Document:

exv10w105

 

Exhibit 10.105

FIRST AMENDMENT TO FOURTH AMENDED

AND RESTATED CREDIT AGREEMENT

     This FIRST AMENDMENT TO FOURTH AMENDED AND RESTATED CREDIT AGREEMENT dated as of July 5, 2007
(this “Amendment”), is among EZCORP, INC., a Delaware corporation (the “Borrower”),
the Guarantors, the Lenders, and WELLS FARGO BANK, NATIONAL ASSOCIATION, as Agent for itself and
the other Lenders (the “Agent”).

RECITALS:

     A. The Borrower, the Agent, the Lenders and the Issuing Bank have previously entered into that
certain Fourth Amended and Restated Credit Agreement dated as of October 13, 2006 (as the same has
been amended, restated or modified from time to time, the “Agreement”).

     B. The Agent, the Lenders and the Borrower desire to amend the Agreement on the terms and
subject to the conditions and to the extent set forth below.

     NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants
herein contained, the parties hereto hereby agree as follows:

ARTICLE I

Definitions

Section 1.1 Definitions. All capitalized terms not otherwise defined herein shall have the
same meanings as in the Agreement, as amended hereby.

ARTICLE II

Amendment

Section 2.1 Addition to Article I. Effective as of the date hereof, a new Section 1.3 is
added to Article I of the Agreement to read in its entirety as follows:

     Section 1.3 Consolidation of Variable Interest Entities. All references herein
to consolidated financial statements of the Borrower and the Subsidiaries or to the
determination of any amount for the Borrower and its Subsidiaries on a consolidated basis or
any similar reference shall, in each case, be deemed to include each variable interest
entity that the Borrower is required to consolidate pursuant to FASB Interpretation No. 46
 — Consolidation of Variable Interest Entities: an interpretation of ARB No. 51 (January
2003), as if such variable interest entity were a Subsidiary as defined herein, but each
such variable interest entity shall not be considered a Subsidiary for any other purpose
hereunder.

Section 2.2 Amendment to Section 9.5(c). Effective as of the date hereof, the reference to
the dollar amount “$7,500,000” in Section 9.5(c) of the Agreement is deleted and the reference to
the dollar amount “$15,000,000” is inserted in lieu thereof.

 

 

ARTICLE III

Conditions Precedent

Section 3.1 Conditions. The effectiveness of this Amendment is subject to the satisfaction
of the following conditions precedent:

	 	(a)	 	Amendment. The Agent shall have received this Amendment executed by
the Borrower, the Guarantors, the Required Lenders and the Agent.
	 
	 	(b)	 	No Default. No Default shall have occurred and be continuing.
	 
	 	(c)	 	Representations and Warranties. All of the representations and
warranties contained in Article VII of the Agreement and in the other Loan Documents
shall be true and correct on and as of the date of this Amendment with the same force
and effect as if such representations and warranties had been made on and as of such
date, except to the extent such representations and warranties speak to a specific
date.
	 
	 	(d)	 	Additional Documentation. The Agent shall have received such
additional approvals, opinions or documents as the Agent or its legal counsel may
reasonably request.

ARTICLE IV

Ratifications, Representations and Warranties

Section 4.1 Ratifications. The terms and provisions set forth in this Amendment shall
modify and supersede all inconsistent terms and provisions set forth in the Agreement and except as
expressly modified and superseded by this Amendment, the terms and provisions of the Agreement and
the other Loan Documents are ratified and confirmed and shall continue in full force and effect.
The Borrower, the Guarantors and the Agent agree that the Agreement as amended hereby and the other
Loan Documents shall continue to be legal, valid, binding and enforceable in accordance with their
respective terms.

Section 4.2 Representations and Warranties. Each of the Borrower and the Guarantors hereby
represents and warrants to the Lenders, the Agent and the Issuing Bank that (a) the execution,
delivery and performance of this Amendment and any and all other Loan Documents executed and/or
delivered in connection herewith have been authorized by all requisite corporate or other action on
the part of the Borrower or such Guarantor and will not violate the certificate of incorporation,
bylaws or other organizational documents of the Borrower or such Guarantor, (b) the representations
and warranties contained in the Agreement, and any other Loan Document are true and correct on and
as of the date hereof as though made on and as of the date hereof (except for such representations
and warranties as are limited by their express terms to a specific date), (c) effective upon the
execution of this Amendment and the Loan Documents executed in connection herewith, no Default has
occurred and is continuing, and (d) the Borrower and the Guarantors are in full compliance with all
covenants and agreements contained in the Agreement as amended hereby.

Section 4.3 Ratification by Guarantors. The Guarantors hereby consent and agree to this
Amendment and agree that the Guaranty shall remain in full force and in effect and shall continue
to (a) guarantee the Guaranteed Indebtedness (as defined in the Guaranty), and (b) be the legal,
valid and binding obligation of the Guarantors and enforceable against the Guarantors in accordance
with its terms. In addition, the Guarantors hereby agree that each Subsidiary Security Agreement,
the Contribution and Indemnification Agreement and each Real Property Security Agreement shall
remain in full force and in effect and shall continue to (i) secure the Obligations (as defined in
the Loan Documents other than the Real Property Security Documents) and the Debt (as defined in the
Real Property Security Documents), and (ii) be the legal, valid and binding obligation of the
Guarantors and enforceable against the Guarantors and collateral in accordance with their
respective terms.

ARTICLE V

Miscellaneous

Section 5.1 Survival of Representations and Warranties. All representations and warranties
made in this Amendment or any other Loan Document including any Loan Document furnished in
connection with this Amendment shall survive the execution and delivery of this Amendment and the
other Loan Documents, and no
 

 

 

investigation by the Lenders, the Agent or the Issuing Bank or any closing shall affect the representations and warranties or the right of the Lenders, the Agent or
the Issuing Bank to rely upon them.

Section 5.2 Reference to Agreement. Each of the Loan Documents, including the Agreement
and any and all other agreements, documents, or instruments now or hereafter executed and delivered
pursuant to the terms hereof or pursuant to the terms of the Agreement as amended hereby, are
hereby amended so that any reference in such Loan Documents to the Agreement shall mean a reference
to the Agreement as amended hereby.

Section 5.3 Expenses of Agent. As provided in the Agreement, Borrower agrees to pay on
demand all costs and expenses incurred by the Agent in connection with the preparation,
negotiation, and execution of this Amendment and the other Loan Documents executed pursuant hereto
and any and all amendments, modifications, and supplements thereto, including without limitation
the reasonable costs and fees of the Agent’s legal counsel, and all costs and expenses incurred by
the Agent in connection with the enforcement or preservation of any rights under the Agreement or
any other Loan Document, including without limitation the reasonable costs and fees of the Agent’s
legal counsel.

Section 5.4 Severability. Any provision of this Amendment held by a court of competent
jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this
Amendment and the effect thereof shall be confined to the provision so held to be invalid or
unenforceable.

Section 5.5 Applicable Law. This Amendment and all other Loan Documents executed pursuant
hereto shall be governed by and construed in accordance with the laws of the State of Texas and the
applicable laws of the United States of America.

Section 5.6 Successors and Assigns. This Amendment is binding upon and shall inure to the
benefit of the Lenders, the Agent, the Issuing Bank and the Borrower and the Guarantors and their
respective successors and assigns, except neither the Borrower nor any Guarantor may assign or
transfer any of its rights or obligations hereunder without the prior written consent of the
Lenders and the Agent.

Section 5.7 Counterparts. This Amendment may be executed in one or more counterparts, each
of which when so executed shall be deemed to be an original, but all of which when taken together
shall constitute one and the same instrument. Signatures transmitted by facsimile, email or other
electronic medium shall be effective as originals.

Section 5.8 Headings. The headings, captions, and arrangements used in this Amendment are
for convenience only and shall not affect the interpretation of this Amendment.

Section 5.9 ENTIRE AGREEMENT. THIS AMENDMENT AND ALL OTHER INSTRUMENTS, DOCUMENTS AND
AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH THIS AMENDMENT EMBODY THE FINAL, ENTIRE
AGREEMENT AMONG THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDE ANY AND
ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL,
RELATING TO THIS AMENDMENT, AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES HERETO.

[Remainder of Page Intentionally Left Blank]

 

 

     Executed as of the date first written above.

	 	 	 	 	 	 	 
	 	 	BORROWER:  
	 
	 	 	 	 	 	 
	 	 	EZCORP, INC.
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Daniel N. Tonissen

Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	GUARANTORS:
	 
	 	 	 	 	 	 
	 	 	EZCORP INTERNATIONAL, INC.

EZMONEY COLORADO, INC.

EZMONEY HOLDINGS, INC.

EZMONEY IDAHO, INC.

EZMONEY MANAGEMENT, INC.

EZMONEY NEBRASKA, INC.

EZMONEY UTAH, INC.

EZMONEY WISCONSIN, INC.

EZPAWN ALABAMA, INC.

EZPAWN ARKANSAS, INC.

EZPAWN COLORADO, INC.

EZPAWN FLORIDA, INC.

EZPAWN HOLDINGS, INC.

EZPAWN INDIANA, INC.

EZPAWN LOUISIANA, INC.

EZPAWN NEVADA, INC.

EZPAWN OKLAHOMA, INC.

EZPAWN TENNESSEE, INC.

EZPAWN MEXICO LTD., INC.

EZPAWN MEXICO HOLDINGS, INC.

TEXAS EZPAWN MANAGEMENT, INC.

PAYDAY LOAN MANAGEMENT, INC.

TEXAS DIAMOND & GOLD, & PAWN, INC.

	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Daniel N. Tonissen

Senior Vice President

of each Guarantor listed above
	 	 

	 	 	 	 	 	 	 
	 	 	TEXAS EZPAWN L.P.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Texas EZPAWN Management, Inc.,

its sole general partner	 	 

	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Daniel N. Tonissen

Senior Vice President
	 	 

 

 

	 	 	 	 	 	 	 
	 	 	TEXAS PRA MANAGEMENT, L.P.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	EZMoney Management, Inc.,

its sole general partner	 	 

	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Daniel N. Tonissen

Senior Vice President
	 	  

	 	 	 	 	 	 	 
	 	 	TEXAS EZMONEY, L.P.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Payday Loan Management, Inc.,

its sole general partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Daniel N. Tonissen

Senior Vice President	 	 
	 
	 	 	 	 	 	 
	 	 	Address for Notices:

1901 Capital Parkway

Austin, Texas 78746

Fax No.: (512) 314-3404

Telephone No.: (512) 314-2289

Email: dtonissen@ezcorp.com

Attention: Chief Financial Officer

 

 

	 	 	 	 	 
	 	AGENT AND LENDERS:

WELLS FARGO BANK, NATIONAL ASSOCIATION, as

Agent and a Lender

 	 
	 	By:  	 	 
	 	 	Michael Brewer 	 
	 	 	Vice President 	 
	 

 

 

	 	 	 	 	 
	 	GUARANTY BANK, as a Lender

 	 
	 	By:  	 	 
	 	 	Dan Leonard	 
	 	 	Vice Presidentexv10w1

 

Exhibit
10.1

ELECTRONIC ARTS INC.

2000 EQUITY INCENTIVE PLAN

As Amended by the Stockholders on July 26, 2007

1. PURPOSE. The purpose of this Plan is to provide incentives to attract, retain and
motivate eligible persons whose present and potential contributions are important to the success of
the Company, its Parent and Subsidiaries by offering them an opportunity to participate in the
Company’s future performance through awards of Options, Restricted Stock, Restricted Stock Units,
and Stock Appreciation Rights. Capitalized terms not defined in the text are defined in Section
24.

2. SHARES SUBJECT TO THE PLAN.

          2.1 Number of Shares. Subject to Sections 2.2, 2.3 and 19, the aggregate number of
Shares that have been reserved pursuant to this Plan is 76,400,000 Shares. Shares that are: (a)
subject to issuance upon exercise of an Award but cease to be subject to such Award for any reason
other than exercise of such Award; (b) subject to an Award granted hereunder but are forfeited; or
(c) subject to an Award that otherwise terminates or is settled without Shares being issued shall
revert to and again become available for issuance under the Plan. The following Shares shall not
again become available for issuance under the Plan: (x) Shares that are not issued or delivered as
a result of the net settlement of an Option or Stock Appreciation Right; (y) Shares that are used
to pay the exercise price or withholding taxes related to an Award; or (z) Shares that are
repurchased by the Company with the proceeds of an Option exercise. At all times the Company shall
reserve and keep available a sufficient number of Shares as shall be required to satisfy the
requirements of all outstanding Options and Stock Appreciation Rights granted under this Plan and
all other outstanding but unvested Awards granted under this Plan.

          2.2 Limitation on Number of Shares Subject to Restricted Stock Awards and Restricted Stock
Unit Awards. The number of Shares that may be issued under Sections 6 and 7 of this Plan
shall not exceed 11,000,000 in the aggregate.

          2.3 Adjustment of Shares. In the event that the number of outstanding shares is
changed by a stock dividend, recapitalization, stock split, reverse stock split, subdivision,
combination, reclassification or similar change in the capital structure of the Company without
consideration, then (a) the number of Shares reserved for issuance under this Plan, (b) the
Exercise Prices of and number of Shares subject to outstanding Awards, and (c) the number of Shares
associated with other outstanding Awards, will be proportionately adjusted, subject to any required
action by the Board or the stockholders of the Company and compliance with applicable securities
laws; provided, however, that fractions of a Share will not be issued but will either be replaced
by a cash payment equal to the Fair Market Value of such fraction of a Share or will be rounded up
to the nearest whole Share, as determined by the Committee.

3. ELIGIBILITY. ISOs (as defined in Section 5 below) may be granted only to employees
(including officers and directors who are also employees) of the Company or of a Parent or
Subsidiary of the Company. All other Awards may be granted to employees and directors of the
Company or any Parent or Subsidiary of the Company. No person will be eligible to receive Awards
covering more than 1,400,000 Shares in any calendar year under this Plan, of which no more than
400,000 Shares shall be covered by Awards of Restricted Stock or Restricted Stock Units, other than
new employees of the Company or of a Parent or Subsidiary of the Company (including new employees
who are also officers and directors of the Company or any Parent or Subsidiary of the Company), who
are eligible to receive Awards covering up to a maximum of 2,800,000 Shares in the calendar year in
which they commence their employment, of which no more than 800,000 Shares shall be covered by
Awards of Restricted Stock or Restricted Stock Units. For purposes of these limits, each
Restricted Stock Unit settled in Shares (but not those settled in cash), shall be deemed to cover
one Share. A person may be granted more than one Award under this Plan.

D-1

 

4. ADMINISTRATION.

          4.1 Committee Authority. This Plan will be administered by the Committee or by the
Board acting as the Committee. Except for automatic grants to Outside Directors pursuant to
Section 10 hereof, and subject to the general purposes, terms and conditions of this Plan, and to
the direction of the Board, the Committee will have full power to implement and carry out this
Plan. Except for automatic grants to Outside Directors pursuant to Section 10 hereof, the
Committee will have the authority to:

	 	(a)	 	construe and interpret this Plan, any Award
Agreement and any other agreement or document executed pursuant to
this Plan;
	 
	 	(b)	 	prescribe, amend and rescind rules and
regulations relating to this Plan or any Award;
	 
	 	(c)	 	select persons to receive Awards;
	 
	 	(d)	 	determine the form and terms of Awards;
	 
	 	(e)	 	determine the number of Shares or other
consideration subject to Awards;
	 
	 	(f)	 	determine whether Awards will be granted
singly, in combination with, in tandem with, in replacement of, or as
alternatives to, other Awards under this Plan or any other incentive
or compensation plan of the Company or any Parent or Subsidiary of
the Company;
	 
	 	(g)	 	grant waivers of Plan or Award conditions;
	 
	 	(h)	 	determine the vesting, exercisability and
payment of Awards;
	 
	 	(i)	 	correct any defect, supply any omission or
reconcile any inconsistency in this Plan, any Award or any Award
Agreement;
	 
	 	(j)	 	determine whether an Award has been earned;
and
	 
	 	(k)	 	make all other determinations necessary or
advisable for the administration of this Plan.

          4.2 Committee Discretion. Except for automatic grants to Outside Directors pursuant
to Section 10 hereof, any determination made by the Committee with respect to any Award will be
made in its sole discretion at the time of grant of the Award or, unless in contravention of any
express term of this Plan or Award, at any later time, and such determination will be final and
binding on the Company and on all persons having an interest in any Award under this Plan. The
Committee may delegate to one or more officers of the Company the authority to (i) construe and
interpret this Plan, any Award Agreement and any other agreement or document executed pursuant to
this Plan, and (ii) grant an Award under this Plan to Participants who are not Insiders of the
Company.

          4.3 Section 162(m). To the extent that Awards are granted hereunder as
“performance-based compensation” within the meaning of Section 162(m) of the Code, the Plan shall
be administered by a committee, which may be the Committee, of two or more “outside directors”
within the meaning of Section 162(m) of the Code. For purposes of qualifying grants of Awards as
“performance-based compensation” under Section 162(m) of the Code, the committee, in its
discretion, may set restrictions based upon the achievement of performance goals. The performance
goals shall be set by the committee on or before the latest date permissible to enable the Awards
to qualify as “performance-based compensation” under Section 162(m) of the Code. In granting
Awards that are intended to qualify under

D-2

 

Section 162(m) of the Code, the committee shall follow any procedures determined by it from
time to time to be necessary or appropriate to ensure qualification of the Awards under Section
162(m) of the Code (e.g., in determining the performance goals).

5. OPTIONS. The Committee may grant Options to eligible persons and will determine whether
such Options will be Incentive Stock Options within the meaning of the Code (“ISO”) or Nonqualified
Stock Options (“NQSOs”), the number of Shares subject to the Option, the Exercise Price of the
Option, the period during which the Option may be exercised, and all other terms and conditions of
the Option, subject to the following:

          5.1 Form of Option Grant. Each Option granted under this Plan will be evidenced by an
Award Agreement which will expressly identify the Option as an ISO or an NQSO (“Stock Option
Agreement”), and, except as otherwise required by the terms of Section 10 hereof, will be in such
form and contain such provisions (which need not be the same for each Participant) as the Committee
may from time to time approve, and which will comply with and be subject to the terms and
conditions of this Plan.

          5.2 Date of Grant. The date of grant of an Option will be the date on which the
Committee makes the determination to grant such Option, unless otherwise specified by the
Committee. The Stock Option Agreement and a copy of this Plan will be delivered to the Participant
within a reasonable time after the granting of the Option.

          5.3 Exercise Period; Performance Goals.

          (a) Options may be exercisable within the times or upon the events determined by the
Committee as set forth in the Stock Option Agreement governing such
Option; provided, however, that
no Option will be exercisable after the expiration of ten (10) years from the date the Option is
granted; and provided, further, that no ISO granted to a person who directly or by attribution owns
more than ten percent (10%) of the total combined voting power of all classes of stock of the
Company or of any Parent or Subsidiary of the Company (“Ten Percent Stockholder”) will be
exercisable after the expiration of five (5) years from the date the ISO is granted. The Committee
also may provide for Options to become exercisable at one time or from time to time, periodically
or otherwise, in such number of Shares or percentage of Shares as the Committee determines.

          (b) Participant’s ability to exercise Options shall be subject to such restrictions, if any,
as the Committee may impose. These restrictions may be based upon completion of a specified number
of years of service with the Company or a Subsidiary or upon completion of the performance goals as
set out in advance in the Participant’s individual Stock Option Agreement. Options may vary from
Participant to Participant and between groups of Participants. Should the Committee elect to
impose restrictions on an Option, the Committee shall: (a) determine the nature, length and
starting date of any Performance Period for the Option; (b) select from among the Performance
Factors to be used to measure performance goals, if any; and (c) determine the number of Shares
subject to such Option. Prior to such Option becoming exercisable, the Committee shall determine
the extent to which such Performance Factors have been met. Performance Periods may overlap and
Participants may participate simultaneously with respect to Options that are subject to different
Performance Periods and have different performance goals and other criteria.

          5.4 Exercise Price. The Exercise Price of an Option will be determined by the
Committee when the Option is granted and may be not less than 100% of the Fair Market Value of the
Shares on the date of grant; provided that the Exercise Price of any ISO granted to a Ten Percent
Stockholder will not be less than 110% of the Fair Market Value of the Shares on the date of grant.
Payment for the Shares purchased may be made in accordance with Section 9 of this Plan.

          5.5 Method of Exercise. Options may be exercised only by delivery to the Company of a
written stock option exercise agreement (the “Exercise Agreement”) in a form approved by the
Committee (which need not be the same for each Participant), stating the number of Shares being
purchased, the restrictions imposed on the Shares purchased under such Exercise Agreement, if any,
and

D-3

 

such representations and agreements regarding Participant’s investment intent and access to
information and other matters, if any, as may be required or desirable by the Company to comply with
applicable securities laws, together with payment in full of the Exercise Price for the number of
Shares being purchased.

          5.6 Termination. Notwithstanding the exercise periods set forth in the Stock Option
Agreement, exercise of an Option will always be subject to the following:

	 	(a)	 	If the Participant is Terminated for any
reason except death or Disability, then the Participant may exercise
such Participant’s Options only to the extent that such Options would
have been exercisable upon the Termination Date no later than three
(3) months after the Termination Date (or such shorter or longer time
period not exceeding five (5) years as may be determined by the
Committee, with any exercise beyond three (3) months after the
Termination Date deemed to be an NQSO), but in any event, no later
than the expiration date of the Options.
	 
	 	(b)	 	If the Participant is Terminated because of
Participant’s death or Disability (or the Participant dies within
three (3) months after a Termination other than for Cause or because
of Participant’s Disability), then Participant’s Options may be
exercised only to the extent that such Options would have been
exercisable by Participant on the Termination Date and must be
exercised by Participant (or Participant’s legal representative or
authorized assignee) no later than twelve (12) months after the
Termination Date (or such shorter or longer time period not exceeding
five (5) years as may be determined by the Committee, with any such
exercise beyond (a) three (3) months after the Termination Date when
the Termination is for any reason other than the Participant’s death
or Disability, or (b) twelve (12) months after the Termination Date
when the Termination is for Participant’s death or Disability, deemed
to be an NQSO), but in any event no later than the expiration date of
the Options.
	 
	 	(c)	 	Notwithstanding the provisions in paragraph
5.6(a) above, if a Participant is terminated for Cause, neither the
Participant, the Participant’s estate nor such other person who may
then hold the Option shall be entitled to exercise any Option with
respect to any Shares whatsoever, after termination of service,
whether or not after termination of service the Participant may
receive payment from the Company or Subsidiary for vacation pay, for
services rendered prior to termination, for services rendered for the
day on which termination occurs, for salary in lieu of notice, or for
any other benefits. In the event that the Committee has delegated to
one or more officers of the Company the authority set forth in
Section 4.2 above and Participant has been notified that such officer
or officers has made a determination that Participant has been
terminated for Cause, Participant shall have five (5) business days
(measured from the date he or she was first notified of such
determination) to appeal such determination to the Committee. If
Participant appeals to the Committee in a timely manner, the
Committee shall give the Participant an opportunity to present to the
Committee evidence on his or her behalf. If the Committee has not
delegated to one or more officers of the Company the authority set
forth in Section 4.2, and the Committee makes such Cause
determination itself, such decision shall be deemed final and
unappealable.
For the purpose of this paragraph, termination of
service 

D-4

 

	 	 	 	shall be deemed to occur on the date when the Company or
Subsidary
dispatches notice or advice to the Participant that his service is
terminated.

          5.7 Limitations on Exercise. The Committee may specify a reasonable minimum number of
Shares that may be purchased on any exercise of an Option, provided that such minimum number will
not prevent Participant from exercising the Option for the full number of Shares for which it is
then exercisable.

          5.8 Limitations on ISO. The aggregate Fair Market Value (determined as of the date of
grant) of Shares with respect to which ISO are exercisable for the first time by a Participant
during any calendar year (under this Plan or under any other incentive stock option plan of the
Company, Parent or Subsidiary of the Company) will not exceed $100,000. If the Fair Market Value
of Shares on the date of grant with respect to which ISO are exercisable for the first time by a
Participant during any calendar year exceeds $100,000, then the Options for the first $100,000
worth of Shares to become exercisable in such calendar year will be ISO and the Options for the
amount in excess of $100,000 that become exercisable in that calendar year will be NQSOs. In the
event that the Code or the regulations promulgated thereunder are amended after the Effective Date
of this Plan to provide for a different limit on the Fair Market Value of Shares permitted to be
subject to ISO, such different limit will be automatically incorporated herein and will apply to
any Options granted after the effective date of such amendment.

          5.9 Modification, Extension or Renewal. The Committee may modify, extend or renew
outstanding Options and authorize the grant of new Options, provided however, that (i) any such
action may not, without the written consent of a Participant, impair any of such Participant’s
rights under any Option previously granted, (ii) any such action shall not extend the exercise
period of the Option to a date later than the later of (a) the fifteenth day of the third month
following the date on which the Option otherwise would have expired or (b) December 31 of the
calendar year in which the Option would have otherwise expired, and (iii) the Committee may not
reduce the Exercise Price of outstanding Options without the approval of the stockholders. Any
outstanding ISO that is modified, extended, renewed or otherwise altered will be treated in
accordance with Section 424(h) of the Code.

          5.10 No Disqualification. Notwithstanding any other provision in this Plan, no term
of this Plan relating to ISO will be interpreted, amended or altered, nor will any discretion or
authority granted under this Plan be exercised, so as to disqualify this Plan under Section 422 of
the Code or, without the consent of the Participant affected, to disqualify any ISO under Section
422 of the Code.

6. RESTRICTED STOCK. A Restricted Stock Award is an offer by the Company to grant or to
sell to an eligible person Shares that are subject to restrictions. The Committee will determine
to whom an offer will be made, the number of Shares the person may purchase, the price to be paid
(the “Purchase Price”), if any, the restrictions to which the Shares will be subject, and all other
terms and conditions of the Restricted Stock Award, subject to the following:

          6.1 Form of Restricted Stock Award. All grants or purchases under a Restricted Stock
Award made pursuant to this Plan will be evidenced by an Award Agreement (“Restricted Stock
Purchase Agreement”) that will be in such form (which need not be the same for each Participant) as
the Committee will from time to time approve, and will comply with and be subject to the terms and
conditions of this Plan. The offer of Restricted Stock will be accepted by the Participant’s
execution and delivery of the Restricted Stock Purchase Agreement and full payment, if any, for the
Shares to the Company within thirty (30) days, or such other date as may be set forth in the
Restricted Stock Purchase Agreement, from the date the Restricted Stock Purchase Agreement is
delivered to the person. If such person does not execute and deliver the Restricted Stock Purchase
Agreement along with full payment, if any, for the Shares to the Company within thirty (30) days,
or such other date as may be set forth in the Restricted Stock Purchase Agreement, then the offer
will terminate, unless otherwise determined by the Committee.

D-5

 

          6.2 Purchase Price. The Purchase Price of Shares sold pursuant to a Restricted Stock
Award, if any, will be determined by the Committee on the date the Restricted Stock Award is
granted. At the Committee’s discretion, consideration for the Restricted Stock Award may be in the
form
of continued service to the Company or a Subsidiary. Payment of the Purchase Price may be
made in accordance with Section 9 of this Plan.

          6.3 Terms of Restricted Stock Awards. Restricted Stock Awards shall be subject to
such restrictions as the Committee may impose. These restrictions may be based upon completion of
a specified number of years of service with the Company or a Subsidiary or upon completion of the
performance goals as set out in advance in the Participant’s individual Restricted Stock Purchase
Agreement. Restricted Stock Awards may vary from Participant to Participant and between groups of
Participants. Prior to the grant of a Restricted Stock Award, the Committee shall: (a) determine
the nature, length and starting date of any Performance Period for the Restricted Stock Award; (b)
select from among the Performance Factors to be used to measure performance goals, if any; and (c)
determine the number of Shares that may be awarded to the Participant. Prior to the payment of any
Restricted Stock Award, the Committee shall determine the extent to which such Restricted Stock
Award has been earned. Performance Periods may overlap and Participants may participate
simultaneously with respect to Restricted Stock Awards that are subject to different Performance
Periods and having different performance goals and other criteria.

          6.4 Termination During Performance Period. If a Participant is Terminated during a
Performance Period for any reason, then such Participant will be entitled to payment (whether in
Shares, cash or otherwise) with respect to the Restricted Stock Award only to the extent earned as
of the date of Termination in accordance with the Restricted Stock Purchase Agreement, unless the
Committee determines otherwise in the case of a Participant who is not a “covered employee” for
purposes of Section 162(m) of the Code in the year of Termination.

7. RESTRICTED STOCK UNITS. Each Restricted Stock Unit shall have a value equal to the Fair
Market Value of a share of the Company’s Common Stock. A Restricted Stock Unit does not constitute
a share of, nor represent any ownership interest in, the Company. The Committee will determine the
number of Restricted Stock Units granted to any eligible person; whether the Restricted Stock Units
will be settled in Shares, in cash, or in a combination of the two; the price to be paid (the
“Purchase Price”), if any, for any Shares issued pursuant to a Restricted Stock Unit; the
restrictions to which the Restricted Stock Units will be subject, and all other terms and
conditions of the Restricted Stock Units, subject to the following:

          7.1 Form of Restricted Stock Unit Award. All Restricted Stock Units granted pursuant
to this Plan will be evidenced by an Award Agreement (“Restricted Stock Unit Agreement”) that will
be in such form (which need not be the same for each Participant) as the Committee will from time
to time approve, and will comply with and be subject to the terms and conditions of this Plan. The
offer of Restricted Stock Units will be accepted by the Participant’s execution and delivery of the
Restricted Stock Unit Agreement within thirty (30) days, or such other date as may be set forth in
the Restricted Stock Unit Agreement, from the date the Restricted Stock Unit Agreement is delivered
to the person. If such person does not execute and deliver the Restricted Stock Unit Agreement
within thirty (30) days, or such other date as may be set forth in the Restricted Stock Unit
Agreement, then the offer will terminate, unless otherwise determined by the Committee.

          7.2 Purchase Price. The Purchase Price of Shares sold pursuant to a Restricted Stock
Unit, if any, will be determined by the Committee on the date the Restricted Stock Unit is granted.
At the Committee’s discretion, consideration for the Restricted Stock Unit may be in the form of
continued service to the Company or a Subsidiary. Payment of the Purchase Price, if any, shall be
made in accordance with Section 9 of this Plan when the Shares are issued.

          7.3 Terms of Restricted Stock Units. Restricted Stock Units shall be subject to such
restrictions as the Committee may impose. These restrictions may be based upon completion of a
specified number of years of service with the Company or a Subsidiary or upon completion of the
performance goals as set out in advance in the Participant’s individual Restricted Stock Unit
Agreement. Restricted Stock

D-6

 

Units may vary from Participant to Participant and between groups of
Participants. Prior to the grant of Restricted Stock Units, the Committee shall: (a) determine the
nature, length and starting date of any Performance Period for the Restricted Stock Unit; (b)
select from among the Performance Factors to be
used to measure performance goals, if any; and (c) determine the number of Restricted Stock
Units that will be awarded to the Participant. Prior to the payment (whether in Shares, cash or
otherwise) of any Restricted Stock Units, the Committee shall determine the extent to which such
Restricted Stock Units have been earned. Performance Periods may overlap and Participants may
participate simultaneously with respect to Restricted Stock Units that are subject to different
Performance Periods and have different performance goals and other criteria.

          7.4 Termination During Performance Period. If a Participant is Terminated during a
Performance Period for any reason, then such Participant will be entitled to payment (whether in
Shares, cash or otherwise) with respect to the Restricted Stock Units only to the extent earned as
of the date of Termination in accordance with the Restricted Stock Unit Agreement, unless the
Committee determines otherwise in the case of a Participant who is not a “covered employee” for
purposes of Section 162(m) of the Code in the year of Termination.

          7.5 Payment When Restrictions Lapse. The cash or Shares that a Participant is
entitled to receive pursuant to a Restricted Stock Unit shall be paid or issued to the Participant
when all applicable restrictions and other conditions applicable to the Restricted Stock Unit have
lapsed or have been satisfied, unless the Restricted Stock Unit Agreement provides for a later
settlement date in compliance with Section 409A of the Code.

8. STOCK APPRECIATION RIGHTS. The Committee may grant Stock Appreciation Rights or SARs to
eligible persons and will determine the number of Shares subject to the SARs, the Exercise Price of
the SARs, the period during which the SARs may be exercised, and all other terms and conditions of
the SARs, subject to the following:

          8.1 Form of SAR Grant. SARs granted under this Plan will be evidenced by an Award
Agreement that will expressly identify the SARs as freestanding SARs (SARs granted independent of
any other Option), tandem SARs (SARs granted in connection with an Option, or any portion thereof),
or any combination thereof (“SAR Agreement”), and will be in such form and contain such provisions
(which need not be the same for each Participant) as the Committee may from time to time approve,
and which will comply with and be subject to the terms and conditions of this Plan.

          8.2 Date of Grant. The date of grant of a SAR will be the date on which the Committee
makes the determination to grant such SAR, unless otherwise specified by the Committee. The SAR
Agreement and a copy of this Plan will be delivered to the Participant within a reasonable time
after the granting of the SAR.

          8.3 Exercise Price and Other Terms.

          (a) The Committee, subject to the provisions of the Plan, shall have complete discretion to
determine the terms and conditions of SARs granted under the Plan; provided, however, that no SAR
will be exercisable after the expiration of ten (10) years from the date the SAR is granted;
provided, further, that the Exercise Price for freestanding SARs shall be not less than one hundred
percent (100%) of the Fair Market Value of a Share on the grant date. The Exercise Price for
tandem SARs shall equal the Exercise Price of the related Option.

          (b) Participant’s ability to exercise SARs shall be subject to such restrictions, if any, as
the Committee may impose. These restrictions may be based upon completion of a specified number of
years of service with the Company or a Subsidiary or upon completion of the performance goals as
set out in advance in the Participant’s individual SAR Agreement. SARs may vary from Participant
to Participant and between groups of Participants. Should the Committee elect to impose
restrictions on a SAR, the Committee shall: (a) determine the nature, length and starting date of
any Performance Period for the SAR; (b) select from among the Performance Factors to be used to
measure performance goals, if any; and (c)

D-7

 

determine the number of Shares subject to such SAR.
Prior to such SAR becoming exercisable, the Committee shall determine the extent to which such
Performance Factors have been met. Performance
Periods may overlap and Participants may participate simultaneously with respect to SAR that
are subject to different Performance Periods and have different performance goals and other
criteria.

          8.4 Exercise of Tandem SARs. Tandem SARs may be exercised for all or part of the
Shares subject to the related Option upon the surrender of the right to exercise the equivalent
portion of the related Option. Tandem SARs may be exercised only with respect to the Shares for
which the related Option is then exercisable. With respect to tandem SARs granted in connection
with an Option: (a) the tandem SARs shall expire no later than the expiration of the underlying
Option; (b) the value of the payout with respect to the tandem SARs shall be for no more than one
hundred percent (100%) of the difference between the Exercise Price of the underlying Option and
the Fair Market Value of the Shares subject to the underlying Option at the time the tandem SARs
are exercised; and (c) the tandem SARs shall be exercisable only when the Fair Market Value of the
Shares subject to the underlying Option exceeds the Exercise Price of the Option.

          8.5 Exercise of Freestanding SARs. Freestanding SARs shall be exercisable on such
terms and conditions as the Committee, in its sole discretion, shall determine.

          8.6 Payment of SAR Amount. Upon exercise of a SAR, a Participant shall be entitled to
receive payment from the Company in an amount determined by multiplying:

	 	(a)	 	The difference between (i) the Fair Market
Value of a Share on the date of exercise (or such other date as may
be determined by the Committee and set forth in the Participant’s SAR
Agreement) and (ii) the Exercise Price; times
	 
	 	(b)	 	The number of Shares with respect to which
the SAR is exercised.

               At the discretion of the Committee, the payment upon exercise of the SAR may be in cash, in
Shares of equivalent value, or in some combination thereof.

          8.7 Termination. Notwithstanding the exercise periods set forth in the SAR Agreement,
exercise of a SAR will always be subject to the following:

	 	(a)	 	If the Participant is Terminated for any
reason except death or Disability, then the Participant may exercise
such Participant’s SAR only to the extent that such SAR would have
been exercisable upon the Termination Date no later than three (3)
months after the Termination Date (or such shorter or longer time
period not exceeding five (5) years as may be determined by the
Committee), but in any event, no later than the expiration date of
the SAR.
	 
	 	(b)	 	If the Participant is Terminated because of
Participant’s death or Disability (or the Participant dies within
three (3) months after a Termination other than for Cause or because
of Participant’s Disability), then Participant’s SAR may be exercised
only to the extent that such SAR would have been exercisable by
Participant on the Termination Date and must be exercised by
Participant (or Participant’s legal representative or authorized
assignee) no later than twelve (12) months after the Termination
Date, but in any event no later than the expiration date of the SAR.
	 
	 	(c)	 	Notwithstanding the provisions in paragraph
8.7(a) above, if a Participant is terminated for Cause, neither the
Participant, the 

D-8

 

	 	 	 	Participant’s estate nor such other person who may
then hold the SAR shall be entitled to exercise any SAR with respect
to any Shares
whatsoever, after termination of service, whether or not after
termination of service the Participant may receive payment from
the Company or Subsidiary for vacation pay, for services rendered
prior to termination, for services rendered for the day on which
Termination occurs, for salary in lieu of notice, or for any other
benefits. In the event that the Committee has delegated to one or
more officers of the Company the authority set forth in Section
4.2 above and Participant has been notified that such officer or
officers has made a determination that Participant has been
terminated for Cause, Participant shall have five (5) business
days (measured from the date he or she was first notified of such
determination) to appeal such determination to the Committee. If
Participant appeals to the Committee in a timely manner, the
Committee shall give the Participant an opportunity to present to
the Committee evidence on his or her behalf. If the Committee has
not delegated to one or more officers of the Company the authority
set forth in Section 4.2, and the Committee makes such Cause
determination itself, such decision shall be deemed final and
unappealable. For the purpose of this paragraph, termination of
service shall be deemed to occur on the date when the Company or
Subsidiary dispatches notice or advice to the Participant that his
service is terminated.

          8.8 Modification, Extension or Renewal. The Committee may modify, extend or renew
outstanding SARs and authorize the grant of new SARs, provided however, that (i) any such action
may not, without the written consent of a Participant, impair any of such Participant’s rights
under any SAR previously granted, (ii) any such action shall not extend the exercise period of the
SAR to a date later than the later of (a) the fifteenth day of the third month following the date
on which the SAR otherwise would have expired or (b) December 31 of the calendar year in which the
Option would have otherwise expired, and (iii) the Committee may not reduce the Exercise Price of
outstanding SARs without the approval of the stockholders.

9. PAYMENT FOR SHARE PURCHASES. Where expressly approved for the Participant by the
Committee and where permitted by law, payment for Shares purchased pursuant to this Plan may:

	 	(a)	 	be made in cash (by check);
	 
	 	(b)	 	by cancellation of indebtedness of the
Company to the Participant;
	 
	 	(c)	 	by surrender of shares that either: (1)
have been owned by Participant for more than six (6) months and have
been paid for within the meaning of SEC Rule 144 (and, if such shares
were purchased from the Company by use of a promissory note, such
note has been fully paid with respect to such shares); or (2) were
obtained by Participant in the public market;
	 
	 	(d)	 	by waiver of compensation due or accrued to
the Participant for services rendered;
	 
	 	(e)	 	with respect only to purchases upon
exercise of an Option, and provided that a public market for the
Company’s stock exists:

	 	(1)	 	through a “same day sale”
commitment from the Participant and a broker-dealer that is a
member of the National Association of Securities Dealers (an
“NASD Dealer”)

D-9

 

	 	 	 	whereby the Participant irrevocably elects to
exercise the Option and to sell a portion of the Shares so
purchased to pay
for the Exercise Price, and whereby the NASD Dealer
irrevocably commits upon receipt of such Shares to forward
the Exercise Price directly to the Company; or

	 	(2)	 	through a “margin”
commitment from the Participant and a NASD Dealer whereby the
Participant irrevocably elects to exercise the Option and to
pledge the Shares so purchased to the NASD Dealer in a margin
account as security for a loan from the NASD Dealer in the
amount of the Exercise Price, and whereby the NASD Dealer
irrevocably commits upon receipt of such Shares to forward
the Exercise Price directly to the Company; or

	 	(f)	 	by withholding from the Shares to be issued
upon exercise of an Award that number of Shares having a Fair Market
Value equal to the minimum amount required to satisfy the Exercise
Price or Purchase Price (the Fair Market Value of the Shares to be
withheld shall be determined on the date that the Award is exercised
by the Participant); or
	 
	 	(g)	 	by any combination of the foregoing; or
	 
	 	(h)	 	such other consideration and method of
payment for issuance of Shares to the extent permitted by applicable
laws.

10. AUTOMATIC GRANTS TO OUTSIDE DIRECTORS.

          10.1 Types of Awards and Shares. Awards granted under this Plan and subject to this
Section 10 may, at the discretion of the Committee, be NQSOs, SARs, or Restricted Stock Units;
provided, however, that any payment upon exercise of SARs granted pursuant to this section 10 shall
be in Shares of equivalent value.

          10.2 Eligibility. Awards subject to this Section 10 shall be granted only to Outside
Directors. Outside Directors shall also be eligible to receive Awards granted pursuant to sections
5, 6, 7 and 8 hereof at such times and on such conditions as determined by the Committee.

          10.3 Initial Grant. Each Outside Director who first becomes a member of the Board on
or after the Effective Date will automatically be granted (a) an Option or SAR, as determined by
the Committee, for 17,500 Shares and (b) 2,500 Restricted Stock Units (together, an “Initial
Grant”) on the date such Outside Director first becomes a member of the Board.

          10.4 Succeeding Grants. Upon re-election to the Board at each Annual Meeting of
Stockholders, each Outside Director will automatically be granted (a) an Option or SAR, as
determined by the Committee, for 8,400 Shares and (b) 1,200 Restricted Stock Units (together, a
“Succeeding Grant”); provided, however, that any such Outside Director who received an Initial
Grant since the last Annual Meeting of Stockholders will receive a prorated Succeeding Grant
consisting of (x) an Option or SAR, as determined by the Committee, to purchase a number of Shares
equal to 8,400 multiplied by a fraction whose numerator is the number of calendar months or
portions thereof that the Outside Director has served since the date of the Initial Grant and whose
denominator is twelve, and (y) a grant of Restricted Stock Units equal to 1,200 multiplied by a
fraction whose numerator is the number of calendar months or portions thereof that the Outside
Director has served since the date of the Initial Grant and whose denominator is twelve.

D-10

 

          10.5 Vesting.

          (a) The date an Outside Director receives an Initial Grant or a Succeeding Grant is referred
to in this Plan as the “Start Date” for such Award. Each Initial Grant will vest (a) with respect
to Options or SARs, as to 2% of the Shares on the Start Date for such Initial Grant, and as to an
additional 2% of the Shares on the first day of each calendar month after the Start Date, so long
as the Outside Director continuously remains a director of the Company, and (b) with respect to
Restricted Stock Units, in accordance with the Restricted Stock Unit Agreement. Succeeding Grants
will vest in accordance with each Stock Option, SAR or Restricted Stock Unit Agreement, as the case
may be.

          (b) Notwithstanding any provision to the contrary, in the event of a corporate transaction
described in Section 19.1, the vesting of all Awards granted to Outside Directors pursuant to this
Section 10 will accelerate and such Awards will become exercisable in full prior to the
consummation of such event at such times and on such conditions as the Committee determines, and
must be exercised, if at all, within three months of the consummation of said event. Any Awards
not exercised within such three-month period shall expire.

          10.6 Exercise Price. The exercise price of an Award pursuant to an Initial Grant or
Succeeding Grant shall be the Fair Market Value of the Shares at the time that the Award is
granted.

          10.7 Shares in Lieu of Cash Compensation. Each Outside Director may elect
to reduce all or part of the cash compensation otherwise payable for services to be rendered by him
as a director (including the annual retainer and any fees payable for serving on the Board or a
Committee of the Board) and to receive in lieu thereof Shares. Any such election shall be in
writing and must be made before the services are rendered giving rise to such compensation, and may
not be revoked or changed thereafter during the Outside Director’s term. On such election, the
cash compensation otherwise payable will be increased by 10% for purposes of determining the number
of Shares to be credited to such Outside Director. If an Outside Director so elects to receive
Shares in lieu of cash, there shall be credited to such Outside Director a number of Shares equal
to the amount of the cash compensation so reduced (increased by 10% as described in the preceding
sentence) divided by the Fair Market Value on the day in which the compensation would have been
paid in the absence of such election.

11. WITHHOLDING TAXES.

          11.1 Withholding Generally. Whenever Shares are to be issued in satisfaction of
Awards granted under this Plan, the Company may require the Participant to remit to the Company an
amount sufficient to satisfy federal, state and local withholding tax and social security
requirements prior to the delivery of any certificate or certificates for such Shares. Whenever,
under this Plan, payments in satisfaction of Awards are to be made in cash, such payment will be
net of an amount sufficient to satisfy federal, state, and local withholding tax and social
security requirements.

          11.2 Stock Withholding. When, under applicable tax or social security laws, a
Participant incurs tax or social security liability in connection with the exercise or vesting of
any Award that is subject to tax or social security withholding and the Participant is obligated to
pay the Company the amount required to be withheld, the Committee may in its sole discretion allow
the Participant to satisfy the minimum tax or social security withholding obligation by electing to
have the Company withhold from the Shares to be issued that number of Shares having a Fair Market
Value equal to the minimum amount required to be withheld, determined on the date that the amount
of tax to be withheld is to be determined. All elections by a Participant to have Shares withheld
for this purpose will be made in accordance with the requirements established by the Committee and
be in writing in a form acceptable to the Committee.

12. TRANSFERABILITY.

          12.1 Except as otherwise provided in this Section 12, Awards granted under this Plan, and any
interest therein, will not be transferable or assignable by Participant, and may not be made
subject

D-11

 

to execution, attachment or similar process, otherwise than by will or by the laws of
descent and
distribution or as determined by the Committee and set forth in the Award Agreement with
respect to Awards that are not ISOs.

          12.2 All Awards other than NQSOs and SARs. All Awards other than NQSOs and SARs shall
be exercisable: (i) during the Participant’s lifetime, only by (A) the Participant, or (B) the
Participant’s guardian or legal representative; and (ii) after Participant’s death, by the legal
representative of the Participant’s heirs or legatees.

          12.3 NQSOs and SARs. Unless otherwise restricted by the Committee, a NQSO and SAR
shall be exercisable: (i) during the Participant’s lifetime only by (A) the Participant, (B) the
Participant’s guardian or legal representative, (C) a Family Member of the Participant who has
acquired the NQSO or SAR by “permitted transfer;” and (ii) after Participant’s death, by the legal
representative of the Participant’s heirs or legatees. “Permitted transfer” means, as authorized
by this Plan and the Committee in a Stock Option Agreement or SAR Agreement, any transfer effected
by the Participant during the Participant’s lifetime of an interest in such NQSO and SAR but only
such transfers which are by gift or domestic relations order. A permitted transfer does not
include any transfer for value and neither of the following are transfers for value: (a) a
transfer under a domestic relations order in settlement of marital property rights or (b) a
transfer to an entity in which more than fifty percent of the voting interests are owned by Family
Members or the Participant in exchange for an interest in that entity.

13. PRIVILEGES OF STOCK OWNERSHIP; RESTRICTIONS ON SHARES.

          13.1 Voting and Dividends. No Participant will have any of the rights of a
stockholder with respect to any Shares until the Shares are issued to the Participant. After
Shares are issued to the Participant, the Participant will be a stockholder and have all the rights
of a stockholder with respect to such Shares, including the right to vote and receive all dividends
or other distributions made or paid with respect to such Shares; provided, that if such
Shares are Restricted Stock, then any new, additional or different securities the Participant may
become entitled to receive with respect to such Shares by virtue of a stock dividend, stock split
or any other change in the corporate or capital structure of the Company will be subject to the
same restrictions as the Restricted Stock; provided, further, that the Participant
will have no right to retain such stock dividends or stock distributions with respect to Shares
that are repurchased at the Participant’s Purchase Price or Exercise Price pursuant to Section
13.2.

          13.2 Restrictions on Shares. At the discretion of the Committee, the Company may
reserve to itself and/or its assignee(s) in the Award Agreement a right to repurchase a portion of
or all Unvested Shares held by a Participant following such Participant’s Termination at any time
within ninety (90) days after the later of Participant’s Termination Date and the date Participant
purchases Shares under this Plan, for cash and/or cancellation of purchase money indebtedness, at
the Participant’s Exercise Price or Purchase Price, as the case may be.

14. CERTIFICATES. All certificates for Shares or other securities delivered under this
Plan will be subject to such stock transfer orders, legends and other restrictions as the Committee
may deem necessary or advisable, including restrictions under any applicable federal, state or
foreign securities law, or any rules, regulations and other requirements of the SEC or any stock
exchange or automated quotation system upon which the Shares may be listed or quoted.

15. ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a Participant’s Shares, the
Committee may require the Participant to deposit all certificates representing Shares, together
with stock powers or other instruments of transfer approved by the Committee, appropriately
endorsed in blank, with the Company or an agent designated by the Company to hold in escrow until
such restrictions have lapsed or terminated, and the Committee may cause a legend or legends
referencing such restrictions to be placed on the certificates. Any Participant who is permitted
to execute a promissory note as partial or full consideration for the purchase of Shares under this
Plan will be required to pledge and deposit with the Company all or part of the Shares so purchased
as collateral to secure the payment of Participant’s obligation to the Company under the promissory
note; provided, however, that the Committee may require 

D-12

 

or accept other or additional forms of
collateral to secure the payment of such obligation and, in any event,
the Company will have full recourse against the Participant under the promissory note
notwithstanding any pledge of the Participant’s Shares or other collateral. In connection with any
pledge of the Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the Committee will from time to time approve. The Shares purchased with
the promissory note may be released from the pledge on a pro rata basis as the promissory note is
paid.

16. EXCHANGE AND BUYOUT OF AWARDS. The Committee may, at any time or from time to time,
authorize the Company, with the consent of the respective Participants, to issue new Awards in
exchange for the surrender and cancellation of any or all outstanding
Awards; provided, however,
that no such exchange program may, without the approval of the Company’s stockholders, allow for
the cancellation of an outstanding Option followed by its immediate replacement with a new Option
having a lower Exercise Price. The Committee may, subject to approval by the Company’s
stockholders, at any time buy from a Participant an Award previously granted with payment in cash,
Shares (including Restricted Stock) or other consideration, based on such terms and conditions as
the Committee and the Participant may agree.

17. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award will not be effective unless
such Award is in compliance with all applicable federal and state securities laws, rules and
regulations of any governmental body, and the requirements of any stock exchange or automated
quotation system upon which the Shares may then be listed or quoted, as they are in effect on the
date of grant of the Award and also on the date of exercise or other issuance. Notwithstanding any
other provision in this Plan, the Company will have no obligation to issue or deliver certificates
for Shares under this Plan prior to: (a) obtaining any approvals from governmental agencies that
the Company determines are necessary or advisable; and/or (b) completion of any registration or
other qualification of such Shares under any state or federal law or ruling of any governmental
body that the Company determines to be necessary or advisable. The Company will be under no
obligation to register the Shares with the SEC or to effect compliance with the registration,
qualification or listing requirements of any state securities laws, stock exchange or automated
quotation system, and the Company will have no liability for any inability or failure to do so.

18. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award granted under this Plan
will confer or be deemed to confer on any Participant any right to continue in the employ of, or to
continue any other relationship with, the Company or any Parent or Subsidiary of the Company or
limit in any way the right of the Company or any Parent or Subsidiary of the Company to terminate
Participant’s employment or other relationship at any time, with or without cause.

19. CORPORATE TRANSACTIONS.

          19.1 Assumption or Replacement of Awards by Successor. Except for automatic grants to
Outside Directors pursuant to Section 10 hereof, in the event of (a) a dissolution or liquidation
of the Company, (b) a merger or consolidation in which the Company is not the surviving corporation
(other than a merger or consolidation with a wholly-owned subsidiary, a reincorporation of the
Company in a different jurisdiction, or other transaction in which there is no substantial change
in the stockholders of the Company or their relative stock holdings and the Awards granted under
this Plan are assumed, converted or replaced by the successor corporation, which assumption will be
binding on all Participants), (c) a merger in which the Company is the surviving corporation but
after which the stockholders of the Company immediately prior to such merger (other than any
stockholder that merges, or which owns or controls another corporation that merges, with the
Company in such merger) cease to own their shares or other equity interest in the Company, (d) the
sale of substantially all of the assets of the Company, or (e) the acquisition, sale, or transfer
of more than 50% of the outstanding shares of the Company by tender offer or similar transaction,
any or all outstanding Awards may be assumed, converted or replaced by the successor corporation
(if any), which assumption, conversion or replacement will be binding on all Participants. In the
alternative, the successor corporation may substitute equivalent Awards or provide substantially
similar consideration to Participants as was provided to stockholders (after taking into account
the existing provisions of the Awards). The successor corporation may also issue, in place of
outstanding Shares of the Company held by the Participants, substantially similar shares or other
property subject to repurchase

D-13

 

restrictions no less favorable to the Participant. In the event
such successor corporation (if any) refuses to
assume or substitute Awards, as provided above, pursuant to a transaction described in this
Section 19.1, such Awards will accelerate and will become exercisable in full prior to the
consummation of such transaction at such time and on such conditions as the Committee will
determine, and if such Awards are not exercised prior to the consummation of the corporate
transaction, they shall terminate at such time as determined by the Committee.

          19.2 Other Treatment of Awards. Subject to any greater rights granted to Participants
under the foregoing provisions of this Section 19, in the event of the occurrence of any
transaction described in Section 19.1, any outstanding Awards will be treated as provided in the
applicable agreement or plan of merger, consolidation, dissolution, liquidation, or sale of assets.

          19.3 Assumption of Awards by the Company. The Company, from time to time, also may
substitute or assume outstanding awards granted by another company, whether in connection with an
acquisition of such other company or otherwise, by either; (a) granting an Award under this Plan in
substitution of such other company’s award; or (b) assuming such award as if it had been granted
under this Plan if the terms of such assumed award could be applied to an Award granted under this
Plan. Such substitution or assumption will be permissible if the holder of the substituted or
assumed award would have been eligible to be granted an Award under this Plan if the other company
had applied the rules of this Plan to such grant. In the event the Company assumes an award
granted by another company, the terms and conditions of such award will remain unchanged
(except that the exercise price and the number and nature of Shares issuable upon exercise
of any such option will be adjusted appropriately pursuant to Sections 409A and 424(a) of the
Code). In the event the Company elects to grant a new Option or SAR rather than assuming an
existing option, such new Option or SAR may be granted with a similarly adjusted Exercise Price.

20. ADOPTION AND STOCKHOLDER APPROVAL. This Plan will become effective on the date that it
is adopted by the Board (the “Effective Date”). This Plan shall be approved by the stockholders of
the Company (excluding Shares issued pursuant to this Plan), consistent with applicable laws,
within twelve (12) months before or after the date this Plan is adopted by the Board. Upon the
Effective Date, the Committee may grant Awards pursuant to this Plan; provided, however, that: (a)
no Option or SAR may be exercised prior to initial stockholder approval of this Plan; (b) no Option
or SAR granted pursuant to an increase in the number of Shares subject to this Plan approved by the
Board will be exercised prior to the time such increase has been approved by the stockholders of
the Company; (c) in the event that initial stockholder approval is not obtained within the time
period provided herein, all Awards granted hereunder shall be cancelled, any Shares issued pursuant
to any Awards shall be cancelled and any purchase of Shares issued hereunder shall be rescinded;
and (d) in the event that stockholder approval of such increase is not obtained within the time
period provided herein, all Awards granted pursuant to such increase will be cancelled, any Shares
issued pursuant to any Award granted pursuant to such increase will be cancelled, and any purchase
of Shares pursuant to such increase will be rescinded.

21. TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as provided herein, this Plan
will terminate ten (10) years from the date this Plan is adopted by the Board or, if earlier, the
date of stockholder approval. This Plan and all agreements thereunder shall be governed by and
construed in accordance with the laws of the State of California.

22. AMENDMENT OR TERMINATION OF PLAN. The Board may at any time terminate or amend this
Plan in any respect, including without limitation amendment of any form of Award Agreement or
instrument to be executed pursuant to this Plan; provided, however, that the Board will not,
without the approval of the stockholders of the Company, amend this Plan in any manner that
requires such stockholder approval.

23. NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this Plan by the Board, the
submission of this Plan to the stockholders of the Company for approval, nor any provision of this
Plan will be construed as creating any limitations on the power of the Board to adopt such
additional compensation arrangements as it may deem desirable, including, without limitation, the
granting of stock options and

D-14

 

bonuses otherwise than under this Plan, and such arrangements may be either generally applicable or
applicable only in specific cases.

24. DEFINITIONS. As used in this Plan, the following terms will have the following
meanings:

25.

          “Award” means any award under this Plan, including any Option, Restricted Stock, Restricted
Stock Unit or Stock Appreciation Right.

          “Award Agreement” means, with respect to each Award, the signed written agreement between the
Company and the Participant setting forth the terms and conditions of the Award.

          “Board” means the Board of Directors of the Company.

          “Cause” means the commission of an act of theft, embezzlement, fraud, dishonesty, other acts
constituting gross misconduct, or a breach of fiduciary duty to the Company or a Parent or
Subsidiary of the Company.

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

          “Committee” means the Compensation Committee of the Board.

          “Company” means Electronic Arts Inc. or any successor corporation.

          “Disability” means a disability, whether temporary or permanent, partial or total, as
determined by the Committee.

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

          “Exercise Price” means the price at which a holder of an Option or a SAR, as the case may be,
may purchase the Shares issuable upon exercise of such Option or SAR.

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

	 	(a)	 	if such Common Stock is then quoted on the
Nasdaq National Market, its closing price on the Nasdaq National
Market on the date of determination as reported in The Wall
Street Journal;
	 
	 	(b)	 	if such Common Stock is publicly traded and
is then listed on a national securities exchange, its closing price
on the date of determination on the principal national securities
exchange on which the Common Stock is listed or admitted to trading
as reported in The Wall Street Journal;
	 
	 	(c)	 	if such Common Stock is publicly traded but
is not quoted on the Nasdaq National Market nor listed or admitted to
trading on a national securities exchange, the average of the closing
bid and asked prices on the date of determination as reported in
The Wall Street Journal; or
	 
	 	(d)	 	if none of the foregoing is applicable, by
the Committee in good faith.

          “Family Member” includes any of the following:

	 	(a)	 	child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, former spouse, sibling, niece,
nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law, or sister-in-law of the

D-15

 

	 	 	 	Participant, including any such person with such relationship to
the Participant by adoption;
	 	(b)	 	any person (other than a tenant or
employee) sharing the Participant’s household;
	 
	 	(c)	 	a trust in which the persons in (a) and (b)
have more than fifty percent of the beneficial interest;
	 
	 	(d)	 	a foundation in which the persons in (a)
and (b) or the Participant control the management of assets; or
	 
	 	(e)	 	any other entity in which the persons in
(a) and (b) or the Participant own more than fifty percent of the
voting interest.

          “Insider” means an officer or director of the Company or any other person whose transactions
in the Company’s Common Stock are subject to Section 16 of the Exchange Act.

          “Option” means an award of an option to purchase Shares pursuant to Section 5.

          “Outside Director” means a member of the Board who is not an employee of the Company or any
Parent or Subsidiary of the Company.

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

          “Participant” means a person who receives an Award under this Plan.

          “Performance Factors” means any of the factors selected by the Committee and specified in an
Award Agreement, from among the following objective measures, either individually, alternatively or
in any combination, applied to the Company as a whole or any business unit or Subsidiary, either
individually, alternatively, or in any combination, and measured, to the extent applicable on an
absolute basis or relative to a pre-established target, to determine whether the performance goals
established by the Committee with respect to applicable Awards have been satisfied:

	 	(a)	 	Net revenue;
	 
	 	(b)	 	Earnings before interest, income taxes,
depreciation and amortization;
	 
	 	(c)	 	Operating income;
	 
	 	(d)	 	Operating margin;
	 
	 	(e)	 	Net income;
	 
	 	(f)	 	Earnings per share;
	 
	 	(g)	 	Total stockholder return;
	 
	 	(h)	 	The Company’s stock price;
	 
	 	(i)	 	Growth in stockholder value relative to a
pre-determined index;
	 
	 	(j)	 	Return on equity;

D-16

 

	 	(k)	 	Return on invested capital;
	 
	 	(l)	 	Operating cash flow;
	 
	 	(m)	 	Free cash flow;
	 
	 	(n)	 	Economic value added; and
	 
	 	(o)	 	Individual confidential business
objectives.

          The Committee may, in recognition of unusual or non-recurring items such as
acquisition-related activities or changes in applicable accounting rules, provide for one or more
equitable adjustments (based on objective standards) to the Performance Factors to preserve the
Committee’s original intent regarding the Performance Factors at the time of the initial award
grant. It is within the sole discretion of the Committee to make or not make any such equitable
adjustments.

          “Performance Period” means the period of service determined by the Committee, which shall be
no less than one calendar quarter nor more than five years (unless tied to a specific and objective
milestone or event), during which time of service or performance is to be measured for Awards.

          “Plan” means this EA 2000 Equity Incentive Plan, as amended from time to time.

          “Restricted Stock Award” means an award of Shares that are subject to restrictions pursuant to
Section 6.

          “Restricted Stock Unit” means an award of the right to receive, in cash or Shares, the value
of a share of the Company’s Common Stock pursuant to Section 7.

          “SEC” means the Securities and Exchange Commission.

          “Securities Act” means the Securities Act of 1933, as amended.

          “Shares” means shares of the Company’s Common Stock reserved for issuance under this Plan,
as adjusted pursuant to Sections 2 and 19, and any successor security.

          “Stock Appreciation Right” or “SAR” means an Award, granted alone or in tandem with a related
Option that pursuant to Section 8 is designated as a SAR.

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

          “Termination” or “Terminated” means, for purposes of this Plan with respect to a Participant,
that the Participant has for any reason ceased to provide services as an employee, officer,
director, consultant, independent contractor, or advisor to the Company or a Parent or Subsidiary
of the Company. An employee will not be deemed to have ceased to provide services in the case of
(i) sick leave, (ii) military leave, or (iii) any other leave of absence approved by the Committee,
provided, that such leave is for a period of not more than 90 days, unless reemployment upon the
expiration of such leave is guaranteed by contract or statute or unless provided otherwise pursuant
to formal policy adopted from time to time by the Company and issued and promulgated to employees
in writing. In the case of any employee on an approved leave of absence, the Committee may make
such provisions respecting suspension of vesting of the Award while on leave from the employ of the
Company or a Subsidiary as it may deem appropriate, except that in no event may an Option be
exercised after the expiration of the term set forth in the Option agreement. The Committee will
have sole discretion to determine whether a Participant has ceased to provide services and the
effective date on which the Participant ceased to provide services (the “Termination Date”).

          “Unvested Shares” means “Unvested Shares” as defined in the Award Agreement.

          “Vested Shares” means “Vested Shares” as defined in the Award Agreement.

D-17

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00127-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00127-of-00352.parquet"}]]