otherwise agree to make adequate provision for any sums required to satisfy any
or all income tax, social insurance, payroll tax, payment on account or other
tax-related withholding (“Tax-Related Items”) which arise in connection with your Award.  In addition, you authorize the Company, or your employer, if different from the
Company (the “Employer”) to withhold all applicable Tax-Related Items
from your wages or other cash compensation paid to you by the Employer.  Alternatively, or in addition, if permissible
under local law, the Employer may (1) sell or arrange for the sale of shares
that you would otherwise receive to meet the necessary withholding obligation
for Tax-Related Items, and/or (2) withhold in shares the amount of shares necessary
to satisfy applicable withholding taxes, the number of which shall
be determined to comply with appropriate tax laws and as would be
otherwise necessary or desirable. 
Finally, you shall pay to the Employer any amount of Tax-Related Items
that the Employer may be required to withhold as a result of your receipt of
the Award and/or the shares issuable pursuant thereto that cannot be satisfied
by the means previously described.  The
Employer may refuse to deliver the shares issuable pursuant to this Award if
you fail to comply with your obligations in connection with the Tax-Related
Items as described in this section.

(b)           Unless
the tax withholding obligations of the Company and/or any Affiliate are
satisfied, the Company shall have no obligation to deliver to you any Common
Stock.

 

(c)           In
the event the Company’s obligation to withhold arises prior to the delivery to
you of Common Stock or it is determined after the delivery of Common Stock to
you that the amount of the Company’s withholding obligation was greater than
the amount withheld by the Company, you agree to indemnify and hold the Company
harmless from any failure by the Company to withhold the proper amount.

(d)           Regardless of any action Employer takes
with respect to Tax-Related Items, you acknowledge that the ultimate liability
for all Tax-Related Items legally due by you is and remains your responsibility
and that the Employer (1) makes no representations or undertakings
regarding the treatment of any Tax-Related Items in connection with any aspect
of the Award, including the grant, vesting or settlement of the Award, the
subsequent sale of shares delivered  pursuant thereto; and (2) does not
commit to structure the terms of the grant or any aspect of the Award to reduce
or eliminate your liability for Tax-Related Items.

11.          NATURE OF
GRANT.

(a)           In accepting this Award, you acknowledge that:

(i)
           the Plan is established voluntarily by the
Employer, is discretionary in nature, and may be modified, amended, suspended
or terminated by the Company as provided in the Plan;

(ii)           the grant of the Award and any other awards under the Plan is voluntary
and occasional and does not create any contractual or other right to receive
Awards, shares or any other benefit or compensation in lieu of future Awards,
even if awards have been granted repeatedly in the past;

(iii)          all decisions with respect to future awards, if any, will be at the
sole discretion of the Company;

(iv)          you are voluntarily participating in the Plan;

(v)           the Award is an extraordinary item that does not constitute
compensation of any kind for services of any kind rendered to the Employer or
the Company, as applicable, and is outside the scope of your employment or
service contract, if any;

(vi)          the Award and the shares deliverable thereunder is a potential bonus
payment not paid in lieu of any normal or expected compensation or salary for
any purposes, including, but not limited to, calculating any severance,
resignation, termination, redundancy, end of service payments, bonuses,
long-service awards, life or accident insurance benefits, pension or retirement
benefits or similar payments;

(vii)         in the event of the termination of your employment or service
relationship, your eligibility to receive shares of common stock or payments
under the Award or the Plan, if any, will terminate as of the date expressly
provided in the Award, regardless of any reasonable notice period mandated by
local law;

 

(viii)        the future value of the shares underlying the Award is unknown and
cannot be predicted;

(ix)           you understand that
should you die owning shares of Company common stock or the Award, such shares
or the Award may subject your estate to United States federal estate
taxes.  You understand that you should
seek your own tax advice regarding this potential tax;

(x)            you disclaim any
entitlement to compensation or damages arising from the termination of the
Award or diminution in value of the shares of Common Stock and you hereby
irrevocably release the Company and the Employer from any such claim that may
arise; and

(xi)           the Plan and this
Agreement forth the entire understanding between you, the Company, the
Employer, and any affiliate thereof regarding the acquisition of the shares of
Common Stock and supersede all prior oral and written agreements pertaining to
the Award.

12.          DATA
PRIVACY.

(a)           You hereby explicitly and unambiguously consent
to the collection, use and transfer, in electronic or other form, of your
personal data as described in this document by and among, as applicable, the
Employer and its subsidiaries and affiliates for the exclusive purpose of
implementing, administering and managing your participation in the Plan.

(b)           You understand that the Employer holds
certain personal information about you, including, but not limited to, your
name, home address and telephone number, date of birth, social insurance number
or other identification number, salary, nationality, job title, any shares of
stock or directorships held in Employer, details of all awards or any other
entitlement to shares of stock awarded, canceled, settled, vested, unvested or
outstanding in your favor (the “Personal Data”), for the purpose of
implementing, administering and managing the Plan.  You understand that Personal Data may be
transferred to any third parties assisting in the implementation,
administration and management of the Plan, that these recipients may be located
in your country or elsewhere, and that the recipient’s country may have
different data privacy laws and protections than your country.  You understand that you may request a list
with the names and addresses of any potential recipients of the Personal Data
by contacting your local human resources representative.  You authorize the recipients to receive,
possess, use, retain and transfer the Personal Data, in electronic or other
form, for the purposes of implementing, administering and managing your
participation in the Plan, including any requisite transfer of such Personal
Data as may be required to a broker or other third party with whom you may
elect to deposit any shares of stock acquired upon exercise of the Award.  You understand that Personal Data will be
held only as long as is necessary to implement, administer and manage your
participation in the Plan.  You
understand that you may, at any time, view the Personal Data, request
additional information about the storage and processing of the Personal Data,
require any necessary amendments to the Personal Data or refuse or withdraw the
consents herein, in any case without cost, by contacting in writing your local
human resources representative.  You
understand, however, that refusing or withdrawing your consent may affect 

 

your ability to
hold the Award and participate in the Plan. 
For more information on the consequences of your refusal to consent or
withdrawal of consent, you understand that you may contact your local human
resources representative.

13.          NOTICES.  Any notices provided for in your Award or the
Plan shall be given in writing to each of the other parties hereto and
shall be deemed effectively given on the earlier of (i) the date of personal
delivery, including delivery by express courier, or (ii) the date that is five
(5) days after deposit in the United States Post Office (whether or not
actually received by the addressee), by registered or certified mail with
postage and fees prepaid, addressed at the following addresses, or at such
other address(es) as a party may designate by ten (10) days’ advance
written notice to each of the other parties hereto:

	
  COMPANY:

  	
   

  	
  Synopsys, Inc.

  
	
   

  	
   

  	
  Shareholder Services

  
	
   

  	
   

  	
  700 East Middlefield Road

  
	
   

  	
   

  	
  Mountain View, CA 94043

  
	
   

  	
   

  	
   

  
	
  PARTICIPANT:

  	
   

  	
  Your address as on file with the Company at the time
  notice is given

  

 

14.          HEADINGS.  The
headings of the Sections in this Agreement are inserted for convenience only
and shall not be deemed to constitute a part of this Agreement or to affect the
meaning of this Agreement.

15.          AMENDMENT.  This
Agreement may be amended only by a writing executed by the Company and you
which specifically states that it is amending this Agreement. Notwithstanding
the foregoing, this Agreement may be amended solely by the Company by a writing
which specifically states that it is amending this Agreement, so long as a copy
of such amendment is delivered to you, and provided that no such amendment
impairing your rights hereunder may be made without your written consent.
Without limiting the foregoing, the Company reserves the right to change, by
written notice to you, the provisions of this Agreement in any way it may deem
necessary or advisable to carry out the purpose of the grant as a result of any
change in applicable laws or regulations or any future law, regulation, ruling,
or judicial decision, provided that any such change shall be applicable only to
rights relating to that portion of the Award which is then subject to
restrictions as provided herein.

16.          MISCELLANEOUS.

(a)           The rights and
obligations of the Company under your Award shall be transferable by the
Company to any one or more persons or entities, and all covenants and
agreements hereunder shall inure to the benefit of, and be enforceable by the
Company’s successors and assigns.

(b)           You agree upon
request to execute any further documents or instruments necessary or desirable
in the sole determination of the Company to carry out the purposes or intent of
your Award.

 

(c)           You acknowledge and
agree that you have reviewed your Award in its entirety, have had an
opportunity to obtain the advice of counsel prior to executing and accepting
your Award and fully understand all provisions of your Award.

(d)           This Agreement
shall be subject to all applicable laws, rules, and regulations, and to such
approvals by any governmental agencies or national securities exchanges as may
be required.

(e)           All obligations of
the Company under the Plan and this Agreement shall be binding on any successor
to the Company, whether the existence of such successor is the result of a
direct or indirect purchase, merger, consolidation, or otherwise, of all or
substantially all of the business and/or assets of the Company.

17.          GOVERNING PLAN DOCUMENT.  Your
Award is subject to all the provisions of the Plan, the provisions of which are
hereby made a part of your Award, and is further subject to all
interpretations, amendments, rules and regulations which may from time to time
be promulgated and adopted pursuant to the Plan.  In the event of any conflict between the
provisions of your Award and those of the Plan, the provisions of the Plan
shall control; provided, however,
that Section 3 of this Agreement shall govern the timing of any distribution of
Common Stock under your Award.  The
Company shall have the power to interpret the Plan and this Agreement and to
adopt such rules for the administration, interpretation, and application of the
Plan as are consistent therewith and to interpret or revoke any such rules. All
actions taken and all interpretations and determinations made by the Board
shall be final and binding upon you, the Company, and all other interested
persons. No member of the Board shall be personally liable for any action,
determination, or interpretation made in good faith with respect to the Plan or
this Agreement.

18.          EFFECT ON OTHER
EMPLOYEE BENEFIT PLANS.  The value of the Award subject to this
Agreement shall not be included as compensation, earnings, salaries, or other
similar terms used when calculating benefits under any employee benefit plan
(other than the Plan) sponsored by the Company or any Affiliate except as such
plan otherwise expressly provides. The Company expressly reserves its rights to
amend, modify, or terminate any or all of the employee benefit plans of the
Company or any Affiliate.

19.          CHOICE
OF LAW.  The
interpretation, performance and enforcement of this Agreement shall be governed
by the law of the state of California without
regard to such state’s conflicts of laws rules. For purposes of litigating any
dispute that arises directly or indirectly from the relationship of the parties
evidenced by this Award or the Agreement, the parties hereby submit to and
consent to the exclusive jurisdiction of the State of California and agree that such litigation shall be
conducted only in the courts of Santa Clara, California, or the federal courts
for the United States for the Northern District of California, and no other
courts, where this grant is made and/or to be performed.

20.          SEVERABILITY.  If
all or any part of this Agreement or the Plan is declared by any court or
governmental authority to be unlawful or invalid, such unlawfulness or
invalidity shall not invalidate any portion of this Agreement or the Plan
not declared to be unlawful or invalid. Any Section of this Agreement (or part
of such a Section) so declared to be unlawful or invalid 

 

shall, if possible, be construed in a manner which
will give effect to the terms of such Section or part of a Section to the
fullest extent possible while remaining lawful and valid.

21.          OTHER DOCUMENTS. 
You hereby acknowledge receipt or the right to receive a document
providing the information required by Rule 428(b)(1) promulgated under the
Securities Act.  In addition, you
acknowledge receipt of the Company’s Insider Trading Policy.

* * * * *

Your signature
below indicates that I have read this Agreement and agree to be bound by the
terms and conditions of the Plan and this Agreement.

	
  SYNOPSYS,
  INC.

  	
   

  	
  PARTICIPANT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  
	
  Signature

  	
   

  	
  Signature

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Date:Exhibit 10.43

	
  Title:

  	
   

  	
  Executive Incentive Plan (2006)

  
	
  Effective
  Date:

  	
   

  	
  October 30, 2005

  

 

	
  Document Owner:

  	
   

  	
  Human Resources Compensation

  
	
   

  	
   

  	
   

  
	
  Approvals:

  	
   

  	
  Jan Collinson

  
	
   

  	
   

  	
  Senior Vice President – HR/FAC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Chi-Foon Chan

  
	
   

  	
   

  	
  President and COO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Aart de Geus

  
	
   

  	
   

  	
  Chairman and CEO

  

 

	
  Date

  	
   

  	
  Author

  	
   

  	
  Revision History

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  March 15, 2005

  	
   

  	
  J. Cleveland

  	
   

  	
  2005 Initial Plan

  
	
  March 20, 2006

  	
   

  	
  J. Collinson

  	
   

  	
  2006 Plan Updates

  

 

 1
 

 

OBJECTIVES:

1.               Drive strategic direction for the Company.

2.               Drive attainment of revenue and expense
targets.

3.               Reinforce culture of accountability and
performance excellence.

ELIGIBILITY: Executive Officers
of Synopsys employed (full or part time) during the full eligibility period
(fiscal year) are eligible for the Executive Incentive Plan (EIP). If hired
prior to the fourth quarter, the Executive Officer is eligible for a prorated
EIP bonus. If hired in the fourth quarter, Executive Officer is not eligible
for EIP bonus.

Executive Officers who are covered by an individual
compensation plan and/or a special incentive plan in connection with an
acquisition are not eligible for this Plan.

INCENTIVE
TARGET: Incentive target is stated as a percentage of
annual base salary as determined by the Compensation Committee of the Board of
Directors. Stock based compensation and other special incentive payments are
not included in eligible earnings calculation.

INDIVIDUAL BONUS AWARDS:   Individual
bonus awards are determined by the executive’s management and the Compensation
Committee of the Board of Directors. Criteria taken into consideration include
corporate, business group and individual performance.

PAYMENT SCHEDULE: Actual incentive bonuses are paid on an annual
basis approximately 45-60 days from the end of the fiscal year.

INCENTIVE
POOL FUNDING: Under this Plan the incentive pool available for distribution will fund in relation to attainment of the Company’s
financial and business objectives. Plan targets and their relative weighting
are as follows:

	
  [*]%

  
	
   

  
	
  [*]%

  
	
   

  
	
  [*]%

  
	
   

  
	
  [*]%

  
	
   

  
	
  [*]%

  

 

The Company must
achieve at least 90% in aggregate of its financial and business targets to fund
a minimum of [*]% of the target bonus amount. The upside payment potential is
[*]% of the target incentive pool. The detailed Pool Funding Schedule is
attached hereto as Exhibit A.

 2
 

 

For Executive
Officers leading product business groups, [*]% of incentive pool funds are
based upon the Company’s overall performance and [*]% based upon the business
group performance. For all other Executive Officers, the incentive pool will
fund [*]% based upon the Company’s aggregate achievement of its financial and
business targets.

BUSINESS GROUP PERFORMANCE: Assuming the Company achieves 90% or greater
of its aggregate financial and business targets, business group performance
will be judged to determine [*]% of the incentive pool for executives leading
product business groups. The two components of business group performance are
current year accepted orders and expenses.

Business Group Performance ([*]%):

 

	
  [*]%

  
	
   

  
	
  [*]%

  

 

IMPORTANT NOTES ABOUT THE PLAN: This Plan supersedes and replaces all
prior executive incentive plans with the exception of the Operating Incentive
Plan. The Company reserves the right to terminate and or make changes to the
Plan at any time, with or without notice. The Company may likewise terminate an
individual’s participation in the Plan at any time, with or without notice. Nothing
in this Plan shall be construed to be a guarantee that any participant will
receive all or part of an incentive award or to imply a contract between the
Company and any participant. The Compensation Committee of the Board of
Directors may alter the incentive payout based on achievement of publicly
announced targets, product milestones, strategic goals, cross-functional
teamwork and collaboration, and unforeseen changes in the economy and/or
geopolitical climate. Eligibility for and determination of incentive awards
under the Plan are within the sole discretion of the Company and its Board of
Directors, and prior to actual distribution, incentive awards may be increased,
reduced or eliminated.

	
  Approvals:

  	
   

  	
   

  
	
  /s/ Jan Collinson

  	
   

  	
   

  
	
  Jan Collinson

  	
   

  	
  Date

  
	
  Senior Vice President – HR/FAC

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Chi-Foon Chan

  	
   

  	
   

  
	
  Chi-Foon Chan

  	
   

  	
  Date

  
	
  President and COO

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Aart de Geus

  	
   

  	
   

  
	
  Aart de Geus

  	
   

  	
  Date

  
	
  Chairman and CEO

  	
   

  	
   

  

 

 3
 

 

Executive Incentive Plan (2006)

Exhibit A – Pool Funding Schedule

 

	
  Corporate or Business Group Pool Funding Schedule

  	
   

  

 

	
  % Performance to Plan

  	
   

  	
  Performance Factor %

  
	
   

  	
   

  	
   

  
	
  Below 90%

  	
   

  	
  0.0%

  
	
  [*]%

  	
   

  	
  [*]%

  
	
  [*]%

  	
   

  	
  [*]%

  
	
  [*]%

  	
   

  	
  [*]%

  
	
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*     Represents specific
quantitative or qualitative performance-related factors, or factors or criteria
involving confidential commercial or business information, the disclosure of
which would have an adverse effect on the Registrant.

 4

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00114-of-00352.parquet"}]]