Document:

exv10wb

Exhibit 10(b)

DIGI INTERNATIONAL INC.

EMPLOYEE STOCK PURCHASE PLAN

AS AMENDED AND RESTATED AS OF DECEMBER 4, 2009

     1. PURPOSE AND SCOPE OF PLAN. The purpose of this Digi International Inc. Employee Stock
Purchase Plan (the “Plan”) is to provide the employees of Digi International Inc. (the “Company”)
with an opportunity to acquire a proprietary interest in the Company through the purchase of its
Common Stock and, thus, to develop a stronger incentive to work for the continued success of the
Company. The Plan is intended to be an “employee stock purchase plan” within the meaning of Section
423(b) of the Internal Revenue Code of 1986, as amended, and shall be interpreted and administered
in a manner consistent with such intent.

     2. DEFINITIONS.

     2.1. The terms defined in this section are used (and capitalized) elsewhere in this Plan:

     (a) “Affiliate” means any corporation that is a “parent corporation” or “subsidiary
corporation” of the Company, as defined in Sections 424(e) and 424(f) of the Code or any successor
provision, and whose participation in the Plan has been approved by the Board of Directors.

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

     (c) “Code” means the Internal Revenue Code of 1986, as amended from time to time.

     (d) “Committee” means three or more Disinterested Persons designated by the Board of Directors
to administer the Plan under Section 13.

     (e) “Common Stock” means the common stock, par value $.01 per share (as such par value may be
adjusted from time to time), of the Company.

     (f) “Company” means Digi International Inc.

     (g) “Compensation” means the gross cash compensation (including wage, salary, commission,
bonus, and overtime earnings) paid by the Company or any Affiliate to a Participant in accordance
with the terms of employment.

     (h) “Disinterested Persons” means a member of the Board of Directors who is considered a
disinterested person within the meaning of Exchange Act Rule 16b-3 or any successor definition.

     (i) “Eligible Employee” means any employee of the Company or an Affiliate who has been
employed for at least 90 days and whose customary employment is at least 20 hours per week;
provided, however, that “Eligible Employee” shall not include any person who would be deemed for
purposes of Section 423(b)(3) of the Code, to own stock possessing 5% or more of the total combined
voting power or value of all classes of stock of the Company.

     (j) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

     (k) “Fair Market Value” of a share of Common Stock as of any date means, if the Company’s
Common Stock is listed on a national securities exchange or traded in the national market system,
the mean between the high and low sale prices for such Common Stock on such exchange or market on
said date, or, if no sale has been made on such exchange or market on said date, on the last
preceding day on which any sale shall have been made. If such determination of Fair Market Value is
not consistent with the then current regulations of the Secretary of the Treasury applicable to
plans intended to qualify as an “employee stock purchase plan” within the meaning of Section 423(b)
of the Code, however, Fair Market Value shall be determined in accordance with such regulations.
The determination of Fair Market Value shall be subject to adjustment as provided in Section 14.

     (l) “Participant” means an Eligible Employee who has elected to participate in the Plan in the
manner set forth in Section 4.

     (m) “Plan” means this Digi International Inc. Employee Stock Purchase Plan, as amended from
time to time.

     (n) “Purchase Period” means each quarter of the Company’s fiscal year. The first Purchase
Period will be the quarter that starts April 1, 1996 and ends June 30, 1996.

 

 

     (o) “Recordkeeping Account” means the account maintained in the books and records of the
Company recording the amount withheld from each Participant through payroll deductions made under
the Plan.

     (p) “Share” means a share of Common Stock.

     3. SCOPE OF THE PLAN. Shares of Common Stock may be sold by the Company to Eligible Employees
commencing April 1, 1996, as hereinafter provided, but not more than 2,000,000 shares of Common
Stock (subject to adjustment as provided in Section 14) shall be sold to Eligible Employees
pursuant to this Plan. All sales of Common Stock pursuant to this Plan shall be subject to the same
terms, conditions, rights and privileges. The shares of Common Stock delivered by the Company
pursuant to this Plan may be acquired shares having the status of any combination of authorized but
unissued shares, newly issued shares, or treasury shares.

     4. ELIGIBILITY AND PARTICIPATION. To be eligible to participate in the Plan for a given
Purchase Period, an employee must be an Eligible Employee on the first day of such Purchase Period.
An Eligible Employee may elect to participate in the Plan by filing an enrollment form with the
Company before the first day of such Purchase Period that authorizes regular payroll deductions
from Compensation beginning with the first payday in such Purchase Period and continuing until the
Eligible Employee withdraws from the Plan, modifies his or her authorization, or ceases to be an
Eligible Employee, as hereinafter provided.

     5. AMOUNT OF COMMON STOCK EACH ELIGIBLE EMPLOYEE MAY PURCHASE.

     5.1. Subject to the provisions of the Plan, each Eligible Employee shall be offered the right
to purchase on the last day of the Purchase Period the number of shares of Common Stock (including
fractional shares) that can be purchased at the price specified in Section 5.2 with the entire
credit balance in the Participant’s Recordkeeping Account; provided, however, that the Fair Market
Value (determined on the first day of any Purchase Period) of shares of Common Stock that may be
purchased by a Participant during such Purchase Period shall not exceed the excess, if any, of (i)
$25,000 over (ii) the Fair Market Value (determined on the first day of the relevant Purchase
Period) of shares of Common Stock previously acquired by the Participant in any prior Purchase
Period during such calendar year. Notwithstanding the foregoing, no Eligible Employee shall be
granted an option to acquire shares of Common Stock under this Plan which permits the Eligible
Employee’s rights to purchase shares of Common Stock under this Plan and all employee stock
purchase plans of the Company and the Affiliates to accrue at a rate which exceeds $25,000 of Fair
Market Value (determined at the time such option is granted) for each calendar year in which such
option is outstanding at any time. If the purchases by all Participants would otherwise cause the
aggregate number of shares of Common Stock to be sold under the Plan to exceed the number specified
in Section 3, however, each Participant shall be allocated at a ratable portion of the maximum
number of shares of Common Stock which may be sold.

     5.2. The purchase price of each share of Common Stock sold pursuant to this Plan will be the
lesser of (a) or (b) below: (a) 85% of the Fair Market Value of such share on the first day of the
Purchase Period. (b) 85% of the Fair Market Value of such share on the last day of the Purchase
Period.

     6. METHOD OF PARTICIPATION.

     6.1. The Company shall give notice to each Eligible Employee of the opportunity to purchase
shares of Common Stock pursuant to this Plan and the terms and conditions for such offering. Such
notice is subject to revision by the Company at any time prior to the date of purchase of such
shares. The Company contemplates that for tax purposes the first day of a Purchase Period will be
the date of the offering of such shares.

     6.2. Each Eligible Employee who desires to participate in the Plan for a Purchase Period shall
signify his or her election to do so by signing an election form developed by the Committee. An
Eligible Employee may elect to have any whole percent of Compensation withheld, but not exceeding
ten percent (10%) per pay period. An election to participate in the Plan and to authorize payroll
deductions as described herein must be made before the first day of the Purchase Period to which it
relates and shall remain in effect unless and until such Participant withdraws from this Plan,
modifies his or her authorization, or terminates his or her employment with the Company, as
hereinafter provided.

     6.3. Any Eligible Employee who does not make a timely election as provided in Section 6.2,
shall be deemed to have elected not to participate in the Plan. Such election shall be irrevocable
for such Purchase Period.

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     7. RECORDKEEPING ACCOUNT.

     7.1. The Company shall maintain a Recordkeeping Account for each Participant. Payroll
deductions pursuant to Section 6 will be credited to such Recordkeeping Accounts on each payday.

     7.2. No interest will be credited to a Participant’s Recordkeeping Account.

     7.3. The Recordkeeping Account is established solely for accounting purposes, and all amounts
credited to the Recordkeeping Account will remain part of the general assets of the Company.

     7.4. A Participant may not make any separate cash payment into the Recordkeeping Account.

     8. RIGHT TO ADJUST PARTICIPATION OR TO WITHDRAW.

     8.1. A Participant may, at any time during a Purchase Period, direct the Company to make no
further deductions from his or her Compensation or to adjust the amount of such deductions. Upon
either of such actions, future payroll deductions with respect to such Participant shall cease or
be adjusted in accordance with the Participant’s direction.

     8.2. Any Participant who stops payroll deductions may not thereafter resume payroll deductions
during such Purchase Period.

     8.3. At any time before the end of a Purchase Period, any Participant may also withdraw from
the Plan. In such event, all future payroll deductions shall cease and the entire credit balance in
the Participant’s Recordkeeping Account will be paid to the Participant, without interest, in cash
within 15 days. A Participant who withdraws from the Plan will not be eligible to reenter the Plan
until the next succeeding Purchase Period.

     8.4. Notification of a Participant’s election to adjust or terminate deductions, or to
withdraw from the Plan, shall be made by the filing of an appropriate notice to such effect with
the Company.

     9. TERMINATION OF EMPLOYMENT. If the employment of a Participant is terminated for any reason,
including death, disability, or retirement, the entire balance in the Participant’s Recordkeeping
Account will be applied to the purchase of shares as provided in Section 10.1 as of the last day of
the Purchase Period in which the Participant’s employment terminated; except that if such
Participant so requests prior to the last day of such Purchase Period, the Company shall refund in
cash within 15 days all amounts credited to his or her Recordkeeping Account.

     10. PURCHASE OF SHARES.

     10.1. As of the last day of the Purchase Period, the entire credit balance in each
Participant’s Recordkeeping Account will be used to purchase shares (including fractional shares)
of Common Stock (subject to the limitations of Section 5) unless the Participant has filed an
appropriate form with the Company in advance of that date (which either elects to purchase a
specified number of shares which is less than the number described above or elects to receive the
entire credit balance in cash). Any amount in a Participant’s Recordkeeping Account that is not
used to purchase shares pursuant to this Section 10.1 will be refunded to the Participant.

     10.2. Shares of Common Stock acquired by each Participant shall be held in a general account
maintained for the benefit of all Participants.

     10.3. Certificates for the number of whole shares of Common Stock, determined as aforesaid,
purchased by each Participant shall be issued and delivered to him or her only upon request of the
Participant or his or her representative directed to the Company. No Certificates for fractional
shares will be issued. Instead, Participants will receive a cash distribution representing any
fractional shares.

     10.4. Dividends with respect to a Participant’s shares held in the general account will, at
the election of the Participant, either be paid to the Participant in cash or reinvested in
additional shares of Common Stock. If a Participant fails to make such an election, all dividends
with respect to the Participant’s shares held in the general account will automatically be
reinvested to purchase additional shares of Common Stock.

     10.5. Each Participant will be entitled to vote all shares held for the benefit of such
Participant in the general account.

     11. RIGHTS AS A STOCKHOLDER. A Participant shall not be entitled to any of the rights or
privileges of a stockholder of the Company with respect to such shares, including the right to
receive any dividends which may be

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declared by the Company, until (i) he or she actually has paid the purchase price for such
shares and (ii) either the shares have been credited to his or her account or certificates have
been issued to him or her, both as provided in Section 10.

     12. RIGHTS NOT TRANSFERABLE. A Participant’s rights under this Plan are exercisable only by
the Participant during his or her lifetime, and may not be sold, pledged, assigned or transferred
in any manner other than by will or the laws of descent and distribution. Any attempt to sell,
pledge, assign or transfer the same shall be null and void and without effect. The amounts credited
to a Recordkeeping Account may not be assigned, transferred, pledged or hypothecated in any way,
and any attempted assignment, transfer, pledge, hypothecation or other disposition of such amounts
will be null and void and without effect.

     13. ADMINISTRATION OF THE PLAN. This Plan shall be administered by the Committee, which is
authorized to make such uniform rules as may be necessary to carry out its provisions. The
Committee shall determine any questions arising in the administration, interpretation and
application of this Plan, and all such determinations shall be conclusive and binding on all
parties.

     14. ADJUSTMENT FOR CHANGES IN CAPITALIZATION. In the event of any equity restructuring (within
the meaning of authoritative guidance issued by the Financial Accounting Standards Board relating
to stock-based compensation) that causes the per Share value of Shares to change, such as a stock
dividend, stock split, spin off, rights offering, or recapitalization through a large, nonrecurring
cash dividend, the Committee shall cause there to be made an equitable adjustment to the number,
class and purchase price of Shares that may be purchased under the Plan. In the event of any other
change in corporate capitalization, such as a merger, consolidation, any reorganization (whether or
not such reorganization comes within the definition of such term in Section 368 of the Code), or
any partial or complete liquidation of the Company, such equitable adjustments described in the
foregoing sentence may be made as determined to be appropriate and equitable by the Committee to
prevent dilution or enlargement of rights. In either case, any such adjustment shall be conclusive
and binding for all purposes of the Plan.

     15. REGISTRATION OF CERTIFICATES. Stock certificates will be registered in the name of the
Participant, or jointly in the name of the Participant and another person, as the Participant may
direct on an appropriate form.

     16. AMENDMENT OF PLAN. The Board of Directors may at any time amend this Plan in any respect
which shall not adversely affect the rights of Participants pursuant to shares previously acquired
under the Plan, except that, without stockholder approval, no amendment shall be made (i) to
increase the number of shares to be reserved under this Plan, (ii) to decrease the minimum purchase
price, (iii) to withdraw the administration of this Plan from the Committee, or (iv) to change the
definition of employees eligible to participate in the Plan.

     17. EFFECTIVE DATE OF PLAN. This Plan shall consist of an offering commencing April 1, 1996,
and ending June 30, 1996, and continuing on a quarterly basis thereafter. All rights of
Participants in any offering hereunder shall terminate at the earlier of (i) the day that
Participants become entitled to purchase a number of shares of Common Stock equal to or greater
than the number of shares remaining available for purchase or (ii) at any time, at the discretion
of the Board of Directors, after 30 days’ notice has been given to all Participants. Upon
termination of this Plan, shares of Common Stock shall be issued to Participants in accordance with
Section 10, and cash, if any, remaining in the Participant’s Recordkeeping Accounts shall be
refunded to them, as if the Plan were terminated at the end of a Purchase Period.

     18. GOVERNMENTAL REGULATIONS AND LISTING. All rights granted or to be granted to Eligible
Employees under this Plan are expressly subject to all applicable laws and regulations and to the
approval of all governmental authorities required in connection with the authorization, issuance,
sale or transfer of the shares of Common Stock reserved for this Plan, including, without
limitation, there being a current registration statement of the Company under the Securities Act of
1933, as amended, covering the shares of Common Stock purchasable on the last day of the Purchase
Period applicable to such shares, and if such a registration statement shall not then be effective,
the term of such Purchase Period shall be extended until the first business day after the effective
date of such a registration statement, or post-effective amendment thereto. If applicable, all such
rights hereunder are also similarly subject to effectiveness of an appropriate listing application
to a national securities exchange or a national market system, covering the shares of Common Stock
under the Plan upon official notice of issuance.

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     19. MISCELLANEOUS.

     19.1. This Plan shall not be deemed to constitute a contract of employment between the Company
and any Participant, nor shall it interfere with the right of the Company to terminate any
Participant and treat him or her without regard to the effect which such treatment might have upon
him or her under this Plan.

     19.2. Wherever appropriate as used herein, the masculine gender may be read as the feminine
gender, the feminine gender may be read as the masculine gender, the singular may be read as the
plural and the plural may be read as the singular.

     19.3. The Plan, and all agreements hereunder, shall be construed in accordance with and
governed by the laws of the State of Minnesota.

     19.4. Delivery of shares of Common Stock or of cash pursuant to this Plan shall be subject to
any required withholding taxes. A person entitled to receive shares of Common Stock may, as a
condition precedent to receiving such shares, be required to pay the Company a cash amount equal to
the amount of any required withholdings.

5exv10wc

Exhibit 10(c)

Digi International Inc.

ID:                           

11001 Bren Road East

Minnetonka, MN 55343

Notice of Grant of Stock Options and Option Agreement

	 	 	 
	[Optionee]

	 	Option Number:
	 
	 	 
	[Address]

	 	Plan: [Digi International Inc. 2000 Omnibus Stock Plan]
	 
	 	 
	[City, State, Zip]

	 	ID:

Effective [date], you have been granted a(n) Non-Qualified Stock Option to buy [number of shares]
shares of Digi International Inc. (the Company) stock at $[per share exercise price]-per share.

The total option price of the shares granted is $[aggregate exercise price].

Shares in each period will become fully vested on the date shown.

	 	 	 	 	 	 	 
	Shares

	 	Vest Type
	 	Full Vest
	 	Expiration
	 

	 	 
	 	 
	 	 
	 

By your signature and the Company’s signature below, you and the Company agree that these options
are granted under and governed by the terms and conditions of the
Plan identified above, as
amended, and the Option Agreement, all of which are attached and made a part of this document.

	 	 	 
	 
	 

	 	 
	Digi International Inc.

	 	Date
	 
	 

	 	 
	[Optionee]

	 	Date

 

 

DIGI INTERNATIONAL INC.

2000 OMNIBUS STOCK PLAN

Terms and Conditions of Nonstatutory Stock Option Agreement

          These are the terms and conditions applicable to the NONSTATUTORY STOCK OPTION AGREEMENT
between Digi International Inc., a Delaware corporation (the “Company”), and the optionee (the
“Optionee”) listed on the cover page hereof (the “Cover Page”) effective as of the date of grant.
The Cover Page together with these terms and conditions of Nonstatutory Stock Option Agreement
constitute the “Nonstatutory Stock Option Agreement.”

          WHEREAS, the Company desires to carry out the purposes of its Digi International Inc. 2000
Omnibus Stock Plan as amended from time to time (the “Plan”), by affording the Optionee an
opportunity to purchase Common Stock of the Company, par value $.01 per share (the “Common
Shares”), according to the terms set forth herein and on the Cover Page;

          NOW THEREFORE, the Company hereby grants this Option to the Optionee under the terms and
conditions as follows.

          1. Grant of Option. Subject to the terms of the Plan, the Company hereby grants to the
Optionee the right and option (the “Option”) to purchase the number of Common Shares specified on
the Cover Page, on the terms and conditions hereinafter set forth. The Option is not intended by
the Company to be an “incentive stock option” within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the “Code”).

          2. Purchase Price. The purchase price of each of the Common Shares subject to the Option
shall be the exercise price per share specified on the Cover Page, which price has been specified
in accordance with the Plan and shall not be less than 100% of the Fair Market Value (as defined in
paragraph 2.1(l) of the Plan) of a common share as of the date of grant.

          3. Option Period.

          (a) Subject to the provisions of paragraphs 5(a), 5(b), 6(a) and 6(b) hereof, the Option shall
become exercisable as to the number of shares and on the dates specified in the exercise schedule
on the Cover Page. The exercise schedule shall be cumulative; thus, to the extent the Option has
not already been exercised and has not expired, terminated or been canceled, the Optionee may at
any time, and from time to time, purchase all or any portion of the Common Shares then purchasable
under the exercise schedule.

          (b) The Option and all rights to purchase shares thereunder shall cease on the earliest of:

     (i) the expiration date specified on the Cover Page (which date shall not be
more than ten years after the date of this Nonstatutory Stock Option Agreement);

     (ii) the expiration of the period after the termination of the Optionee’s
employment (as defined in paragraph 5 of the Plan) within which the Option is
exercisable as specified in paragraph 5(a) or 5(b), whichever is applicable; or

     (iii) the date, if any, fixed for cancellation pursuant to paragraph 6(b)
hereof.

Notwithstanding any other provision in this Nonstatutory Stock Option Agreement, in no event may
anyone exercise the Option, in whole or in part, after its original expiration date.

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          4. Manner of Exercising Option.

          Subject to the terms and conditions of this Nonstatutory Stock Option Agreement, the Option
may be exercised online with E*Trade at www.etrade.com/stockplans or by such other means as the
Committee shall approve. In accordance with present practice, when your stock option is granted, a
letter or email will be sent to you from E*Trade with instructions on how to activate your account
with E*Trade so that you can view and exercise your stock options online. If you are a director or
officer of the Company, then you must contact E*Trade Executive Support at 1-800-775-2793 in order
to exercise your options.

          5. Exercisability of Option After Termination of Employment.

          (a) During the lifetime of the Optionee, the Option may be exercised only while the Optionee
is employed (as defined in paragraph 5 of the Plan) by the Company or a parent or subsidiary
thereof, and only if the Optionee has been continuously so employed since the date of this
Nonstatutory Stock Option Agreement, except that:

     (i) if the Optionee is not an Outside Director (as defined in paragraph 2.1(t)
of the Plan), the Option shall continue to be exercisable for three months after
termination of the Optionee’s employment for any reason other than death or
disability, but only to the extent that the Option was exercisable immediately prior
to the Optionee’s termination of employment;

     (ii) if the Optionee is not an Outside Director, in the event the Optionee is
disabled (within the meaning of Section 22(e)(3) of the Code) while employed, the
Optionee or his or her legal representative may exercise the Option (to the extent
specified in paragraph 6(a) of this Nonstatutory Stock Option Agreement) within one
year after the termination of the Optionee’s employment because of such disability;

     (iii) if the Optionee is not an Outside Director and if the Optionee dies while
employed, or within three months after his or her termination of employment, then
(notwithstanding paragraph 5(a)(i) of this Nonstatutory Stock Option Agreement)
heirs or legatees of the Optionee’s estate or the person who acquired the right to
exercise the Option by bequest or inheritance may exercise the Option (to the extent
specified in paragraph 6(a)) within one year after the death of the Optionee;

     (iv) if the Optionee is an Outside Director, the Option shall continue to be
exercisable after the Optionee’s employment ends for the remaining term of the
Option, but shall be exercisable only to the extent that the Option was exercisable
immediately prior to the end of Optionee’s employment, except that if the Optionee’s
employment ends because of death or disability, or the Optionee dies within three
months of his or her employment ending, the Option, whether or not previously
exercisable, shall become exercisable to the extent specified in paragraph 6(a) of
this Nonstatutory Stock Option Agreement and shall continue to be exercisable after
the Optionee’s employment ends for the remaining term of the Option; and

     (v) if the Optionee’s employment terminates after a declaration pursuant to
paragraph 6(b) of this Nonstatutory Stock Option Agreement, the Optionee may
exercise the Option at any time permitted by such declaration.

If, during the term of the Option, the Optionee’s status changes to or from that of an Outside
Director, the provisions of this paragraph 5(a) shall be applied to the Optionee based on the
Optionee’s status as of the date the Option was granted.

          (b) Neither the transfer of the Optionee between any combination of the Company, its parent
and any subsidiary of the Company, nor a leave of absence granted to the Optionee and approved by
the Committee, shall be deemed a termination of employment. The terms “parent” and “subsidiary” as
used herein shall have the meaning ascribed to “parent corporation” and “subsidiary corporation,”
respectively, in Sections 424(e) and (f) (or successor provisions) of the Code.

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          6. Acceleration of Option.

          (a) Disability or Death. If paragraph 5(a)(ii), 5(a)(iii) or the exception clause of
paragraph 5(a)(iv) of this Nonstatutory Stock Option Agreement is applicable, the Option, whether
or not previously exercisable, shall become immediately exercisable in full if the Optionee shall
have been employed continuously by the Company or a parent or subsidiary thereof between the date
the Option was granted and the date of such disability or, in the event of death, a date not more
than three months prior to such death.

          (b) Dissolution, Liquidation, Merger. In the event of (i) a proposed merger or
consolidation of the Company with or into any other corporation, regardless of whether the Company
is the surviving corporation, unless appropriate provision shall have been made for the protection
of the Option by the substitution, in lieu of the Option, of an option to purchase appropriate
voting common stock (the “Survivor’s Stock”) of the corporation surviving any such merger or
consolidation or, if appropriate, the parent corporation of the Company or such surviving
corporation, or, alternatively, by the delivery of a number of shares of the Survivor’s Stock which
has a Fair Market Value as of the effective date of such merger or consolidation equal to the
product of (A) the excess of (x) the Event Proceeds per Common Share (as hereinafter defined)
covered by the Option as of such effective date, over (y) the Option exercise price per Common
Share, times (B) the number of Common Shares covered by the Option, or (ii) the proposed
dissolution or liquidation of the Company (such merger, consolidation, dissolution or liquidation
being herein called an “Event”), the Committee shall declare, at least ten days prior to the actual
effective date of an Event, and provide written notice to the Optionee of the declaration, that the
Option, whether or not then exercisable, shall be canceled at the time of, or immediately prior to
the occurrence of, the Event (unless it shall have been exercised prior to the occurrence of the
Event) in exchange for payment to the Optionee, within ten days after the Event, of cash equal to
the amount (if any), for each Common Share covered by the canceled Option, by which the Event
Proceeds per Common Share (as hereinafter defined) exceeds the exercise price per Common Share
covered by the Option. At the time of the declaration provided for in the immediately preceding
sentence, the Option shall immediately become exercisable in full and the Optionee shall have the
right, during the period preceding the time of cancellation of the Option, to exercise the Option
as to all or any part of the Common Shares covered thereby. The Option, to the extent it shall not
have been exercised prior to the Event, shall be canceled at the time of, or immediately prior to,
the Event, as provided in the declaration, and this Plan shall terminate at the time of such
cancellation, subject to the payment obligations of the Company provided in this paragraph 6(b).
For purposes of this paragraph, “Event Proceeds per Common Share” shall mean the cash plus the fair
market value, as determined in good faith by the Committee, of the non-cash consideration to be
received per Common Share by the stockholders of the Company upon the occurrence of the Event.

          7. Limitation on Transfer. During the lifetime of the Optionee, only the Optionee or his or
her guardian or legal representative may exercise the Option. The Optionee shall not assign or
transfer the Option otherwise than by will or the laws of descent and distribution, and the Option
shall not be subject to pledge, hypothecation, execution, attachment or similar process. Any
attempt to assign, transfer, pledge, hypothecate or otherwise dispose of the Option contrary to the
provisions hereof, and the levy of any attachment or similar process upon the Option, shall be null
and void.

          8. Stockholder Rights Before Exercise. The Optionee shall have none of the rights of a
stockholder of the Company with respect to any share subject to the Option until the share is
actually issued to him or her upon exercise of the Option.

          9. Adjustment For Changes in Capitalization. The Option is subject to adjustment for changes
in capitalization as provided in paragraph 16 of the Plan.

          10. Tax Withholding. The parties hereto recognize that the Company or a parent or subsidiary
thereof may be obligated to withhold federal and state income taxes and social security or other
taxes upon the Optionee’s exercise of the Option. The Optionee agrees that, at the time he or she
exercises the Option, if the Company or a parent or subsidiary thereof is required to withhold such
taxes, he or she will promptly pay in cash upon demand to the Company, or the parent or subsidiary
having such obligation, such amounts as shall be necessary to satisfy such obligation; provided,
however, that in lieu of all or any part of such a cash payment, the Committee may, but shall not
be required to, (or, in the case of an Optionee who is an Outside Director (as defined in the
Plan), the Committee shall) permit the Optionee to elect to cover all or any part of the required
withholdings through a reduction of the number of

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Common Shares delivered to the Optionee or through a subsequent return to the Company of shares
delivered to the Optionee.

          11. Interpretation of this Nonstatutory Stock Option Agreement. All decisions and
interpretations made by the Committee with regard to any question arising hereunder or under the
Plan shall be binding and conclusive upon the Company and the Optionee. In the event that there is
any inconsistency between the provisions of this Nonstatutory Stock Option Agreement and the Plan,
the provisions of the Plan shall govern.

          12. Discontinuance of Employment. This Nonstatutory Stock Option Agreement shall not give the
Optionee a right to continued employment with the Company or any parent or subsidiary thereof, and
the Company or any such parent or subsidiary thereof employing the Optionee may terminate his or
her employment and otherwise deal with the Optionee without regard to the effect it may have upon
him or her under this Nonstatutory Stock Option Agreement.

          13. General. The Company shall at all times during the term of this Option reserve and keep
available such number of Common Shares as will be sufficient to satisfy the requirements of this
Nonstatutory Stock Option Agreement. This Nonstatutory Stock Option Agreement shall be binding in
all respects on the Optionee’s heirs, representatives, successors and assigns. This Nonstatutory
Stock Option Agreement is entered into under the laws of the State of Minnesota and shall be
construed and interpreted thereunder.

5

 

Certain of the options may include an addendum regarding acceleration of vesting upon a change in control,

which reads substantially similar to the following:

DIGI INTERNATIONAL INC.

2000 OMNIBUS STOCK PLAN

Addendum I

to

Terms and Conditions of Nonstatutory Stock Option Agreement

     Paragraph 6, entitled “Acceleration of Option,” is amended to add new subparagraph (c) which
provides as follows:

     (c) Change in Control. The Option, whether or not previously exercisable, shall
become immediately exercisable in full upon the occurrence of any “Change in Control”. A
“Change in Control” shall be deemed to have occurred upon the occurrence of either of the
following events:

     (i) any person, as defined in Sections 3(a)(9) and 13(d)(3) of the
Securities Exchange Act of 1934 (the “Exchange Act”), becomes the
“beneficial owner” (as defined in Rule 13d-3 promulgated pursuant to the
Exchange Act), directly or indirectly, of securities of the Company having
25% or more of the voting power in the election of directors of the Company,
excluding, however, Optionee (or a group of persons, including Optionee,
acting in concert); or

     (ii) the occurrence within any period, commencing immediately after an
Annual Meeting of Stockholders and continuing to and including the Annual
Meeting of Stockholders occurring on or about the third anniversary date of
the commencement of such period, of a change in the Board of Directors of
the Company with the result that the Incumbent Members (as defined below) do
not constitute a majority of the Company’s Board of Directors. The term
“Incumbent Members” shall mean the members of the Board on the date of the
commencement of such period, provided that any person becoming a director
during such period whose election or nomination for election was approved by
a majority of the directors who, on the date of such election or nomination
for election, comprised the Incumbent Members shall be considered one of the
Incumbent Members in respect of such period.

6

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