Document:

exv10w09

 

 

    Exhibit 10.09

 

    eBay
    Inc.

    

 

    1998
    DIRECTORS STOCK OPTION PLAN

 

    As
    Adopted July 10, 1998

 

    (As Amended March 18, 1999, December 4, 2002,
    August 28, 2003, February 16, 2005 and
    January 10, 2007)

 

    1.  Purpose.  This
    1998 Directors Stock Option Plan (this
    “Plan”) is established to provide equity
    incentives for certain nonemployee members of the Board of
    Directors of eBay Inc. (the “Company”),
    who are described in Section 6.1 below, by granting such
    persons options to purchase shares of common stock of the
    Company (“Options”).

 

    2.  Adoption and Stockholder
    Approval.  After this Plan is adopted by the Board
    of Directors of the Company (the
    “Board”), this Plan will become
    effective on the time and date (the “Effective
    Date”) on which the registration statement filed by
    the Company with the Securities and Exchange Commission
    (“SEC”) under the Securities Act of
    1933, as amended (the “Securities Act”),
    to register the initial public offering of the Company’s
    Common Stock is declared effective by the SEC. This Plan shall
    be approved by the stockholders of the Company, consistent with
    applicable laws, within twelve (12) months after the date
    this Plan is adopted by the Board.

 

    3.  Types of Options and
    Shares.  Options granted under this Plan shall be
    non-qualified stock options (“NQSOs”).
    The shares of stock that may be purchased upon exercise of
    Options granted under this Plan (the
    “Shares”) are shares of the Common Stock
    of the Company.

 

    4.  Number of Shares.  The maximum
    number of Shares that may be issued pursuant to Options granted
    under this Plan (the “Maximum Number”)
    is
    5,600,000*
    Shares, subject to adjustment as provided in this Plan. If any
    Option is terminated for any reason without being exercised in
    whole or in part, the Shares thereby released from such Option
    shall be available for purchase under other Options subsequently
    granted under this Plan. At all times during the term of this
    Plan, the Company shall reserve and keep available such number
    of Shares as shall be required to satisfy the requirements of
    outstanding Options granted under this Plan; provided, however
    that if the aggregate number of Shares subject to outstanding
    Options granted under this Plan plus the aggregate number of
    Shares previously issued by the Company pursuant to the exercise
    of Options granted under this Plan equals or exceeds the Maximum
    Number, then notwithstanding anything herein to the contrary, no
    further Options may be granted under this Plan until the Maximum
    Number is increased or the aggregate number of Shares subject to
    outstanding Options granted under this Plan plus the aggregate
    number of Shares previously issued by the Company pursuant to
    the exercise of Options granted under this Plan is less than the
    Maximum Number.

 

    5.  Administration.  This Plan shall
    be administered by the Board or by a committee of not less than
    two members of the Board appointed to administer this Plan (the
    “Committee”). As used in this Plan,
    references to the Committee shall mean either such Committee or
    the Board if no Committee has been established. The
    interpretation by the Committee of any of the provisions of this
    Plan or any Option granted under this Plan shall be final and
    binding upon the Company and all persons having an interest in
    any Option or any Shares purchased pursuant to an Option.

 

    6.  Eligibility and Award Formula.

 

    6.1  Eligibility.  Options
    shall be granted only to directors of the Company who are not
    employees of the Company or any Parent, Subsidiary or Affiliate
    of the Company, as those terms are defined in Section 17
    below (each such person referred to as an
    “Optionee”).

 

    6.2  Initial
    Grant.  [Intentionally blank].

 

    6.3  Succeeding Grants.  At
    each Annual Meeting of the Company commencing with the Annual
    Meeting taking place in the year 2000, each Optionee will
    automatically be granted an Option for
    [15,000]**

 

 

    *  Share
    number reflects all stock splits from the Effective Date through
    February 2005.

    **  Share
    number does not reflect stock split effective February 16,
    2005. Share number needs to be approved by Compensation
    Committee of the Company’s Board.

 

    Shares (a “Succeeding Grant”), provided
    the Optionee (i) was elected to the Board prior to such
    date, and (ii) is a director after the Annual Meeting, and
    (iii) has served continuously as a member of the Board
    since the date of such Optionee’s election.

 

    7.  Terms and Conditions of
    Options.  Subject to the following and to
    Section 6 above:

 

    7.1  Form of Option
    Grant.  Each Option granted under this Plan
    shall be evidenced by a written Stock Option Grant
    (“Grant”) in such form (which need not
    be the same for each Optionee) as the Committee shall from time
    to time approve, which Grant shall comply with and be subject to
    the terms and conditions of this Plan.

 

    7.2  Vesting.  The date an
    Optionee receives an Initial Grant or a Succeeding Grant is
    referred to in this Plan as the “Start Date”
    for such Option. Each Succeeding Grant will vest as to
    twenty-five percent (25%) of the Shares on the first anniversary
    of the Start Date for such Succeeding Grant, and as to 2.08333%
    of the Shares on each subsequent monthly anniversary of the
    Start Date, so long as the Optionee continuously remains a
    director or a consultant of the Company.

 

    7.3  Exercise Price.  The
    exercise price of an Option shall be the Fair Market Value (as
    defined in Section 17.5) of the Shares, at the time that
    the Option is granted.

 

    7.4  Termination of
    Option.  Except as provided below in this
    Section, each Option shall expire ten (10) years after its
    Start Date (the “Expiration Date”). The
    Option shall cease to vest when the Optionee ceases to be a
    member of the Board or a consultant of the Company. The date on
    which the Optionee ceases to be a member of the Board or a
    consultant of the Company shall be referred to as the
    “Termination Date”. An Option may be
    exercised after the Termination Date only as set forth below:

 

    (a) Termination Generally.  If the
    Optionee ceases to be a member of the Board or a consultant of
    the Company for any reason except death of the Optionee or
    disability of the Optionee (whether temporary or permanent,
    partial or total, as determined by the Committee), then each
    Option then held by such Optionee, to the extent (and only to
    the extent) that it would have been exercisable by the Optionee
    on the Termination Date, may be exercised by the Optionee no
    later than seven (7) months after the Termination Date, but
    in no event later than the Expiration Date.

 

    (b) Death or Disability.  If the
    Optionee ceases to be a member of the Board or a consultant of
    the Company because of the death of the Optionee or the
    disability of the Optionee (whether temporary or permanent,
    partial or total, as determined by the Committee), then each
    Option then held by such Optionee to the extent (and only to the
    extent) that it would have been exercisable by the Optionee on
    the Termination Date, may be exercised by the Optionee (or the
    Optionee’s legal representative) no later than twelve
    (12) months after the Termination Date, but in no event
    later than the Expiration Date.

 

    8.  Exercise of Options.

 

    8.1  Exercise Period.  Subject
    to the provisions of Section 8.5 below, Options shall be
    exercisable as they vest; provided that the Committee may
    provide that such Options shall be immediately exercisable
    subject to repurchase in accordance with the vesting schedule
    set forth in Section 7.

 

    8.2  Notice.  Options may be
    exercised only by delivery to the Company of an exercise
    agreement in a form approved by the Committee stating the number
    of Shares being purchased, the restrictions imposed on the
    Shares and such representations and agreements regarding the
    Optionee’s investment intent and access to information as
    may be required by the Company to comply with applicable
    securities laws, together with payment in full of the exercise
    price for the number of Shares being purchased.

 

    8.3  Payment.  Payment for the
    Shares purchased upon exercise of an Option may be made
    (a) in cash or by check; (b) by surrender of shares of
    Common Stock of the Company that have been owned by the Optionee
    for more than six (6) months (and which have been paid for
    within the meaning of SEC Rule 144 and, if such shares were
    purchased from the Company by use of a promissory note, such
    note has been fully paid with respect to such shares) or were
    obtained by the Optionee in the open public market, having a
    Fair Market Value equal to the exercise price of the Option;
    (c) by waiver of compensation due or accrued to the
    Optionee

    

    2

 

    for services rendered; (d) provided that a public market
    for the Company’s stock exists (and to the extent permitted
    by law), through a “same day sale” commitment from the
    Optionee and a broker-dealer that is a member of the National
    Association of Securities Dealers (an “NASD
    Dealer”) whereby the Optionee irrevocably elects to
    exercise the Option and to sell a portion of the Shares so
    purchased to pay for the exercise price and whereby the NASD
    Dealer irrevocably commits upon receipt of such Shares to
    forward the exercise price directly to the Company;
    (e) provided that a public market for the Company’s
    stock exists (and to the extent permitted by law), through a
    “margin” commitment from the Optionee and an NASD
    Dealer whereby the Optionee irrevocably elects to exercise the
    Option and to pledge the Shares so purchased to the NASD Dealer
    in a margin account as security for a loan from the NASD Dealer
    in the amount of the exercise price, and whereby the NASD Dealer
    irrevocably commits upon receipt of such Shares to forward the
    exercise price directly to the Company; or (f) by any
    combination of the foregoing.

 

    8.4  Withholding Taxes.  Prior
    to issuance of the Shares upon exercise of an Option, the
    Optionee shall pay or make adequate provision for any federal or
    state withholding obligations of the Company, if applicable.

 

    8.5  Limitations on
    Exercise.  Notwithstanding the exercise
    periods set forth in the Grant, exercise of an Option shall
    always be subject to the following limitations:

 

    (a) An Option shall not be exercisable unless such exercise
    is in compliance with the Securities Act and all applicable
    state securities laws, as they are in effect on the date of
    exercise.

 

    (b) The Committee may specify a reasonable minimum number
    of Shares that may be purchased upon any exercise of an Option,
    provided that such minimum number will not prevent the Optionee
    from exercising the full number of Shares as to which the Option
    is then exercisable.

 

    9.  Nontransferability of
    Options.  During the lifetime of the Optionee, an
    Option shall be exercisable only by the Optionee or by the
    Optionee’s guardian or legal representative, unless
    otherwise determined by the Committee. No Option may be sold,
    pledged, assigned, hypothecated, transferred or disposed of in
    any manner other than by will or by the laws of descent and
    distribution, unless otherwise determined by the Committee.

 

    10.  Privileges of Stock
    Ownership.  No Optionee shall have any of the
    rights of a stockholder with respect to any Shares subject to an
    Option until the Option has been validly exercised. No
    adjustment shall be made for dividends or distributions or other
    rights for which the record date is prior to the date of
    exercise, except as provided in this Plan. The Company shall
    provide to each Optionee a copy of the annual financial
    statements of the Company at such time after the close of each
    fiscal year of the Company as they are released by the Company
    to its stockholders.

 

    11.  Adjustment of Option Shares.

 

    (a) In the event that any dividend or other distribution,
    reorganization, merger, consolidation, combination, repurchase,
    or exchange of the Company’s Common Stock or other
    securities of the Company, or other change in the corporate
    structure of the Company affecting the Company’s Common
    Stock (other than an Equity Restructuring) occurs such that an
    adjustment is determined by the Committee (in its sole
    discretion) to be appropriate in order to prevent dilution or
    enlargement of the benefits or potential benefits intended to be
    made available under the Plan, then the Committee shall, in such
    manner as it may deem equitable, adjust the number and class of
    Shares which may be delivered under the Plan, the exercise price
    per Share and the number and type of Shares covered by each
    Option which has not yet been exercised, and the numerical
    limits of Section 4 and 6.3.

 

    (b) In connection with the occurrence of any Equity
    Restructuring, and notwithstanding anything to the contrary in
    Sections 11(a) and 14, the exercise price and number
    and type of securities subject to each outstanding Option will
    be equitably adjusted by the Committee. The adjustments provided
    under this Section 2.2(b) shall be nondiscretionary and
    shall be final and binding on the affected Optionee and the
    Company.

 

    12.  No Obligation to Continue as
    Director.  Nothing in this Plan or any Option
    granted under this Plan shall confer on any Optionee any right
    to continue as a director of the Company.

    

    3

 

 

    13.  Compliance With Laws.  The grant
    of Options and the issuance of Shares upon exercise of any
    Options shall be subject to and conditioned upon compliance with
    all applicable requirements of law, including without limitation
    compliance with the Securities Act, compliance with all other
    applicable state securities laws and compliance with the
    requirements of any stock exchange or national market system on
    which the Shares may be listed. The Company shall be under no
    obligation to register the Shares with the SEC or to effect
    compliance with the registration or qualification requirement of
    any state securities laws, stock exchange or national market
    system.

 

    14.  Acceleration of Options on Certain Corporate
    Transactions.  In the event of (a) a
    dissolution or liquidation of the Company, (b) a merger or
    consolidation in which the Company is not the surviving
    corporation (other than a merger or consolidation with a
    wholly-owned subsidiary, a reincorporation of the Company in a
    different jurisdiction, or other transaction in which there is
    no substantial change in the stockholders of the Company or
    their relative stock holdings and the Options granted under this
    Plan are assumed, converted or replaced by the successor
    corporation, which assumption, conversion or replacement will be
    binding on all Optionees), (c) a merger in which the
    Company is the surviving corporation but after which the
    stockholders of the Company (other than any stockholder which
    merges (or which owns or controls another corporation which
    merges) with the Company in such merger) cease to own their
    shares or other equity interests in the Company, (d) the
    sale of substantially all of the assets of the Company, or
    (e) the acquisition, sale or transfer of more than 50% of
    the outstanding shares of the Company by tender offer or similar
    transaction, the vesting of all Options granted pursuant to this
    Plan will accelerate and the Options will become exercisable in
    full prior to the consummation of such event at such times and
    on such conditions as the Committee determines, and must be
    exercised, if at all, within seven months of the consummation of
    said event. Any Options not exercised within such seven-month
    period shall expire.

 

    15.  Amendment or Termination of
    Plan.  The Board may at any time terminate or
    amend this Plan or any outstanding Option, provided that the
    Board may not terminate or amend the terms of any outstanding
    Option without the consent of the Optionee. In any case, no
    amendment of this Plan may adversely affect any then outstanding
    Options or any unexercised portions thereof without the written
    consent of the Optionee.

 

    16.  Term of Plan.  Options may be
    granted pursuant to this Plan from time to time within a period
    of ten (10) years from the Effective Date.

 

    17.  Certain Definitions.  As used in
    this Plan, the following terms shall have the following meanings:

 

    17.1  “Parent” means any corporation
    (other than the Company) in an unbroken chain of corporations
    ending with the Company if each of such 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.

 

    17.2  “Subsidiary” means 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.

 

    17.3  “Affiliate” means any
    corporation that directly, or indirectly through one or more
    intermediaries, controls or is controlled by, or is under common
    control with, another corporation, where “control”
    (including the terms “controlled by” and “under
    common control with”) means the possession, direct or
    indirect, of the power to cause the direction of the management
    and policies of the corporation, whether through the ownership
    of voting securities, by contract or otherwise.

 

    17.4  “Equity Restructuring” means a
    non-reciprocal transaction (i.e. a transaction in which the
    Company does not receive consideration or other resources in
    respect of the transaction approximately equal to and in
    exchange for the consideration or resources the Company is
    relinquishing in such transaction) between the Company and its
    stockholders, such as a stock split, spin-off, rights offering,
    nonrecurring stock dividend or recapitalization through a large,
    nonrecurring cash dividend, that affects the shares of the
    Company’s Common Stock (or other securities of the Company)
    or the share price of the Company’s Common Stock (or other
    securities) and causes a change in the per share value of the
    Shares underlying outstanding Options.

    

    4

 

 

    17.5  “Fair Market Value” means, as
    of any date, the value of a share of the Company’s Common
    Stock determined as follows:

 

    (a) if such Common Stock is then quoted on the Nasdaq
    National Market, its closing price on the Nasdaq National Market
    on the date of determination as reported in The Wall Street
    Journal;

 

    (b) if such Common Stock is publicly traded and is then
    listed on a national securities exchange, its closing price on
    the date of determination on the principal national securities
    exchange on which the Common Stock is listed or admitted to
    trading as reported in The Wall Street Journal;

 

    (c) if such Common Stock is publicly traded but is not
    quoted on the Nasdaq National Market nor listed or admitted to
    trading on a national securities exchange, the average of the
    closing bid and asked prices on the date of determination as
    reported in The Wall Street Journal;

 

    (d) in the case of an Option granted on the Effective Date,
    the price per share at which shares of the Company’s Common
    Stock are initially offered for sale to the public by the
    Company’s underwriters in the initial public offering of
    the Company’s Common Stock pursuant to a registration
    statement filed with the SEC under the Securities Act; or

 

    (e) if none of the foregoing is applicable, by the
    Committee in good faith.

    

    5exv10w10

 

    Exhibit 10.10

 

    eBay
    Inc.

 

    1999
    Global Equity Incentive Plan, as amended

 

    Initial
    Stockholder Approval on May 23, 2000

    Amendment adopted by the Board of Directors on March 14,
    2002

    Stockholder Approval of Amendment on June 5, 2002

    Amendment Adopted by the Compensation Committee on
    March 18, 2004

    Stockholder Approval of Amendment on June 24, 2004

    Amendment Adopted by the Board of Directors on September 9,
    2004

    Amendment Adopted by the Board of Directors on January 10,
    2007

 

    Termination
    Date: None

 

    1.  Purposes.

 

    (a) Eligible Stock Award Recipients.  The
    persons eligible to receive Stock Awards are the Employees and
    Consultants of the Company and its Affiliates, in particular
    (but not limited to) those Employees and Consultants who are
    neither citizens nor residents of the United States of America.

 

    (b) Available Stock Awards.  The purpose
    of the Plan is to provide a means by which eligible recipients
    of Stock Awards may be given an opportunity to benefit from
    increases in value of the Common Stock through the granting of
    the following Stock Awards: (i) Stock Options,
    (ii) stock bonuses, (iii) rights to acquire restricted
    stock, and (iv) restricted stock units.

 

    (c) General Purpose.  The Company, by
    means of the Plan, seeks to retain the services of the group of
    persons eligible to receive Stock Awards, to secure and retain
    the services of new members of this group, and to provide
    incentives for such persons to exert maximum efforts for the
    success of the Company and its Affiliates.

 

    2.  Definitions.

 

    (a) “Affiliate” means any parent
    corporation or subsidiary corporation of the Company, whether
    now or hereafter existing, as those terms are defined in
    Sections 424(e) and (f), respectively, of the Code, and any
    other entity which is controlled, directly or indirectly, by the
    Company.

 

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

 

    (c) “Code” means the United States
    Internal Revenue Code of 1986, as amended.

 

    (d) “Committee” means a committee of one
    or more members of the Board appointed by the Board in
    accordance with subsection 3(c).

 

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

 

    (f) “Company” means eBay Inc., a Delaware
    corporation.

 

    (g) “Consultant” means any natural person,
    including an advisor, (i) engaged by the Company or an
    Affiliate to render consulting or advisory services and who is
    compensated for such services, or (ii) who is a member of
    the Board of Directors or comparable governing body of an
    Affiliate and who is compensated for such services. However, the
    term “Consultant” shall not include Directors who are
    not compensated by the Company for their services as Directors.
    In addition, the payment of a director’s fee by the Company
    for services as a Director shall not cause a Director to be
    considered a “Consultant” for purposes of the Plan.

 

    (h) “Continuous Service” means that the
    Participant’s service with the Company or an Affiliate,
    whether as an Employee, Director or Consultant, is not
    interrupted or terminated. The Participant’s Continuous
    Service shall not be deemed to have terminated merely because of
    a change in the capacity in which the Participant renders
    service to the Company or an Affiliate as an Employee,
    Consultant or Director or a change in the entity for which the
    Participant renders such service, provided that there is no
    interruption or termination of the Participant’s Continuous

 

    Service. For example, a change in status from an Employee of the
    Company to a Consultant of an Affiliate or a Director will not
    constitute an interruption of Continuous Service. The Board or
    the chief executive officer of the Company, in that party’s
    sole discretion, may determine whether Continuous Service shall
    be considered interrupted in the case of any leave of absence
    approved by that party, including sick leave, military leave or
    any other personal leave.

 

    (i) “Covered Employee” means the chief
    executive officer and the four (4) other highest
    compensated officers of the Company for whom total compensation
    is required to be reported to stockholders under the Exchange
    Act, as determined for purposes of Section 162(m) of the
    Code.

 

    (j) “Director” means a member of the Board
    of Directors of the Company.

 

    (k) “Disability” means the inability of a
    natural person to continue to perform services for the Company
    or any Affiliate of the type previously performed prior to the
    occurrence of such Disability, whether as a result of physical
    and/or
    mental illness or injury, as determined by a physician
    acceptable to the Company, for a period that is expected to be
    of a duration of no less than six (6) months.

 

    (l) “Employee” means any person employed
    by the Company or an Affiliate. Mere service as a Director or
    payment of a director’s fee by the Company or an Affiliate
    shall not be sufficient to constitute “employment” by
    the Company or an Affiliate.

 

    (m) “Equity Restructuring” means a
    non-reciprocal transaction (i.e. a transaction in which the
    Company does not receive consideration or other resources in
    respect of the transaction approximately equal to and in
    exchange for the consideration or resources the Company is
    relinquishing in such transaction) between the Company and its
    stockholders, such as a stock split, spin-off, rights offering,
    nonrecurring stock dividend or recapitalization through a large,
    nonrecurring cash dividend, that affects the shares of Common
    Stock (or other securities of the Company) or the share price of
    Common Stock (or other securities) and causes a change in the
    per share value of the Stock underlying outstanding Stock Awards.

 

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

 

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

 

    (i) If the Common Stock is listed on any established stock
    exchange or traded on the Nasdaq National Market or the Nasdaq
    SmallCap Market, the Fair Market Value of a share of Common
    Stock shall be the closing sales price for such stock (or the
    closing bid, if no sales were reported) as quoted on such
    exchange or market (or the exchange or market with the greatest
    volume of trading in the Common Stock) on the last market
    trading day prior to the day of determination, as reported in
    The Wall Street Journal or such other source as the Board
    deems reliable.

 

    (ii) In the absence of such markets for the Common Stock,
    the Fair Market Value shall be determined in good faith by the
    Board.

 

    (p) “Non-Employee Director” means a
    Director who either (i) is not a current Employee or
    officer of the Company or an Affiliate, does not receive
    compensation, either directly or indirectly, from the Company or
    an Affiliate for services rendered as a Consultant or in any
    capacity other than as a Director (except for an amount as to
    which disclosure would not be required under Item 404(a) of
    Regulation S-K
    promulgated pursuant to the Securities Act
    (“Regulation S-K”)),
    does not possess an interest in any other transaction for which
    disclosure would be required under Item 404(a) of
    Regulation S-K,
    and is not engaged in a business relationship for which
    disclosure would be required pursuant to Item 404(b) of
    Regulation S-K;
    or (ii) is otherwise considered a “non-employee
    director” for purposes of
    Rule 16b-3.

 

    (q) “Option” means an option granted
    pursuant to Section 6 of the Plan.

 

    (r) “Option Agreement” means a written
    agreement between the Company and an Optionholder evidencing the
    terms and conditions of an individual Option grant. Each Option
    Agreement shall be subject to the terms and conditions of the
    Plan.

    

    2

 

 

    (s) “Optionholder” means a person to whom
    an Option is granted pursuant to the Plan or, if applicable,
    such other person who holds an outstanding Option.

 

    (t) “Outside Director” means a Director
    who either (i) is not a current employee of the Company or
    an “affiliated corporation” (within the meaning of
    Treasury Regulations promulgated under Section 162(m) of
    the Code), is not a former employee of the Company or an
    “affiliated corporation” who receives compensation for
    prior services (other than benefits under a tax-qualified
    retirement plan) during the taxable year, has not been an
    officer of the Company or an “affiliated corporation”,
    and does not receive remuneration from the Company or an
    “affiliated corporation,” either directly or
    indirectly, in any capacity other than as a Director or
    (ii) is otherwise considered an “outside
    director” for purposes of Section 162(m) of the Code.

 

    (u) “Participant” means a person to whom a
    Stock Award is granted pursuant to the Plan or, if applicable,
    such other person who holds an outstanding Stock Award.

 

    (v) “Plan” means this eBay Inc. 1999
    Global Equity Incentive Plan, as it may be duly amended from
    time to time.

 

    (w) “Rule 16b-3”
    means
    Rule 16b-3
    promulgated under the Exchange Act of any successor to
    Rule 16b-3,
    as in effect from time to time.

 

    (x) “Securities Act” means the United
    States Securities Act of 1933, as amended.

 

    (y) “Stock Award” means any right granted
    under the Plan, including an option, a stock bonus, a right to
    acquire restricted stock and a restricted stock unit award.

 

    (z) “Stock Award Agreement” means a
    written agreement between the Company and a holder of a Stock
    Award evidencing the terms and conditions of an individual Stock
    Award grant. Each Stock Award Agreement shall be subject to the
    terms and conditions of the Plan.

 

    3.  Administration.

 

    (a) Administration by Board.  The Board
    shall administer the Plan unless and until the Board delegates
    administration to a Committee, as provided in
    subsection 3(c).

 

    (b) Powers of Board.  The Board shall have
    the power, subject to, and within the limitations of, the
    express provisions of the Plan:

 

    (i) To determine from time to time which of the persons
    eligible under the Plan shall be granted Stock Awards; when and
    how each Stock Award shall be granted; what type or combination
    of types of Stock Award shall be granted; the provisions of each
    Stock Award granted (which need not be identical), including the
    time or times when a person shall be permitted to receive Common
    Stock pursuant to a Stock Award; and the number of shares of
    Common Stock with respect to which a Stock Award shall be
    granted to each such person.

 

    (ii) To construe and interpret the Plan and Stock Awards
    granted under it, and to establish, amend and revoke rules and
    regulations for its administration. The Board, in the exercise
    of this power, may correct any defect, omission or inconsistency
    in the Plan or in any Stock Award Agreement, in a manner and to
    the extent it shall deem necessary or expedient in its sole
    discretion to make the Plan fully effective.

 

    (iii) To amend the Plan or a Stock Award as provided in
    Section 12.

 

    (iv) To terminate or suspend the Plan as provided in
    Section 13.

 

    (v) Generally, to exercise such powers and to perform such
    acts as the Board deems necessary or expedient in its sole
    discretion to promote the best interests of the Company, which
    are not in conflict with the provisions of the Plan.

 

    (c) Delegation to Committee.

 

    (i) General.  The Board may delegate
    administration of the Plan to a Committee or Committees of one
    (1) or more members of the Board, and the term
    “Committee” shall apply to any person or persons to
    whom such authority has been delegated. If administration is
    delegated to a Committee, the Committee shall have, in
    connection with the

    

    3

 

    administration of the Plan, the powers theretofore possessed by
    the Board, including the power to delegate to a subcommittee of
    one (1) or more members of the Board any of the
    administrative powers the Committee is authorized to exercise
    (and references in this Plan to the Board shall thereafter be to
    the Committee or subcommittee), subject, however, to such
    resolutions, not inconsistent with the provisions of the Plan,
    as may be adopted from time to time by the Board. The Board may
    abolish the Committee at any time and revest in the Board the
    administration of the Plan.

 

    (ii) Section 162(m) and
    Rule 16b-3
    Compliance.  In the sole discretion of the Board,
    a Committee may consist solely of two or more Outside Directors,
    in accordance with Section 162(m) of the Code,
    and/or
    solely of two or more Non-Employee Directors, in accordance with
    Rule 16b-3.
    Within the scope of such authority, the Board or the Committee
    may (1) delegate to a committee of one or more members of
    the Board who are not Outside Directors the authority to grant
    Stock Awards to eligible persons who are either (a) not
    then Covered Employees and are not expected to be Covered
    Employees at the time of recognition of income resulting from
    such Stock Award or (b) not persons with respect to whom
    the Company wishes to comply with Section 162(m) of the
    Code and/or
    (2) delegate to a committee of one or more members of the
    Board who are not Non-Employee Directors the authority to grant
    Stock Awards to eligible persons who are not then subject to
    Section 16 of the Exchange Act.

 

    (d) Effect of Board’s Decision.  All
    determinations, interpretations and constructions made by the
    Board in good faith shall not be subject to review by anyone and
    shall be final, binding and conclusive on all Participants and
    any other person having an interest in such determination,
    interpretation or construction.

 

    4.  Shares Subject
    to the Plan.

 

    (a) Share Reserve.  Subject to the
    provisions of Section 11 relating to adjustments upon
    changes in Common Stock, the Common Stock that may be issued
    pursuant to Stock Awards shall not exceed in the aggregate fifty
    two million
    (52,000,000)1
    shares of Common Stock. No more than two million
    (2,000,000)2
    of such shares of Common Stock (subject to adjustment as
    provided in Section 11) may be awarded under the Plan
    in the aggregate in respect of the Stock Awards pursuant to
    Section 7 for which a Participant pays less than Fair
    Market Value per share on the date of grant.

 

    (b) Reversion of Shares to the Share
    Reserve.  If any Stock Option shall for any reason
    expire or otherwise terminate, in whole or in part, without
    having been exercised in full, the shares of Common Stock not
    acquired under such Stock Option shall revert to and again
    become available for issuance under the Plan.

 

    (c) Source of Shares.  The shares of
    Common Stock subject to the Plan may be unissued shares or
    reacquired shares, bought on the market or otherwise.

 

    5.  Eligibility.

 

    (a) Eligibility for Specific Stock
    Awards.  Stock Awards may be granted to Employees
    and Consultants.

 

    (b) Consultants.

 

    (i) Consultant shall not be eligible for the grant of a
    Stock Award if, at the time of grant, a
    Form S-8
    Registration Statement under the Securities Act
    (“Form S-8”)
    is not available to register either the offer or the sale of the
    Company’s securities to such Consultant because of the
    nature of the services that the Consultant is providing to the
    Company, or because the Consultant is not a natural person, or
    as otherwise provided by the rules governing the use of
    Form S-8.

 

    (ii) Form S-8
    generally is available to consultants and advisors only if
    (i) they are natural persons; (ii) they provide bona
    fide services to the issuer, its parents, its majority-owned
    subsidiaries or majority-owned subsidiaries of the issuer’s
    parent; and (iii) the services are not in connection with
    the offer or sale of securities

 

 

    1  
    Denotes that such share number reflects the stock splits of
    eBay’s common stock occurring in 5/00, 8/03 and 2/05.

    2  
    Denotes that such share number reflects the stock split of
    eBay’s common stock occurring only in 2/05 because this
    provision was approved in 2004.

    

    4

 

    in a capital-raising transaction, and do not directly or
    indirectly promote or maintain a market for the issuer’s
    securities.

 

    (c) Section 162(m)
    Limitation.  Notwithstanding the provisions of
    subsection 5(a) hereof and subject to the provisions of
    Section 11 relating to adjustments upon changes in the
    shares of Common Stock, no Employee shall be eligible to be
    granted Options covering more than four million
    (4,000,000)1
    shares of Common Stock during any calendar year.

 

    6.  Option
    Provisions

 

    Each Option shall be in such form and shall contain such terms
    and conditions as the Board shall deem appropriate. The
    provisions of separate Options need not be identical, but each
    Option shall include (through incorporation of provisions hereof
    by reference in the Option or otherwise) the substance of each
    of the following provisions:

 

    (a) Exercise Price.  The exercise price of
    each Option shall not be less than one hundred percent (100%) of
    the Fair Market Value of the Common Stock subject to the Option
    on the date the Option is granted. Notwithstanding the
    foregoing, an Option may be granted with an exercise price lower
    than that set forth in the preceding sentence if such Option is
    granted pursuant to an assumption or substitution for another
    option in a manner satisfying the provisions of
    Section 424(a) of the Code.

 

    (b) Consideration.  The purchase price of
    Common Stock acquired pursuant to an Option shall be paid, to
    the extent permitted by applicable statutes and regulations,
    either (i) in cash at the time the Option is exercised, or
    (ii) at the discretion of the Board: (1) by delivery
    to the Company, or attestation to the Company of ownership, of
    other Common Stock, (2) according to a deferred payment or
    other similar arrangement with the Optionholder, whether through
    the use of a promissory note or otherwise, or (3) in any
    other form of legal consideration that may be acceptable to the
    Board; provided, however, that at any time that the Company is
    incorporated in Delaware, payment of the Common Stock’s
    “par value,” as defined in the Delaware General
    Corporation Law, shall not be made by deferred payment.

 

    Unless otherwise specifically provided, the purchase price of
    Common Stock acquired pursuant to an Option that is paid by
    delivery to the Company, or attestation to the Company of
    ownership, of other Common Stock shall be paid only by shares of
    the Common Stock of the Company that have been held for more
    than six (6) months (or such longer or shorter period of
    time required to avoid a charge to earnings for financial
    accounting purposes).

 

    (c) Transferability.  An Option shall be
    transferable to the extent provided in the Option Agreement. If
    the Option does not provide for transferability, then the Option
    shall not be transferable except by will or by the laws of
    descent and distribution and shall be exercisable during the
    lifetime of the Optionholder only by the Optionholder.
    Notwithstanding the foregoing, the Optionholder may, by
    delivering written notice to the Company, in a form satisfactory
    to the Company, designate a third party who, in the event of the
    death of the Optionholder, shall thereafter be entitled to
    exercise the Option.

 

    (d) Vesting Generally.  The total number
    of shares of Common Stock subject to an Option may, but need
    not, vest and therefore become exercisable in periodic
    installments that may, but need not, be equal. The Option may be
    subject to such other terms and conditions on the time or times
    when it may be exercised (which may be based on performance or
    other criteria) as the Board may deem appropriate. The vesting
    provisions of individual Options may vary. The provisions of
    this subsection 6(d) are subject to any Option provisions
    governing the minimum number of shares of Common Stock as to
    which an Option may be exercised.

 

    (e) Termination of Continuous Service.  In
    the event an Optionholder’s Continuous Service terminates
    (other than upon the Optionholder’s death or Disability),
    the Optionholder may exercise his or her Option (to the extent
    that the Optionholder was entitled to exercise such Option as of
    the date of termination) but only within such period of time
    ending on the earlier of (i) the date three (3) months
    following the termination of the

 

 

    1  Denotes
    that such share number reflects the stock split of eBay’s
    common stock occurring only in 2/05 because this provision was
    approved in 2004.

    

    5

 

    Optionholder’s Continuous Service (or such longer or
    shorter period specified in the Option Agreement), or
    (ii) the expiration of the term of the Option as set forth
    in the Option Agreement. If, after termination, the Optionholder
    does not exercise his or her Option within the time specified in
    the Option Agreement, the Option shall terminate.

 

    (f) Extension of Termination Date.  An
    Optionholder’s Option Agreement may also provide that if
    the exercise of the Option following the termination of the
    Optionholder’s Continuous Service (other than upon the
    Optionholder’s death or Disability) would be prohibited at
    any time solely because the issuance of shares of Common Stock
    would violate the registration requirements under the Securities
    Act, then the Option shall terminate on the earlier of
    (i) the expiration of the term of the Option, or
    (ii) the expiration of a period of three (3) months
    after the termination of the Optionholder’s Continuous
    Service during which the exercise of the Option would not be in
    violation of such registration requirements.

 

    (g) Disability of Optionholder.  In the
    event that an Optionholder’s Continuous Service terminates
    as a result of the Optionholder’s Disability, the
    Optionholder may exercise his or her Option (to the extent that
    the Optionholder was entitled to exercise such Option as of the
    date of termination), but only within such period of time ending
    on the earlier of (i) the date twelve (12) months
    following such termination (or such longer or shorter period
    specified in the Option Agreement), or (ii) the expiration
    of the term of the Option as set forth in the Option Agreement.
    If, after termination, the Optionholder does not exercise his or
    her Option within the time specified herein, the Option shall
    terminate.

 

    (h) Death of Optionholder.  In the event
    (i) an Optionholder’s Continuous Service terminates as
    a result of the Optionholder’s death or (ii) the
    Optionholder dies within the period (if any) specified in the
    Option Agreement after the termination of the
    Optionholder’s Continuous Service for a reason other than
    death, then the Option may be exercised (to the extent the
    Optionholder was entitled to exercise such Option as of the date
    of death) by the Optionholder’s estate, by a person who
    acquired the right to exercise the Option by bequest or
    inheritance or by a person designated to exercise the option
    upon the Optionholder’s death, but only within the period
    ending on the earlier of (1) the date eighteen
    (18) months following the date of death (or such longer or
    shorter period specified in the Option Agreement), or
    (2) the expiration of the term of such Option as set forth
    in the Option Agreement. If, after death, the Option is not
    exercised within the time specified herein, the Option shall
    terminate.

 

    (i) Early Exercise.  The Option may, but
    need not, include a provision whereby the Optionholder may elect
    at any time before the Optionholder’s Continuous Service
    terminates to exercise the Option as to any part or all of the
    shares of Common Stock subject to the Option prior to the full
    vesting of the Option. Any unvested shares of Common Stock so
    purchased may be subject to a repurchase option in favor of the
    Company or to any other restriction the Board determines to be
    appropriate. The Company will not exercise its repurchase option
    until at least six (6) months (or such longer or shorter
    period of time required to avoid a charge to earnings for
    financial accounting purposes) have elapsed following exercise
    of the Option unless the Board otherwise specifically provides
    in the Option.

 

    7.  Provisions
    of Stock Awards other than Options.

 

    (a) Stock Bonus Awards.  Each stock bonus
    agreement shall be in such form and shall contain such terms and
    conditions as the Board shall deem appropriate. The terms and
    conditions of stock bonus agreements may change from time to
    time, and the terms and conditions of separate stock bonus
    agreements need not be identical, but each stock bonus agreement
    shall include (through incorporation of provisions hereof by
    reference in the agreement or otherwise) the substance of each
    of the following provisions:

 

    (i) Consideration.  A stock bonus may be
    awarded in consideration for past services actually rendered to
    the Company or an Affiliate for its benefit.

 

    (ii) Vesting.  Shares of Common Stock
    awarded under the stock bonus agreement may, but need not, be
    subject to a share reacquisition right or option in favor of the
    Company in accordance with a vesting schedule to be determined
    by the Board.

    

    6

 

 

    (iii) Termination of Participant’s Continuous
    Service.  In the event a Participant’s
    Continuous Service terminates, the Company may reacquire any or
    all of the shares of Common Stock held by the Participant which
    have not vested as of the date of termination under the terms of
    the stock bonus agreement.

 

    (iv) Transferability.  Rights to acquire
    shares under the stock bonus agreement shall be transferable by
    the Participant only upon such terms and conditions as are set
    forth in the stock bonus agreement, as the Board shall determine
    in its discretion, so long as Common Stock awarded under the
    stock bonus agreement remains subject to the terms of the stock
    bonus agreement.

 

    (b) Restricted Stock Purchase
    Awards.  Each restricted stock purchase agreement
    shall be in such form and shall contain such terms and
    conditions as the Board shall deem appropriate. The terms and
    conditions of the restricted stock purchase agreements may
    change from time to time, and the terms and conditions of
    separate restricted stock purchase agreements need not be
    identical, but each restricted stock purchase agreement shall
    include (through incorporation of provisions hereof by reference
    in the agreement or otherwise) the substance of each of the
    following provisions:

 

    (i) Purchase Price.  The purchase price
    under each restricted stock purchase agreement shall be such
    amount as the Board shall determine and designate in such
    restricted stock purchase agreement.

 

    (ii) Consideration.  The purchase price of
    Common Stock acquired pursuant to the restricted stock purchase
    agreement shall be paid either: (i) in cash at the time of
    purchase; (ii) at the discretion of the Board, according to
    a deferred payment or other similar arrangement with the
    Participant, whether through the use of a promissory note or
    otherwise; or (iii) in any other form of legal
    consideration that may be acceptable to the Board in its
    discretion; provided, however, that at any time that the Company
    is incorporated in Delaware, then payment of the Common
    Stock’s “par value,” as defined in the Delaware
    General Corporation Law, shall not be made by deferred payment.

 

    (iii) Vesting.  Shares of Common Stock
    acquired under the restricted stock purchase agreement may, but
    need not, be subject to a share repurchase option in favor of
    the Company in accordance with a vesting schedule to be
    determined by the Board.

 

    (iv) Termination of Participant’s Continuous
    Service.  In the event a Participant’s
    Continuous Service terminates, the Company may repurchase or
    otherwise reacquire any or all of the shares of Common Stock
    held by the Participant which have not vested as of the date of
    termination under the terms of the restricted stock purchase
    agreement.

 

    (v) Transferability.  Rights to acquire
    shares under the restricted stock purchase agreement shall be
    transferable by the Participant only upon such terms and
    conditions as are set forth in the restricted stock purchase
    agreement, as the Board shall determine in its discretion, so
    long as Common Stock awarded under the restricted stock purchase
    agreement remains subject to the terms of the restricted stock
    purchase agreement.

 

    (c) Restricted Stock Unit Awards.  The
    Board, or the Committee, if delegated by the Board, is
    authorized to make awards of restricted stock units to any
    Employee or Consultant selected by the Board in such amounts and
    subject to such terms and conditions as the Board shall deem
    appropriate. On the maturity date of a restricted stock unit,
    unless otherwise noted in the restricted stock unit agreement,
    the Company shall transfer to the Participant one unrestricted,
    fully transferable share of Common Stock for each restricted
    stock unit scheduled to be paid out on such date and not
    previously forfeited.

 

    (i) Consideration.  Restricted stock units
    may be awarded in consideration for past services actually
    rendered to the Company or an Affiliate for its benefit.

 

    (ii) Form of Restricted Stock Unit
    Award.  All awards of restricted stock units made
    pursuant to this Plan will be evidenced by a restricted stock
    unit agreement and will comply with and be subject to the terms
    and conditions of this Plan.

 

    (iii) Terms of Restricted Stock Unit
    Awards.  Restricted stock units shall be subject
    to such terms and conditions as the Board may impose. These
    terms and conditions may include restrictions based upon

    

    7

 

    completion of a specified period of service with the Company or
    an Affiliate, or upon completion of the performance goals as set
    out in advance in the Participant’s individual restricted
    stock unit agreement. The terms of restricted stock units may
    vary from Participant to Participant and between groups of
    Participants. Prior to the grant of a restricted stock unit
    award, the Board shall: (a) determine the nature, length
    and starting date of any performance period for the restricted
    stock unit; (b) select from among the performance factors
    to be used to measure performance goals, if any; and
    (c) determine the number of shares of Common Stock that may
    be awarded to the Participant pursuant to such restricted stock
    unit. Prior to the issuance of any shares of Common Stock
    pursuant to any restricted stock unit, the Board shall determine
    the extent to which performance goals have been met. Performance
    periods may overlap and Participants may participate
    simultaneously with respect to restricted stock units that are
    subject to different performance periods and have different
    performance goals and other criteria.

 

    (iv) Termination During Performance
    Period.  In the event a Participant’s
    Continuous Service terminates during a performance period for
    any reason, then such Participant will be entitled to payment
    (whether in shares of Common Stock, cash or otherwise, at the
    Committee’s sole discretion) with respect to the restricted
    stock unit only to the extent performance goals are met as of
    the date of termination of the Participant’s Continuous
    Service in accordance with the restricted stock unit agreement,
    unless the Board will determine otherwise.

 

    (v) Form and Timing of Settlement of Restricted Stock
    Units.  Settlement of restricted stock units shall
    be made as soon as practicable after vesting
    and/or the
    expiration of the applicable performance period. The Board, in
    its sole discretion, may settle restricted stock units in the
    form of cash, in shares of Common Stock (which have an aggregate
    Fair Market Value equal to the value of the earned restricted
    stock units), or in a combination thereof.

 

    8.  Covenants
    of the Company.

 

    (a) Availability of Shares.  During the
    terms of the Stock Awards, the Company shall keep available at
    all times the number of shares of Common Stock required to
    satisfy such Stock Awards.

 

    (b) Securities Law Compliance.  The
    Company shall seek to obtain from each regulatory commission or
    agency having jurisdiction over the Plan such authority as may
    be required to grant Stock Awards and to issue and sell shares
    of Common Stock upon exercise of the Stock Awards; provided,
    however, that this undertaking shall not require the Company to
    register under the Securities Act the Plan, any Stock Award or
    any Common Stock issued or issuable pursuant to any such Stock
    Award. If, after reasonable efforts, the Company is unable to
    obtain from any such regulatory commission or agency the
    authority which counsel for the Company deems necessary for the
    lawful issuance and sale of Common Stock under the Plan, the
    Company shall be relieved from any liability for failure to
    issue and sell Common Stock upon exercise or vesting of such
    Stock Awards unless and until such authority is obtained.

 

    9.  Use
    of Proceeds from Stock.

 

    Proceeds from the sale of Common Stock pursuant to Stock Awards
    shall constitute general funds of the Company.

 

    10.  Miscellaneous.

 

    (a) Acceleration of Exercisability and
    Vesting.  The Board shall have the power to
    accelerate the time at which a Stock Option may first be
    exercised or the time during which a Stock Award or any part
    thereof will vest in accordance with the Plan, notwithstanding
    the provisions in the Stock Award stating the time at which it
    may first be exercised or the time during which it will vest.

 

    (b) Stockholder Rights.  No Participant
    shall be deemed to be the holder of, or to have any of the
    rights of a holder with respect to, any shares of Common Stock
    subject to such Stock Award unless and until such Participant
    has satisfied all requirements for exercise of the Stock Option
    or receipt of other type of Stock Award pursuant to its terms.

    

    8

 

 

    (c) No Employment or other Service
    Rights.  Nothing in the Plan or any instrument
    executed or Stock Award granted pursuant thereto shall confer
    upon any Participant any right to continue to serve the Company
    or an Affiliate in the capacity in effect at the time the Stock
    Award was granted or shall affect the right of the Company or an
    Affiliate to terminate (i) the employment of an Employee
    with or without notice and with or without cause, for any reason
    or no reason, (ii) the service of a Consultant pursuant to
    the terms of such Consultant’s agreement with the Company
    or an Affiliate, or (iii) the service of a Director
    pursuant to the Bylaws of the Company or an Affiliate, and any
    applicable provisions of the corporate law of the jurisdiction
    in which the Company or the Affiliate is incorporated, as the
    case may be.

 

    (d) Investment Assurances.  The Company
    may require a Participant, as a condition of exercising a Stock
    Option or acquiring Common Stock under any Stock Award,
    (i) to give written assurances satisfactory to the Company
    as to the Participant’s knowledge and experience in
    financial and business matters
    and/or to
    employ a purchaser representative reasonably satisfactory to the
    Company who is knowledgeable and experienced in financial and
    business matters and that he or she is capable of evaluating,
    alone or together with the purchaser representative, the merits
    and risks of exercising the Stock Award; (ii) to give
    written assurances satisfactory to the Company stating that the
    Participant is acquiring Common Stock subject to the Stock Award
    for the Participant’s own account and not with any present
    intention of selling or otherwise distributing the Common Stock;
    and/or
    (iii) to give such other written assurances as the Company
    shall determine are necessary, desirable or appropriate to
    comply with applicable securities regulation and other governing
    law. The Company may, upon advice of counsel to the Company,
    place legends on stock certificates issued under the Plan as
    such counsel deems necessary or appropriate in order to comply
    with applicable securities laws, including, but not limited to,
    legends restricting the transfer of the Common Stock.

 

    (e) Withholding Obligations.  To the
    extent provided by the terms of a Stock Award Agreement, the
    Participant may satisfy any tax and social insurance withholding
    obligation arising under the laws or regulations of any country,
    state or local jurisdiction relating to the exercise of a Stock
    Option or acquisition of Common Stock under a Stock Award by any
    of the following means (in addition to the Company’s or
    Affiliate’s right to withhold from any compensation paid to
    the Participant by the Company or the Affiliate) or by a
    combination of such means: (i) tendering a cash payment;
    (ii) authorizing the Company to withhold shares of Common
    Stock from the shares of Common Stock otherwise issuable to the
    Participant as a result of the exercise or acquisition of Common
    Stock under the Stock Award; provided, however, that no shares
    of Common Stock are withheld with a value exceeding the minimum
    amount of tax required to be withheld by law (or such lesser
    amount as may be required to avoid variable award accounting);
    or (iii) delivering to the Company owned and unencumbered
    shares of the Common Stock; or (iv) authorizing the sale of
    shares of Common Stock by the Company’s designated broker
    equal to the amount of taxes due.

 

    11.  Adjustments
    upon Changes in Stock.

 

    (a) Capitalization Adjustments.  In the
    event that any dividend or other distribution, reorganization,
    merger, consolidation, combination, repurchase, or exchange of
    Common Stock or other securities of the Company, or other change
    in the corporate structure of the Company affecting the Common
    Stock (other than an Equity Restructuring) occurs such that an
    adjustment is determined by the Board (in its sole discretion)
    to be appropriate in order to prevent dilution or enlargement of
    the benefits or potential benefits intended to be made available
    under the Plan, then the Board shall, in such manner as it may
    deem equitable, adjust the number and class of Common Stock
    which may be delivered under the Plan, the number of shares
    covered by each outstanding Stock Award, the exercise price or
    grant price per share of such outstanding Stock Awards, if
    applicable, and the numerical limits of Sections 4(a) and
    4(c). The Company is not responsible for any tax consequences to
    the Participant resulting from such adjustment.

 

    (b) Dissolution or Liquidation.  In the
    event of a dissolution or liquidation of the Company, then all
    outstanding Stock Awards shall terminate immediately prior to
    such event.

 

    (c) Corporate Transaction.  In the event
    of (i) a sale, lease or other disposition of all or
    substantially all of the assets of the Company, (ii) a
    merger or consolidation in which the Company is not the
    surviving corporation, or (iii) a reverse merger in which
    the Company is the surviving corporation but the shares of
    Common Stock outstanding immediately preceding the merger are
    converted by virtue of the merger into other property, whether
    in the form of securities, cash or otherwise, then any surviving
    corporation or acquiring corporation shall assume or continue
    any

    

    9

 

    Stock Awards outstanding under the Plan or shall substitute
    similar stock awards (including an award to acquire the same
    consideration paid to the stockholders in the transaction
    described in this subsection 11(c)) for those outstanding
    under the Plan. In the event any surviving corporation or
    acquiring corporation refuses to assume or continue such Stock
    Awards or to substitute similar stock awards for those
    outstanding under the Plan, then with respect to Stock Awards
    held by Participants whose Continuous Service has not
    terminated, the vesting of such Stock Awards (and, if
    applicable, the time during which such Stock Awards may be
    exercised) shall be accelerated in full, and the Stock Awards
    shall terminate if not exercised (if applicable) at or prior to
    such event. With respect to any other Stock Awards outstanding
    under the Plan, such Stock Awards shall terminate if not
    exercised (if applicable) at or prior to such event.

 

    (d) Equity Restructuring Adjustments.  In
    connection with the occurrence of any Equity Restructuring, and
    notwithstanding anything to the contrary in Sections 11(a)
    and 11(c) the number and type of securities subject to each
    outstanding Stock Award and the exercise price or grant price
    thereof, if applicable, will be equitably adjusted by the
    Committee. The adjustments provided under this
    Section 11(d) shall be nondiscretionary and shall be final
    and binding on the affected Participant and the Company.

 

    12.  Amendment
    of the Plan and Stock Awards.

 

    (a) Amendment of Plan.  The Board at any
    time, and from time to time, may amend the Plan. However, except
    as provided in Section 11 relating to adjustments upon
    changes in Common Stock, no amendment shall be effective unless
    approved by the stockholders of the Company to the extent
    stockholder approval is necessary under applicable laws or
    regulations or to the extent that such amendment constitutes a
    material amendment to the Plan.

 

    (b) Stockholder Approval.  The Board may,
    in its sole discretion, submit any amendment to the Plan for
    stockholder approval, including, but not limited to, amendments
    to the Plan intended to satisfy the requirements of
    Section 162(m) of the Code and the regulations thereunder
    regarding the exclusion of performance-based compensation from
    the limit on corporate deductibility of compensation paid to
    Covered Employees. Notwithstanding any provision of the Plan to
    the contrary, the Board shall not, without prior stockholder
    approval, (A) reduce the exercise price of any outstanding
    Option under the Plan, (B) cancel any outstanding Option
    under the Plan and grant in substitution therefor, on either an
    immediate or delayed basis, a new Option under the Plan covering
    the same or a different number of shares of Common Stock or
    cash, or (C) take any other action with respect to any
    outstanding Option under the Plan that is treated as a repricing
    of such Option pursuant to generally accepted accounting
    principles.

 

    (c) No Impairment of Rights.  Rights under
    any Stock Award granted before amendment of the Plan shall not
    be impaired by any amendment of the Plan unless (i) the
    Company requests the consent of the Participant and
    (ii) the Participant consents in writing.

 

    (d) Amendment of Stock Awards.  The Board
    at any time, and from time to time, may amend the terms of any
    one or more Stock Awards; provided, however, that the rights
    under any Stock Award shall not be impaired by any such
    amendment unless (i) the Company requests the consent of
    the Participant, and (ii) the Participant consents in
    writing.

 

    13.  Termination
    or Suspension of the Plan.

 

    (a) Plan Term.  The Board may suspend or
    terminate the Plan at any time. No Stock Awards may be granted
    under the Plan while the Plan is suspended or after it is
    terminated.

 

    (b) No Impairment of Rights.  Suspension
    or termination of the Plan shall not impair rights and
    obligations under any Stock Award granted while the Plan is in
    effect, except with the written consent of the Participant.

 

    14.  Effective
    Date of Plan.

 

    The Plan shall become effective upon adoption by the Board.

 

    15.  Choice
    of Law.

 

    The law of the State of Delaware shall govern all questions
    concerning the construction, validity and interpretation of this
    Plan, without regard to such state’s conflict of laws rules.

    

    10

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