Document:

EXHIBIT 10.64

 

Micron Technology, Inc.

8000 S. Federal Way

Mail Stop 557

Boise, ID 83716

 

Nonstatutory Stock Option Plan

Form of Agreement and

Terms and Conditions

 

Pursuant to the terms and conditions of the Company’s Nonstatutory Stock Option Plan (the ‘Plan’), you have been
granted a Non-Qualified Stock Option to purchase shares (the ‘Option’) of stock
as outlined below.

 

	
  Granted To: [EMPLOYEE]

  
	
   

  	
   

  
	
  Grant Date:

  	
   

  
	
  Options Granted:

  	
   

  
	
  Option Price per
  Share:  $

  	
  Total Cost to
  Exercise:  $

  
	
   

  	
   

  
	
  Expiration Date:

  	
   

  
	
  Vesting
  Schedule:

  	
   

  

 

This
option may be exercised for thirty (30) days after termination of the Optionee’s
employment or consulting relationship with the Company.  Upon the death or disability of the Optionee,
this Option may be exercised for such longer period as provided in the
Plan.  In no event shall this option be
exercised later than the Expiration date as provided above.

 

By my
signature below, I hereby acknowledge receipt of this Option granted on the
date shown above, which has
been issued to me under the terms and conditions of the Plan.  I further acknowledge receipt of the copy of
the Plan and agree to conform to all of the terms and conditions of the Option
and the Plan.

 

I
acknowledge that the grant or acceptance of this Option do not constitute an
employment agreement and do not assure continuous employment with Micron
Technology, Inc., its affiliated companies, or subsidiaries.

 

I
authorize Micron Technology, Inc. to release my Social Security Number and
address information to the Company’s Broker who has agreed to provide brokerage
service for stock plan participants for the purposes of opening an account
under my name.

 

 

	
   

  	
  MICRON
  TECHNOLOGY, INC.

  a Delaware Corporation

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Signature:

  	
   

  	
   

  	
   

  
	
   

  	
  [employee]

  	
   

  
	
   

  	
   

  
	
  Date:

  	
   

  	
   

  
							

 

 

NONSTATUTORY STOCK OPTION PLAN TERMS AND CONDITIONS

 

Unless otherwise defined herein, the terms defined in
the Plan shall have the same defined meanings in this Option Agreement.

 

I.                                         OPTIONEE

 

The Optionee named on the Notice of Grant on the
reverse side hereof has been granted an option to purchase Common Stock of the
Company, subject to the terms and conditions of the Nonstatutory Stock Option
Plan (the “Plan”), and this Option Agreement.

 

II.                                     AGREEMENT

 

1.                                       Grant
of Option.  The Plan Administrator of
the Company hereby grants to the Optionee (the “Optionee”), an option (the “Option”)
to purchase the number of Shares, as set forth in the Notice of Grant, at the
exercise price per share set forth in the Notice of Grant (the “Exercise Price”),
subject to the terms and conditions of the Plan, which is incorporated herein
by reference.  Subject to Section 14(b)
of the Plan, in the event of a conflict between the terms and conditions of the
Plan and the terms and conditions of this Option Agreement, the terms and
conditions of the Plan shall prevail.

 

2.                                       Exercise
of Option.

 

(a)  Right to Exercise.  This Option is exercisable during its term in
accordance with the Vesting Schedule set out in the Notice of Grant and
the applicable provisions of the Plan and this Option Agreement.  In the event of an Optionee’s death,
disability or other termination of Optionee’s employment or consulting
relationship, the exercisability of the Option is governed by the applicable
provisions of the Plan and this Option Agreement.

 

(b)  Method of Exercise.  This Option is exercisable by delivery of an
exercise notice, substantially in a form approved by the Company (the “Exercise
Notice”), which shall state the election to exercise the Option, the number of
Shares in respect of which the Option is being exercised (the “Exercise Shares”),
and such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. 
The Exercise Notice shall be signed by the Optionee and shall be
delivered in person or by certified mail to the Secretary of the Company.  The Exercise Notice shall be accompanied by
payment of the aggregate Exercise Price as to all Exercised Shares.  This Option shall be deemed to be exercised
upon receipt by the Company of such fully executed Exercise Notice accompanied
by such aggregate Exercise Price.

 

No
Shares shall be issued pursuant to the exercise of this Option unless such
issuance and exercise complies with all relevant provisions of law and the
requirements of any stock exchange or quotation service upon which the Shares
are then listed.  Assuming such
compliance, for income tax purposes the Exercise Shares shall be considered
transferred to the Optionee on the date the Option is exercised with respect to
such Exercise Shares.

 

3.                                       Method
of Payment.  Payment of the aggregate
Exercise Price shall be by any of the following, or a combination thereof, at
the election of the Optionee:

 

(a)  cash;

 

(b)  check; or,

 

(c)  delivery of a properly executed Exercise
Notice together with such other documentation as the Administrator and the
broker, if applicable, shall require to effect an exercise of the Option and
delivery to the Company of the sale of loan proceeds required to pay the
exercise price.

 

4.                                       Non-Transferability
of Option.  This Option may not be
transferred in any manner otherwise than by will or by the laws of descent or
distribution and may be exercised during the lifetime of Optionee only by the
Optionee.  The terms of the Plan and this
Option Agreement shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.

 

5.                                       Term
of Option.  This Option may be
exercised only within the term set out in the Notice of Grant, and may be
exercised during such term only in accordance with the Plan and the terms of
this Option Agreement.

 

6.                                       Entire
Agreement; Governing Law.  The Plan
is incorporated herein by reference.  The
Plan, this Option Agreement and Notice of Grant constitute the entire agreement
of the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the
Optionee’s interest except by means of a writing signed by the Company and Optionee.  This agreement is governed by Delaware law
except for that body of law pertaining to conflict of laws.

 

By your acceptance of this agreement, you agree that
the Option is granted under and governed by the terms and conditions of the
Plan, this Option Agreement and Notice of Grant.  Optionee has reviewed the Plan, this Option
Agreement and Notice of Grant in their

 

 

entirety, has had an opportunity to obtain the advice of counsel prior
to executing this Option Agreement and fully understands all provisions of the
Plan, this Option Agreement and Notice of Grant.  Optionee hereby agrees to accept as binding,
conclusive and final all decisions or interpretations of the Administrator upon
any questions relating to the Plan and Option Agreement.  Optionee further agrees to notify the Company
upon any change in the Optionee’s residence address by contacting the Company’s
Stock Administration Department.

 

Revised:  10/19/01EXHIBIT 10.139

 

MICRON TECHNOLOGY, INC.

 

1989 EMPLOYEE STOCK PURCHASE PLAN

 

The following constitute the provisions of
the 1989 Employee Stock Purchase Plan of Micron Technology, Inc.:

 

1.                                       Purpose.  The purpose of the Plan is to provide
employees of the Company and its Designated Subsidiaries with an opportunity to
purchase Common Stock of the Company through accumulated payroll
deductions.  It is the intention of the
Company to have the Plan qualify as an “Employee Stock Purchase Plan” under Section 423
of the Internal Revenue Code of 1986, as amended.  The provisions of the Plan shall,
accordingly, be construed so as to extend and limit participation in a manner
consistent with the requirements of that section of the Code.

 

2.                                       Definitions.

 

(a)                                  “Board” shall
mean the Board of Directors of the Company.

 

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

 

(c)                                  “Committee”
shall mean the committee of the Board appointed by the Board to administer the
Plan, if any is appointed.

 

(d)                                 “Common Stock”
shall mean the Common Stock, $.10 par value, of the Company.

 

(e)                                  “Company”
shall mean Micron Technology, Inc., a Delaware corporation.

 

(f)                                    “Compensation”
with respect to any Employee means such Employee’s wages, salaries, fees for
professional services and other amounts received for personal services actually
rendered in the course of employment with the Company or its designated
subsidiaries to the extent that the amounts are includible in gross income
(including, but not limited to, commissions paid to salesmen, compensation for
services on the basis of a percentage of profits, tips, and bonuses).

 

Compensation shall exclude (a)(1)
contributions made by the employer to a plan of deferred compensation to the
extent that, the contributions are not includible in the gross income of the
Employee for the taxable year in which contributed, (2) employer contributions
made on behalf of an Employee to a simplified employee pension plan described
in Code Section 408(k) to the extent such contributions are excludable
from the Employee’s gross income, (3) any distributions from a plan of deferred
compensation; (b) amounts realized from the exercise of a non-qualified stock
option, or when restricted stock (or property) held by an Employee either
becomes freely transferable or is no longer subject to substantial risk of
forfeiture; (c) amounts realized from the sale, exchange or other disposition
of stock acquired under a qualified stock option; (d) other amounts which
receive special tax benefits, such as premiums for group-term life insurance
(but only to the extent that the premiums are not includible in the gross
income of the employee), or contributions made by the employer (whether or not
under a salary reduction agreement) towards the purchase of any annuity contract
described in Code Section 403(b) (whether or not the contributions are
actually excludable from the Employee’s gross income); (e) reimbursements or
other expense allowances; (f) fringe benefits (cash and noncash); (g) moving
expenses; and (h) welfare benefits.

 

(g)                                 “Continuous Status
as an Employee” shall mean the absence of any interruption or termination
of service as an Employee.  Continuous
Status as an Employee shall not be considered interrupted in the case of a
leave of absence agreed to in writing by the Company, provided that such leave
is for a period of not more than 90 days or reemployment upon the expiration of
such leave is guaranteed by contract or statute.

 

(h)                                 “Designated
Subsidiaries” shall mean the Subsidiaries which have been designated by the
Board from time to time in its sole discretion as eligible to participate in
the Plan.

 

 

 

02/08/2005

 

(i)                                     “Employee”
shall mean any person, including an officer, who is continuously employed for
at least twenty (20) hours per week and more than five (5) months in a calendar
year by the Company or one of its Designated Subsidiaries.

 

(j)                                     “Enrollment
Date” shall mean the first day of each Offering Period.

 

(k)                                  “Exercise
Date” shall mean the last Trading Day of each Offering Period of the Plan.

 

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

 

(i)                                     If the Common Stock is listed on any
established stock exchange, including without limitation the New York Stock
Exchange (“NYSE”), or a national market system, the Fair Market Value of a
Share of Common Stock shall be the average closing price for such stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system
(or the exchange with the greatest volume of trading in Common Stock) for the
last market trading day prior to the day of determination, as reported by Bloomberg L.P. or such other source as the Administrator deems
reliable;

 

(ii)                                  If the Common Stock is quoted on the
over-the-counter market or is regularly quoted by a recognized securities
dealer, but selling prices are not reported, the Fair Market Value of a Share
of Common Stock shall be the mean between the high bid and low asked prices for
the Common Stock on the last market trading day prior to the day of determination,
as reported by Bloomberg L.P. or such other source as the
Administrator deems reliable;

 

(iii)                               In
the absence of an established market for the Common Stock, the Fair Market
Value shall be determined in good faith by the Administrator.

 

(m)                               “Offering Period”
shall mean a period of three (3) months during which an option granted pursuant
to the Plan may be exercised.

 

(n)                                 “Plan” shall
mean this Employee Stock Purchase Plan.

 

(o)                                 “Subsidiary”
shall mean a corporation, domestic or foreign, of which not less than 50% of
the voting shares are held by the Company or a Subsidiary, whether or not such
corporation now exists or is hereafter organized or acquired by the Company or
a Subsidiary.

 

(p)                                 “Trading Day”
shall mean a day on which the national stock exchanges and Nasdaq system are
open for trading.

 

3.                                       Eligibility.

 

(a)                                  Any Employee as
defined in paragraph 2 who is employed by the Company or any subsidiary of the
Company on a given Enrollment Date shall be eligible to participate in the
Plan.

 

(b)                                 Any provisions of the
Plan to the contrary notwithstanding, no Employee shall be granted an option
under the Plan (i) if, immediately after the grant, such Employee (or any other
person whose stock would be attributed to such Employee pursuant to Section 424(d)
of the Code) would own stock and/or hold outstanding options to purchase stock
possessing five percent (5%) or more of the total combined voting power or
value of all classes of stock of the Company or of any subsidiary of the
Company, or (ii) which permits his rights to purchase stock under all employee
stock purchase plans (described in Section 423 of the Code) of the Company
and its subsidiaries to accrue at a rate which exceeds Twenty-Five Thousand
Dollars ($25,000) of Fair Market Value of such stock (determined at the time
such option is granted) for each calendar year in which such option is
outstanding at any time.

 

(c)                                  All Employees who
participate in the Plan shall have the same rights and privileges, except for
differences that may be mandated by local law and that are consistent with Code
Section 423(b)(5);

 

2

 

provided that Employees participating in any sub-plan adopted pursuant
to Section 14(c) that is not designed to qualify under Section 423 of
the Code need not have the same rights and privileges as Employees
participating in the Code Section 423 plan.

 

4.                                       Offering
Periods.  The Plan shall be
implemented by consecutive Offering Periods with a new Offering Period
commencing on or about January 1, April 1, July 1, and October 1
of each year commencing on or about January 1, 1989 or, in the discretion
of the committee, April 1, 1989, and continuing thereafter until
terminated in accordance with paragraph 20 hereof.  Subject to the shareholder approval
requirements of paragraph 20, the Board of Directors of the Company shall have
the power to change the duration of offering periods with respect to future
offerings if such change is announced at least fifteen (15) days prior to the
scheduled beginning of the first offering period to be affected.

 

5.                                       Participation.

 

(a)                                  An eligible Employee may become a participant
in the Plan by completing a Company approved enrollment form authorizing
payroll deductions and filing it with the Company’s Global Stock Plans
Department at least ten (10) business days prior to the applicable Enrollment
Date, unless a different time for filing the subscription agreement is set by
the Board for all eligible Employees with respect to a given Offering Period.

 

(b)                                 Payroll
deductions for a participant shall commence on the first payroll following the
Enrollment Date and shall end on the last payroll in the Offering Period to
which such authorization is applicable, unless sooner terminated by the
participant as provided in paragraph 11.

 

6.                                       Payroll
Deductions.

 

(a)                                  At the time a
participant files his subscription agreement, he or she shall elect to have
payroll deductions made on each payday during the Offering Period in an amount
not less than one percent (1%) and not greater than twenty percent (20%) of the
Compensation which he or she received on the payday immediately preceding the
Enrollment Date, and the aggregate of such payroll deductions during the
Offering Period shall not exceed twenty percent (20%) of his or her aggregate
Compensation during said Offering Period.

 

(b)                                 All payroll deductions
made by a participant shall be credited to his or her account under the
Plan.  A participant may not make any
additional payments into such account.

 

(c)                                  A
participant may discontinue his or her participation in the Plan as provided in
paragraph 11, but may not otherwise change, their rate of payroll deductions
during the Offering Period.  A
participant’s subscription agreement shall remain in effect for successive
Offering Periods unless revised as provided herein or terminated as provided in
paragraph 11.

 

(d)                                 Notwithstanding the
foregoing, to the extent necessary to comply with Section 423(b)(8) of the
Code and paragraph 3(b) herein, a participant’s payroll deductions may be
decreased to 0% at such time during any Offering Period which is scheduled to
end during the current calendar year that the aggregate of all payroll
deductions accumulated with respect to such Offering Period and any other
Offering Period ending within the same calendar year equal $21,250.  Payroll deductions shall recommence at the
rate provided in such participant’s subscription agreement at the beginning of
the first Offering Period which is scheduled to end in the following calendar
year, unless terminated by the participant as provided in paragraph 11.

 

7.                                       Grant of
Option.

 

(a)                                  On
the Enrollment Date of each Offering Period, each eligible Employee
participating in such Offering Period shall be granted an option to purchase on
each Exercise Date during such Offering Period up to a number of shares of the
Company’s Common Stock determined by dividing such Employee’s payroll
deductions accumulated prior to such Exercise Date and retained in the
participant’s account as of the Exercise Date by ninety-five percent (95%) of
the Fair Market Value of a share of the Company’s Common Stock on the Exercise
Date; provided that in no event shall an Employee be permitted to purchase
during each Offering Period more than 2,000 shares, and provided further that
such purchase shall be subject to the limitations set forth in Section 3(b)
and 13

 

3

 

hereof.  Exercise of the option shall occur as
provided in Section 8, unless the participant has withdrawn pursuant to Section 11,
and shall expire on the last day of the Offering Period.  Fair market value or a share of the Company’s
Common Stock shall be determined as provided in Section 7(b) herein.

 

(b)                                 The option price per share of the shares offered
in a given Offering Period shall be: 95% of the Fair Market Value of a share of
the Common Stock of the Company on the Exercise Date.  The Fair Market Value of the Company’s Common
Stock on a given date shall be determined by the Board in its discretion;
provided, however that where there is a public market for the Common Stock, the
Fair Market Value per share shall be the closing price for the Company’s Common
Stock (or the closing bid, if no sales were reported) as quoted on any
established stock exchange, including without limitation the New York Stock
Exchange (“NYSE”), or a national market system (or the exchange with the
greatest volume of trading in Common Stock) on the day of determination, as
reported by Bloomberg, L.P. or such other source as the Administrator deems
reliable.

 

8.                                       Exercise of
Option.  Unless a participant
withdraws from the Plan as provided in paragraph 11, his or her option for the
purchase of shares will be exercised automatically on the Exercise Date of the
Offering Period, and the maximum number of full shares subject to option will
be purchased for him or her at the applicable option price with the accumulated
payroll deductions in his account.  The
shares purchased upon exercise of an option hereunder shall be deemed to be transferred
to the participant on the Exercise Date. 
During his or her lifetime, a participant’s option to purchase shares
hereunder is exercisable only by such participant.

 

9.                                       Maximum
Number of Shares per Offering Period. 
The maximum number of shares of the Company’s Common Stock which shall be
made available for sale under the Plan in each Offering Period shall be
1,250,000, subject to adjustment upon changes in capitalization of the Company
as provided in paragraph 19.  If the
total number of shares which would otherwise be subject to options granted
pursuant to Section 7(a) hereof on the Enrollment Date of an Offering
Period exceeds 1,250,000 shares, the Company shall make a pro rata allocation
of the shares available for option grant in as uniform a manner as shall be
practicable and as it shall determine to be equitable.  In such event, the Company shall give written
notice of such reduction of the number of shares subject to the option to each
participant affected thereby and shall similarly reduce the rate of payroll
deductions, if necessary.

 

10.                                 Delivery.  Following the Exercise Date of each Offering
Period, unless a participant requests the issuance of a certificate
representing the participant’s shares, the Company shall as soon as practicable
record the participant’s full shares in book entry form.  Upon request from a participant, the Company
shall arrange for the delivery to the participant of a certificate representing
the full shares purchased.  Any cash remaining
to the credit of a participant’s account under the Plan after a purchase by the
participant of shares at the termination of each Offering Period, which is
insufficient to purchase a full share of Common Stock of the Company, shall be
returned to said participant or retained in the participant’s account for the
subsequent Offering Period, as determined by the Company as to all participants
for a given Offering Period.

 

11.                                 Withdrawal;
Termination of Employment.

 

(a)                                  A participant may
withdraw all but not less than all the payroll deductions credited to such
participant’s account under the Plan at any time prior to the Exercise Date of
the Offering Period by giving written notice to the Company.  All of the participant’s payroll deductions
credited to his or her account will be paid to him or her promptly after
receipt of the notice of withdrawal and the participant’s option for the
current Offering Period will be automatically terminated, and no further
payroll deductions for the purchase of shares will be made during the Offering
Period.  If a participant withdraws from
an Offering Period, payroll deductions will not resume at the beginning of the
succeeding Offering Period unless the participant delivers to the Company a new
subscription agreement as described in Section 5(a).

 

(b)                                 Upon
termination of the participant’s Continuous Status as an Employee prior to the
Exercise Date of the Offering Period for any reason, including retirement or
death, the payroll deductions credited to such participant’s account will be
returned to him or her or, in the case of his or her death, to the person or
persons entitled thereto under paragraph 15, and such participant’s option will
be automatically terminated.

 

(c)                                  In the event an
Employee fails to remain in Continuous Status as an Employee of the Company for
at least twenty (20) hours per week during the Offering Period in which the
Employee is a participant,

 

4

 

he or she will be deemed to have elected to withdraw from the Plan and
the payroll deductions credited to his or her account will be returned to him
or her and the option terminated.

 

(d)                                 A participant’s
withdrawal from an Offering Period will not have any effect upon his or her
eligibility to participate in a succeeding Offering Period or in any similar
plan which may hereafter be adopted by the Company.

 

12.                                 Interest.  No interest shall accrue on the payroll
deductions of a participant in the Plan.

 

13.                                 Stock.

 

(a)                                  The
maximum number of shares of the Company’s Common Stock which shall be made
available for sale under the Plan shall be 29,500,000, subject to adjustment
upon changes in capitalization of the Company as provided in paragraph 19.  If the total number of shares which would
otherwise be subject to options granted pursuant to Section 7(a) hereof on
the Enrollment Date of an Offering Period exceeds the number of shares then
available under the Plan (after deduction of all shares for which options have
been exercised or are then outstanding), the Company shall make a pro rata
allocation of the shares remaining available for option grant in as uniform a
manner as shall be practicable and as it shall determine to be equitable.  In such event, the Company shall give written
notice of such reduction of the number of shares subject to the option to each
participant affected thereby and shall similarly reduce the rate of payroll
deductions, if necessary.

 

(b)                                 The participant will
have no interest or voting right in shares covered by his or her option until
such option has been exercised.

 

(c)                                  Shares to be
delivered to a participant under the Plan will be registered in the name of the
participant.

 

14.                                 Administration.  The Plan shall be administered by the Board
of the Company or a committee of members of the Board appointed by the
Board.  The administration,
interpretation or application of the Plan by the Board or its committee shall
be final, conclusive and binding upon all participants.  Members of the Board who are eligible
Employees are permitted to participate in the Plan, provided that:

 

(a)                                  Members of the Board
who are eligible to participate in the Plan may not vote on any matter
affecting the administration of the Plan or the grant of any option pursuant to
the Plan.

 

(b)                                 If a Committee is
established to administer the Plan, no member of the Board who is eligible to
participate in the Plan may be a member of the Committee.

 

(c)                                  The Board or the
Committee may adopt rules or procedures relating to the operation and
administration of the Plan to accommodate the specific requirements of local
laws and procedures.  Without limiting
the generality of the foregoing, the Board or the Committee is specifically
authorized to adopt rules and procedures regarding handling of payroll
deductions, payment of interest, conversion of local currency, payroll tax,
withholding procedures and handling of stock certificates which vary with local
requirements.  With respect to any
Designated Subsidiary that employs participants who reside outside of the
United States and notwithstanding anything herein to the contrary, the Board or
the Committee may, in its sole discretion, amend or vary the terms of the Plan
in order to conform such terms with the requirements of local law or to meet
the objectives and purpose of the Plan. 
The Board or the Committee may, where appropriate, establish one or more
sub-plans applicable to particular Designated Subsidiaries or locations to
reflect such amended or varied provisions and which sub-plans may be designed
to be outside the scope of Code Section 423.  The rules of such sub-plans may take
precedence over other provisions of the Plan, with the exception of Section 13(a),
but unless otherwise superseded by the terms of such sub-plan, the provisions
of the Plan shall govern the operation of such sub-plan.

 

15.                                 Designation of
Beneficiary.

 

(a)                                  A participant may
file a written designation of a beneficiary who is to receive any shares and
cash, if any, from the participant’s account under the Plan in the event of
such participant’s death subsequent to

 

5

 

the end of the Offering Period but prior to delivery to him of such
shares and cash.  In addition, a
participant may file a written designation of a beneficiary who is to receive
any cash from the participant’s account under the Plan in the event of such
participant’s death prior to the Exercise Date of the Offering Period.

 

(b)                                 Such designation of
beneficiary may be changed by the participant at any time by written
notice.  In the event of the death of a
participant and in the absence of a beneficiary validly designated under the Plan
who is living at the time of such participant’s death, the Company shall
deliver such shares and/or cash to the executor or administrator of the estate
of the participant, or if no such executor or administrator has been appointed
(to the knowledge of the Company), the Company, in its discretion, may deliver
such shares and/or cash to the spouse or to any one or more dependents or
relatives of the participant, or if no spouse, dependent or relative is known
to the Company, then to such other person as the Company may designate.

 

16.                                 Transferability of
Rights.  Neither payroll deductions
credited to a participant’s account nor any rights with regard to the exercise
of an option or to receive shares under the Plan may be assigned, transferred,
pledged or otherwise disposed of in any way (other than by will, the laws of
descent and distribution or as provided in paragraph 15 hereof) by the
participant.  Any such attempt at
assignment, transfer, pledge or other disposition shall be without effect,
except that the Company may treat such act as an election to withdraw funds in
accordance with paragraph 11.

 

17.                                 Use of Funds.  All payroll deductions received or held by
the Company under the Plan may be used by the Company for any corporate
purpose, and the Company shall not be obligated to segregate such payroll
deductions.

 

18.                                 Reports.  Individual accounts will be maintained for
each participant in the Plan.  Statements
of account will be given to participating Employees; on no less than an annual
basis, promptly following the Exercise Date, which statements will set forth
the amounts of payroll deductions, the per share purchase price, the number of
shares purchased and the remaining cash balance, if any.

 

19.                                 Adjustments Upon
Changes in Capitalization.  Subject
to any required action by the shareholders of the Company, the number of shares
of Common Stock covered by each option under the Plan which has not yet been
exercised and the number of shares of Common Stock which have been authorized
for issuance under the Plan but have not yet been placed under option
(collectively, the “Reserves”), as well as the price per share of Common Stock
covered by each option under the Plan which has not yet been exercised, 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 or reclassification of the Common Stock, or
any other increase or decrease in the number of 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 Board, whose
determination in that respect shall be final, binding and conclusive.  Except as expressly provided herein, no issue
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 of Common Stock
subject to an option.

 

In the event of the proposed dissolution or
liquidation of the Company, the Offering Period will terminate immediately
prior to the consummation of such proposed action, unless otherwise provided by
the Board.  In the event of a
reorganization, merger, or consolidation of the Company with one or more
corporations in which the Company is not the surviving corporation (or survives
as a direct or indirect subsidiary of other such other constituent corporation
or its parent), or upon a sale of all or substantially all of the property or
stock of the Company to another corporation, then, in the discretion of the
Board or the Committee, (i) each outstanding option shall be assumed, or an
equivalent option substituted, by the successor corporation or its parent, or
(ii) the Offering Period then in progress shall be shortened by setting a new
Exercise Date, which shall be on or before the date of the proposed
transaction.  If the Committee sets a new
Exercise Date, the Company shall notify each participant, at least ten (10)
business days prior to the new Exercise Date, that the original Exercise Date
has been changed to the new Exercise Date and that the participant’s option
shall be exercised automatically on the new Exercise Date, unless the
participant has withdrawn from the Offering Period, as provided in Section 11(a)
hereof, prior to the new Exercise Date.

 

6

 

The Board may, if it so determines in the
exercise of its sole discretion, also make provision for adjusting the
Reserves, as well as the price per share of Common Stock covered by each
outstanding option, in the event that the Company effects one or more
reorganizations, recapitalizations, rights offerings or other increases or
reductions of shares of its outstanding Common Stock, and in the event of the
Company being consolidated with or merged into any other corporation.

 

20.                                 Amendment or
Termination.  The Board of Directors
of the Company may at any time terminate or amend the Plan.  Except as provided in paragraph 19, no such
termination can affect options previously granted, nor may an amendment make
any change in any option theretofore granted which adversely affects the rights
of any participant, nor may an amendment be made without prior approval of the
shareholders of the Company (obtained in the manner described in paragraph 22)
if such amendment would:

 

(a)                                  Increase the number of
shares that may be issued under the Plan;

 

(b)                                 Change the designation
of the employees (or class of employees) eligible for participation in the
Plan; or

 

(c)                                  Materially increase
the benefits which may accrue to participants under the Plan.

 

(d)                                 In the event that the
Board determines that the ongoing operation of the Plan may result in
unfavorable financial accounting consequences, the Board may, in its discretion
and, to the extent necessary or desirable, modify or amend the Plan by means of
the following to reduce or eliminate such unfavorable accounting consequence
including, but not limited to:

 

(i)                                     altering
the option price per share for any Offering Period, including an Offering
Period underway at the time of the change in Purchase Price including an
alteration of the option price under paragraph 7(b); and

 

(ii)                                  shortening
any Offering Period so that Offering Period ends on a new Exercise Date,
including an Offering Period underway at the time of the Board action.

 

Such modifications or amendments shall not
require stockholder approval or the consent of any Plan participants.

 

21.                                 Notices.  All notices or other communications by a
participant to the Company under or in connection with the Plan shall be deemed
to have been duly given when received in the form specified by the Company at
the location, or by the person, designated by the Company for the receipt
thereof.

 

22.                                 Shareholder
Approval.  Continuance of the Plan
shall be subject to approval by the shareholders of the Company within twelve
months before or after the date the Plan is adopted.  If such shareholder approval is obtained at a
duly held shareholders’ meeting, it may be obtained by the affirmative vote of
the holders of a majority of the shares of the Company present or represented
and entitled to vote thereon, which approval shall be:

 

(a)                                  (1) solicited
substantially in accordance with Section 14(a) of the Securities Exchange
Act of 1934, as amended (the “Act”) and the rules and regulations promulgated
thereunder, or (2) solicited after the Company has furnished in writing to the
holders entitled to vote substantially the same information concerning the Plan
as that which would be required by the rules and regulations in effect under Section 14(a)
of the Act at the time such information is furnished; and

 

(b)                                 obtained at or prior
to the first annual meeting of shareholders held subsequent to the first
registration of Common Stock under Section 12 of the Act.

 

In the case of approval by written consent,
it must be obtained by the unanimous written consent of all shareholders of the
Company, or by written consent of a smaller percentage of shareholders but only
if the Board determines, on the basis of advice of the Company’s legal counsel,
that the written consent of such a smaller

 

7

 

percentage of shareholders will comply with all applicable laws and
will not adversely affect the qualifications of the Plan under Section 423
of the Code.

 

23.                                 Conditions Upon
Issuance of Shares.  Shares shall not
be issued with respect to an option unless the exercise of such option and the
issuance and delivery of such shares pursuant thereto shall comply with all
applicable provisions of law, domestic or foreign, including, without
limitation, the Securities Act of 1933, as amended, the Act, the rules and
regulations promulgated thereunder, and the requirements of any stock exchange
upon which the shares may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance.

 

As a condition to the exercise of an option,
the Company may require the person exercising such option 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 any of the aforementioned applicable provisions
of law.

 

24.                                 Term of Plan.  The Plan shall become effective upon the
earlier to occur of its adoption by the Board of Directors or its approval by
the shareholders of the Company as described in paragraph 22.  It shall continue in effect for a term of
twenty (20) years unless sooner terminated under paragraph 20.

 

8

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