Document:

Exhibit
10.2

 

TRAQ WIRELESS, INC. 1999
STOCK PLAN

NOTICE OF STOCK OPTION GRANT

 

You have been granted the following option to
purchase Common Stock of Traq Wireless, Inc. (the “Company”):

 

	
  Name
  of Optionee:

  	
   

  	
  «Name»

  
	
   

  	
   

  	
   

  
	
  Total
  Number of Shares Granted:

  	
   

  	
  «SHARES»

  
	
   

  	
   

  	
   

  
	
  Type
  of Option:

  	
   

  	
  «ISO» Incentive
  Stock Option

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  «NSO» Nonstatutory
  Stock Option

  
	
   

  	
   

  	
   

  
	
  Exercise
  Price Per Share:

  	
   

  	
  $0.09

  
	
   

  	
   

  	
   

  
	
  Date
  of Grant:

  	
   

  	
  «GRANT»

  
	
   

  	
   

  	
   

  
	
  Date
  Exercisable:

  	
   

  	
  This
  option may be exercised, in whole or in part, for 100% of the Shares subject
  to this option at any time after the Date of Grant.

  
	
   

  	
   

  	
   

  
	
  Vesting
  Commencement Date:

  	
   

  	
  «VCD»

  
	
   

  	
   

  	
   

  
	
  Vesting
  Schedule:

  	
   

  	
  25%
  of the Shares shall be immediately vested. The Right of Repurchase shall
  lapse with respect to 2.0833% of the Shares subject to this option on the
  corresponding day of each calendar month after the Vesting Commencement Date,
  or to the extent such calendar month does not have the corresponding day, on
  the last day of any such calendar month, until the Right of Repurchase has lapsed
  as to all such Shares, subject to Optionee’s continued Service to the
  Company.

  
	
   

  	
   

  	
   

  
	
  Expiration
  Date:

  	
   

  	
  Tenth
  anniversary of the Date of Grant.

  

 

By your signature and the signature of the Company’s
representative below, you and the Company agree that this option is granted
under and governed by the terms and conditions of the 1999 Stock Plan and the
Stock Option Agreement, both of which are attached to and made a part of this
document.

 

	
  OPTIONEE:

  	
   

  	
  TRAQ
  WIRELESS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
  «Name»

  	
   

  	
  Title:

  	
   

  
	
  Print
  Name

  	
   

  	
   

  

 

 

THE OPTION GRANTED PURSUANT
TO THIS AGREEMENT AND THE SHARES ISSUABLE UPON THE EXERCISE THEREOF HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT
BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
THEREOF UNDER SUCH ACT OR AN OPINION OF COUNSEL, SATISFACTORY TO THE COMPANY
AND ITS COUNSEL, THAT SUCH REGISTRATION IS NOT REQUIRED.

 

TRAQ WIRELESS, INC. 1999
STOCK PLAN:

STOCK OPTION AGREEMENT

 

SECTION 1.  GRANT OF OPTION.

 

(a)                                  Option.  On the terms and conditions
set forth in the Notice of Stock Option Grant and this Agreement, the Company
grants to the Optionee on the Date of Grant the option to purchase at the
Exercise Price the number of Shares set forth in the Notice of Stock Option Grant.  The Exercise Price is agreed to be at least
100% of the Fair Market Value per Share on the Date of Grant (110% of Fair
Market Value if this option is designated as an ISO in the Notice of Stock
Option Grant and Section 3(b) of the Plan applies).  This option is intended to be an ISO or a
Nonstatutory Option, as provided in the Notice of Stock Option Grant.

 

(b)                                 Stock Plan and Defined Terms.  This option is granted
pursuant to the Plan, a copy of which the Optionee acknowledges having
received.  The provisions of the Plan are
incorporated into this Agreement by this reference.  Capitalized terms are defined in Section 14
of this Agreement.

 

SECTION 2.  RIGHT TO EXERCISE.

 

(a)                                  Exercisability.  Subject to Subsections (b) and
(c) below and the other conditions set forth in this Agreement, all or
part of this option may be exercised prior to its expiration at the time or
times set forth in the Notice of Stock Option Grant.  Shares purchased by exercising this option
may be subject to the Right of Repurchase under Section 7.

 

(b)                                 $100,000 Limitation.  If
this Option is designated as an ISO in the Notice of Stock Option Grant, then
the Optionee’s right to exercise this option shall be deferred to the extent
(and only to the extent) that this option otherwise would not be treated as an
ISO by reason of the $100,000 annual limitation under Section 422(d) of
the Code, except that the Optionee’s right to exercise this option shall no
longer be deferred if (i) the Company is subject to a Change in Control
before the Optionee’s Service terminates, (ii) this option does not remain
outstanding, (iii) this option is not assumed by the surviving corporation
or its parent and (iv) the surviving corporation or its parent does not
substitute an option with substantially the same terms for this option.

 

 

(c)                                  Stockholder Approval.  Any other provision of this Agreement
notwithstanding, no portion of this option shall be exercisable at any time
prior to the approval of the Plan by the Company’s stockholders.

 

SECTION 3.  NO TRANSFER OR ASSIGNMENT OF OPTION.

 

Except as otherwise provided in this
Agreement, this option and the rights and privileges conferred hereby shall not
be sold, pledged or otherwise transferred (whether by operation of law or
otherwise) and shall not be subject to sale under execution, attachment, levy
or similar process.

 

SECTION 4.  EXERCISE PROCEDURES.

 

(a)                                  Notice
of Exercise.  The Optionee or the Optionee’s
representative may exercise this option by giving written notice to the Company
pursuant to Section 13(c).  The
notice shall specify the election to exercise this option, the number of Shares
for which it is being exercised and the form of payment.  The notice shall be signed by the person
exercising this option.  In the event
that this option is being exercised by the representative of the Optionee, the
notice shall be accompanied by proof (satisfactory to the Company) of the
representative’s right to exercise this option. 
The Optionee or the Optionee’s representative shall deliver to the
Company, at the time of giving the notice, payment in a form permissible under Section 5
for the full amount of the Purchase Price.

 

(b)                                 Issuance of Shares.  After receiving a proper
notice of exercise, the Company shall cause to be issued a certificate or
certificates for the Shares as to which this option has been exercised,
registered in the name of the person exercising this option (or in the names of
such person and his or her spouse as community property or as joint tenants
with right of survivorship).  The Company
shall cause such certificate or certificates to be deposited in escrow or
delivered to or upon the order of the person exercising this option.

 

(c)                                  Withholding Taxes.  In the event that the Company
determines that it is required to withhold any tax as a result of the exercise
of this option, the Optionee, as a condition to the exercise of this option,
shall make arrangements satisfactory to the Company to enable it to satisfy all
withholding requirements. The Optionee shall also make arrangements satisfactory
to the Company to enable it to satisfy any withholding requirements that may
arise in connection with the vesting or disposition of Shares purchased by
exercising this option.

 

SECTION 5.  PAYMENT FOR STOCK.

 

(a)                                  Cash.  All or part of the Purchase
Price may be paid in cash or cash equivalents.

 

(b)                                 Surrender of Stock.  All or any part of the
Purchase Price may be paid by surrendering, or attesting to the ownership of,
Shares that are already owned by the Optionee. Such Shares shall be surrendered
to the Company in good form for transfer and shall be valued at their Fair
Market Value on the date when this option is exercised.  The Optionee shall not surrender, or attest
to the ownership of, Shares in payment of the Purchase Price if such action

 

2

 

would cause the Company to recognize compensation
expense (or additional compensation expense) with respect to this option for
financial reporting purposes.

 

(c)                                  Exercise/Sale.  If Stock is publicly traded,
all or part of the Purchase Price and any withholding taxes may be paid by the
delivery (on a form prescribed by the Company) of an irrevocable direction to a
securities broker approved by the Company to sell Shares and to deliver all or
part of the sales proceeds to the Company.

 

(d)                                 Exercise/Pledge.  If Stock is publicly traded,
all or part of the Purchase Price and any withholding taxes may be paid by the
delivery (on a form prescribed by the Company) of an irrevocable direction to
pledge Shares to a securities broker or lender approved by the Company, as
security for a loan, and to deliver all or part of the loan proceeds to the
Company.

 

SECTION 6.  TERM AND EXPIRATION.

 

(a)                                  Basic Term.  This option shall in any
event expire on the expiration date set forth in the Notice of Stock Option
Grant, which date is 10 years after the Date of Grant (five years after the
Date of Grant if this option is designated as an ISO in the Notice of Stock
Option Grant and Section 3(b) of the Plan applies).

 

(b)                                 Termination of Service (Except by Death).  If the Optionee’s Service
terminates for any reason other than death, then this option shall expire on
the earliest of the following occasions:

 

(i)                                     The expiration date
determined pursuant to Subsection (a) above;

 

(ii)                                  The date three months after
the termination of the Optionee’s Service for any reason other than Disability;
or

 

(iii)                               The date 12 months after the
termination of the Optionee’s Service by reason of Disability.

 

The Optionee may exercise all or part of this option
at any time before its expiration under the preceding sentence, but only to the
extent that this option had become exercisable before the Optionee’s Service
terminated. When the Optionee’s Service terminates, this option shall expire
immediately with respect to the number of Shares for which this option is not
yet exercisable and with respect to any Restricted Shares. In the event that
the Optionee dies after termination of Service but before the expiration of
this option, all or part of this option may be exercised (prior to expiration)
by the executors or administrators of the Optionee’s estate or by any person
who has acquired this option directly from the Optionee by beneficiary
designation, bequest or inheritance, but only to the extent that this option
had become exercisable before the Optionee’s Service terminated.

 

(c)                                  Death of the Optionee.  If the Optionee dies while
in Service, then this option shall expire on the earlier of the following
dates:

 

3

 

(i)                                     The expiration date
determined pursuant to Subsection (a) above; or

 

(ii)                                  The date 12 months after the
Optionee’s death.

 

All or part of this option may be exercised at any
time before its expiration under the preceding sentence by the executors or
administrators of the Optionee’s estate or by any person who has acquired this
option directly from the Optionee by beneficiary designation, bequest or
inheritance, but only to the extent that this option had become exercisable
before the Optionee’s death. When the Optionee dies, this option shall expire
immediately with respect to the number of Shares for which this option is not
yet exercisable and with respect to any Restricted Shares.

 

(d)                                 Leaves of Absence.  For any purpose under this
Agreement, Service shall be deemed to continue while the Optionee is on a bona
fide leave of absence, if such leave was approved by the Company in writing and
if continued crediting of Service for such purpose is expressly required by the
terms of such leave or by applicable law (as determined by the Company).

 

(e)                                  Notice Concerning ISO Treatment.  If this option is designated
as an ISO in the Notice of Stock Option Grant, it ceases to qualify for
favorable tax treatment as an ISO to the extent it is exercised (i) more
than three months after the date the Optionee ceases to be an Employee for any
reason other than death or Disability, (ii) more than 12 months after the
date the Optionee ceases to be an Employee by reason of Disability or (iii) after
the Optionee has been on a leave of absence for more than 90 days, unless the
Optionee’s reemployment rights are guaranteed by statute or by contract.

 

SECTION 7.  RIGHT OF REPURCHASE.

 

(a)                                  Scope
of Repurchase Right.  Unless they have become
vested in accordance with the Notice of Stock Option Grant and Subsection (c) below,
the Shares acquired under this Agreement initially shall be Restricted Shares
and shall be subject to a right (but not an obligation) of repurchase by the
Company. The Optionee shall not transfer, assign, encumber or otherwise dispose
of any Restricted Shares, except as provided in the following sentence.  The Optionee may transfer Restricted Shares (i) by
beneficiary designation, will or intestate succession or (ii) to the
Optionee’s spouse, children or grandchildren or to a trust established by the
Optionee for the benefit of the Optionee or the Optionee’s spouse, children or
grandchildren, provided in either case that the Transferee agrees in writing on
a form prescribed by the Company to be bound by all provisions of this
Agreement.  If the Optionee transfers any
Restricted Shares, then this Section 7 shall apply to the Transferee to
the same extent as to the Optionee.

 

(b)                                 Condition Precedent to Exercise.  The Right of Repurchase
shall be exercisable with respect to any Restricted Shares only during the
60-day period next following the later of:

 

(i)                                     The date when the Optionee’s
Service terminates for any reason, with or without cause, including (without
limitation) death or disability; or

 

4

 

(ii)                                  The date when such
Restricted Shares were purchased by the Optionee, the executors or
administrators of the Optionee’s estate or any person who has acquired this
option directly from the Optionee by bequest, inheritance or beneficiary
designation.

 

(c)                                  Lapse of Repurchase Right.  The Right of Repurchase
shall lapse with respect to the Shares subject to this option in accordance
with the vesting schedule set forth in the Notice of Stock Option Grant. In
addition, the Right of Repurchase shall lapse and all of the remaining
Restricted Shares shall become vested if (i) the Company is subject to a
Change in Control before the Optionee’s Service terminates and (ii) the
Right of Repurchase is not assigned to the entity that employs the Optionee
immediately after the Change in Control or to its parent or subsidiary.

 

(d)                                 Repurchase Cost.  If the Company exercises the
Right of Repurchase, it shall pay the Optionee an amount equal to the Exercise
Price for each of the Restricted Shares being repurchased.

 

(e)                                  Exercise of Repurchase Right.  The Right of Repurchase
shall be exercisable only by written notice delivered to the Optionee prior to
the expiration of the 60-day period specified in Subsection (b) above.  The notice shall set forth the date on which
the repurchase is to be effected.  Such
date shall not be more than 30 days after the date of the notice. The
certificate(s) representing the Restricted Shares to be repurchased shall,
prior to the close of business on the date specified for the repurchase, be
delivered to the Company properly endorsed for transfer.  The Company shall, concurrently with the
receipt of such certificate(s), pay to the Optionee the purchase price
determined according to Subsection (d) above. Payment shall be made in
cash or cash equivalents or by canceling indebtedness to the Company incurred
by the Optionee in the purchase of the Restricted Shares.  The Right of Repurchase shall terminate with
respect to any Restricted Shares for which it has not been timely exercised
pursuant to this Subsection (e).

 

(f)                                    Additional Shares or Substituted Securities.  In the event of the
declaration of a stock dividend, the declaration of an extraordinary dividend
payable in a form other than stock, a spin-off, a stock split, an adjustment in
conversion ratio, a recapitalization or a similar transaction affecting the
Company’s outstanding securities without receipt of consideration, any new,
substituted or additional securities or other property (including money paid
other than as an ordinary cash dividend) which are by reason of such
transaction distributed with respect to any Restricted Shares or into which
such Restricted Shares thereby become convertible shall immediately be subject
to the Right of Repurchase.  Appropriate
adjustments to reflect the distribution of such securities or property shall be
made to the number and/or class of the Restricted Shares.  Appropriate adjustments shall also, after
each such transaction, be made to the price per share to be paid upon the exercise
of the Right of Repurchase in order to reflect any change in the Company’s
outstanding securities effected without receipt of consideration therefor;
provided, however, that the aggregate purchase price payable for the Restricted
Shares shall remain the same.

 

(g)                                 Termination of Rights as Stockholder.  If the Company makes available, at the time
and place and in the amount and form provided in this Agreement, the
consideration for

 

5

 

the Restricted Shares to be repurchased in
accordance with this Section 7, then after such time the person from whom
such Restricted Shares are to be repurchased shall no longer have any rights as
a holder of such Restricted Shares (other than the right to receive payment of
such consideration in accordance with this Agreement). Such Restricted Shares
shall be deemed to have been repurchased in accordance with the applicable
provisions hereof, whether or not the certificate(s) therefor have been
delivered as required by this Agreement.

 

(h)                                 Escrow.  Upon issuance, the
certificates for Restricted Shares shall be deposited in escrow with the
Company to be held in accordance with the provisions of this Agreement. Any
new, substituted or additional securities or other property described in
Subsection (f) above shall immediately be delivered to the Company to be
held in escrow, but only to the extent the Shares are at the time Restricted
Shares. All regular cash dividends on Restricted Shares (or other securities at
the time held in escrow) shall be paid directly to the Optionee and shall not
be held in escrow. Restricted Shares, together with any other assets or
securities held in escrow hereunder, shall be (i) surrendered to the
Company for repurchase and cancellation upon the Company’s exercise of its
Right of Repurchase or Right of First Refusal or (ii) released to the
Optionee upon the Optionee’s request to the extent the Shares are no longer
Restricted Shares (but not more frequently than once every six months). In any
event, all Shares which have vested (and any other vested assets and securities
attributable thereto) shall be released within 60 days after the earlier of (i) the
Optionee’s cessation of Service or (ii) the lapse of the Right of First
Refusal.

 

SECTION 8.  RIGHT OF FIRST REFUSAL.

 

(a)                                  Right
of First Refusal.  In the event that the
Optionee proposes to sell, pledge or otherwise transfer to a third party any
Shares acquired under this Agreement, or any interest in such Shares, the
Company shall have the Right of First Refusal with respect to all (and not less
than all) of such Shares.  If the
Optionee desires to transfer Shares acquired under this Agreement, the Optionee
shall give a written Transfer Notice to the Company describing fully the
proposed transfer, including the number of Shares proposed to be transferred,
the proposed transfer price, the name and address of the proposed Transferee
and proof satisfactory to the Company that the proposed sale or transfer will
not violate any applicable federal or state securities laws. The Transfer
Notice shall be signed both by the Optionee and by the proposed Transferee and
must constitute a binding commitment of both parties to the transfer of the
Shares. The Company shall have the right to purchase all, and not less than all,
of the Shares on the terms of the proposal described in the Transfer Notice
(subject, however, to any change in such terms permitted under Subsection (b) below)
by delivery of a notice of exercise of the Right of First Refusal within 30
days after the date when the Transfer Notice was received by the Company. The
Company’s rights under this Subsection (a) shall be freely assignable, in
whole or in part.

 

(b)                                 Transfer of Shares.  If the Company fails to
exercise its Right of First Refusal within 30 days after the date when it
received the Transfer Notice, the Optionee may, not later than 90 days
following receipt of the Transfer Notice by the Company, conclude a transfer of
the Shares subject to the Transfer Notice on the terms and conditions described
in the Transfer Notice, provided that any such sale is made in compliance with
applicable federal and state securities laws and not in violation of any other
contractual restrictions to which the Optionee is bound.  Any proposed transfer on terms and conditions
different from those described in the

 

6

 

Transfer Notice, as well as any subsequent proposed
transfer by the Optionee, shall again be subject to the Right of First Refusal
and shall require compliance with the procedure described in Subsection (a) above.
If the Company exercises its Right of First Refusal, the parties shall
consummate the sale of the Shares on the terms set forth in the Transfer Notice
within 60 days after the date when the Company received the Transfer Notice (or
within such longer period as may have been specified in the Transfer Notice);
provided, however, that in the event the Transfer Notice provided that payment
for the Shares was to be made in a form other than cash or cash equivalents
paid at the time of transfer, the Company shall have the option of paying for
the Shares with cash or cash equivalents equal to the present value of the
consideration described in the Transfer Notice.

 

(c)                                  Additional Shares or Substituted Securities.  In the event of the
declaration of a stock dividend, the declaration of an extraordinary dividend
payable in a form other than stock, a spin-off, a stock split, an adjustment in
conversion ratio, a recapitalization or a similar transaction affecting the Company’s
outstanding securities without receipt of consideration, any new, substituted
or additional securities or other property (including money paid other than as
an ordinary cash dividend) which are by reason of such transaction distributed
with respect to any Shares subject to this Section 8 or into which such
Shares thereby become convertible shall immediately be subject to this Section 8.  Appropriate adjustments to reflect the
distribution of such securities or property shall be made to the number and/or
class of the Shares subject to this Section 8.

 

(d)                                 Termination of Right of First Refusal.  Any other provision of this Section 8
notwithstanding, in the event that the Stock is readily tradable on an
established securities market when the Optionee desires to transfer Shares, the
Company shall have no Right of First Refusal, and the Optionee shall have no
obligation to comply with the procedures prescribed by Subsections (a) and
(b) above.

 

(e)                                  Permitted Transfers.  This Section 8 shall
not apply to (i) a transfer by beneficiary designation, will or intestate
succession or (ii) a transfer to the Optionee’s spouse, children or
grandchildren or to a trust established by the Optionee for the benefit of the
Optionee or the Optionee’s spouse, children or grandchildren, provided in
either case that the Transferee agrees in writing on a form prescribed by the
Company to be bound by all provisions of this Agreement.  If the Optionee transfers any Shares acquired
under this Agreement, either under this Subsection (e) or after the
Company has failed to exercise the Right of First Refusal, then this Section 8
shall apply to the Transferee to the same extent as to the Optionee.

 

(f)                                    Termination of Rights as Stockholder.  If the Company makes
available, at the time and place and in the amount and form provided in this
Agreement, the consideration for the Shares to be purchased in accordance with
this Section 8, then after such time the person from whom such Shares are
to be purchased shall no longer have any rights as a holder of such Shares
(other than the right to receive payment of such consideration in accordance
with this Agreement).  Such Shares shall
be deemed to have been purchased in accordance with the applicable provisions
hereof, whether or not the certificate(s) therefor have been delivered as
required by this Agreement.

 

7

 

SECTION 9.  LEGALITY OF INITIAL ISSUANCE.

 

No Shares shall be issued upon the exercise
of this option unless and until the Company has determined that:

 

(a)                                  It and the Optionee have
taken any actions required to register the Shares under the Securities Act or
to perfect an exemption from the registration requirements thereof;

 

(b)                                 Any applicable listing
requirement of any stock exchange or other securities market on which Stock is
listed has been satisfied; and

 

(c)                                  Any other applicable
provision of state or federal law has been satisfied.

 

SECTION 10.  NO REGISTRATION RIGHTS.

 

The Company may, but shall not be obligated
to, register or qualify the sale of Shares under the Securities Act or any
other applicable law. The Company shall not be obligated to take any
affirmative action in order to cause the sale of Shares under this Agreement to
comply with any law.

 

SECTION 11.  RESTRICTIONS ON TRANSFER.

 

(a)                                  Securities
Law Restrictions.  Regardless of whether the
offering and sale of Shares under the Plan have been registered under the
Securities Act or have been registered or qualified under the securities laws
of any state, the Company at its discretion may impose restrictions upon the
sale, pledge or other transfer of such Shares (including the placement of appropriate
legends on stock certificates or the imposition of stop-transfer instructions)
if, in the judgment of the Company, such restrictions are necessary or
desirable in order to achieve compliance with the Securities Act, the
securities laws of any state or any other law.

 

(b)                                 Market Stand-Off.  In connection with any
underwritten public offering by the Company of its equity securities pursuant
to an effective registration statement filed under the Securities Act,
including the Company’s initial public offering, the Optionee shall not
directly or indirectly sell, make any short sale of, loan, hypothecate, pledge,
offer, grant or sell any option or other contract for the purchase of, purchase
any option or other contract for the sale of, or otherwise dispose of or
transfer, or agree to engage in any of the foregoing transactions with respect
to, any Shares acquired under this Agreement without the prior written consent
of the Company or its underwriters. Such restriction (the “Market Stand-Off”)
shall be in effect for such period of time following the date of the final
prospectus for the offering as may be requested by the Company or such
underwriters. In no event, however, shall such period exceed 180 days.  The Market Stand-Off shall in any event
terminate two years after the date of the Company’s initial public offering. In
the event of the declaration of a stock dividend, a spin-off, a stock split, an
adjustment in conversion ratio, a recapitalization or a similar transaction
affecting the Company’s outstanding securities without receipt of
consideration, any new, substituted or additional securities which are by
reason of such transaction distributed with respect to any Shares subject to
the Market Stand-Off, or into which such Shares thereby become convertible,
shall immediately be subject to the Market Stand-Off.  In order to enforce the Market Stand-Off, the
Company may impose stop-transfer instructions with respect to the Shares

 

8

 

acquired under this Agreement until the end of the
applicable stand-off period. The Company’s underwriters shall be beneficiaries
of the agreement set forth in this Subsection (b). This Subsection (b) shall
not apply to Shares registered in the public offering under the Securities Act,
and the Optionee shall be subject to this Subsection (b) only if the
directors and officers of the Company are subject to similar arrangements.

 

(c)                                  Investment Intent at Grant.  The Optionee represents and
agrees that the Shares to be acquired upon exercising this option will be
acquired for investment, and not with a view to the sale or distribution
thereof.

 

(d)                                 Investment Intent at Exercise.  In the event that the sale
of Shares under the Plan is not registered under the Securities Act but an
exemption is available which requires an investment representation or other
representation, the Optionee shall represent and agree at the time of exercise
that the Shares being acquired upon exercising this option are being acquired
for investment, and not with a view to the sale or distribution thereof, and
shall make such other representations as are deemed necessary or appropriate by
the Company and its counsel.

 

(e)                                  Legends.  All certificates evidencing
Shares purchased under this Agreement shall bear the following legend:

 

“THE
SHARES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED, TRANSFERRED,
ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN COMPLIANCE WITH THE TERMS OF
A WRITTEN AGREEMENT BETWEEN THE COMPANY AND THE REGISTERED HOLDER OF THE SHARES
(OR THE PREDECESSOR IN INTEREST TO THE SHARES). SUCH AGREEMENT GRANTS TO THE
COMPANY CERTAIN RIGHTS OF FIRST REFUSAL UPON AN ATTEMPTED TRANSFER OF THE
SHARES AND CERTAIN REPURCHASE RIGHTS UPON TERMINATION OF SERVICE WITH THE
COMPANY. THE SECRETARY OF THE COMPANY WILL UPON WRITTEN REQUEST FURNISH A COPY
OF SUCH AGREEMENT TO THE HOLDER HEREOF WITHOUT CHARGE.”

 

All certificates evidencing Shares purchased under
this Agreement in an unregistered transaction shall bear the following legend
(and such other restrictive legends as are required or deemed advisable under
the provisions of any applicable law):

 

“THE
SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED
WITHOUT AN EFFECTIVE REGISTRATION THEREOF UNDER SUCH ACT OR AN OPINION OF
COUNSEL, SATISFACTORY TO THE COMPANY AND ITS COUNSEL, THAT SUCH REGISTRATION IS
NOT REQUIRED.”

 

(f)                                    Removal of Legends.  If, in the opinion of the
Company and its counsel, any legend placed on a stock certificate representing
Shares sold under this Agreement is no longer

 

9

 

required, the holder of such certificate shall be
entitled to exchange such certificate for a certificate representing the same
number of Shares but without such legend.

 

(g)                                 Administration.  Any determination by the
Company and its counsel in connection with any of the matters set forth in this
Section 11 shall be conclusive and binding on the Optionee and all other
persons.

 

SECTION 12.  ADJUSTMENT OF SHARES.

 

In the event of any
transaction described in Section 8(a) of the Plan, the terms of this
option (including, without limitation, the number and kind of Shares subject to
this option and the Exercise Price) shall be adjusted as set forth in Section 8(a) of
the Plan. In the event that the Company is a party to a merger or
consolidation, this option shall be subject to the agreement of merger or
consolidation, as provided in Section 8(b) of the Plan.

 

SECTION 13.  MISCELLANEOUS PROVISIONS.

 

(a)                                  Rights
as a Stockholder.  Neither the Optionee nor the
Optionee’s representative shall have any rights as a stockholder with respect
to any Shares subject to this option until the Optionee or the Optionee’s
representative becomes entitled to receive such Shares by filing a notice of
exercise and paying the Purchase Price pursuant to Sections 4 and 5.

 

(b)                                 No Retention Rights.  Nothing in this option or in
the Plan shall confer upon the Optionee any right to continue in Service for
any period of specific duration or interfere with or otherwise restrict in any
way the rights of the Company (or any Parent or Subsidiary employing or
retaining the Optionee) or of the Optionee, which rights are hereby expressly
reserved by each, to terminate his or her Service at any time and for any
reason, with or without cause.

 

(c)                                  Notice.  Any notice required by the
terms of this Agreement shall be given in writing and shall be deemed effective
upon personal delivery or upon deposit with the United States Postal Service,
by registered or certified mail, with postage and fees prepaid. Notice shall be
addressed to the Company at its principal executive office and to the Optionee
at the address that he or she most recently provided to the Company.

 

(d)                                 Entire Agreement.  The Notice of Stock Option
Grant, this Agreement and the Plan constitute the entire contract between the
parties hereto with regard to the subject matter hereof. They supersede any
other agreements, representations or understandings (whether oral or written
and whether express or implied) which relate to the subject matter hereof.

 

(e)                                  Choice of Law.  This Agreement shall be
governed by, and construed in accordance with, the laws of the State of
California, as such laws are applied to contracts entered into and performed in
such State.

 

SECTION 14.  DEFINITIONS.

 

(a)                                  “Agreement”  shall mean this Stock Option
Agreement.

 

10

 

(b)                                 “Board of Directors” shall mean the Board of
Directors of the Company, as constituted from time to time or, if a Committee
has been appointed, such Committee.

 

(c)                                  “Change in Control” shall mean:

 

(i)                                     The consummation of a merger
or consolidation of the Company with or into another entity or any other
corporate reorganization, if persons who were not stockholders of the Company
immediately prior to such merger, consolidation or other reorganization own
immediately after such merger, consolidation or other reorganization 50% or
more of the voting power of the outstanding securities of each of (A) the
continuing or surviving entity and (B) any direct or indirect parent
corporation of such continuing or surviving entity; or

 

(ii)                                  The sale, transfer or other
disposition of all or substantially all of the Company’s assets.

 

A transaction shall not constitute a Change in
Control if its sole purpose is to change the state of the Company’s
incorporation or to create a holding company that will be owned in
substantially the same proportions by the persons who held the Company’s securities
immediately before such transaction.

 

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

 

(e)                                  “Committee” shall mean a committee of
the Board of Directors, as described in Section 2 of the Plan.

 

(f)                                    “Company” shall mean Traq Wireless, Inc.,
a Delaware corporation.

 

(g)                                 “Consultant”  shall mean a person who
performs bona fide services for the Company, a Parent or a Subsidiary as a
consultant or advisor, excluding Employees and Outside Directors.

 

(h)                                 “Date of
Grant”  shall mean the
date specified in the Notice of Stock Option Grant, which date shall be the
later of (i) the date on which the Board of Directors resolved to grant
this option or (ii) the first day of the Optionee’s Service.

 

(i)                                     “Disability”  shall mean that the Optionee
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 which has lasted, or can be expected to last, for a
continuous period of not less than 12 months.

 

(j)                                     “Employee” shall mean any individual
who is a common-law employee of the Company, a Parent or a Subsidiary.

 

(k)                                  “Exercise Price” shall mean the amount for
which one Share may be purchased upon exercise of this option, as specified in
the Notice of Stock Option Grant.

 

11

 

(l)                                     “Fair Market Value” shall mean the fair market
value of a Share, as determined by the Board of Directors in good faith. Such
determination shall be conclusive and binding on all persons.

 

(m)                               “ISO”  shall mean an employee
incentive stock option described in Section 422(b) of the Code.

 

(n)                                 “Nonstatutory
Option”  shall mean a
stock option not described in Sections 422(b) or 423(b) of the Code.

 

(o)                                 “Notice
of Stock Option Grant”  shall mean the document so entitled to which this Agreement is
attached.

 

(p)                                 “Optionee”  shall mean the individual
named in the Notice of Stock Option Grant.

 

(q)                                 “Outside
Director”  shall mean a
member of the Board of Directors who is not an Employee.

 

(r)                                    “Parent”  shall mean any corporation
(other than the Company) in an unbroken chain of corporations ending with the
Company, if each of the corporations other than the Company owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.

 

(s)                                  “Plan” shall mean the Traq Wireless, Inc. 1999 Stock
Plan, as in effect on the Date of Grant.

 

(t)                                    “Purchase
Price”  shall mean the
Exercise Price multiplied by the number of Shares with respect to which this
option is being exercised.

 

(u)                                 “Restricted
Share”  shall mean a
Share that is subject to the Right of Repurchase.

 

(v)                                 “Right
of First Refusal”  shall mean the
Company’s right of first refusal described in Section 8.

 

(w)                               “Right
of Repurchase”  shall mean the
Company’s right of repurchase described in Section 7.

 

(x)                                   “Securities
Act”  shall mean the
Securities Act of 1933, as amended.

 

(y)                                 “Service”  shall mean service as an
Employee, Outside Director or Consultant.

 

(z)                                   “Share”  shall mean one share of
Stock, as adjusted in accordance with Section 8 of the Plan (if
applicable).

 

12

 

(aa)                            “Stock” shall mean the Common Stock of the Company, with a par
value of $0.001 per Share.

 

(bb)                          “Subsidiary” shall mean any corporation (other than the Company) in an unbroken
chain of corporations beginning with the Company, if each of the corporations
other than the last corporation in the unbroken chain owns stock possessing 50%
or more of the total combined voting power of all classes of stock in one of
the other corporations in such chain.

 

(cc)                            “Transferee” shall mean any person to whom the Optionee has directly or indirectly
transferred any Share acquired under this Agreement.

 

(dd)                          “Transfer
Notice” shall mean the notice of a
proposed transfer of Shares described in Section 8.

 

13Exhibit 10.3

 

TANGOE, INC.

 

AMENDED AND RESTATED EMPLOYEE
STOCK OPTION/STOCK ISSUANCE PLAN

 

1.                                       Purposes of the Plan.  The purposes of this Amended
and Restated Employee Stock Option/Stock Issuance Plan are to attract and
retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to key
Employees and to select Directors and Consultants and to promote the success of
the Company’s business.  Options granted
under the Plan may be Incentive Stock Options or Nonstatutory Stock Options, as
determined by the Administrator at the time of grant of an option and subject
to the applicable provisions of Section 422 of the Code and the
regulations promulgated thereunder. 
Stock purchase rights may also be granted under the Plan.

 

2.                                       Definitions.  As used herein, the
following definitions shall apply:

 

(a)                                  “Administrator”  means the Board
or its Committee appointed pursuant to Section 4 of the Plan.

 

(b)                                 “Affiliate”  means an entity
other than a Subsidiary (as defined below) which, together with the Company, is
under common control of a third person or entity.

 

(c)                                  “Applicable Laws”  means the legal
requirements relating to the administration of stock option and restricted
stock purchase plans under applicable U.S. state corporate laws, U.S. federal
and applicable state securities laws, the Code, any Stock Exchange rules or
regulations and the applicable laws of any other country or jurisdiction where
Options or Stock Purchase Rights are granted under the Plan, as such laws, rules,
regulations and requirements shall be in place from time to time.

 

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

 

(e)                                  “Cause” for termination of a Participant’s Continuous
Service Status will exist if the Participant is terminated for any of the
following reasons:  (i) Participant’s
willful failure substantially to perform his or her duties and responsibilities
to the Company or deliberate violation of a Company policy; (ii) Participant’s
commission of any act of fraud, embezzlement, dishonesty or any other willful
misconduct that has caused or is reasonably expected to result in material
injury to the Company; (iii) unauthorized use or disclosure by Participant
of any proprietary information or trade secrets of the Company or any other party
to whom the Participant owes an obligation of nondisclosure as a result of his
or her relationship with the Company; or (iv) Participant’s willful breach
of any of his or her obligations under any written agreement or covenant with
the Company.  The determination as to
whether a Participant is being terminated for Cause shall be made in good faith
by the Company and shall be final and binding on the Participant.  The foregoing definition does not in any way
limit the Company’s ability to terminate a Participant’s employment or
consulting relationship at any time as provided in Section 5(d) below,
and the term “Company” will be interpreted to include any Subsidiary, Parent,
Affiliate or successor thereto, if appropriate.

 

 

(f)                                    “Change of Control”  means (i) a sale of all
or substantially all of the Company’s assets, (ii) any merger or
consolidation of the Company with or into another corporation other than a
merger or consolidation in which the holders of more than 50% of the shares of
capital stock of the Company outstanding immediately prior to such transaction
continue to hold (either by the voting securities remaining outstanding or by
their being converted into voting securities of the surviving entity) more than
50% of the total voting power represented by the voting securities of the
Company, or such surviving entity, outstanding immediately after such
transaction, or (iii) any person or group (as such terms are used in and
under Section 13(d) of the Exchange Act), other than a person or
group that is a stockholder of the Company as of December 10, 2004,
becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company representing more
than 50% of the total voting power represented by the then outstanding voting
securities of the Company.

 

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

 

(h)                                 “Committee”  means one or
more committees or subcommittees of the Board appointed by the Board to
administer the Plan in accordance with Section 4 below.

 

(i)                                     “Common Stock”  means the
Common Stock of the Company.

 

(j)                                     “Company”  means Tangoe, Inc.,
a Delaware corporation.

 

(k)                                  “Consultant”  means any
person, including an advisor, who is engaged by the Company or any Parent,
Subsidiary or Affiliate to render services and is compensated for such
services.

 

(1)                                  “Continuous Service Status”  means the
absence of any interruption or termination of service as an Employee, Director
or Consultant.  Continuous Service Status
shall not be considered interrupted in the case of: (i) sick leave; (ii) military
leave; (iii) any other leave of absence approved by the Administrator,
provided that such leave is for a period of not more than ninety (90) days,
unless reemployment or reengagement upon the expiration of such leave is
guaranteed by contract or statute, or unless provided otherwise pursuant to
Company policy adopted from time to time; (iv) in the case of transfers
between locations of the Company or between the Company, its Parents,
Subsidiaries, Affiliates or their respective successors; or (v) changes in
status between service as an Employee, Director or Consultant, provided,
however, that the amendments to this definition adopted on December 10,
2004 shall not apply to Options granted prior to December 10, 2004.

 

(m)                               “Corporate Transaction”  means a sale of
all or substantially all of the Company’s assets, or a merger, consolidation or
other capital reorganization of the Company with or into another corporation
and includes a Change of Control.

 

(n)                                 “Director”  means a member
of the Board,

 

(o)                                 “Employee” means any
person employed by the Company or any Parent, Subsidiary or Affiliate, with the
status of employment determined based upon such factors as are 

 

 

deemed
appropriate by the Administrator in its discretion, subject to any requirements
of the Code or the Applicable Laws.  The
payment by the Company of a director’s fee to a Director shall not be
sufficient to constitute “employment” of such Director by the Company.

 

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

 

(q)                                 “Fair Market Value”  means, as of
any date, the fair market value of the Common Stock, as determined by the
Administrator in good faith on such basis as it deems appropriate and applied
consistently with respect to Participants. 
Whenever possible, the determination of Fair Market Value shall be based
upon the closing price for the Shares as reported in the Wall Street Journal
for the applicable date.

 

(r)                                    “Incentive Stock Option”  means an Option
intended to qualify as an incentive stock option within the meaning of Section 422
of the Code, as designated in the applicable Option Agreement.

 

(s)                                  “Involuntary Termination”  means
termination of a Participant’s Continuous Service Status under the following
circumstances: (i) termination without Cause by the Company or a
Subsidiary, Parent, Affiliate or successor thereto, as appropriate; or (ii) voluntary
termination by the Participant within 60 days following (A) a material
reduction in the Participant’s job responsibilities, provided that neither a
mere change in title alone nor reassignment following a Change of Control to a
position that is substantially similar to the position held prior to the Change
of Control shall constitute a material reduction in job responsibilities; (B) relocation
by the Company or a Subsidiary, Parent, Affiliate or successor thereto, as
appropriate, of the Participant’s work site to a facility or location more than
50 miles from the Participant’s principal work site for the Company at the time
of the Change of Control; or (C) a reduction in Participant’s then-current
total compensation by at least 15%, provided that an across-the-board reduction
in the compensation of all other Employees or Consultants in positions similar
to the Participant’s by the same percentage amount as part of a general salary
level reduction shall not constitute such a salary reduction.

 

(t)                                    “Listed Security”  means any
security of the Company that is listed or approved for listing on a national
securities exchange or designated or approved for designation as a national
market system security on an interdealer quotation system by the National
Association of Securities Dealers, Inc.

 

(u)                                 “Named Executive”  means any
individual who, on the last day of the Company’s fiscal year, is the chief
executive officer of the Company (or is acting in such capacity) or among the
four most highly compensated officers of the Company (other than the chief
executive officer).  Such officer status
shall be determined pursuant to the executive compensation disclosure rules under
the Exchange Act.

 

(v)                                 “Nonstatutory Stock Option”  means an Option
not intended to qualify as an Incentive Stock Option, as designated in the
applicable Option Agreement.

 

(w)                               “Option”  means a stock
option granted pursuant to the Plan.

 

 

(x)                                   “Option Agreement”  means a written
document, the form(s) of which shall be approved from time to time by the
Administrator, reflecting the terms of an Option granted under the Plan and
includes any documents attached to or incorporated into such Option Agreement,
including, but not limited to, a notice of stock option grant and a form of
exercise notice.

 

(y)                                 “Option Exchange Program”  means a program
approved by the Administrator whereby outstanding Options are exchanged for Options
with a lower exercise price or are amended to decrease the exercise price as a
result of a decline in the Fair Market Value of the Common Stock.

 

(z)                                   “Optioned Stock”  means the
Common Stock subject to an Option.

 

(aa)                            “Optionee”  means an
Employee, Consultant or Director who receives an Option.

 

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

 

(cc)                            “Participant”  means any
holder of one or more Options or Stock Purchase Rights, or the Shares issuable
or issued upon exercise of such awards, under the Plan.

 

(dd)                          “Plan”  means this
Tangoe, Inc. Amended and Restated Employee Stock Option/Stock Issuance
Plan.

 

(ee)                            “Reporting Person”  means an
officer, Director, or greater than ten percent stockholder of the Company
within the meaning of Rule 16a-2 under the Exchange Act, who is required
to file reports pursuant to Rule 16a-3 under the Exchange Act.

 

(ff)                                “Restricted Stock”  means Shares of
Common Stock acquired pursuant to a grant of a Stock Purchase Right under Section 11
below.

 

(gg)                          “Restricted Stock Purchase Agreement”  means a written document, the form(s) of which shall be approved
from time to time by the Administrator, reflecting the terms of a Stock Purchase
Right granted under the Plan and includes any documents attached to such
agreement.

 

(hh)                          “Rule 16b-3”  means Rule 16b-3
promulgated under the Exchange Act, as amended from time to time, or any
successor provision.

 

(ii)                                  “Share”  means a share
of the Common Stock, as adjusted in accordance with Section 14 of the
Plan.

 

(jj)                                  “Stock Exchange” means any national
securities exchange or consolidated stock price reporting system on which
prices for the Common Stock are quoted at any given time.

 

 

(kk)                            “Stock Purchase Right”  means the right
to purchase Common Stock pursuant to Section 11 below.

 

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

 

(mm)                      “Ten Percent Holder”  means a person
who owns stock representing more than ten percent (10%) of the voting power of
all classes of stock of the Company or any Parent or Subsidiary.

 

3.                                       Stock Subject to the Plan.  Subject to the provisions of
Section 14 of the Plan, the maximum aggregate number of Shares that may be
sold under the Plan is 1,120,000.  The
Shares may be authorized, but unissued, or reacquired Shares.  If an award should expire or become
unexercisable for any reason without having been exercised in full, or is
surrendered pursuant to an Option Exchange Program, the unpurchased Shares that
were subject thereto shall, unless the Plan shall have been terminated, become
available for future grant under the Plan. 
In addition, any Shares which are retained by the Company upon exercise
of an award in order to satisfy any withholding taxes due with respect to such
exercise or purchase shall be treated as not issued and shall continue to be
available under the Plan.  Shares issued
under the Plan and later repurchased by the Company pursuant to any repurchase
right which the Company may have shall not be available for future grant under
the Plan.

 

4.                                       Administration of the Plan.

 

(a)                                  General.  The Plan shall be
administered by the Board or a Committee, or a combination thereof, as
determined by the Board.  The Plan may be
administered by different administrative bodies with respect to different
classes of Participants and, if permitted by the Applicable Laws, the Board may
authorize one or more officers to make awards under the Plan.

 

(b)                                 Committee Composition.  If a Committee has been
appointed pursuant to this Section 4, such Committee shall continue to
serve in its designated capacity until otherwise directed by the Board.  From time to time the Board may increase the
size of any Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill
vacancies (however caused) and remove all members of a Committee and thereafter
directly administer the Plan, all to the extent permitted by the Applicable
Laws and, in the case of a Committee administering the Plan in accordance with
the requirements of Rule 16b-3 or Section 162(m) of the Code, to
the extent permitted or required by such provisions.

 

(c)                                  Powers of the Administrator.  Subject to the provisions of
the Plan and in the case of a Committee, the specific duties delegated by the
Board to such Committee, the Administrator shall have the authority, in its
discretion:

 

(i)                                     to determine the
Fair Market Value of the Common Stock, in accordance with Section 2(q) of
the Plan, provided that such determination shall be applied consistently with
respect to Participants under the Plan;

 

 

(ii)                                  to select the
Employees, Directors and Consultants to whom Options and Stock Purchase Rights
may from time to time be granted;

 

(iii)                               to determine
whether and to what extent Options and Stock Purchase Rights are granted;

 

(iv)                              to determine
the number of Shares of Common Stock to be covered by each award granted;

 

(v)                                 to approve the
form(s) of agreements) used under the Plan;

 

(vi)                              to determine
the terms and conditions, not inconsistent with the terms of the Plan, of any
award granted hereunder, which terms and conditions include but are not limited
to the exercise or purchase price, the time or times when awards may be
exercised (which may be based on performance criteria), any vesting,
acceleration or waiver of forfeiture restrictions, and any restriction or
limitation regarding any Option, Optioned Stock, Stock Purchase Right or
Restricted Stock, based in each case on such factors as the Administrator, in
its sole discretion, shall determine;

 

(vii)                           to determine
whether and under what circumstances an Option may be settled in cash under Section 10(c) instead
of Common Stock;

 

(viii)                        to implement an
Option Exchange Program on such terms and conditions as the Administrator in
its discretion deems appropriate, provided that no amendment or adjustment to
an Option that would materially and adversely affect the rights of any Optionee
shall be made without the prior written consent of the Optionee;

 

(ix)                                to adjust the
vesting of an Option held by an Employee, Director or Consultant as a result of
a change in the terms or conditions under which such person is providing
services to the Company;

 

(x)                                   to construe and
interpret the terms of the Plan and awards granted under the Plan, which
constructions, interpretations and decisions shall be final and binding on all
Participants; and

 

(xii)                             in order to
fulfill the purposes of the Plan and without amending the Plan, to modify
grants of Options or Stock Purchase Rights to Participants who are foreign
nationals or employed outside of the United States in order to recognize
differences in local law, tax policies or customs.

 

5.                                       Eligibility.

 

(a)                                  Recipients of Grants.  Nonstatutory Stock Options and Stock Purchase
Rights may be granted to any Employee, Director or Consultant.  Incentive Stock Options may be granted only
to Employees, provided that Employees of Affiliates shall not be eligible to
receive Incentive Stock Options.

 

 

(b)                                 Type of Option.  Each Option shall be
designated in the Option Agreement as either an Incentive Stock Option or a
Nonstatutory Stock Option.

 

(c)                                  ISO $100,000 Limitation.  Notwithstanding any designation
under Section 5(b), to the extent that the aggregate Fair Market Value of
Shares with respect to which Options designated as Incentive Stock Options are
exercisable for the first time by any Optionee during any calendar year (under
all plans of the Company or any Parent or Subsidiary) exceeds $100,000, such
excess Options shall be treated as Nonstatutory Stock Options.  For purposes of this Section 5(c),
Incentive Stock Options shall be taken into account in the order in which they
were granted, and the Fair Market Value of the Shares subject to an Incentive
Stock Option shall be determined as of the date of the grant of such Option.

 

(d)                                 No Employment Rights.  The Plan shall not confer upon any
Participant any right with respect to continuation of an employment or
consulting relationship with the Company, nor shall it interfere in any way
with such Participant’s right or the Company’s right to terminate his or her
employment or consulting relationship at any time, with or without Cause.

 

6.                                       Term of Plan.  The Plan shall become effective upon its
adoption by the Board of Directors.  It
shall continue in effect for a term often (10) years unless sooner
terminated under Section 16 of the Plan.

 

7.                                       Term of Option.  The term of each Option
shall be the term stated in the Option Agreement; provided that the term shall
be no more than ten years from the date of grant thereof or such shorter term
as may be provided in the Option Agreement and provided further that, in the
case of an Incentive Stock Option granted to a person who at the time of such
grant is a Ten Percent Holder, the term of the Option shall be five years from
the date of grant thereof or such shorter term as may be provided in the Option
Agreement.

 

8.                                       [Reserved.]

 

9.                                       Option Exercise Price and Consideration.

 

(a)                                  Exercise Price.  The per Share exercise price for the Shares
to be issued pursuant to exercise of an Option shall be such price as is
determined by the Administrator and set forth in the Option Agreement, but
shall be subject to the following:

 

(i)                                     In the case of
an Incentive Stock Option

 

(A)                              granted to an
Employee who at the time of grant is a Ten Percent Holder, the per Share
exercise price shall be no less than 110% of the Fair Market Value per Share on
the date of grant; or

 

(B)                                granted to any
other Employee, the per Share exercise price shall be no less than 100% of the
Fair Market Value per Share on the date of grant.

 

(ii) 
In the case of a Nonstatutory Stock Option

 

 

(A)                              granted prior
to the date, if any, on which the Common Stock becomes a Listed Security to a
person who is at the time of grant is a Ten Percent Holder, the per Share
exercise price shall be no less than 110% of the Fair Market Value per Share on
the date of grant if required by the Applicable Laws and, if not so required,
shall be such price as is determined by the Administrator;

 

(B)                                granted prior
to the date, if any, on which the Common Stock becomes a Listed Security to any
other eligible person, the per Share exercise price shall be no less than 85%
of the Fair Market Value per Share on the date of grant if required by the
Applicable Laws and, if not so required, shall be such price as is determined
by the Administrator; or

 

(C)                                granted on or
after the date, if any, on which the Common Stock becomes a Listed Security to
any eligible person, the per share Exercise Price shall be such price as
determined by the Administrator provided that if such eligible person is, at
the time of the grant of such Option, a Named Executive of the Company, the per
share Exercise Price shall be no less than 100% of the Fair Market Value on the
date of grant if such Option is intended to qualify as performance-based
compensation under Section 162(m) of the Code.

 

(iii)                               Notwithstanding
the foregoing, Options may be granted with a per Share exercise price other
than as required above pursuant to a merger or other Corporate Transaction.

 

(iv)                              In the event an
Option is granted with an Exercise Price that is below the Fair Market Value
per Share on the date of grant, and subject to Section 12(g) below,
the Option shall be subject to any terms and conditions that the Administrator
may in his discretion determine to be necessary to avoid the income tax
penalties set forth under Section 409A of the Code.

 

(b)                                 Permissible Consideration.  The consideration to be paid for the Shares
to be issued upon exercise of an Option, including the method of payment, shall
be determined by the Administrator (and, in the case of an Incentive Stock
Option, shall be determined at the time of grant) and may consist entirely of (1) cash;
(2) check; (3) delivery of Optionee’s promissory note with such
recourse, interest, security and redemption provisions as the Administrator
determines to be appropriate (subject to the provisions of Section 153 of
the Delaware General Corporation Law); (4) cancellation of indebtedness; (5) other
Shares that have a Fair Market Value on the date of surrender equal to the
aggregate exercise price of the Shares as to which the Option is exercised,
provided that in the case of Shares acquired, directly or indirectly,
from the Company, such Shares must have been owned by the Optionee for more
than six months on the date of surrender (or such other period as may be
required to avoid the Company’s incurring an adverse accounting charge); (6) delivery
of a properly executed exercise notice together with such other documentation
as the Administrator and a securities broker approved by the Company shall
require to effect exercise of the Option and prompt delivery to the Company of
the sale or loan proceeds required to pay the exercise price and any applicable
withholding taxes; or (7) any combination of the foregoing methods of
payment.  In making its determination as
to the type of consideration to accept, the Administrator shall consider if acceptance
of such consideration may be reasonably expected to benefit the Company and the

 

 

Administrator
may, in its sole discretion, refuse to accept a particular form of
consideration at the time of any Option exercise.

 

10.                                 Exercise of Option.

 

(a)                                  General.

 

(i)                                     Exercisability.  Any Option granted hereunder
shall be exercisable at such times and under such conditions as determined by
the Administrator, consistent with the term of the Plan and reflected in the
Option Agreement, including vesting requirements and/or performance criteria
with respect to the Company and/or the Optionee; provided however that, if
required by the Applicable Laws, any Option granted prior to the date, if any,
upon which the Common Stock becomes a Listed Security shall become exercisable
at the rate of at least 20% per year over five years from the date the Option
is granted.  In the event that any of the
Shares issued upon exercise of an Option granted prior to the date, if any,
upon which the Common Stock becomes a Listed Security should be subject to a
right of repurchase in the Company’s favor, (A) such repurchase right
shall, if required by the Applicable Laws, lapse at the rate of at least 20%
per year over five years from the date the Option is granted, (B) the
purchase price for the shares repurchased shall be the original purchase price
paid by the purchaser and may be paid in cash or by cancellation of any
indebtedness of the purchaser to the Company and (C) the right to
repurchase shall only be exercisable within 90 days of termination of
Continuous Service Status (or in the case of securities issued upon the
exercise of Options, within 90 days after the date of exercise).  Notwithstanding the above, in the case of an
Option granted to an officer, Director or Consultant of the Company or any
Parent, Subsidiary or Affiliate of the Company, the Option may become fully
exercisable, or a repurchase right, if any, in favor of the Company shall
lapse, at any time or during any period established by the Administrator.  The Administrator shall have the discretion
to determine whether and to what extent the vesting of Options shall be tolled
during any unpaid leave of absence; provided, however, that in the absence of
such determination, vesting of Options shall be tolled during any such leave.

 

(ii)                                  Minimum Exercise Requirements.  An Option may not be
exercised for a fraction of a Share.  The
Administrator may require that an Option be exercised as to a minimum number of
Shares, provided that such requirement shall not prevent an Optionee from
exercising the full number of Shares as to which the Option is then
exercisable.

 

(iii)                               Procedures for and Results of Exercise.  An Option shall
be deemed exercised when written notice of such exercise has been given to the
Company in accordance with the terms of the Option by the person entitled to
exercise the Option and the Company has received full payment for the Shares
with respect to which the Option is exercised. 
Full payment may, as authorized by the Administrator, consist of any
consideration and method of payment allowable under Section 9(b) of
the Plan, provided that the Administrator may, in its sole discretion, refuse
to accept any form of consideration at the time of any Option exercise.

 

Exercise
of an Option in any manner shall result in a decrease in the number of Shares
that thereafter may be available, both for purposes of the Plan and for sale
under the Option, by the number of Shares as to which the Option is exercised.

 

 

(iv)                              Rights as Stockholder.  Until the issuance of the
Shares (as evidenced by the appropriate entry on the books of the Company or of
a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a stockholder shall exist with respect to the
Optioned Stock, notwithstanding the exercise of the Option.  No adjustment will be made for a dividend or
other right for which the record date is prior to the date the stock certificate
is issued, except as provided in Section 14 of the Plan.

 

(b)                                 Termination of Continuous Service Status.  Except as
otherwise set forth in this Section 10(b), the Administrator shall
establish and set forth in the applicable Option Agreement the terms and
conditions upon which an Option shall remain exercisable, if at all, following
termination of an Optionee’s Continuous Service Status, which provisions may be
waived or modified by the Administrator at any time.  To the extent that the Optionee is not
entitled to exercise an Option at the date of his or her termination of
Continuous Service Status, or if the Optionee (or other person entitled to
exercise the Option) does not exercise the Option to the extent so entitled
within the time specified in the Option Agreement or below (as applicable), the
Option shall terminate and the Optioned Stock underlying the unexercised
portion of the Option shall revert to the Plan. 
In no event may any Option be exercised after the expiration of the
Option term as set forth in the Option Agreement (and subject to Section 7).

 

The
following provisions (1) shall apply to the extent an Option Agreement
does not specify the terms and conditions upon which an Option shall terminate
upon termination of an Optionee’s Continuous Service Status, and (2) establish
the minimum post-termination exercise periods that may be set forth in an
Option Agreement:

 

(i)                                     Termination other than Upon Disability or Death or for Cause.  In the event of termination of an Optionee’s
Continuous Service Status (other than as a result of Optionee’s death or
disability or as a result of termination by the Company of the Optionee’s
Continuous Service Status for Cause), such Optionee may exercise an Option for
30 days following such termination to the extent the Optionee was entitled to
exercise such Option at the date of such termination.

 

(ii)                                  Termination Upon Disability of Optionee.  In the event of
termination of an Optionee’s Continuous Service Status as a result of his or
her disability (including a disability within the meaning of Section 22(e)(3) of
the Code), such Optionee may exercise an Option at any time within six months
following such termination to the extent the Optionee was entitled to exercise
such Option at the date of such termination.

 

(iii)                               Termination Upon Death of Optionee.  In the event of the death of
an Optionee during the period of Continuous Service Status or within thirty
days following termination of Optionee’s Continuous Service Status (other than
in the case of termination for Cause), the Option may be exercised by Optionee’s
estate or by a person who acquired the right to exercise the Option by bequest
or inheritance at any time within twelve months following the date of death,
but only to the extent of the right to exercise that had accrued at the date of
death or, if earlier, the date the Optionee’s Continuous Service Status
terminated.

 

(iv)                              Termination for Cause.  In the event of termination
of an Optionee’s Continuous Service Status by the Company for Cause, all
Options held by such 

 

 

Optionee
shall terminate immediately upon such termination for Cause, provided, however,
that the provisions of this Section 10(b)(iv) shall not apply to
Options granted prior to December 10, 2004.

 

(c)                                  Buyout Provisions.  The Administrator may at any
time offer to buy out for a payment in cash or Shares an Option previously
granted under the Plan based on such terms and conditions as the Administrator
shall establish and communicate to the Optionee at the time that such offer is
made.

 

11.                                 Stock Purchase Rights.

 

(a)                                  Rights to Purchase.  When the Administrator
determines that it will offer Stock Purchase Rights under the Plan, it shall
advise the offeree in writing of the terms, conditions and restrictions related
to the offer, including the number of Shares that such person shall be entitled
to purchase, the price to be paid, and the time within which such person must
accept such offer.  In the case of a
Stock Purchase Right granted prior to the date, if any, on which the Common
Stock becomes a Listed Security and if required by the Applicable Laws at that
time, the purchase price of Shares subject to such Stock Purchase Rights shall
not be less than 85% of the Fair Market Value of the Shares as of the date of
the offer, or, in the case of a Ten Percent Holder, the price shall not be less
than 100% of the Fair Market Value of the Shares as of the date of the
offer.  If the Applicable Laws do not
impose the requirements set forth in the preceding sentence and with respect to
any Stock Purchase Rights granted after the date, if any, on which the Common
Stock becomes a Listed Security, the purchase price of Shares subject to Stock
Purchase Rights shall be as determined by the Administrator.  The offer to purchase Shares subject to Stock
Purchase Rights shall be accepted by execution of a Restricted Stock Purchase
Agreement in the form determined by the Administrator.

 

(b)                                 Repurchase Option.  Unless the Administrator
determines otherwise, the Restricted Stock Purchase Agreement shall grant the
Company a repurchase option exercisable upon the voluntary or involuntary
termination of the purchaser’s Continuous Service Status for any reason
(including death or disability).  The
purchase price for Shares repurchased pursuant to the Restricted Stock Purchase
Agreement shall be the original purchase price paid by the purchaser and may be
paid in cash or by cancellation of any indebtedness of the purchaser to the
Company.  The repurchase option shall
lapse at such rate as the Administrator may determine, provided that with
respect to a Stock Purchase Right granted prior to the date, if any, on which
the Common Stock becomes a Listed Security to a purchaser who is not an
officer, Director or Consultant of the Company or of any Parent or Subsidiary
of the Company, it shall lapse at a minimum rate of 20% per year over five year
if required by the Applicable Laws.  The
right to repurchase shall only be exercisable within 90 days of termination of
Continuous Service Status.

 

(c)                                  Other Provisions.  The Restricted Stock
Purchase Agreement shall contain such other terms, provisions and conditions
not inconsistent with the Plan as may be determined by the Administrator in its
sole discretion.  In addition, the
provisions of Restricted Stock Purchase Agreements need not be the same with
respect to each purchaser.

 

(d)                                 Rights as a Stockholder.  Once the Stock Purchase
Right is exercised, the purchaser shall have the rights equivalent to those of
a stockholder, and shall be a stockholder 

 

 

when
his or her purchase is entered upon the records of the duly authorized transfer
agent of the Company.  No adjustment will
be made for a dividend or other right for which the record date is prior to the
date the Stock Purchase Right is exercised, except as provided in Section 14
of the Plan.

 

12.                                 Taxes.

 

(a)                                  As a condition
of the exercise of an Option or Stock Purchase Right granted under the Plan,
the Participant (or in the case of the Participant’s death, the person
exercising the Option or Stock Purchase Right) shall make such arrangements as
the Administrator may require for the satisfaction of any applicable federal,
state, local or foreign withholding tax obligations that may arise in
connection with the exercise of the Option or Stock Purchase Right and the
issuance of Shares.  The Company shall
not be required to issue any Shares under the Plan until such obligations are
satisfied.  If the Administrator allows
the withholding or surrender of Shares to satisfy a Participant’s tax
withholding obligations under this Section 12 (whether pursuant to Section 12(c),
(d) or (e), or otherwise), the Administrator shall not allow Shares to be
withheld in an amount that exceeds the minimum statutory withholding rates for
federal and state tax purposes, including payroll taxes.

 

(b)                                 In the case of
an Employee and in the absence of any other arrangement, the Employee shall be
deemed to have directed the Company to withhold or collect from his or her
compensation an amount sufficient to satisfy such tax obligations from the next
payroll payment otherwise payable after the date of an exercise of the Option
or Stock Purchase Right.

 

(c)                                  This Section 12(c) shall
apply only after the date, if any, upon which the Common Stock becomes a Listed
Security.  In the case of Participant
other than an Employee (or in the case of an Employee where the next payroll
payment is not sufficient to satisfy such tax obligations, with respect to any
remaining tax obligations), in the absence of any other arrangement and to the
extent permitted under the Applicable Laws, the Participant shall be deemed to
have elected to have the Company withhold from the Shares to be issued upon
exercise of the Option or Stock Purchase Right that number of Shares having a
Fair Market Value determined as of the applicable Tax Date (as defined below)
equal to the amount required to be withheld. 
For purposes of this Section 12, the Fair Market Value of the
Shares to be withheld shall be determined on the date that the
amount of tax to be withheld is to be determined under the Applicable Laws (the
“Tax Date”).

 

(d)                                 If permitted by
the Administrator, in its discretion, a Participant may satisfy his or her tax
withholding obligations upon exercise of an Option or Stock Purchase Right by
surrendering to the Company Shares that have a Fair Market Value determined as
of the applicable Tax Date equal to the amount required to be withheld.  In the case of Shares previously acquired
from the Company that are surrendered under this Section 12(d), such
Shares must have been owned by the Participant for more than six (6) months
on the date of surrender (or such other period of time as is required for the
Company to avoid adverse accounting charges).

 

(e)                                  Any election or
deemed election by a Participant to have Shares withheld to satisfy tax
withholding obligations under Section 12(c) or (d) above shall
be irrevocable as to 

 

 

the
particular Shares as to which the election is made and shall be subject to the
consent or disapproval of the Administrator. 
Any election by a Participant under Section 12(d) above must
be made on or prior to the applicable Tax Date.

 

(f)                                    In the event an
election to have Shares withheld is made by a Participant and the Tax Date is
deferred under Section 83 of the Code because no election is filed under Section 83(b) of
the Code, the Participant shall receive the full number of Shares with respect
to which the Option or Stock Purchase Right is exercised but such Participant
shall be unconditionally obligated to tender back to the Company the proper
number of Shares on the Tax Date.

 

(g)                                 Neither the
Company nor the Administrator shall, however, have any obligation whatsoever to
grant or modify any Option or Stock Purchase Right in a manner that avoids
penalties that may arise under Section 409A of the Code.

 

13.                                 Non-Transferability of Options and Stock Purchase Rights.

 

(a)                                  General.  Except as set forth in this Section 13,
Options and Stock Purchase Rights may not be sold, pledged, assigned,
hypothecated, transferred or disposed of in any manner other than by will or by
the laws of descent or distribution.  The
designation of a beneficiary by an Optionee will not constitute a
transfer.  An Option or Stock Purchase
Right may be exercised, during the lifetime of the holder of an Option or Stock
Purchase Right, only by such holder or a transferee permitted by this Section 13.

 

(b)                                 Limited Transferability Rights.  Notwithstanding anything
else in this Section 13, prior to the date, if any, on which the Common
Stock becomes a Listed Security, the Administrator may in its discretion grant
Nonstatutory Stock Options that may be transferred by instrument to an inter
vivos or testamentary trust in which the Options are to be passed to
beneficiaries upon the death of the trustor (settlor) or by gift to “Immediate
Family” (as defined below), on such terms and conditions as the Administrator
deems appropriate.  Following the date,
if any, on which the Common Stock becomes a Listed Security, the Administrator
may in its discretion grant transferable Nonstatutory Stock Options pursuant to
Option Agreements specifying the manner in which such Nonstatutory Stock
Options are transferable.  “Immediate
Family” means any child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law, and shall include adoptive
relationships.

 

14.                                 Adjustments Upon Changes in Capitalization, Merger or Certain Other
Transactions.

 

(a)                                  Changes in Capitalization.  Subject to any required
action by the stockholders of the Company, the number of Shares of Common Stock
covered by each outstanding Option or Stock Purchase Right, and the number of
Shares of Common Stock that have been authorized for issuance under the Plan
but as to which no Options or Stock Purchase Rights have yet been granted or
that have been returned to the Plan upon cancellation or expiration of an
Option or Stock Purchase Right, as well as the price per Share of Common Stock
covered by each such outstanding Option or Stock Purchase Right, shall be
proportionately 

 

 

adjusted
for any increase or decrease in the number of issued Shares of Common
Stock  resulting  from a stock split, reverse stock split,
stock dividend, combination, recapitalization or reclassification of the Common
Stock, or any other increase or decrease in the number of issued Shares of
Common Stock effected without receipt of consideration by the Company;
provided, however, that conversion of any convertible securities of the Company
shall not be deemed to have been “effected without receipt of consideration.”
Such adjustment shall be made by the Administrator, whose determination in that
respect shall be final, binding and conclusive. 
Except as expressly provided herein, no issuance by the Company of
shares of stock of any class, or securities convertible into shares of stock of
any class, shall affect, and no adjustment by reason thereof shall be made with
respect to, the number or price of Shares subject to an Option or Stock
Purchase Right.

 

(b)                                 Dissolution or Liquidation.  In the event of the
dissolution or liquidation of the Company, each Option and Stock Purchase Right
will terminate immediately prior to the consummation of such action, unless
otherwise determined by the Administrator.

 

(c)                                  Corporate Transaction; Change of Control.  In the event of
a Corporate Transaction, each outstanding Option or Stock Purchase Right shall
be assumed or an equivalent option or right shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation
(the “Successor Corporation”) unless the Successor Corporation does not
agree to assume the award or to substitute an equivalent option or right, in
which case such Option or Stock Purchase Right shall terminate upon the
consummation of the transaction; provided however that, in the case of a Change
of Control in which outstanding awards are neither being assumed nor replaced
with equivalent awards by the Successor Corporation, the vesting of such awards
shall accelerate in full as of immediately prior to the consummation of the
Change of Control so that Options shall vest and become exercisable as to all
of the Shares that otherwise would have been unvested as of immediately prior
to such consummation and any repurchase right of the Company with respect to
Shares issued upon exercise of an Option or Stock Purchase Right shall lapse as
to all of the Shares subject to such repurchase right as of immediately prior
to such consummation.  To the extent that
an Option or Stock Purchase Right is not exercised prior to consummation of a
transaction in which the Option or Stock Purchase Right is not being assumed
or substituted, such Option or Stock Purchase Right shall terminate upon such
consummation.

 

Notwithstanding
the above, in the event a Participant holding an Option or Stock Purchase Right
assumed or substituted by the Successor Corporation in a Change of Control, or
holding Restricted Stock issued upon exercise of an Option or Stock Purchase
Right with respect to which the Successor Corporation has succeeded to a
repurchase right as a result of a Change of Control, is Involuntarily
Terminated by the Successor Corporation in connection with, or within 12 months
following consummation of, the transaction, then any assumed or substituted
Option or Stock Purchase Right held by the terminated Participant at the time
of termination shall accelerate and become exercisable in full, and any
repurchase right applicable to any Shares shall lapse in full.  The acceleration of vesting and lapse of
repurchase rights provided for in the previous sentence shall occur immediately
prior to the effective date of the Participant’s termination.

 

 

For
purposes of this Section 14(c), an Option or a Stock Purchase Right shall
be considered assumed, without limitation, if, at the time of issuance of the
stock or other consideration upon a Corporate Transaction or a Change of
Control, as the case may be, each holder of an Option or Stock Purchase Right
would be entitled to receive upon exercise of the award the same number and
kind of shares of stock or the same amount of property, cash or securities as
such holder would have been entitled to receive upon the occurrence of the
transaction if the holder had been, immediately prior to such transaction, the
holder of the number of Shares of Common Stock covered by the award at such time
(after giving effect to any adjustments in the number of Shares covered by the
Option or Stock Purchase Right as provided for in this Section 14);
provided that if such consideration received in the transaction is not solely
common stock of the Successor Corporation, the Administrator may, with the
consent of the Successor Corporation, provide for the consideration to be
received upon exercise of the award to be solely common stock of the Successor
Corporation equal to the Fair Market Value of the per Share consideration
received by holders of Common Stock in the transaction.

 

(d)                                 Limitation on Payments.  In the event that the
vesting, acceleration or lapse of a repurchase right provided for in Section 14(c) above
(x) constitutes “parachute payments” within the meaning of Section 280G
of the Code, and (y) but for this Section 14(d) would be subject
to the excise tax imposed by Section 4999 of the Code (or any
corresponding provisions of state income tax law), then such vesting,
acceleration or lapse of a repurchase right shall be either

 

(i)                                     delivered in
full, or

 

(ii)                                  delivered as to
such lesser extent which would result in no portion of such severance benefits
being subject to excise tax under Code Section 4999,

 

whichever
amount, taking into account the applicable federal, state and local income
taxes and the excise tax imposed by Code Section 4999, results in the
receipt by the Participant on an after-tax basis of the greater amount of
acceleration or lapse of repurchase rights benefits, notwithstanding that all
or some portion of such benefits may be taxable under Code Section 4999.  Any determination required under this Section 14(d) shall
be made in writing by the Company’s independent accountants, whose
determination shall be conclusive and binding for all purposes on the Company
and any affected Participant.  In the
event that (i) above applies, then the Participant shall be responsible
for any excise taxes imposed with respect to such benefits.  In the event that (ii) above applies,
then each benefit provided hereunder shall be proportionately reduced to the
extent necessary to avoid imposition of such excise taxes.

 

(e)                                  Certain Distributions.  In the event of any
distribution to the Company’s stockholders of securities of any other entity or
other assets (other than dividends payable in cash or stock of the Company)
without receipt of consideration by the Company, the Administrator may, in its
discretion, appropriately adjust the price per Share covered by each
outstanding Option or Stock Purchase Right to reflect the effect of such
distribution.

 

15.                                 Time of Granting Options and Stock Purchase Rights.  The date of
grant of an Option or Stock Purchase Right shall, for all purposes, be the date
on which the Administrator makes the determination granting such Option or
Stock Purchase Right, or such other date as is 

 

 

determined
by the Administrator, provided that in the case of any Incentive Stock Option,
the grant date shall be the later of the date on which the Administrator makes
the determination granting such Incentive Stock Option or the date of
commencement of the Optionee’s employment relationship with the Company.  Notice of the determination shall be given to
each Employee or Consultant to whom an Option or Stock Purchase Right is so
granted within a reasonable time after the date of such grant.

 

16.                                 Amendment and Termination of the Plan.

 

(a)                                  Authority to Amend or Terminate.  The Board may at any time
amend, alter, suspend or discontinue the Plan, but no amendment, alteration,
suspension or discontinuation (other than an adjustment pursuant to Section 14
above) shall be made that would materially and adversely affect the rights of
any Optionee or holder of Stock Purchase Rights under any outstanding grant,
without his or her consent.  In addition,
to the extent necessary and desirable to comply with the Applicable Laws, the
Company shall obtain stockholder approval of any Plan amendment in such a
manner and to such a degree as required.

 

(b)                                 Effect of Amendment or Termination.  No amendment or termination
of the Plan shall materially and adversely affect Options or Stock Purchase
Rights already granted, unless mutually agreed otherwise between the Optionee
or holder of the Stock Purchase Rights and the Administrator, which agreement
must be in writing and signed by the Optionee or holder and the Company.

 

17.                                 Conditions Upon Issuance of Shares.  Notwithstanding any other
provision of the Plan or any agreement entered into by the Company pursuant to
the Plan, the Company shall not be obligated, and shall have no liability for
failure, to issue or deliver any Shares under the Plan unless such issuance or
delivery would comply with the Applicable Laws, with such compliance determined
by the Company in consultation with its legal counsel.  As a condition to the exercise of an Option
or Stock Purchase Right, the Company may require the person exercising the
award to represent and warrant at the time of any such exercise that the Shares
are being purchased only for investment and without any present intention to
sell or distribute such Shares if, in the opinion of counsel for the Company,
such a representation is required by law.

 

18.                                 Reservation of Shares.  The Company, during the term
of this Plan, will at all times reserve and keep available such number of
Shares as shall be sufficient to satisfy the requirements of the Plan.

 

19.                                 Agreements.  Options and Stock Purchase Rights shall be
evidenced by Option Agreements and Restricted Stock Purchase Agreements,
respectively, in such form(s) as the Administrator shall from time to time
approve.

 

20.                                 Stockholder Approval.  If required by the
Applicable Laws, continuance of the Plan shall be subject to approval by the
stockholders of the Company within twelve (12) months before or after the date
the Plan is adopted.  Such stockholder
approval shall be obtained in the manner and to the degree required under the
Applicable Laws.

 

 

21.                                 Information and Documents to Optionees and Purchasers.  Prior to the
date, if any, upon which the Common Stock becomes a Listed Security and if
required by the Applicable Laws, the Company shall provide financial statements
at least annually to each Optionee and to each individual who acquired Shares
pursuant to the Plan, during the period such Optionee or purchaser has one or
more Options or Stock Purchase Rights outstanding, and in the case of an
individual who acquired Shares pursuant to the Plan, during the period such
individual owns such Shares.  The Company
shall not be required to provide such information if the issuance of Options or
Stock Purchase Rights under the Plan is limited to key employees whose duties
in connection with the Company assure their access to equivalent information.

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