Document:

Waiver and First Amendment to Credit Agreement

 Exhibit 10.63 
 Execution Version 
 WAIVER AND FIRST AMENDMENT TO CREDIT AGREEMENT 
 THIS WAIVER AND FIRST AMENDMENT TO CREDIT AGREEMENT (as the same may from time to time be amended, restated or otherwise modified, this
“Agreement”) is made as of August 4, 2008 and entered into by and among SALIX PHARMACEUTICALS, LTD. (the “Borrower”), BANK OF AMERICA, N.A., as Administrative Agent (in such capacity, the “Administrative
Agent”), and the lenders party hereto (collectively, the “Lenders”). 
 RECITALS 
 A. The Borrower, the Lenders and the Administrative Agent have entered into that certain Credit Agreement dated as of February 22, 2007 (as amended
hereby and as further amended, restated, supplemented or otherwise modified, the “Credit Agreement”), pursuant to which the Lenders have agreed to make the Loans (such term, together with each other capitalized term used in this
Agreement but not defined in this Agreement, shall be defined in accordance with the Credit Agreement) and other extensions of credit, all upon the terms and conditions set forth in the Credit Agreement. 
 B. The Borrower has requested that the Administrative Agent and the Lenders agree to a waiver and certain amendments to the Credit Agreement. 

C. Subject to the terms and conditions hereof, the Lenders are willing to grant the Borrower’s requests. 
 D. In consideration of the agreements hereinafter set forth, and for other good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows: 
 AGREEMENT 
 1. Waiver. Subject to the terms and conditions hereof, including, without limitation, the conditions to effectiveness set forth in
Section 3, the Administrative Agent and the Lenders hereby waive any Event of Default that may have arisen under Section 8.01(d) and/or Section 8.01(n) solely as a result of the approval by Office of Generic Drugs on
December 28, 2007 of three generic balsalazide capsule products, as disclosed in the “Notes to Condensed Consolidated Financial Statements” in the Form 10-Q filed by the Borrower with the United States Securities and Exchange
Commission on May 7, 2008 (the pertinent portion of which is set forth on Exhibit A hereto). 
 2. Amendments to the Credit
Agreement. The Administrative Agent, the Lenders and the Borrower agree to amend, effective in accordance with Section 3 below, the Credit Agreement as follows: 
 (a) Section 1.01 of the Credit Agreement is hereby amended by amending and restating or adding (as applicable) the following
definitions in their entirety: 
 “‘Applicable Rate’ means, from the effective date of the Waiver and
First Amendment, for so long as all Outstanding Amounts are fully cash collateralized in accordance with Section 2.14, and provided that no Default or Event of Default has occurred and is continuing, the following percentages per annum
set forth for Level I. Otherwise, ‘Applicable 

 
Rate’ means the following percentages per annum, based upon the Consolidated Leverage Ratio as set forth in the most recent Compliance Certificate
received by the Administrative Agent pursuant to Section 6.02(a): 
  

											
	 Level
	  	 Consolidated
 Leverage Ratio
	  	 Commitment Fee (bps)
	  	 Applicable Rate for
Eurodollar Rate Loans
(bps)
	  	 Letter of Credit Fee (bps)
	  	 Applicable Rate for Base
Rate Loans (bps)

	I	  	Less than 1.00 to 1.00	  	25.0	  	100.0	  	100.0	  	0.0
						
	II	  	Greater than or equal to 1.00 to 1.00 but less than 1.50 to 1.00	  	30.0	  	125.0	  	125.0	  	25.0
						
	III	  	Greater than or equal to 1.50 to 1.00 but less than 2.00 to 1.00	  	35.0	  	150.0	  	150.0	  	50.0
						
	IV	  	Greater than or equal to 2.00 to 1.00	  	50.0	  	175.0	  	175.0	  	75.0

 Any increase or decrease in the Applicable Rate resulting from a change in the
Consolidated Leverage Ratio shall become effective as of the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 6.02(a); provided, however, that if a Compliance
Certificate is not delivered when due in accordance with such Section, then Pricing Level IV shall apply as of the first Business Day after the date on which such Compliance Certificate was required to have been delivered. The Applicable Rate in
effect from the Closing Date until receipt by the Administrative Agent of the Borrower’s Compliance Certificate for the fiscal quarter ended June 30, 2007 shall be determined based upon Pricing Level I. 
 Notwithstanding anything to the contrary contained in this definition, the determination of the Applicable Rate for any period shall be
subject to the provisions of Section 2.10(b).” 
 “‘Waiver and First Amendment’ means that
certain Waiver and First Amendment to Credit Agreement dated as of August 4, 2008 by and among the Borrower, the Administrative Agent and the lenders party thereto.” 
 (b) Article II is hereby amended by adding the following Section 2.14: 
 “2.14 Collateralization. Notwithstanding anything contained herein, or in any other Loan Document, to the contrary, the
Borrower shall pledge and deposit with the Administrative Agent, for the benefit of the Secured Parties, an amount in cash equal to 100% of all Outstanding Amounts as cash collateral for the Obligations and pursuant to documentation in form and
substance reasonably satisfactory to the Administrative Agent (which documents are hereby consented to by the Lenders). Such cash collateral shall be maintained in a blocked deposit account or certificate of deposit at Bank of America and shall be
subject to the dominion 

 
and control of the Administrative Agent. The Borrower hereby reaffirms the security interests granted under the Collateral Agreement, which such grants
include a security interest in all cash, deposit accounts, certificates of deposit and all balances therein and all proceeds of the foregoing, including, without limitation, the cash collateral and related account contemplated hereby, all in favor
of the Administrative Agent and for the benefit of the Secured Parties. In addition to the other conditions and requirements for Credit Extensions set forth herein, no further Credit Extension shall be permitted unless and until each such requested
Credit Extension is fully cash collateralized in accordance herewith.” 
 (c) Section 4.02 of the Credit Agreement
is hereby amended by adding the following item (d): 
 “(d) The Administrative Agent shall have received cash collateral
in an amount equal to 100% of each such Credit Extension in accordance with Section 2.14.” 
 (d)
Section 6.02(a) of the Credit Agreement is hereby amended and restated as follows: 
 “(a) subject to the limitation
set forth in Section 7.12(d), concurrently with the delivery of the financial statements referred to in Sections 6.01(a) and (b), a duly completed Compliance Certificate signed by the chief executive officer, chief
financial officer, treasurer or controller of the Borrower;” 
 (e) Section 7.12 is hereby amended and restated in
its entirety to read as follows: 
 “7.12 Financial Covenants. 
 (a) Consolidated Leverage Ratio. Except as provided in subsection (d) below, permit the Consolidated Leverage Ratio at any
time during any period of four fiscal quarters of the Borrower to be greater than 2.75 to 1.00; 
 (b) Consolidated Fixed
Charge Coverage Ratio. Except as provided in subsection (d) below, permit the Consolidated Fixed Charge Coverage Ratio as of the end of any fiscal quarter of the Borrower to be less than 1.25 to 1.00; 
 (c) Minimum Cash Balance. At all times maintain a cash balance on the balance sheet of the Borrower of not less than $23,000,000.

 (d) From the effective date of the Waiver and First Amendment, so long as all Outstanding Amounts are fully cash
collateralized in accordance with Section 2.14, and provided that no Default or Event of Default has occurred and is continuing, compliance by the Borrower and its Subsidiaries with the financial covenants set forth in subsection
(a) and subsection (b) above shall be suspended. In furtherance thereof, during such period neither the Borrower nor any of its Subsidiaries shall be required to complete a Compliance Certificate pursuant to Section 6.02(a)
with respect to Sections 7.12(a) and 7.12(b); provided that nothing in this subsection (d) shall be deemed to limit or otherwise restrict the scope or type of information that the Administrative Agent and Lenders may
request from the Borrower and its Subsidiaries under this Agreement, including, without limitation, Compliance Certificates showing financial covenant calculations.” 

 (f) Schedule 2.01 of the Credit Agreement is hereby amended and restated in its entirety
to read as set forth on Schedule 2.01 hereto. 
 (g) Exhibit D of the Credit Agreement is hereby amended and restated
in its entirety to read as set forth on Exhibit D hereto. 
 (h) All references to “RBC Centura Bank” in the
Credit Agreement and all other applicable Loan Documents are hereby amended to read “RBC Bank (USA) (formerly known as RBC Centura Bank).” 
 3. Effectiveness; Conditions Precedent. This Agreement shall be effective when all of the conditions set forth in this Section 3 shall have been satisfied in form and substance satisfactory to the
Administrative Agent: 
 (a) The Administrative Agent shall have received duly executed counterparts of this Agreement from
each of the Borrower, its Subsidiaries, the Administrative Agent and each Lender consenting to the terms hereof (each such Lender, a “Consenting Lender”) and acknowledged by each Lender not consenting to this Agreement and exiting
the credit facility concurrently with the effectiveness hereof (each such Lender, an “Exiting Lender”). 
 (b) The Borrower shall have paid all reasonable professional fees and expenses of the Administrative Agent in connection with this Agreement, the Loan Documents and the transactions contemplated hereby (including all reasonable fees and
expenses of Winston & Strawn LLP in its capacity as counsel to the Administrative Agent) pursuant to wire transfer instructions to be provided by the Administrative Agent. 
 (c) In addition to any amounts previously paid or owing to the Administrative Agent or Lenders, the Borrower shall have paid to the
Administrative Agent for the benefit of each Consenting Lender a consent fee in an amount equal to 25 basis points times the sum of each Consenting Lender’s Commitment (after giving effect to the Commitment Reduction set forth in
Section 2(f) above). 
 (d) The Administrative Agent shall have received a favorable opinion of counsel to the
Borrower, addressed to the Administrative Agent and each Lender, in form and substance satisfactory to the Administrative Agent. 
 (e) The deposit account (the “Cash Collateral Account”) referenced in Section 2(b) hereof shall have been established and cash collateral in an amount equal to 100% of all Outstanding Amounts shall have been
deposited therein. 
 (f) The Cash Collateral Account shall be subject to a deposit account control agreement perfecting the
Administrative Agent’s security interest (for the benefit of the Secured Parties). 
 (g) The Administrative Agent shall
have received such other instruments, documents and certificates as the Administrative Agent shall reasonably request in connection with the execution of this Agreement. 
 4. Lender Consent. By their execution hereof, each Consenting Lender and each Exiting Lender consents to the non pro-rata repayment in full and exit of each Exiting Lender, notwithstanding any provision of the
Credit Agreement (including without limitation, Section 2.13) or any other Loan Document. 

 5. Representations and Warranties. Each Loan Party hereby represents and warrants to the
Administrative Agent and the Lenders that (a) each Loan Party has the legal power and authority to execute and deliver this Agreement; (b) the officers of each Loan Party executing this Agreement have been duly authorized to execute and
deliver the same and bind each Loan Party with respect to the provisions hereof; (c) the execution and delivery hereof by each Loan Party and the performance and observance by each Loan Party of the provisions hereof do not violate or conflict
with any organizational document of any Loan Party or any law applicable to any Loan Party or result in a breach of any provision of or constitute a default under any other agreement, instrument or document binding upon or enforceable against any
Loan Party; (d) (after giving effect to the waiver set forth in Section 1) no Default or Event of Default exists under the Credit Agreement, nor will any occur immediately after the execution and delivery of this Agreement or by the
performance or observance of any provision hereof; (e) no Loan Party is aware of any claim or offset against, or defense or counterclaim to, any Loan Party’s obligations or liabilities under the Credit Agreement or any other Loan Document;
(f) this Agreement and each document executed by each Loan Party in connection herewith constitute valid and binding obligations of the applicable Loan Party in every respect, enforceable in accordance with their terms; (g) no Loan Party
has received a notice of default of any kind from any material account debtor or any counterparty to a Material Contract and no material account debtor or counterparty to a Material Contract has asserted any right of set-off, deduction or
counterclaim with respect to any account or such Material Contract, respectively and (h) (after giving effect to the waiver set forth in Section 1) all representations and warranties made by the Borrower and contained in this
Agreement, the Credit Agreement or any other Loan Document to which it is a party are true and correct in all material respects on and as of the date of this Agreement to the same extent as though made on and as of such date, except to the extent
that any thereof expressly relate to an earlier date. 
 6. Release. Each Loan Party hereby waives and releases the Administrative
Agent, each Lender and their respective directors, officers, employees, agents, attorneys, affiliates and subsidiaries (each a “Releasee”) from any and all claims, offsets, defenses and counterclaims, known and unknown, that any
Loan Party may have as of the date of this Agreement based upon, relating to, or arising out of the Obligations and related transactions in any way. 
 Notwithstanding the foregoing, this Section 6 shall not constitute a release of the obligations of the Administrative Agent or any Lender under the Loan Documents, such waiver and release being with full knowledge and
understanding of the circumstances and effect thereof and after having consulted legal counsel with respect thereto. 
 7. Covenant Not to
Sue. Each Loan Party, on behalf of itself and its successors, assigns, and other legal representatives, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee that it will not sue (at law, in
equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any claim released, remised and discharged by such Loan Party pursuant to Section 6 above. If any Loan Party or any of its successors, assigns or other legal
representations violates the foregoing covenant, such Loan Party, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all
attorneys’ fees and costs incurred by any Releasee as a result of such violation. 
 8. Loan Documents Unaffected. Except as
otherwise specifically amended hereby, all provisions of the Credit Agreement and the other Loan Documents shall remain in full force and effect and be unaffected hereby. The parties hereto acknowledge and agree that this Agreement constitutes a
“Loan Document” under the terms of the Credit Agreement. 

 9. Subsidiary Guarantor Acknowledgement. Each Subsidiary Guarantor, by signing this Agreement:

 (a) Consents and agrees to and acknowledges the terms of this Agreement, including, without limitation, the waiver and
amendments to the Credit Agreement set forth herein. 
 (b) Acknowledges and agrees that all of the Loan Documents to which
such Subsidiary Guarantor is a party or otherwise bound shall continue in full force and effect and that all of such Subsidiary Guarantor’s obligations thereunder shall be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Agreement. 
 (c) Represents and warrants to the Administrative Agent and the Lenders that
all representations and warranties made by such Subsidiary Guarantor and contained in this Agreement or any other Loan Document to which it is a party are true and correct in all material respects on and as of the date of this Agreement to the same
extent as though made on and as of such date, except to the extent that any thereof expressly relate to an earlier date. 
 (d) Acknowledges and agrees that (i) notwithstanding the conditions to effectiveness set forth in this Agreement, such Subsidiary Guarantor is not required by the terms of the Credit Agreement or any other Loan Document to which such
Subsidiary Guarantor is a party to consent to the terms of this Agreement and (ii) nothing in the Credit Agreement, this Agreement or any other Loan Document shall be deemed to require the consent of such Subsidiary Guarantor to any future
waivers or amendments or modifications to the Credit Agreement. 
 10. No Other Promises or Inducements. There are no promises or
inducements that have been made to any party hereto to cause such party to enter into this Agreement other than those that are set forth in this Agreement. This Agreement has been entered into by the Borrower and each Subsidiary Guarantor freely,
voluntarily, with full knowledge, and without duress, and, in executing this Agreement, neither the Borrower nor any Subsidiary Guarantor is relying on any other representations, either written or oral, express or implied, made to the Borrower or
any Subsidiary Guarantor by the Administrative Agent. The Borrower and each Subsidiary Guarantor agrees that the consideration received by the Borrower under this Agreement has been actual and adequate. 
 11. No Course of Dealing. Each Loan Party acknowledges and agrees that, (a) this Agreement is not intended to, nor shall it, establish any
course of dealing between the Loan Parties, the Administrative Agent and the Lenders that is inconsistent with the express terms of the Credit Agreement or any other Loan Document, (b) notwithstanding any course of dealing between the Loan
Parties, the Administrative Agent and the Lenders prior to the date hereof, except as set forth herein, the Lenders shall not be obligated to make any Loan, except in accordance with the terms and conditions of this Agreement and the Credit
Agreement (as amended hereby), and (c) neither the Administrative Agent nor any Lender shall be under any obligation to forbear from exercising any of its rights or remedies upon the occurrence of any Default or Event of Default. Nothing herein
modifies the agreements among the Administrative Agent and the Lenders with respect to the exercise of their respective rights and remedies under the terms of the Credit Agreement. 
 12. No Waiver. Each Loan Party acknowledges and agrees that other than as expressly set forth in Section 1 (a) this Agreement
shall not operate as a waiver of any right, power or remedy of the Administrative Agent or the Lenders under the Credit Agreement or any Loan Document, nor shall it constitute a continuing waiver at any time and (b) nothing herein shall be
deemed to constitute a waiver of any Default or Event of Default and, nothing herein shall in any way prejudice the rights and remedies of 

 
the Administrative Agent or the Lenders under the Credit Agreement, any Loan Document or applicable law. In addition, the Administrative Agent shall have the
right to waive any condition or conditions set forth in this Agreement, the Credit Agreement or any Loan Document, in its sole discretion, and any such waiver shall not prejudice, waive or reduce any other right or remedy that the Administrative
Agent may have against any Loan Party. 
 13. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK. 
 14. Entire Agreement. This Agreement sets forth the entire agreement and understanding among
the parties as to the subject matter hereof and merges and supersedes all prior discussions, agreements, and undertakings of every kind and nature among them with respect to the subject matter hereof. 
 15. Counterparts. This Agreement may be executed in any number of counterparts, and by the parties hereto on the same or separate counterparts and
by facsimile signature, and each such counterpart, when executed and delivered, shall be deemed to be an original, but all such counterparts shall together constitute but one and the same Agreement. 
 16. Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigned in accordance with Section 10.06 of the Credit Agreement. 
 17. Severability Of Provisions;
Captions; Attachments. Wherever possible each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law. Any provision of this Agreement that is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other
jurisdiction. The captions to Sections and subsections herein are inserted for convenience only and shall be ignored in interpreting the provisions of this Agreement. Each schedule or exhibit attached to this Agreement shall be incorporated herein
and shall be deemed to be a part hereof. 
 18. JURY TRIAL WAIVER. EACH OF THE UNDERSIGNED, TO THE EXTENT PERMITTED BY LAW,
HEREBY WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING ANY DISPUTE WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE, AMONG THEM, OR ANY OF THEM, ARISING OUT OF, IN CONNECTION WITH, RELATED TO OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED
AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR ANY DOCUMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS RELATED THERETO. 

 Borrower 
 IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed as of the date first above written. 
  

			
	SALIX PHARMACEUTICALS, LTD.
		
	By:	 	 /s/ Adam C. Derbyshire

	Name:	 	Adam C. Derbyshire
	Title:	 	 Senior Vice President and
 Chief Financial
Officer

 Subsidiary Guarantor Acknowledgement and Consent 
 IN WITNESS WHEREOF, the undersigned hereby acknowledges and consents to this Agreement as of the date first above written. 
  

			
	SALIX PHARMACEUTICALS, INC.
		
	By:	 	 /s/ Adam C. Derbyshire

	Name:	 	Adam C. Derbyshire
	Title:	 	 Senior Vice President and
 Chief Financial
Officer

 Subsidiary Guarantor Acknowledgement and Consent 
 IN WITNESS WHEREOF, the undersigned hereby acknowledges and consents to this Agreement as of the date first above written. 
  

			
	GLYCYX PHARMACEUTICALS, LTD.
		
	By:	 	 /s/ Adam C. Derbyshire

	Name:	 	Adam C. Derbyshire
	Title:	 	 Senior Vice President and
 Chief Financial
Officer

 Subsidiary Guarantor Acknowledgement and Consent 
 IN WITNESS WHEREOF, the undersigned hereby acknowledges and consents to this Agreement as of the date first above written. 
  

			
	INKINE PHARMACEUTICAL COMPANY, INC.
		
	By:	 	 /s/ Adam C. Derbyshire

	Name:	 	Adam C. Derbyshire
	Title:	 	 Senior Vice President and
 Chief Financial
Officer

 Subsidiary Guarantor Acknowledgement and Consent 
 IN WITNESS WHEREOF, the undersigned hereby acknowledges and consents to this Agreement as of the date first above written. 
  

			
	CORBEC PHARMACEUTICALS, INC.
		
	By:	 	 /s/ Adam C. Derbyshire

	Name:	 	Adam C. Derbyshire
	Title:	 	 Senior Vice President and
 Chief Financial
Officer

 Subsidiary Guarantor Acknowledgement and Consent 
 IN WITNESS WHEREOF, the undersigned hereby acknowledges and consents to this Agreement as of the date first above written. 
  

			
	SANGEN PHARMACEUTICAL COMPANY
		
	By:	 	 /s/ Adam C. Derbyshire

	Name:	 	Adam C. Derbyshire
	Title:	 	 Senior Vice President and
 Chief Financial
Officer

 Administrative Agent 
 IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed as of the date first above written. 
  

			
	 BANK OF AMERICA, N.A., as Administrative Agent

		
	By:	 	 /s/ Anne Zesche

	Name:	 	Anne Zesche
	Title:	 	Vice President

 Consenting Lender 
 IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed as of the date first above written. 
  

			
	BANK OF AMERICA, N.A.
		
	By:	 	 /s/ Lynette Songy

	Name:	 	 Lynette M. Songy

	Title:	 	 Senior Vice President

 Consenting Lender 
 IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed as of the date first above written. 
  

			
	 WACHOVIA BANK, N.A.

		
	By:	 	 /s/ C. Douglass Riddle

	Name:	 	C. Douglass Riddle
	Title:	 	Senior Vice President

 Consenting Lender 
 IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed as of the date first above written. 
  

			
	 RBC BANK (USA)
 (formerly
known as RBC Centura Bank)

		
	By:	 	 /s/ Richard Brown

	Name:	 	Richard Brown
	Title:	 	Senior Vice President

 Consenting Lender 
 IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed as of the date first above written. 
  

			
	Branch Banking and Trust Company
		
	By:	 	 /s/ Jack M. Frost

	Name:	 	Jack M. Frost
	Title:	 	Senior Vice President

 Consenting Lender 
 IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed as of the date first above written. 
  

			
	LASALLE BANK NATIONAL ASSOCIATION
		
	By:	 	 /s/ Lynette Songy

	Name:	 	Lynette M. Songy
	Title:	 	Senior Vice President

 Exiting Lender 
 IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed as of the date first above written. 
  

			
	FIRST HORIZON BANK
		
	By:	 	 /s/ Andy Cook

	Name:	 	Andy Cook
	Title:	 	Senior Vice PresidentAltera Corporation 1987 Employee Stock Purchase Plan

 Exhibit 10.2 
 ALTERA CORPORATION 
 1987 EMPLOYEE STOCK PURCHASE PLAN 
 (as amended and restated May 13, 2008) 
 The following constitute the provisions of the 1987 Employee Stock Purchase Plan, as amended and restated May 13, 2008, of Altera Corporation. 
 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. The provisions of the Plan, accordingly, shall be construed so as to extend and limit
participation in a uniform and nondiscriminatory basis consistent with the requirements of Section 423. 
 2. Definitions.

 (a) “Administrator” shall mean the Board or any Committee designated by the Board to administer the plan pursuant to
Section 15 of the Plan. 
 (b) “Board” shall mean the Board of Directors of the Company. 
 (c) “Change of Control” shall mean the occurrence of any of the following events: 
 (i) Any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in
Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company’s then outstanding voting securities; or 
 (ii) The consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets; or 
 (iii) The consummation of a merger or consolidation of the Company, with any other corporation, other than a merger or consolidation that would result
in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least fifty percent
(50%) of the total voting power represented by the voting securities of the Company, or such surviving entity or its parent outstanding immediately after such merger or consolidation. 
 (iv) A change in the composition of the Board, as a result of which fewer than a majority of the Directors are Incumbent Directors. “Incumbent
Directors” shall mean Directors who either (A) are Directors of the Company, as applicable, as of the date hereof, or (B) are elected, or nominated for election, to the Board with the affirmative votes of at least a 

  

 1 

 
majority of those Directors whose election or nomination was not in connection with any transaction described in subsections (i), (ii) or (iii) or
in connection with an actual or threatened proxy contest relating to the election of directors of the Company. 
 (d) “Code”
shall mean the Internal Revenue Code of 1986, as amended. 
 (e) “Committee” means a committee of the Board appointed by the
Board in accordance with Section 15 hereof. 
 (f) “Common Stock” shall mean the common stock of the Company.

 (g) “Company” shall mean Altera Corporation, a Delaware corporation. 
 (h) “Compensation” shall mean all base straight time gross earnings, sales commissions and sales incentives, but exclusive of payments
for overtime, shift premiums, other incentive payments, bonuses or other compensation. 
 (i) “Designated Subsidiary” shall
mean any Subsidiary selected by the Administrator as eligible to participate in the Plan. 
 (j) “Eligible Employee” shall
mean any individual who is a common law employee of the Company or any Designated Subsidiary and whose customary employment with the Company or Designated Subsidiary is at least twenty (20) hours per week and more than five (5) months in
any calendar year. For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual is on sick leave or other leave of absence approved by the Company. Where the period of leave exceeds 90 days and the
individual’s right to reemployment is not guaranteed either by statute or by contract, the individual shall be deemed to have withdrawn from the Plan on the 91st day of such leave. 
 (k) “Exercise Date” shall mean the Trading Day on or before April 30th and October 31st of each year. 
 (l) “Fair Market Value” shall mean, as of any date, the value of Common Stock determined as follows: 
 (i) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market
or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system on the date of determination, as
reported in The Wall Street Journal or such other source as the Board deems reliable; 
 (ii) If the Common Stock is regularly quoted
by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean of the closing bid and asked prices for the Common Stock on the date of determination, as reported in The Wall Street Journal or
such other source as the Board deems reliable; 
  

 2 

 (iii) In the absence of an established market for the Common Stock, the Fair Market Value thereof shall
be determined in good faith by the Board; or 
 (iv) For purposes of the Offering Date of the first Offering Period under the Plan, the Fair
Market Value shall be the initial price to the public as set forth in the final prospectus included within the registration statement in Form S-1 filed with the Securities and Exchange Commission for the initial public offering of the Company’s
Common Stock (the “Registration Statement”). 
 (m) “Offering Date” shall mean the first Trading Day of each
Offering Period. 
 (n) “Offering Periods” shall mean the periods of approximately twelve (12) months during which an
option granted pursuant to the Plan may be exercised, usually commencing on the first Trading Day on or after May 1st and November 1st of each year and terminating on the Trading Day on or before April 30th and October 31st. The
duration and timing of Offering Periods may be changed pursuant to Section 4 of this Plan. 
 (o) “Plan” shall mean
this Employee Stock Purchase Plan. 
 (p) “Purchase Period” shall mean the approximately six (6) month period
commencing on one Exercise Date and ending with the next Exercise Date, except that the first Purchase Period of any Offering Period shall commence on the Offering Date and end with the next Exercise Date. 
 (q) “Purchase Price” shall mean 85% of the Fair Market Value of a share of Common Stock on the Offering Date or on the Exercise Date,
whichever is lower; provided however, that the Purchase Price may be adjusted by the Administrator pursuant to Section 20. 
 (r)
“Subsidiary” shall mean a “subsidiary corporation,” whether now or hereafter existing, as defined in Section 424(f) of the Code. 
 (s) “Trading Day” shall mean a day on which national stock exchanges and the Nasdaq System are open for trading. 
 3. Eligibility. 
 (a) Subsequent Offering Periods. Any Eligible Employee on a given Offering
Date shall be eligible to participate in the Plan. 
 (b) Limitations. Any provisions of the Plan to the contrary notwithstanding, no
Eligible Employee shall be granted an option under the Plan (i) to the extent that, immediately after the grant, such Eligible Employee (or any other person whose stock would be attributed to such Eligible Employee pursuant to
Section 424(d) of the Code) would own capital stock of the Company and/or hold outstanding options to purchase such stock possessing five percent (5%) or more of the total combined voting power or value of all classes of the capital stock
of the Company or of any Subsidiary, or (ii) to the extent that his or her rights to purchase stock under all employee stock purchase plans of the Company and its subsidiaries accrues at a rate that 

  

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exceeds Twenty-Five Thousand Dollars ($25,000) worth of stock (determined at the Fair Market Value of the shares at the time such option is granted) for each
calendar year in which such option is outstanding at any time. 
 4. Offering
Periods. The Plan shall be implemented by consecutive, overlapping Offering Periods with a new Offering Period commencing on the first Trading Day on or after May 1st and November 1st each year, or on such other date as the Board shall determine, and continuing thereafter
until terminated in accordance with Section 21 hereof. The Board shall have the power to change the duration of Offering Periods (including the commencement dates thereof) with respect to future offerings without shareholder approval if such
change is announced prior to the scheduled beginning of the first Offering Period to be affected thereafter. 
 5. Subsequent Offering
Periods. An Eligible Employee may become a participant in the Plan by completing a subscription agreement authorizing payroll deductions in the form of Exhibit A to this Plan and filing it with the Company’s Stock Administration Department
prior to the applicable Offering Date. 
 6. Payroll Deductions. 
 (a) At the time a participant files his or her subscription agreement, he or she shall elect to have payroll deductions made on each pay day during the
Offering Period in an amount not exceeding 10% of the Compensation that he or she receives on each pay day during the Offering Period; provided, however, that should a pay day occur on an Exercise Date, a participant shall have the payroll
deductions made on such day applied to his or her account under the new Offering Period or Purchase Period, as the case may be. A participant’s subscription agreement shall remain in effect for successive Offering Periods unless terminated as
provided in Section 11 hereof. 
 (b) Payroll deductions for a participant shall commence on the first payday following the Offering
Date and shall end on the last payday in the Offering Period to which such authorization is applicable, unless sooner terminated by the participant as provided in Section 11 hereof. 
 (c) All payroll deductions made for a participant shall be credited to his or her account under the Plan and shall be withheld in whole percentages only.
A participant may not make any additional payments into such account. 
 (d) A participant may discontinue his or her participation in the
Plan as provided in Section 11 hereof, or decrease the rate of his or her payroll deductions during the Offering Period by completing or filing with the Company a new subscription agreement authorizing a change in payroll deduction rate. A
participant may increase his or her rate of payroll deductions only for a subsequent Offering Period in which he or she is scheduled to participate and may not increase his or her rate of payroll deductions during an outstanding Offering Period in
which such participant is currently participating. The Administrator may, in its discretion, limit the nature and/or number of participation rate changes during any Offering Period. Any decrease in rate shall be effective fifteen (15) days
following the Company’s receipt of the notification. 
  

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 (e) Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of the
Code and Section 3(b) hereof, the Administrator may decrease a participant’s payroll deductions to zero percent (0%) at any time during a Purchase Period. Payroll deductions shall recommence at the rate provided in such participant’s
subscription agreement at the beginning of the first Purchase Period that is scheduled to end in the following calendar year, unless terminated by the participant as provided in Section 11 hereof. 
 (f) At the time the option is exercised, in whole or in part, or at the time some or all of the Company’s Common Stock issued under the Plan is
disposed of, the participant must make adequate provision for the Company’s federal, state, or other tax withholding obligations, if any, which arise upon the exercise of the option or the disposition of the Common Stock. At any time, the
Company may, but shall not be obligated to, withhold from the participant’s compensation the amount necessary for the Company to meet applicable withholding obligations, including any withholding required to make available to the Company any
tax deductions or benefits attributable to sale or early disposition of Common Stock by the Eligible Employee. 
 7. Grant of Option.
On the Offering 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 (at the applicable Purchase Price) up to a number of
shares of the Company’s Common Stock determined by dividing such Eligible Employee’s payroll deductions accumulated prior to such Exercise Date and retained in the Participant’s account as of the Exercise Date by the applicable
Purchase Price; provided that in no event shall an Eligible Employee be permitted to purchase during each Purchase Period more than 10,000 shares of the Company’s Common Stock (subject to any adjustment pursuant to Section 20 hereof), and
provided further that such purchase shall be subject to the limitations set forth in Section 3(b) and other sections of the Plan that may limit such number. The Eligible Employee may accept the grant of such option by turning in a completed
Subscription Agreement to the Company on or prior to an Offering Date. The Administrator may, for future Offering Periods, increase or decrease, in its absolute discretion, the maximum number of shares of the Company’s Common Stock an Eligible
Employee may purchase during each Purchase Period of such Offering Period. Exercise of the option shall occur as provided in Section 9 hereof, unless the participant has withdrawn pursuant to Section 11 hereof. The option shall expire on
the last day of the Offering Period. 
 8. Automatic Transfer to Low Price Offering Period. To the extent permitted by any applicable
laws, regulations, or stock exchange rules, if the Fair Market Value of the Common Stock on any Exercise Date in an Offering Period is lower than the Fair Market Value of the Common Stock on the Offering Date of such Offering Period, then all
participants in such Offering Period shall be automatically withdrawn from such Offering Period immediately after the exercise of their option on such Exercise Date and automatically re-enrolled in the immediately following Offering Period.

  

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 9. Exercise of Option. 
 (a) Unless a participant withdraws from the Plan as provided in Section 11 hereof, his or her option for the purchase of shares shall be exercised
automatically on the Exercise Date, and the maximum number of full shares subject to option shall be purchased for such participant at the applicable Purchase Price with the accumulated payroll deductions in his or her account. No fractional shares
shall be purchased; any payroll deductions accumulated in a participant’s account that are not sufficient to purchase a full share shall be retained in the participant’s account for the subsequent Purchase Period or Offering Period,
subject to earlier withdrawal by the participant as provided in Section 11 hereof. Any other funds left over in a participant’s account after the Exercise Date shall be returned to the participant. During a participant’s lifetime, a
participant’s option to purchase shares hereunder is exercisable only by him or her. 
 (b) If the Administrator determines that, on a
given Exercise Date, the number of shares with respect to which options are to be exercised may exceed (i) the number of shares of Common Stock that were available for sale under the Plan on the Offering Date of the applicable Offering Period,
or (ii) the number of shares available for sale under the Plan on such Exercise Date, the Administrator may in its sole discretion (1) provide that the Company shall make a pro rata allocation of the shares of Common Stock available for
purchase on such Offering Date or Exercise Date, as applicable, in as uniform a manner as shall be practicable and as it shall determine in its sole discretion to be equitable among all participants exercising options to purchase Common Stock on
such Exercise Date, and continue all Offering Periods then in effect, or (2) provide that the Company shall make a pro rata allocation of the shares available for purchase on such Offering Date or Exercise Date, as applicable, in as uniform a
manner as shall be practicable and as it shall determine in its sole discretion to be equitable among all participants exercising options to purchase Common Stock on such Exercise Date, and terminate any or all Offering Periods then in effect
pursuant to Section 21 hereof. The Company may make pro rata allocation of the shares available on the Offering Date of any applicable Offering Period pursuant to the preceding sentence, notwithstanding any authorization of additional shares
for issuance under the Plan by the Company’s shareholders subsequent to such Offering Date. 
 10. Delivery. As soon as
reasonably practicable after each Exercise Date on which a purchase of shares occurs, the Company shall arrange the delivery to each participant the shares purchased upon exercise of his or her option in a form determined by the Administrator.

 11. Withdrawal. 
 (a) A
participant may withdraw all but not less than all the payroll deductions credited to his or her account and not yet used to exercise his or her option under the Plan at any time by giving written notice to the Company. All of the participant’s
payroll deductions credited to his or her account shall be paid to such participant promptly after receipt of notice of withdrawal and such participant’s option for the Offering Period shall be automatically terminated, and no further payroll
deductions for the purchase of shares shall be made for such Offering Period. If a participant withdraws from an Offering Period, payroll deductions shall not resume at the beginning of the succeeding Offering Period unless the participant delivers
to the Company a new Subscription Agreement. 
  

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 (b) A participant’s withdrawal from an Offering Period shall not have any effect upon his or her
eligibility to participate in any similar plan that may hereafter be adopted by the Company or in succeeding Offering Periods that commence after the termination of the Offering Period from which the participant withdraws. 
 12. Termination of Employment. In the event a participant ceases to be an Eligible Employee prior to the Exercise Date of the Offering Period in
question for any reason, including retirement or death, the payroll deductions credited to the participant’s account will be returned to the participant, or in the case of the participant’s death, to the person or persons entitled thereto
pursuant to Section 16 of the Plan, and the participant’s option will automatically terminate. 
 13. Interest. No interest
shall accrue on the payroll deductions of a participant in the Plan. 
 14. Stock. 
 (a) Subject to adjustment upon changes in capitalization of the Company as provided in Section 20 hereof, the maximum number of shares of the
Company’s Common Stock that shall be made available for sale under the Plan shall be 22,700,000. 
 (b) Until the shares are issued (as
evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), a participant shall only have the rights of an unsecured creditor with respect to such shares, and no right to vote or receive
dividends or any other rights as a stockholder shall exist with respect to such shares. 
 (c) Shares to be delivered to a participant under
the Plan shall be registered in the name of the participant or in the name of the participant and his or her spouse. 
 15.
Administration. The Administrator shall administer the Plan and shall have full and exclusive discretionary authority to construe, interpret and apply the terms of the Plan, to determine eligibility and to adjudicate all disputed claims filed
under the Plan. Every finding, decision and determination made by the Administrator shall, to the full extent permitted by law, be final and binding upon all parties. 
 16. Designation of Beneficiary. 
 (a) Unless otherwise prohibited by applicable law, 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 an Exercise Date on which the option is
exercised but prior to delivery to such participant 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 exercise of the option. If a participant is married and the designated beneficiary is not the spouse, spousal consent shall be required for such designation to be effective. 
  

 7 

 (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. 
 (c) All beneficiary designations shall be in such form and manner as the Administrator may designate from time to time. 
 17. Transferability. 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 Section 16 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 from an Offering Period in accordance with Section 11 hereof. 
 18. 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. Until shares are issued, participants shall only have the rights of an unsecured creditor. 
 19. Reports. Individual
accounts shall be maintained for each participant in the Plan. Statements of account shall be given to participating Eligible Employees at least annually, which statements shall set forth the amounts of payroll deductions, the Purchase Price, the
number of shares purchased and the remaining cash balance, if any. 
 20. Adjustments Upon Changes in Capitalization, Dissolution,
Liquidation, Merger or Change of Control. 
 (a) Changes in Capitalization. Subject to any required action by the shareholders of
the Company, the maximum number of shares of the Company’s Common Stock that shall be made available for sale under the Plan, the maximum number of shares each participant may purchase each Purchase Period (pursuant to Section 7), as well
as the price per share and the number of shares of Common Stock covered by each option under the Plan that have 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 change 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 

  

 8 

 
have been “effected without receipt of consideration.” Such adjustment shall be made by the Administrator, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of shares of Common Stock subject to an option. 
 (b) Dissolution or Liquidation.
In the event of the proposed dissolution or liquidation of the Company, the Offering Period then in progress shall be shortened by setting a new Exercise Date (the “New Exercise Date”), and shall terminate immediately prior to the
consummation of such proposed dissolution or liquidation, unless provided otherwise by the Administrator. The New Exercise Date shall be before the date of the Company’s proposed dissolution or liquidation. The Administrator shall notify each
participant in writing, at least ten (10) business days prior to the New Exercise Date, that the Exercise Date for the participant’s option has been changed to the New Exercise Date and that the participant’s option shall be exercised
automatically on the New Exercise Date, unless prior to such date the participant has withdrawn from the Offering Period as provided in Section 11 hereof. 
 (c) Merger or Change of Control. In the event of a merger or Change of Control, each outstanding option shall be assumed or an equivalent option substituted by the successor corporation or a Parent or
Subsidiary of the successor corporation. In the event that the successor corporation refuses to assume or substitute for the option, any Purchase Periods then in progress shall be shortened by setting a New Exercise Date and any Offering Periods
then in progress shall end on the New Exercise Date. The New Exercise Date shall be before the date of the Company’s proposed merger or Change of Control. The Administrator shall notify each participant in writing, at least ten
(10) business days prior to the New Exercise Date, that the Exercise Date for the participant’s option has been changed to the New Exercise Date and that the participant’s option shall be exercised automatically on the New Exercise
Date, unless prior to such date the participant has withdrawn from the Offering Period as provided in Section 11 hereof. 
 21.
Amendment or Termination. 
 (a) The Administrator may at any time and for any reason terminate or amend the Plan. Except as otherwise
provided in the Plan, no such termination can affect options previously granted, provided that an Offering Period may be terminated by the Administrator on any Exercise Date if the Administrator determines that the termination of the Offering Period
or the Plan is in the best interests of the Company and its shareholders. Except as provided in Section 20 and this Section 21 hereof, no amendment may make any change in any option theretofore granted which adversely affects the rights of
any participant. To the extent necessary to comply with Section 423 of the Code (or any successor rule or provision or any other applicable law, regulation or stock exchange rule), the Company shall obtain shareholder approval in such a manner
and to such a degree as required. 
 (b) Without shareholder consent and without regard to whether any participant rights may be considered
to have been “adversely affected,” the Administrator shall be entitled to 

  

 9 

 
change the Offering Periods, limit the frequency and/or number of changes in the amount withheld during an Offering Period, establish the exchange ratio
applicable to amounts withheld in a currency other than U.S. dollars, permit payroll withholding in excess of the amount designated by a participant in order to adjust for delays or mistakes in the Company’s processing of properly completed
withholding elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Common Stock for each participant properly correspond with amounts withheld
from the participant’s Compensation, and establish such other limitations or procedures as the Administrator determines in its sole discretion advisable which are consistent with the Plan. 
 (c) In the event the Administrator 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 to reduce or eliminate such accounting consequence including, but not limited to: 
 (i) increasing the Purchase Price for any Offering Period, including an Offering Period underway at the time of the change in Purchase Price; 

(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; and 
 (iii) allocating shares. 
 Such modifications or amendments shall not require stockholder approval or the consent of any Plan participants. 
 22.
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 and manner specified by the Company at the location, or by the
person, designated by the Company for the receipt thereof. 
 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 comply with all applicable provisions of law, domestic or foreign, including, without limitation, the Securities Act of 1933, as
amended, the Securities Exchange Act of 1934, as amended, 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. 
  

 10 

 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. It shall continue in effect until terminated under Section 21 hereof. 
  

 11

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