Document:

Exhibit 4.1

 

PETROHAWK ENERGY CORPORATION

 

FOURTH AMENDED AND RESTATED
 2004 EMPLOYEE INCENTIVE PLAN

 

This Petrohawk Energy Corporation Fourth Amended and Restated 2004 Employee Incentive Plan (the “Plan”) amends and restates the Petrohawk Energy Corporation Third Amended and Restated 2004 Employee Incentive Plan, and gives effect to amendments effective through the effective date of this amended and restated Plan as described in Section VII.

 

I. Definitions and Purposes

 

(a)       Definitions.

 

Whenever capitalized in this document, the following terms shall be defined as set forth below:

 

“Award” means an award in the form of Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Stock Options, or Performance Awards, whether granted singly or in combination.

 

“Award Agreement” means a written agreement between the Company and a Participant that sets forth the terms, conditions, restrictions and limitations applicable to an Award.

 

“Board” means the board of directors of the Company.

 

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

 

“Committee” means the committee of the Board which may be the Compensation Committee of the Board or such other committee as the Board shall appoint to administer the Plan, provided it shall be (a) comprised solely of two or more outside directors (within the meaning of Section 162(m) of the Code and the Treasury Regulations promulgated thereunder), and (b) constituted so as to permit the Plan to comply with Rule 16b-3.

 

“Common Stock” means the common stock of the Company, $.001 par value per share, and any class of common stock into which such common stock may hereafter be converted, reclassified or recapitalized.

 

“Company” means Petrohawk Energy Corporation or any successor thereto.

 

“Corporate Change” shall have the meaning set forth in Section VIII(c) below.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

 

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

 

“Fair Market Value” means for one Share on the date in question (i) the closing sale price for such Share as quoted on the New York Stock Exchange, Nasdaq National Market or Nasdaq Small Cap Market, as applicable (“NASDAQ”), or (ii) if not so quoted, the closing sales price as reported on the consolidated reporting system for the securities exchange(s) on which Shares are then listed or admitted to trading (as reported in the Wall Street Journal or other reputable source), or (iii) if not so reported, the

 

 

average of the closing bid and asked prices for a Share on the date of grant as quoted by the National Quotation Bureau’s “Pink Sheets” or the National Association of Securities Dealers’ OTC Bulletin Board System. If there was no public trade of Common Stock on the date in question, Fair Market Value shall be determined by reference to the last preceding date on which such a trade was so reported. If the Company is not a Publicly Held Corporation at the time a determination of the Fair Market Value of the Common Stock is required to be made hereunder, the determination of Fair Market Value for purposes of the Plan shall be made by the Committee in its discretion exercised in good faith. In this respect, the Committee may rely on such financial data, valuations, experts, and other sources, in its discretion, as it deems advisable under the circumstances.

 

“Grantee(s)” means those certain employee or employees of the Company or its subsidiaries to whom the Company shall grant Restricted Stock, Restricted Stock Units, Stock Options, Stock Appreciation Rights or Performance Awards.

 

“Immediate Family” means with respect to an Optionee, the Optionee’s spouse, children or grandchildren (including legally adopted, step children and step grandchildren).

 

“Incentive Stock Option” means a Stock Option which is intended to qualify as an incentive stock option under Section 422 of the Code.

 

“Non-Statutory Stock Option” means a Stock Option that is not an Incentive Stock Option.

 

“Optionee(s)” means those certain employees of the Company or its subsidiaries to whom the Company shall grant Stock Options.

 

“Option Price” shall mean the amount an Optionee must pay the Company upon exercise of the Stock Option.

 

“Participants” shall mean Grantees and Optionees.

 

“Performance Award” means an award granted to a Grantee pursuant to Section III(f) to receive cash or Shares conditioned in whole or in part upon the satisfaction of specified performance criteria.

 

“Publicly Held Corporation” means an entity issuing any class of equity securities required to be registered under Section 12 of the Exchange Act.

 

“Restricted Stock” means Shares subject to specified restrictions that may be granted to eligible persons under Section III (b) below.

 

“Restricted Stock Unit” means a right to receive Shares, cash or a combination of both at the end of a specified period granted to an eligible person under Section III(b) below.

 

“Restriction Period” means the period of time during which the Shares granted pursuant to an Award of Restricted Stock or Restricted Stock Units remain subject to the restrictions or vesting set forth in the applicable Award Agreement; the Restriction Period shall not provide for vesting of greater than one-third (1/3) of the total grant upon each of the first three (3) anniversaries from the date of such grant; provided, however, that the foregoing shall not apply (i) to up to five percent (5%) of the number of shares available under the Plan, or (ii) accelerated vesting on account of the death or disability of a Participant, or (ii) to the acceleration of vesting upon a Corporate Change.

 

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“Rule 16b-3” means Rule 16b-3, as currently in effect or as hereinafter modified or amended, promulgated under the Exchange Act.

 

“Share” or “Shares” means a share or shares of Common Stock.

 

“Stock Appreciation Right” means a contractual right granted to an eligible person under Section III(d) below.

 

“SAR Grant Value” shall have the meaning set forth in Article VI.

 

“Stock Option” means an Incentive Stock Option or a Non-Statutory Stock Option.

 

(b)       Purposes.

 

This Plan is intended to foster and promote the long-term financial success of the Company and its subsidiaries and to increase stockholder value by: (a) encouraging the commitment of selected employees, (b) motivating superior performance of certain employees by means of long-term performance related incentives, (c) encouraging and providing certain employees with a program for obtaining ownership interests in the Company which link and align their personal interests to those of the Company’s stockholders, (d) attracting and retaining certain employees by providing competitive incentive compensation opportunities, and (e) enabling certain employees to share in the long-term growth and success of the Company.

 

This Plan provides for payment of various forms of incentive compensation and it is not intended to be a plan that is subject to ERISA. The Plan shall be interpreted, construed and administered consistent with its status as a plan that is not subject to ERISA.

 

II. Administration

 

The Plan shall be administered by the Committee. The Committee shall have sole authority to select the Participants from among those individuals eligible hereunder and to establish the number of shares of Restricted Stock which may be granted and Shares which may be subject to each Award of Restricted Stock Units, Stock Options, Stock Appreciation Rights and Performance Award. In selecting Participants from among individuals eligible hereunder and in establishing the number of shares of Restricted Stock that may be issued to each Grantee and the number of Shares that may be subject to each Award of Restricted Stock Units, Stock Options, Stock Appreciation Rights, and Performance Award, the Committee may take into account the nature of the services rendered by such individuals, their present and potential contributions to the Company’s success and such other factors as the Committee in its discretion shall deem relevant. The Committee is authorized to interpret the Plan and may from time to time adopt such rules and regulations, consistent with the provisions of the Plan, as it may deem advisable to carry out the Plan. All decisions made by the Committee in selecting the Participants, in establishing the number of shares of Restricted Stock which may be issued to each Grantee, the number of Shares which may be subject to each Award of Restricted Stock Units, Stock Options and Stock Appreciation Rights, and the amount payable or the number of Shares subject to a Performance Award and in construing the provisions of the Plan shall be final.

 

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III. Types of Grants Under the Plan

 

(a)    Types of Grants.

 

Pursuant to this Plan, the Company may grant Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Stock Options, and Performance Awards. Stock Options granted under the Plan may be either Incentive Stock Options or Non-Statutory Stock Options.

 

(b)    Grants of Restricted Stock and Restricted Stock Units.

 

Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time, may grant Restricted Stock or Restricted Stock Units to any eligible person in such amounts and with such restrictions as the Committee shall determine, any of which restrictions may differ with respect to any Grantee. Awards of Restricted Stock or Restricted Stock Units shall include a Restriction Period as determined by the Committee in accordance with the provisions of the Plan and subject to the limitations set forth in the definition of Restricted Period above.

 

With respect to Awards of Restricted Stock, a certificate or certificates representing the number of shares of Restricted Stock granted shall be registered in the name of the Grantee. Until the expiration of the Restriction Period or the lapse of restrictions in the manner provided in the Grantee’s Restricted Stock Award Agreement, the certificate or certificates shall be held in escrow by the Company for the account of the Grantee. The Grantee shall have beneficial ownership of the shares of Restricted Stock, including the right to receive dividends and the right to vote the shares of Restricted Stock. Upon the lapse of all restrictions (as set forth in the Grantee’s Restricted Stock Award Agreement) on any or all of the Restricted Stock granted to the Grantee, the certificate or certificates representing the shares of Restricted Stock for which the restrictions have lapsed shall be delivered to the Grantee.

 

With respect to Awards of Restricted Stock Units, upon the lapse of restrictions with respect to each Restricted Stock Unit, the Participant shall be entitled to receive one Share or an amount of cash equal to the Fair Market Value of one Share, as provided in the Award Agreement. The Committee may, in its sole discretion, grant a tandem cash dividend right with respect to Restricted Stock Units. A grant of cash dividend rights may provide that such cash dividend rights will be paid directly to the Participant at the time of payment of related dividends, be credited to a bookkeeping account subject to the same vesting and payment provisions as the tandem Award (with or without interest in the sole discretion of the Committee), or be subject to such other provisions or restrictions as determined by the Committee in its sole discretion.

 

Each Award of Restricted Stock or Restricted Stock Units shall be evidenced by an Award Agreement which shall contain the Restriction Period, the number of Shares covered by the Award and such other terms and conditions as may be approved by the Committee, including other restrictions as the Committee may determine. The Committee may impose such conditions or restrictions on any Award of Restricted Stock or Restricted Stock Units as it may deem advisable, in its sole discretion.

 

(c)    Grant of Stock Options.

 

Subject to the terms and conditions of the Plan, the Committee is authorized to grant Stock Options to any eligible person.

 

Each Stock Option shall be evidenced by an Award Agreement, which shall contain such terms and conditions as may be approved by the Committee. The terms and conditions of the respective Award Agreements need not be identical for each Optionee. The Option Price upon exercise of any Stock Option shall be payable to the Company in full either: (i) in cash or its equivalent, or (ii) subject to prior approval by the Committee in its discretion, by tendering previously acquired Shares having an aggregate Fair Market Value at the time of exercise equal to the total Option Price, or (iii) subject to prior approval by

 

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the Committee, in its discretion, by withholding Shares which otherwise would be acquired on exercise having an aggregate Fair Market Value at the time of exercise equal to the total Option Price, or (iv) subject to prior approval by the Committee in its discretion, by a combination of (i), (ii), and (iii) above. Any payment in Shares shall be effected by the surrender of such Shares to the Company in good form for transfer and shall be valued at their Fair Market Value on the date when the Stock Option is exercised. Unless otherwise permitted by the Committee, in its discretion, the Optionee shall not surrender, or attest to the ownership of, Shares in payment of the Option Price if such action would cause the Company to recognize compensation (or additional compensation expense) with respect to the Stock Option for financial reporting purposes.

 

The Committee, in its discretion, also may allow the Option Price to be paid with such other consideration as shall constitute lawful consideration for the issuance of Shares (including, without limitation, effecting a “cashless exercise” with a broker of the Stock Option), subject to applicable securities law restrictions and tax withholdings, or by any other means which the Committee determines to be consistent with the Plan’s purpose and applicable law. A “cashless exercise” of a Stock Option is a procedure by which a broker provides the funds to the Optionee to effect a Stock Option exercise, to the extent consented to by the Committee, in its discretion. At the direction of the Optionee, the broker will either (i) sell all of the Shares received when the Stock Option is exercised and pay the Optionee the proceeds of the sale (minus the Option Price, withholding taxes and any fees due to the broker) or (ii) sell enough of the Shares received upon exercise of the Stock Option to cover the Option Price, withholding taxes and any fees due the broker and deliver to the Optionee (either directly or through the Company) a stock certificate for the remaining Shares.

 

In no event will the Committee allow the Option Price to be paid with a form of consideration, including a loan or a “cashless exercise,” if such form of consideration would violate the Sarbanes-Oxley Act of 2002 as determined by the Committee, in its discretion.

 

As soon as practicable after receipt of a written notification of exercise and full payment, the Company shall (i) deliver, or cause to be delivered, to or on behalf of the Optionee, in the name of the Optionee or other appropriate recipient, Share certificates for the number of Shares purchased under the Stock Option or (ii) electronically credit to a brokerage account in the name of the Optionee or other appropriate recipient the number of Shares purchases under the Stock Option. Such delivery shall be effected for all purposes when the Company or a stock transfer agent of the Company shall have (i) deposited such certificates in the United States mail, addressed to Optionee or other appropriate recipient or (ii) electronically credited the Shares to a brokerage account in the name of the Optionee or other appropriate recipient.

 

(d)    Grant of Stock Appreciation Rights.

 

Subject to the terms and conditions of the Plan, the Committee is authorized to grant Stock Appreciation Rights to any eligible person.

 

Each grant of Stock Appreciation Rights shall be evidenced by an Award Agreement, which shall contain such terms and conditions as may be approved by the Committee. Stock Appreciation Rights shall include a Restriction Period as determined by the Committee in accordance with the provisions of the Plan. The terms and conditions of the respective Award Agreements need not be identical for each Grantee; provided that the maximum term of a Stock Appreciation Right shall be ten (10) years from the date of grant and the per share SAR Grant Value shall not, under any circumstances, be less than the Fair Market Value of a Share of Common Stock on the date the Stock Appreciation Right is granted. A Stock Appreciation Right entitles the Grantee, upon exercise, to receive an amount equal to the product of

 

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(x) the excess of the Fair Market Value of one Share of Company Common Stock on the date of exercise over the SAR Grant Value and (y) the number of Shares as to which such Stock Appreciation Right is exercised. Payment of the amount determined under the foregoing shall be made in Shares of Common Stock valued at their Fair Market Value on the date of exercise; provided, however, that no fractional Shares shall be issued upon exercise of a Stock Appreciation Right and any fractional Share interest shall be settled in cash. As soon as practicable after receipt of a written or electronic notification of exercise of a Stock Appreciation Right, the Company shall (i) deliver, or cause to be delivered, to or on behalf of the Grantee, in the name of the Grantee or other appropriate recipient, Share certificates for the number of Shares issued as a result of such exercise or (ii) electronically credit to a brokerage account in the name of the Grantee or other appropriate recipient the number of Shares issued as a result of such exercise . Such delivery shall be effected for all purposes when the Company or a stock transfer agent of the Company shall have (i) deposited such certificates in the United States mail, addressed to Grantee or other appropriate recipient or (ii) electronically credited the Shares to a brokerage account in the name of the Grantee or other appropriate recipient.

 

(e)    Grant of Performance Awards.

 

Subject to the terms and conditions of the Plan, the Committee is authorized to grant Performance Awards to any eligible person. Performance Awards may be granted in the form of cash, Shares or a combination of both, in such amounts and at such times as the Committee shall determine. Performance Awards shall be conditioned upon the level of achievement of one or more stated performance goals over a specified performance period that shall not be shorter than one year. Performance Awards may be combined with other Awards to impose performance criteria as part of the terms of such other Awards.

 

Each Award Agreement with respect to a Performance Award shall set forth (a) the amount, including a target and maximum amount, if applicable, a Grantee may earn in the form of cash or Shares or a formula for determining such amount, (b) the performance criteria and level of achievement versus such criteria that shall determine the amount payable or number of Shares to be granted, issued, retained and/or vested, (c) the performance period over which performance is to be measured, (d) the timing of any payments to be made, (e) restrictions on the transferability of the Performance Award and (f) such other terms and conditions as the Committee may determine that are not inconsistent with the Plan.

 

The Committee shall determine in its sole discretion whether all or any portion of a Performance Award shall be intended to satisfy the requirements for “performance-based” compensation under Section 162(m) of the Code (the “162(m) Requirements”). The performance criteria for any Performance Award that is intended to satisfy the 162(m) Requirements shall be established in writing by the Committee based on one or more performance goals as set forth in this Section III(e) not later than 90 days after the commencement of the performance period with respect to such Performance Award, provided that the outcome of the performance in respect of the goals remains substantially uncertain as of such time. With respect to Performance Awards that are intended to satisfy the 162(m) Requirements, the maximum amount that may be paid in cash pursuant to a Performance Award granted to a Grantee with respect to a fiscal year is $5,000,000 and the maximum number of Shares that may be subject to a Performance Award granted to a Grantee with respect to a fiscal year is 500,000 Shares; provided, however, that such maximum amount and number of Shares with respect to a Performance Award that provides for a performance period longer than one fiscal year shall be the foregoing limit multiplied by the number of full fiscal years in the performance period. At the time of the grant of a Performance Award and to the extent permitted under Section 162(m) of the Code and Treasury Regulations thereunder for a Performance Award intended to satisfy the 162(m) Requirements, the Committee may provide for the manner in which the performance goals will be measured in light of specified corporate transactions, extraordinary events, accounting changes and other similar occurrences. With respect to

 

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Performance Awards that are intended to satisfy the 162(m) Requirements, the terms of this Section III(e) shall be interpreted in a manner consistent with Section 162(m) of the Code and the Treasury Regulations and other guidance thereunder.

 

The performance measure(s) to be used for purposes of Performance Awards may be described in terms of objectives that are related to the individual Grantee or objectives that are company-wide or related to a subsidiary, division, department, region, function or business unit of the Company in which the Grantee is employed or with respect to which the Grantee performs services, and may consist of one or more or any combination of the following criteria: (a) earnings or earnings per Share (whether on a pre-tax, after-tax, operational or other basis), (b) return on equity, (c) return on assets or net assets, (d) return on capital or invested capital and other related financial measures, (e) cash flow or EBITDA or EBITDAX, (f) revenues, (g) income or operating income, (h) expenses or costs or expense levels or cost levels (absolute or per unit), (i) one or more operating ratios, (j) stock price, (k) total stockholder return, (l) operating profit, (m) profit margin, (n) capital expenditures, (o) net borrowing, debt leverage levels, credit quality or debt ratings, (p) the accomplishment of mergers, acquisitions, dispositions, public offerings or similar extraordinary business transactions, (q) net asset value per Share, (r) economic value added, (s) individual business objectives, (t) growth in production, (u) growth in reserves, (v) reserve replacement ratio, (w) finding and development cost per unit, and/or (x) strategic business objectives, consisting of one or more objectives based on meeting specified cost targets, business expansion goals, and goals relating to acquisitions or divestures, or any combination thereof. The performance goals based on these performance measures may be made relative to the performance of other business entities. The Committee may appropriately adjust any evaluation of performance criteria to exclude any of the following events that occurs during a performance period: (1) gains or losses on sales of assets, (2) asset impairments or write-downs, (3) litigation or claim judgments or settlements, (4) the effect of changes in tax law, accounting principles or other such laws or provisions affecting reported results, (5) accruals for reorganization and restructuring programs, (6) any extraordinary non-recurring items as described in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 225-20 (or any successor pronouncement thereto) and/or in management’s discussion and analysis of financial condition and results of operations appearing in the Company’s annual report to stockholders for the applicable year, (7) acquisitions or divestitures, (8) any other specific, unusual or nonrecurring events, or objectively determinable category thereof, (9) foreign exchange gains and losses, (10) a change in the Company’s fiscal year, and (10) the effect of adverse or delayed federal, state or local governmental or regulatory action; provided that the Committee commits to make any such adjustments within the 90 days following the commencement of each performance period (or such other time as may be required or permitted by Section 162(m) of the Code).

 

Prior to the payment of any compensation pursuant to a Performance Award that is intended to satisfy the 162(m) Requirements, the Committee shall certify the extent to which the performance goals and other material terms of the Performance Award have been achieved or satisfied. The Committee in its sole discretion shall have the authority to reduce, but not to increase, the amount payable and the number of Shares to be granted, issued, retained or vested pursuant to a Performance Award.

 

IV. Eligibility of Participants, Term and Transferability

 

Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Stock Options and Performance Awards may be granted only to individuals who are employees (including officers and directors who are also employees) of the Company or any parent or subsidiary corporation (as defined in Section 424 (e) and (f) of the Code) of the Company at the time the Award is granted. Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Stock Options and Performance Awards may be granted to the same individual on more than one occasion. No Incentive Stock Option shall be granted to an eligible

 

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person who owns or who would own immediately before the grant of such Incentive Stock Option more than 10% of the total combined voting power of all classes of stock of the Company or its parent or subsidiary corporation, unless (i) at the time such Stock Option is granted the option price is 110% of the Fair Market Value of the Shares granted on the date of the grant and (ii) such Stock Option by its terms is not exercisable after the expiration of five (5) years from the date of grant. The term of each Stock Option granted to other eligible persons shall be not more than ten (10) years from the date of the grant. To the extent that the aggregate Fair Market Value (determined at the time the respective Incentive Stock Option is granted) of Shares with respect to which Incentive Stock Options are exercisable for the first time by an individual during any calendar year under all incentive stock option plans of the Company and its parent and subsidiary corporations exceeds $100,000, such excess Incentive Stock Options shall be treated as Non-Statutory Stock Options. The Committee shall determine, in accordance with applicable provisions of the Code, Treasury Regulations and other administrative pronouncements, which of an Optionee’s Stock Options will not constitute Incentive Stock Options because of such limitation and shall notify the Optionee of such determination as soon as practicable after such determination.

 

Awards granted under the Plan shall not be transferable or assignable other than: (a) by will or the laws of descent and distribution or (b) pursuant to a qualified domestic relations order (as defined by Section 414(p) of the Code); provided, however, if an Incentive Stock Option is transferred pursuant to a qualified domestic relations order (as defined by Section 414(p) of the Code), the Option shall cease to qualify as an Incentive Stock Option as of the date of such transfer; provided, further, however, only with respect to Non-Statutory Stock Options and Stock Appreciation Rights the Committee may, in its discretion, authorize all or a portion of the Non-Statutory Stock Options and/or Stock Appreciation Rights to be granted on terms which permit transfer by the Optionee / Grantee to (i) the members of the Optionee’s / Grantee’s Immediate Family, (ii) a trust or trusts for the exclusive benefit of such Immediate Family, or (iii) a partnership in which such members of such Immediate Family are the only partners, provided that (A) there may be no consideration for any such transfer, (B) the Award Agreement pursuant to which such Non-Statutory Stock Options and/or Stock Appreciation Rights are granted must be approved by the Committee, and must expressly provide for transferability in a manner consistent with this Section and (C) subsequent transfers of transferred Stock Options and/or Stock Appreciation Rights shall be prohibited except in accordance with clauses (A) and (B) above of this sentence. Following any permitted transfer, any Non-Statutory Stock Option and/or Stock Appreciation Right shall continue to be subject to the same terms and conditions as were applicable immediately prior to transfer, provided that the term “Optionee” and “Grantee” shall be deemed to refer to the transferee. The Non-Statutory Stock Option and/or Stock Appreciation Right shall be exercisable by the transferee only to the extent, and for the periods, specified in the Award Agreement.

 

Except as may otherwise be permitted under the Code, in the event of a permitted transfer of a Non-Statutory Stock Option or Stock Appreciation Right hereunder, the original Optionee/Grantee shall remain subject to withholding taxes upon exercise. In addition, the Company shall have no obligation to provide any notices to a transferee including, for example, the termination of a Stock Option or Stock Appreciation Right following the original Optionee’s termination of employment.

 

No transfer by will, trust or by the laws of descent and distribution shall be effective to bind the Company unless the Committee has been furnished with a copy of the deceased Grantee’s or Optionee’s enforceable will, trust or such other evidence as the Committee deems necessary to establish the validity of the transfer. Any attempted transfer in violation of this provision shall be void and ineffective. All determinations under this Section shall be made by the Committee in its discretion.

 

In the event the employment of a person by the Company (or a subsidiary) shall be terminated at a time when such person holds an Incentive Stock Option, such person (or in the event employment is

 

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terminated due to death or disability of such person, his or her personal representative) may exercise his or her Incentive Stock Option (to the extent such person was entitled to exercise such Incentive Stock Option as of the date of termination) but only within such period of time ending on the earlier of (i) the date that is three months following the termination of such person’s employment (or such shorter or longer period specified in the Award Agreement) or (ii) the expiration of the term of the Incentive Stock Option as set forth in the Award Agreement; provided, however, if termination of employment is due to the death or disability (as defined in section 22(e)(3) of the Code) of such person the three month period set forth in (i) above shall be extended to 12 months.

 

V. Shares Subject to Plan

 

(a)    The aggregate number of shares of Restricted Stock and Shares which may be covered by Stock Options (including Incentive Stock Options), Restricted Stock Units and Performance Awards and issued upon exercise of Stock Appreciation Rights granted under the Plan shall not exceed 28,850,000. Notwithstanding any provision in the Plan to the contrary, the maximum number of Shares that may be granted during any calendar year to an individual under the Plan as Restricted Stock or that may be subject to Restricted Stock Units, Stock Options, Stock Appreciation Rights or Performance Awards may not exceed 500,000 Shares (subject to adjustment in the same manner as provided in Section VIII hereof), and the maximum aggregate number of Shares that may be issued under the Plan through Incentive Stock Options shall be equal to the Plan limit set forth above. The limitation set forth in the preceding sentence shall be applied in a manner which will permit compensation generated under the Plan to constitute “performance-based” compensation for purposes of Section 162(m) of the Code, including, without limitation, counting against such maximum number of Shares, to the extent required under Section 162(m) of the Code and applicable interpretive authority thereunder, any Shares subject to Stock Options, Stock Appreciation Rights and Performance Awards that are canceled or repriced.

 

(b)    Any provision of this Plan to the contrary notwithstanding, any award of Restricted Stock (including Shares issued without a Restriction Period, pursuant to the exception set forth in the definition of such term), Restricted Stock Units and Performance Awards that may be settled in Shares that, in each case, are granted under this Plan subsequent to May 18, 2011, shall reduce the aggregate limit on Shares set forth above by 1.75 shares for every one share issued in connection with such award. The Shares issued hereunder may consist of authorized but unissued Shares, treasury shares of Common Stock, or previously issued Shares reacquired by the Company. Any of such Shares which remain unissued and which are not subject to outstanding Awards at the termination of the Plan shall cease to be subject to the Plan, but, until termination of the Plan, the Company shall at all times make available a sufficient number of Shares to meet the requirements of the Plan. Should any Stock Option or Stock Appreciation Right hereunder expire or terminate prior to its exercise in full, the Shares theretofore subject to such Stock Option or Stock Appreciation Right may again be subject to a Stock Option or Stock Appreciation Right granted under the Plan to the extent permitted under Rule 16b-3; provided, however, that for purposes Article II any such Shares shall be counted in accordance with the requirements of Section 162(m) of the Code. Upon the forfeiture of any Restricted Stock, or Restricted Stock Units or the expiration or termination of Performance Awards that may be settled in Shares, the number of Shares that shall thereafter be available for award under the Plan shall be increased by a number of Shares equal to the amount by which the number of Shares available under the Plan was reduced upon the issuance thereof (for example, each share of Restricted Stock issued prior to May 18, 2011, that is forfeited shall increase the number of Shares available for issuance by one Share, while each share of Restricted Stock issued after May 18, 2011, which reduced the aggregate shares available under the Plan by 1.75 Shares for every one Share issued shall, upon forfeiture, increase the aggregate number of Shares available for issuance by 1.75 Shares). Upon forfeiture of any Awards, Shares theretofore subject to such Awards may again be subject to other Awards granted under the Plan to the extent permitted under Rule 16b-3. The aggregate

 

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number of Shares which may be issued under the Plan shall be subject to adjustment in the same manner as provided in Section VIII hereof with respect to Shares subject to Stock Options and Stock Appreciation Rights then outstanding. Exercise of a Stock Option or Stock Appreciation Right in any manner shall result in a decrease in the number of Shares which may thereafter be available for purposes of the Plan by the number of (i) Shares as to which the Stock Option is exercised, (ii) Shares issued upon exercise of a Stock Appreciation Right, (iii) Shares that were not issued or delivered as a result of the net settlement of the Stock Option or Stock Appreciation Right, (iv) Shares surrendered to pay the exercise price or withholding taxes related to any outstanding award under the Plan, or (v) Shares repurchased on the open market with proceeds from the exercise of the Stock Option. Separate stock certificates may be issued by the Company for those Shares acquired pursuant to the exercise of any Stock Option which does not constitute an Incentive Stock Option.

 

VI. Option Price ; SAR Grant Value; Prohibition on Repricing

 

The Option Price of Shares issued under each Stock Option shall be equal to the Fair Market Value of Shares subject to the Stock Option on the date the Stock Option is granted; provided, however, that this limitation shall not apply to Incentive Stock Options for which a greater Option Price is required pursuant to Section IV hereof.

 

The SAR Grant Value of a Stock Appreciation Right shall be the Fair Market Value of a Share of Company Common Stock on the date the Stock Appreciation Right is granted.

 

Other than to effect adjustments in accordance with Article VIII, without the approval of the stockholders of the Company, the terms of a Stock Option or Stock Appreciation Right may not be amended to reduce the exercise price thereof, and the Company shall not be permitted under this Plan to exchange any outstanding Stock Option or Stock Appreciation Right issued under this Plan for (i) a new Stock Option or Stock Appreciation Right having an exercise price that is lower than the exercise price of such outstanding Stock Option or Stock Appreciation Right or (ii) any combination of cash and other Awards.

 

VII. Term of Plan

 

This Plan became effective as of June 3, 2004, pursuant to approval by the stockholders of the Company at the 2004 Annual Meeting of Stockholders, and was subsequently twice amended and restated in its entirety.  This amended and restated Plan shall become effective on May 18, 2011, provided it is approved by the stockholders of the Company at the 2011 Annual Meeting of Stockholders.  Except with respect to Awards then outstanding, if not sooner terminated under the provisions of Section IX or extended upon approval by the stockholders of the Company, the Plan shall terminate upon and no further Awards shall be granted after May 18, 2021.

 

VIII. Recapitalization or Reorganization

 

(a)    The existence of the Plan and the Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Stock Options and Performance Awards granted hereunder shall not affect in any way the right or power of the Board or the stockholders of the Company to make or authorize any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, any merger or consolidation of the Company, any issue of debt or equity securities, the dissolution or liquidation of the Company or any sale, lease, exchange or other disposition of all or any part of its assets or business or any other corporate act or proceeding.

 

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(b)    The Shares with respect to which Stock Options and Stock Appreciation Rights may be granted are shares of Common Stock as presently constituted, but if, and whenever, prior to the expiration of a Stock Option, Stock Appreciation Right, Restricted Stock Unit or Performance Award theretofore granted, the Company shall effect a subdivision or consolidation of shares of Common Stock or the payment of a stock dividend on Common Stock without receipt of consideration by the Company, the number of Shares with respect to which such Award may thereafter be exercised (i) in the event of an increase in the number of outstanding Shares shall be proportionately increased, and, with respect to Stock Options and Stock Appreciation Rights, the Option Price per Share and SAR Grant Value per Share, respectively, shall be proportionately reduced, and (ii) in the event of a reduction in the number of outstanding Shares shall be proportionately reduced, and, with respect to Stock Options and Stock Appreciation Rights, the Option Price per share and SAR Grant Value per Share, respectively, shall be proportionately increased.

 

(c)    If the Company recapitalizes, reclassifies its capital stock, or otherwise changes its capital structure (a “recapitalization”), the number and class of shares of Common Stock covered by Awards of Restricted Stock Units, Stock Options, Stock Appreciation Rights or Performance Awards theretofore granted shall be adjusted so that such Awards shall thereafter cover the number and class of shares of stock and securities to which the Optionee or Grantee would have been entitled pursuant to the terms of the recapitalization if, immediately prior to the recapitalization, the Optionee or Grantee had been the holder of record of the number of shares then covered by such Awards.

 

If (i) the Company shall not be the surviving entity in any merger, consolidation or other reorganization (or survives only as a subsidiary of an entity other than a previously wholly-owned subsidiary of the Company), (ii) the Company sells, leases or exchanges substantially all of its assets to any other person or entity (other than a wholly-owned subsidiary of the Company), (iii) the Company is to be dissolved and liquidated, (iv) any person or entity, including a “group” as contemplated by Section 13(d)(3) of the Exchange Act acquires or gains ownership or control (including, without limitation, power to vote) of more than 50% of the outstanding shares of the Company’s voting stock (based upon voting power), or (v) as a result of or in connection with a contested election of directors, the persons who were directors of the Company before such election shall cease to constitute a majority of the Board (each such event is referred to herein as a “Corporate Change”), then (a) in connection with the consummation of such merger, consolidation, reorganization, sale, lease or exchange of assets or dissolution or such election of directors or (b) within thirty (30) days after a change of control of the type described in Clause (iv), the Committee, acting in its sole discretion without the consent or approval of any Optionee or Grantee, shall act to effect one or more of the following alternatives, which may vary among individual Optionees and Grantees and which may vary among Stock Options and Stock Appreciation Rights held by any individual Optionee/Grantee: (1) accelerate the time at which Stock Options and Stock Appreciation Rights then outstanding may be exercised so that such Stock Options and Stock Appreciation Rights may be exercised in full for a limited period of time on or before a specified date (before or after such Corporate Change) fixed by the Committee, after which specified date all unexercised Stock Options and Stock Appreciation Rights and all rights of Optionees and Grantees thereunder shall terminate, (2) require the mandatory surrender to the Company by selected Optionees and Grantees of some or all of the outstanding Stock Options or Stock Appreciation Rights held by such Optionees and Grantees (irrespective of whether such Stock Options or Stock Appreciation Rights are then exercisable under the provisions of the Plan) as of a date, before or after such Corporate Change, specified by the Committee, in which event the Committee shall thereupon cancel such Stock Options and Stock Appreciation Rights and the Company shall pay to each Optionee and Grantee an amount of cash per share to be determined by the Committee, (3) make such adjustments to Stock Options and Stock Appreciation Rights then outstanding as the Committee deems appropriate to reflect such Corporate Change (provided, however, that the Committee may determine in its sole discretion that no adjustment is necessary to Stock Options and Stock Appreciation Rights then outstanding) or (4) provide that the

 

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number and class of shares of Common Stock covered by a Stock Option or Stock Appreciation Right theretofore granted shall be adjusted so that such Stock Option or Stock Appreciation Right shall thereafter cover the number and class of shares of stock or other securities or property (including, without limitation, cash) to which the Optionee or Grantee would have been entitled pursuant to the terms of the agreement of merger, consolidation or sale of assets and dissolution if, immediately prior to such merger, consolidation or sale of assets and dissolution the Optionee or Grantee had been the holder of record of the number of shares of Common Stock then covered by such Stock Option or Stock Appreciation Right. In addition, in connection with the consummation of such merger, consolidation, reorganization, sale, lease or exchange of assets or dissolution or such election of directors or (b) thirty (30) days after a change of control of the type described in Clause (iv), the Committee, acting in its sole discretion without the consent or approval of any Grantee, shall act to effect one or more of the following alternatives, which may vary among individual Grantees and which may vary among Restricted Stock or Restricted Stock Units held by any individual Grantee: (1) remove any and all restrictions to which the Restricted Stock and Restricted Stock Units is subject including removing the Restriction Period, (2) require the mandatory surrender to the Company by selected Grantees of some or all of the outstanding Restricted Stock or Restricted Stock Units held by such Grantees as of a date, before or after such Corporate Change, specified by the Committee and the Company shall pay to each Grantee an amount of cash per share to be determined by the Committee, (3) make such adjustments to the Restricted Stock or Restricted Stock Units then outstanding as the Committee deems appropriate to reflect such Corporate Change (provided, however, that the Committee may determine in its sole discretion that no adjustment is necessary to the Restricted Stock or Restricted Stock Units then outstanding) or (4) provide that the number and class of shares covered by a Restricted Stock or Restricted Stock Unit Award Agreement theretofore granted shall be adjusted so that such Award shall thereafter cover the number and class of shares of stock or other securities or property (including, without limitation, cash) to which the Grantee would have been entitled pursuant to the terms of the agreement of merger, consolidation or sale of assets and dissolution if, immediately prior to such merger, consolidation or sale of assets and dissolution the Grantee had been the holder of record of the number of Shares subject to the Award Agreement. In addition, in connection with the consummation of such merger, consolidation, reorganization, sale, lease or exchange of assets or dissolution or such election of directors or (b) thirty (30) days after a change of control of the type described in Clause (iv), the Committee, acting in its sole discretion without the consent of any Grantee, shall act to effect one or more of the following alternatives, which may vary among individual Grantees and which may vary among Performance Awards held by any individual Grantee: (1) terminate the Performance Award in exchange for an amount of cash, if any, equal to the amount that would have been obtained upon the achievement of performance goals under such Award as of the date of the occurrence of such transaction or event or at the target performance level, as determined by the Committee in its sole discretion (and, for the avoidance of doubt, if as of the date of the occurrence of such transaction or event the Committee determines in good faith that no amount would have been payable or Shares issued, then such Performance Award may be terminated by the Committee without payment), (2) replace the Performance Award with other rights and property selected by the Committee in its sole discretion, (3) make such adjustments to the Performance Award then outstanding as the Committee deems appropriate to reflect such Corporate Change (provided, however, that the Committee may determine in its sole discretion that no adjustment is necessary to the Performance Award then outstanding) or (4) provide that the number and class of Shares covered by a Performance Award theretofore granted shall be adjusted so that such Performance Award shall thereafter cover the number and class of shares of stock or other securities or property (including, without limitation, cash) to which the Grantee would have been entitled pursuant to the terms of the agreement of merger, consolidation or sale of assets and dissolution if, immediately prior to such merger, consolidation or sale of assets and dissolution the Grantee had been the holder of record of the number of Shares then covered by such Performance Award.

 

(d)    Except as hereinbefore expressly provided, the issuance by the Company of shares of stock of any class or securities convertible into shares of stock of any class, for cash, property, labor or services,

 

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upon direct sale, upon the exercise of rights or warrants to subscribe therefor, or upon conversion of shares or obligations of the Company convertible into such shares or other securities, and in any case whether or not for fair value, shall not affect, and no adjustment by reason therefor shall be made with respect to, any Restricted Stock or the number of Shares subject to Restricted Stock Units, Stock Options, Stock Appreciation Rights or Performance Awards theretofore granted or the Option Price or SAR Grant Value.

 

(e)    To the extent applicable, the adjustments provided for in this Article VIII are to be made in a manner consistent with the requirements of Sections 422, 424 and 409A of the Code and related Treasury Regulations and other applicable law.

 

IX. Amendment or Termination of the Plan

 

The Board in its discretion may terminate the Plan at any time with respect to any Shares for which Awards have not theretofore been granted. The Board shall have the right to alter or amend the Plan or any part thereof from time to time; provided, that no change in any Award Agreement theretofore granted may be made which would impair the rights of the Participant without the consent of such Participant (unless such change is required in order to cause the benefits under the Plan to qualify as performance-based compensation within the meaning of Section 162(m) of the Code and applicable interpretive authority thereunder); and provided, further, that (i) the Board may not make any alteration or amendment which would decrease any authority granted to the Committee hereunder in contravention of Rule 16b-3 and (ii) the Board may not make any alteration or amendment which would materially increase the benefits accruing to Participants under the Plan, increase the aggregate number of shares which may be issued pursuant to the provisions of the Plan, change the class of individuals eligible to receive Awards under the Plan or extend the term of the Plan, without the approval of the stockholders of the Company.

 

X. Securities Laws

 

(a)   The Company shall not be obligated to issue any Shares pursuant to any Award granted under the Plan at any time when the offering of Shares covered by such Award have not been registered under the Securities Act of 1933 and such other state and federal laws, rules or regulations as the Company or the Committee deems applicable and, in the opinion of legal counsel for the Company, there is no exemption from the registration requirements of such laws, rules or regulations available for the offering and sale of such Shares.

 

(b)   It is intended that the Plan and any grant of an Award pursuant to an Award Agreement made to a person subject to Section 16 of Exchange Act meet all of the requirements of Rule 16b-3. If any provision of the Plan or any such Award Agreement would disqualify the Plan or an Award thereunder, or would otherwise not comply with, Rule 16b-3, such Plan provision or Award Agreement shall be construed or deemed amended to conform to Rule 16b-3.

 

XI. General

 

(a)   Nothing contained in this Plan or any Award Agreement granted pursuant to this Plan shall confer upon any employee the right to continue in the employ of the Company or its parent or subsidiary or any other corporation affiliated with the Company, or interfere in any way with the rights of the Company or its parent or subsidiaries or any corporation affiliated with the Company to terminate his or her employment. Except as provided in Article IV (or such shorter or longer period specified in an Option Award Agreement), for the entire time from the date of granting an Incentive Stock Option until the date

 

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of exercise, the holder of an Incentive Stock Option must be an employee of the Company (or a subsidiary of the Company that is a corporation for federal tax purposes).

 

(b)   No Optionee or Grantee shall have any rights as a stockholder of the Company with respect to any Shares subject to a Stock Option or Stock Appreciation Right hereunder until such Stock Option or Stock Appreciation Right shall be exercised and Shares have been issued. No Grantee shall have any rights as a stockholder of the Company with respect to any Shares subject to a Restricted Stock Unit or a Performance Award until the date of issuance of Shares in Grantee’s name.

 

(c)   Nothing contained in this Plan or an Award Agreement issued hereunder shall impose any liability or responsibility on the Company, the Board, the Committee or any member or any of the foregoing to pay, or reimburse any Participant for the payment of any tax arising out of, or on account of the issuance of Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Stock Options or Performance Awards hereunder to any Participant, an Optionee’s exercise of any Stock Option issued under the Plan, a Grantee’s exercise of any Stock Appreciation Right issued under the Plan or a Participant’s sale, transfer or other disposition of any Restricted Stock, or Shares acquired pursuant to the exercise of any Stock Option, Stock Appreciation Right or Performance Award issued hereunder. Any person receiving Restricted Stock, Restricted Stock Units, a Stock Appreciation Right, a Stock Option or a Performance Award hereunder shall expressly acknowledge and agree that such participation is voluntary and that the Participant shall be solely responsible for all taxes to which he or she may, or become subject, as a consequence of such participation.

 

(d)   The limitations and restrictions set forth in this Plan, to the extent such limitations and restrictions differ from the Company’s prior employee incentive plans, shall not apply to Awards granted prior to the effective date of this Plan.

 

IN WITNESS WHEREOF, this amended and restated Plan has been executed by the Company on this 18th day of May, 2011.

 

	
 
    	
Petrohawk   Energy Corporation
    
	
 
    	
 
    
	
 
    	
By   
    	
/s/   David S. Elkouri
    
	
 
    	
 
    	
Name:   David S. Elkouri
    
	
 
    	
 
    	
Title: Executive Vice   President – General Counsel and Secretary
    
	
 
    	
 
    	
 
    

 

14Exhibit 10.4

 

BOINGO WIRELESS, INC.

 

2011 EQUITY INCENTIVE PLAN

 

(AS ADOPTED EFFECTIVE UPON THE IPO DATE)

 

 

BOINGO WIRELESS, INC. 
 2011 EQUITY INCENTIVE PLAN

 

ARTICLE 1.   INTRODUCTION.

 

The Board adopted the Plan to become effective on the IPO Date.  All share numbers herein have been adjusted to reflect the five-for-one reverse split of the Common Shares effected prior to the IPO Date.  The purpose of the Plan is to promote the long-term success of the Company and the creation of stockholder value by (a) encouraging Service Providers to focus on critical long-range corporate objectives, (b) encouraging the attraction and retention of Service Providers with exceptional qualifications and (c) linking Service Providers directly to stockholder interests through increased stock ownership.  The Plan seeks to achieve this purpose by providing for Awards in the form of Options (which may constitute ISOs or NSOs), SARs, Restricted Shares, Stock Units and Performance Cash Awards.

 

ARTICLE 2.   ADMINISTRATION.

 

2.1                               General.  The Plan may be administered by the Board or one or more Committees.  Each Committee shall have the authority and be responsible for such functions as have been assigned to it.

 

2.2                               Section 162(m).  To the extent an Award is intended to qualify as “performance-based compensation” within the meaning of Code Section 162(m), the Plan will be administered by a Committee of two or more “outside directors” within the meaning of Code Section 162(m).

 

2.3                               Section 16.  To the extent desirable to qualify transactions hereunder as exempt under Exchange Act Rule 16b-3, the transactions contemplated hereunder will be approved by the entire Board or a Committee of two or more “non-employee directors” within the meaning of Rule 16b-3.

 

2.4                               Powers of Administrator.  Subject to the terms of the Plan, and in the case of a Committee, subject to the specific duties delegated to the Committee, the Committee shall have the authority to (a) select the Service Providers who are to receive Awards under the Plan, (b) determine the type, number, vesting requirements and other features and conditions of such Awards, (c) determine whether and to what extent any Performance Goals have been attained, (d) interpret the Plan and Awards granted under the Plan, (e) make, amend and rescind rules relating to the Plan and Awards granted under the Plan, including rules relating to sub-plans established for the purposes of satisfying applicable foreign laws or for qualifying for favorable tax treatment under applicable foreign laws, (f) impose such restrictions, conditions or limitations as it determines appropriate as to the timing and manner of any resales by a Participant of any Common Shares issued pursuant to an Award, including restrictions under an insider trading policy and restrictions as to the use of a specified brokerage firm for such resales, and (g) make all other decisions relating to the operation of the Plan and Awards granted under the Plan.

 

 

2.5                               Effect of Administrator’s Decisions.  The Committee’s decisions, determinations and interpretations shall be final and binding on all Participants and any other holders of Awards.

 

2.6                               Governing Law.  The Plan shall be governed by, and construed in accordance with, the laws of the State of Delaware (except its choice-of-law provisions).

 

ARTICLE 3.   SHARES AVAILABLE FOR GRANTS.

 

3.1                               Basic Limitation.  Common Shares issued pursuant to the Plan may be authorized but unissued shares or treasury shares.  The aggregate number of Common Shares issued under the Plan shall not exceed the sum of (a) 4,000,000 Common Shares, plus (b) the additional Common Shares described in Sections 3.2 and 3.3.  The number of Common Shares that are subject to Awards outstanding at any time under the Plan may not exceed the number of Common Shares that then remain available for issuance under the Plan.  The numerical limitations in this Section 3.1 shall be subject to adjustment pursuant to Article 9.

 

3.2                               Annual Increase in Shares.  As of the first business day of each fiscal year of the Company during the term of the Plan, commencing on January 1, 2012, the aggregate number of Common Shares that may be issued under the Plan shall automatically increase by a number equal to the lowest of (a) 4.5% of the total number of Common Shares then outstanding, (b) subject to adjustment under Article 9, 3,000,000 Common Shares, or (c) a number of Common Shares determined by the Board.

 

3.3                               Shares Returned to Reserve.  To the extent that Options, SARs or Stock Units are forfeited or expire for any other reason before being exercised or settled in full, then the Common Shares subject to such Options, SARs or Stock Units shall again become available for issuance under the Plan.  If SARs are exercised, then only the number of Common Shares (if any) actually issued to the Participant in settlement of such SARs shall reduce the number available under Section 3.1 and the balance shall again become available for issuance under the Plan.  If Stock Units are settled, then only the number of Common Shares (if any) actually issued to the Participant in settlement of such Stock Units shall reduce the number available under Section 3.1 and the balance shall again become available for issuance under the Plan.  If Restricted Shares or Common Shares issued upon the exercise of Options are reacquired by the Company pursuant to a forfeiture provision, repurchase right or for any other reason, then such Common Shares shall again become available for issuance under the Plan.  Shares applied to pay the Exercise Price of Options or to satisfy tax withholding obligations related to any Award shall again become available for issuance under the Plan.  To the extent that an Award is settled in cash rather than Shares, the cash settlement shall not reduce the number of Shares available for issuance under the Plan.

 

3.4                               Awards Not Reducing Share Reserve in Section 3.1.  Any dividend equivalents paid or credited under the Plan with respect to Stock Units shall not be applied against the number of Common Shares that may be issued under the Plan, whether or not such dividend equivalents are converted into Stock Units.  In addition, Common Shares subject to Substitute Awards granted by the Company shall not reduce the number of Common Shares that may be issued under Section 3.1, nor shall shares subject to Substitute Awards again be available for

 

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Awards under the Plan in the event of any forfeiture, expiration or cash settlement of such Substitute Awards.

 

3.5                               Code Section 162(m) and 422 Limits.  Subject to adjustment in accordance with Article 9:

 

(a)                                  The aggregate number of Common Shares subject to Options and SARS that may be granted under this Plan during any calendar year to any one Participant shall not exceed 2,000,000, except that the Company may grant to a new Employee in the calendar year in which his or her Service as an Employee first commences Options and/or SARS that cover (in the aggregate) up to an additional 1,000,000 Common Shares;

 

(b)                                 The aggregate number of Common Shares subject to Restricted Share awards and Stock Units that may be granted under this Plan during any calendar year to any one Participant shall not exceed 1,000,000, except that the Company may grant to a new Employee in the calendar year in which his or her Service as an Employee first commences Restricted Share awards and Stock Units that cover (in the aggregate) up to an additional 500,000 Common Shares;

 

(c)                                  No Participant shall be paid more than $5,000,000 in cash in any calendar year pursuant to Performance Cash Awards granted under the Plan; and

 

(d)                                 No more than 4,000,000 Common Shares plus the additional Common Shares described in Section 3.2 may be issued under the Plan upon the exercise of ISOs.

 

ARTICLE 4.   ELIGIBILITY.

 

4.1                               Incentive Stock Options.  Only Employees who are common-law employees of the Company, a Parent or a Subsidiary shall be eligible for the grant of ISOs.  In addition, an Employee who owns more than 10% of the total combined voting power of all classes of outstanding stock of the Company or any of its Parents or Subsidiaries shall not be eligible for the grant of an ISO unless the additional requirements set forth in Code Section 422(c)(5) are satisfied.

 

4.2                               Other Grants.  Awards other than ISOs may only be granted to Service Providers.(1)

 

ARTICLE 5.   OPTIONS.

 

5.1                               Stock Option Agreement.  Each grant of an Option under the Plan shall be evidenced by a Stock Option Agreement between the Optionee and the Company.  Such Option shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan.  The Stock Option Agreement shall specify whether the Option is an ISO or an NSO.  The provisions of the various Stock Option Agreements entered into under the Plan need not be identical.

 

(1)  Special considerations apply with respect to Options granted to Consultants of a Parent.

 

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5.2                               Number of Shares.  Each Stock Option Agreement shall specify the number of Common Shares subject to the Option, which number shall adjust in accordance with Article 9.

 

5.3                               Exercise Price.  Each Stock Option Agreement shall specify the Exercise Price, which shall not be less than 100% of the Fair Market Value of a Common Share on the date of grant.  The preceding sentence shall not apply to Options granted pursuant to an assumption of, or substitution for, another option in a manner that would satisfy the requirements of Code Section 409A and, if applicable, Code Section 424(a).

 

5.4                               Exercisability and Term.  Each Stock Option Agreement shall specify the date or event when all or any installment of the Option is to become vested and/or exercisable.  The Stock Option Agreement shall also specify the term of the Option; provided that the term of an Option shall in no event exceed 10 years from the date of grant.  A Stock Option Agreement may provide for accelerated vesting and/or exercisability upon certain specified events and may provide for expiration prior to the end of its term in the event of the termination of the Optionee’s Service.

 

5.5                               Death of Optionee.  After an Optionee’s death, any vested and exercisable Options held by such Optionee may be exercised by his or her beneficiary or beneficiaries.  Each Optionee may designate one or more beneficiaries for this purpose by filing the prescribed form with the Company.  A beneficiary designation may be changed by filing the prescribed form with the Company at any time before the Optionee’s death.  If no beneficiary was designated or if no designated beneficiary survives the Optionee, then any vested and exercisable Options held by the Optionee may be exercised by his or her estate.

 

5.6                               Modification or Assumption of Options.  Within the limitations of the Plan, the Committee may modify, reprice, extend or assume outstanding options or may accept the cancellation of outstanding options (whether granted by the Company or by another issuer) in return for the grant of new Options for the same or a different number of shares and at the same or a different exercise price or in return for the grant of a different type of Award.  The foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, impair his or her rights or obligations under such Option.

 

5.7                               Buyout Provisions.  The Committee may at any time (a) offer to buy out for a payment in cash or cash equivalents an Option previously granted or (b) authorize an Optionee to elect to cash out an Option previously granted, in either case at such time and based upon such terms and conditions as the Committee shall establish

 

5.8                               Payment for Option Shares.  The entire Exercise Price of Common Shares issued upon exercise of Options shall be payable in cash or cash equivalents at the time when such Common Shares are purchased.  In addition, the Committee may, in its sole discretion and to the extent permitted by applicable law, accept payment of all or a portion of the Exercise Price through any one or a combination of the following forms or methods:

 

(a)                                  Subject to any conditions or limitations established by the Committee, by surrendering, or attesting to the ownership of, Common Shares that are already owned by the

 

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Optionee with a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Common Shares as to which such Option will be exercised;

 

(b)                                 By delivering (on a form prescribed by the Company) an irrevocable direction to a securities broker approved by the Company to sell all or part of the Common Shares being purchased under the Plan and to deliver all or part of the sales proceeds to the Company;

 

(c)                                  Subject to such conditions and requirements as the Committee may impose from time to time, through a net exercise procedure;

 

(d)                                 By delivering a full-recourse promissory note, on such terms approved by the Committee; or

 

(e)                                  Through any other form or method consistent with applicable laws, regulations and rules.

 

ARTICLE 6.   STOCK APPRECIATION RIGHTS.

 

6.1                               SAR Agreement.  Each grant of a SAR under the Plan shall be evidenced by a SAR Agreement between the Optionee and the Company.  Such SAR shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan.  The provisions of the various SAR Agreements entered into under the Plan need not be identical.

 

6.2                               Number of Shares.  Each SAR Agreement shall specify the number of Common Shares to which the SAR pertains, which number shall adjust in accordance with Article 9.

 

6.3                               Exercise Price.  Each SAR Agreement shall specify the Exercise Price, which shall in no event be less than 100% of the Fair Market Value of a Common Share on the date of grant.  The preceding sentence shall not apply to SARs granted pursuant to an assumption of, or substitution for, another SAR in a manner that would satisfy the requirements of Code Section 409A.

 

6.4                               Exercisability and Term.  Each SAR Agreement shall specify the date when all or any installment of the SAR is to become vested and exercisable.  The SAR Agreement shall also specify the term of the SAR, which shall not be longer than 10 years from the date of grant.  The SAR Agreement may provide for accelerated vesting and exercisability upon certain specified events and may provide for expiration prior to the end of its term in the event of the termination of the Optionee’s Service.

 

6.5                               Exercise of SARs.  Upon exercise of a SAR, the Optionee (or any person having the right to exercise the SAR after his or her death) shall receive from the Company (a) Common Shares, (b) cash or (c) a combination of Common Shares and cash, as the Committee shall determine.  The amount of cash and/or the Fair Market Value of Common Shares received upon exercise of SARs shall, in the aggregate, not exceed the amount by which the Fair Market Value (on the date of surrender) of the Common Shares subject to the SARs exceeds the Exercise Price.  If, on the date when a SAR expires, the Exercise Price is less than the Fair Market Value on such

 

5

 

date but any portion of such SAR has not been exercised or surrendered, then such SAR shall automatically be deemed to be exercised as of such date with respect to such portion.  The SAR Agreement may also provide for an automatic exercise of the SAR on an earlier date.

 

6.6                               Death of Optionee.  After an Optionee’s death, any vested and exercisable SARs held by such Optionee may be exercised by his or her beneficiary or beneficiaries.  Each Optionee may designate one or more beneficiaries for this purpose by filing the prescribed form with the Company.  A beneficiary designation may be changed by filing the prescribed form with the Company at any time before the Optionee’s death.  If no beneficiary was designated or if no designated beneficiary survives the Optionee, then any exercisable SARs held by the Optionee may be exercised by his or her estate.

 

6.7                               Modification or Assumption of SARs.  Within the limitations of the Plan, the Committee may modify, reprice, extend or assume outstanding SARs or may accept the cancellation of outstanding SARs (whether granted by the Company or by another issuer) in return for the grant of new SARs for the same or a different number of shares and at the same or a different exercise price or in return for the grant of a different type of Award.  The foregoing notwithstanding, no modification of a SAR shall, without the consent of the Optionee, impair his or her rights or obligations under such SAR.

 

ARTICLE 7.   RESTRICTED SHARES.

 

7.1                               Restricted Stock Agreement.  Each grant of Restricted Shares under the Plan shall be evidenced by a Restricted Stock Agreement between the recipient and the Company.  Such Restricted Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan.  The provisions of the various Restricted Stock Agreements entered into under the Plan need not be identical.

 

7.2                               Payment for Awards.  Restricted Shares may be sold or awarded under the Plan for such consideration as the Committee may determine, including (without limitation) cash, cash equivalents, property, cancellation of other equity awards, full-recourse promissory notes, past services and future services, and such other methods of payment as are permitted by applicable law.

 

7.3                               Vesting Conditions.  Each Award of Restricted Shares may or may not be subject to vesting and/or other conditions as the Committee may determine.  Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Restricted Stock Agreement.  Such conditions, at the Committee’s discretion, may include one or more Performance Goals.  A Restricted Stock Agreement may provide for accelerated vesting upon certain specified events.

 

7.4                               Voting and Dividend Rights.  The holders of Restricted Shares awarded under the Plan shall have the same voting, dividend and other rights as the Company’s other stockholders, unless the Committee otherwise provides.  A Restricted Stock Agreement, however, may require that any cash dividends paid on Restricted Shares (a) be accumulated and paid when such Restricted Shares vest, or (b) be invested in additional Restricted Shares.  Such additional Restricted Shares shall be subject to the same conditions and restrictions as the Award

 

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with respect to which the dividends were paid.  In addition, unless the Committee provides otherwise, if any dividends or other distributions are paid in Common Shares, such Common Shares shall be subject to the same restrictions on transferability and forfeitability as the Restricted Shares with respect to which they were paid.

 

ARTICLE 8.   STOCK UNITS.

 

8.1                               Stock Unit Agreement.  Each grant of Stock Units under the Plan shall be evidenced by a Stock Unit Agreement between the recipient and the Company.  Such Stock Units shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan.  The provisions of the various Stock Unit Agreements entered into under the Plan need not be identical.

 

8.2                               Payment for Awards.  To the extent that an Award is granted in the form of Stock Units, no cash consideration shall be required of the Award recipients.

 

8.3                               Vesting Conditions.  Each Award of Stock Units may or may not be subject to vesting, as determined by the Committee.  Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Stock Unit Agreement.  Such conditions, at the Committee’s discretion, may include one or more Performance Goals.  A Stock Unit Agreement may provide for accelerated vesting upon certain specified events.

 

8.4                               Voting and Dividend Rights.  The holders of Stock Units shall have no voting rights.  Prior to settlement or forfeiture, any Stock Unit awarded under the Plan may, at the Committee’s discretion, carry with it a right to dividend equivalents.  Such right entitles the holder to be credited with an amount equal to all cash dividends paid on one Common Share while the Stock Unit is outstanding.  Dividend equivalents may be converted into additional Stock Units.  Settlement of dividend equivalents may be made in the form of cash, in the form of Common Shares, or in a combination of both.  Prior to distribution, any dividend equivalents that are not paid shall be subject to the same conditions and restrictions as the Stock Units to which they attach.

 

8.5                               Form and Time of Settlement of Stock Units.  Settlement of vested Stock Units may be made in the form of (a) cash, (b) Common Shares or (c) any combination of both, as determined by the Committee.  The actual number of Stock Units eligible for settlement may be larger or smaller than the number included in the original Award, based on predetermined performance factors, including Performance Goals.  Methods of converting Stock Units into cash may include (without limitation) a method based on the average Fair Market Value of Common Shares over a series of trading days.  Vested Stock Units shall be settled in such manner and at such time(s) as specified in the Stock Unit Agreement.  Until an Award of Stock Units is settled, the number of such Stock Units shall be subject to adjustment pursuant to Article 9.

 

8.6                               Death of Recipient.  Any Stock Units that becomes payable after the recipient’s death shall be distributed to the recipient’s beneficiary or beneficiaries.  Each recipient of Stock Units under the Plan shall designate one or more beneficiaries for this purpose by filing the prescribed form with the Company.  A beneficiary designation may be changed by filing the prescribed form with the Company at any time before the Award recipient’s death.  If no

 

7

 

beneficiary was designated or if no designated beneficiary survives the Award recipient, then any Stock Units that becomes payable after the recipient’s death shall be distributed to the recipient’s estate.

 

8.7                               Modification or Assumption of Stock Units.  Within the limitations of the Plan, the Committee may modify or assume outstanding stock units or may accept the cancellation of outstanding stock units (whether granted by the Company or by another issuer) in return for the grant of new stock units for the same or a different number of shares or in return for the grant of a different type of Award.  The foregoing notwithstanding, no modification of a Stock Unit shall, without the consent of the Participant, impair his or her rights or obligations under such Stock Unit

 

8.8                               Creditors’ Rights.  A holder of Stock Units shall have no rights other than those of a general creditor of the Company.  Stock Units represent an unfunded and unsecured obligation of the Company, subject to the terms and conditions of the applicable Stock Unit Agreement.

 

ARTICLE 9.   ADJUSTMENTS; DISSOLUTIONS AND LIQUIDATIONS; CORPORATE TRANSACTIONS.

 

9.1                               Adjustments.  In the event of a subdivision of the outstanding Common Shares, a declaration of a dividend payable in Common Shares or a combination or consolidation of the outstanding Common Shares (by reclassification or otherwise) into a lesser number of Common Shares, corresponding proportionate adjustments shall automatically be made in each of the following:

 

(a)                                  The number and kind of shares available for issuance under Article 3, including the numerical share limits in Sections 3.1, 3.2 and 3.5;

 

(b)                                 The number and kind of shares covered by each outstanding Option, SAR and Stock Unit; and

 

(c)                                  The Exercise Price applicable to each outstanding Option and SAR, and the repurchase price, if any, applicable to Restricted Shares.

 

In the event of a declaration of an extraordinary dividend payable in a form other than Common Shares in an amount that has a material effect on the price of Common Shares, a recapitalization, a spin-off or a similar occurrence, the Committee shall make such adjustments as it, in its sole discretion, deems appropriate in one or more of the foregoing.  Any adjustment in the number of and kind of shares subject to an Award under this Section 9.1 shall be rounded down to the nearest whole share, although the Committee in its sole discretion may make a cash payment in lieu of a fractional share.  Except as provided in this Article 9, a Participant shall have no rights by reason of any issuance by the Company of stock of any class or securities convertible into stock of any class, any subdivision or consolidation of shares of stock of any class, the payment of any stock dividend or any other increase or decrease in the number of shares of stock of any class.

 

8

 

9.2                               Dissolution or Liquidation.  To the extent not previously exercised or settled, Options, SARs and Stock Units shall terminate immediately prior to the dissolution or liquidation of the Company.

 

9.3                               Corporate Transactions.  In the event that the Company is a party to a merger, consolidation, or any Change in Control other than one described in Section 14.4(d), all Shares acquired under the Plan and all Awards outstanding on the effective date of the transaction shall be treated in the manner described in the definitive transaction agreement (or, in the event the transaction does not entail a definitive agreement to which the Company is party, in the manner determined by the Board of Directors in its capacity as administrator of the Plan, with such determination having final and binding effect on all parties), which agreement or determination need not treat all Awards (or all portions of an Award) in an identical manner. The treatment specified in the transaction agreement may include (without limitation) one or more of the following with respect to each outstanding Award:

 

(a)                                  The continuation of outstanding Awards by the Company (if the Company is the surviving entity);

 

(b)                                 The assumption of outstanding Awards by the surviving entity or its parent, provided that the assumption of Options or SARs shall comply with applicable tax requirements;

 

(c)                                  The substitution by the surviving entity or its parent of new awards for outstanding Awards, provided that the substitution of Options or SARs shall comply with applicable tax requirements;

 

(d)                                 The cancellation of outstanding Options and SARs without payment of any consideration. The Optionees shall be able to exercise such Options and SARs during a period of not less than five full business days preceding the closing date of the transaction, unless (i) a shorter period is required to permit a timely closing of the transaction and (ii) such shorter period still offers the Optionees a reasonable opportunity to exercise such Options and SARs.  Any exercise of such Options and SARs during such period may be contingent on the closing of the transaction;

 

(e)                                  Full exercisability of outstanding Options and SARs and full vesting of the Common Shares subject to Options and SARs, followed by cancellation of such Options and SARs.  The full exercisability of such Options and SARs and full vesting of such Common Shares may be contingent on the closing of the transaction.  The Optionees shall be able to exercise such Options and SARs during a period of not less than five full business days preceding the closing date of such merger or consolidation, unless (i) a shorter period is required to permit a timely closing of such merger or consolidation and (ii) such shorter period still offers the Optionees a reasonable opportunity to exercise such Options and SARs.  Any exercise of such Options and SARs during such period may be contingent on the closing of such merger or consolidation;

 

(f)                                    The cancellation of the Options and SARs and a payment to the Optionee with respect to each Share subject to the portion of the Award that is vested as of the transaction 

 

9

 

date equal to the excess of (A) the value, as determined by the Board of Directors in its absolute discretion, of the property (including cash) received by the holder of a Common Share as a result of the transaction, over (B) the per-Share Exercise Price of the Option or SAR (such excess, the “Spread”).  Such payment shall be made in the form of cash, cash equivalents, or securities of the surviving entity or its parent having a value equal to the Spread.  In addition, any escrow, holdback, earn-out or similar provisions in the transaction agreement may apply to such payment to the same extent and in the same manner as such provisions apply to the holders of Common Shares.  If the Spread applicable to an Option or SAR is zero or a negative number, then the Option may be cancelled without making a payment to the Optionee; or

 

(g)                                 The cancellation of outstanding Stock Units and payment to the Participants with respect to each Common Share subject to the Stock Unit (whether or not such Stock Unit is then vested) equal to the value, as determined by the Committee in its absolute discretion, of the property (including cash) received by the holder of a Common Share as a result of the transaction (the “Transaction Value”).  Such payment shall be made in the form of cash, cash equivalents, or securities of the surviving entity or its parent having a value equal to the Transaction Value.  In addition, such payment may be subject to vesting based on the Participant’s continuing Service, provided that the vesting schedule shall not be less favorable to the Participant than the schedule under which such Stock Units would have vested, and if required under applicable tax rules, such payment may be deferred until the settlement date specified in the Stock Unit Agreement.   In addition, any escrow, holdback, earn-out or similar provisions in the transaction agreement may apply to such payment to the same extent and in the same manner as such provisions apply to the holders of Common Shares.

 

(h)                                 The assignment of any reacquisition or repurchase rights held by the Company in respect of an Award of Restricted Shares to the surviving entity or its parent, with corresponding proportionate adjustments made to the price per share to be paid upon exercise of any such reacquisition or repurchase rights.

 

For avoidance of doubt, the Committee shall have the discretion, exercisable either at the time an Award is granted or at any time while the Award remains outstanding, to provide for the acceleration of vesting upon the occurrence of a Change in Control, whether or not the Award is to be assumed or replaced in the transaction, or in connection with a termination of the Participant’s Service following a transaction.

 

Any action taken under this Section 9.3 shall either preserve an Award’s status as exempt from Code Section 409A or comply with Code Section 409A.

 

ARTICLE 10.   OTHER AWARDS.

 

10.1                        Performance Cash Awards.  A Performance Cash Award is a cash award that may be granted subject to the attainment of specified Performance Goals during a Performance Period.  A Performance Cash Award may also require the completion of a specified period of continuous Service.  The length of the Performance Period, the Performance Goals to be attained during the Performance Period, and the degree to which the Performance Goals have been attained shall be determined conclusively by the Committee.  Each Performance Cash Award shall be set forth in a written agreement or in a resolution duly adopted by the Committee which 

 

10

 

shall contain provisions determined by the Committee and not inconsistent with the Plan.  The terms of various Performance Cash Awards need not be identical.

 

10.2                        Awards Under Other Plans.  The Company may grant awards under other plans or programs.  Such awards may be settled in the form of Common Shares issued under this Plan.  Such Common Shares shall be treated for all purposes under the Plan like Common Shares issued in settlement of Stock Units and shall, when issued, reduce the number of Common Shares available under Article 3.

 

ARTICLE 11.   LIMITATION ON RIGHTS.

 

11.1                        Retention Rights.  Neither the Plan nor any Award granted under the Plan shall be deemed to give any individual a right to remain a Service Provider.  The Company and its Parents, Subsidiaries and Affiliates reserve the right to terminate the Service of any Service Provider at any time, with or without cause, subject to applicable laws, the Company’s certificate of incorporation and by-laws and a written employment agreement (if any).

 

11.2                        Stockholders’ Rights.  Except as set forth in Section 7.4 or 8.4 above, a Participant shall have no dividend rights, voting rights or other rights as a stockholder with respect to any Common Shares covered by his or her Award prior to the time when a stock certificate for such Common Shares is issued or, if applicable, the time when he or she becomes entitled to receive such Common Shares by filing any required notice of exercise and paying any required Exercise Price.  No adjustment shall be made for cash dividends or other rights for which the record date is prior to such time, except as expressly provided in the Plan.

 

11.3                        Regulatory Requirements.  Any other provision of the Plan notwithstanding, the obligation of the Company to issue Common Shares under the Plan shall be subject to all applicable laws, rules and regulations and such approval by any regulatory body as may be required.  The Company reserves the right to restrict, in whole or in part, the delivery of Common Shares pursuant to any Award prior to the satisfaction of all legal requirements relating to the issuance of such Common Shares, to their registration, qualification or listing or to an exemption from registration, qualification or listing.  The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed necessary by the Company’s counsel to be necessary to the lawful issuance and sale of any Common Shares hereunder, will relieve the Company of any liability in respect of the failure to issue or sell such Common Shares as to which such requisite authority will not have been obtained.

 

11.4                        Transferability of Awards.   The Committee may, in its sole discretion, permit transfer of an Award in a manner consistent with applicable law.  Unless otherwise determined by the Committee, Awards shall be transferable by a Participant only by (a) beneficiary designation, (b) a will or (c) the laws of descent and distribution.  An ISO may only be transferred by will or by the laws of descent and distribution and may be exercised during the lifetime of the Optionee only by the Optionee or by the Optionee’s guardian or legal representative.

 

11.5                        Other Conditions or Restrictions on Shares.  Shares issued under the Plan shall be subject to such forfeiture conditions, rights of repurchase, rights of first refusal, other transfer 

 

11

 

restrictions and such other terms and conditions as the Board of Directors may determine.  Such conditions and restrictions shall be set forth in the applicable Award Agreement and shall apply in addition to any restrictions that may apply to holders of Shares generally.  In addition, Shares issued under the Plan shall be subject to such conditions and restrictions imposed either by applicable law or by Company policy, as adopted from time to time, designed to ensure compliance with applicable law or laws with which the Company determines in its sole discretion to comply including in order to maintain any statutory, regulatory or tax advantage.

 

ARTICLE 12.   TAXES.

 

12.1                        General.  As a condition to the grant and acceptance of an Award under the Plan, a Participant or his or her successor shall make arrangements satisfactory to the Company for the satisfaction of any federal, state, local or foreign withholding tax obligations that arise in connection with any Award granted under the Plan.  The Company shall not be required to issue any Common Shares or make any cash payment under the Plan until such obligations are satisfied.

 

12.2                        Share Withholding.  To the extent that applicable law subjects a Participant to tax withholding obligations, the Committee may permit such Participant to satisfy all or part of such obligations by having the Company withhold all or a portion of any Common Shares that otherwise would be issued to him or her or by surrendering all or a portion of any Common Shares that he or she previously acquired.  Such Common Shares shall be valued based upon the value of the actual trade or, if there is none, at their Fair Market Value as of the previous day.  Any payment of taxes by assigning Shares to the Company may be subject to restrictions including any restrictions required by SEC, accounting or others rules.

 

12.3                        Section 162(m) Matters  The Committee, in its sole discretion, may determine whether an Award is intended to qualify as “performance-based compensation” within the meaning of Code Section 162(m).  The Committee may grant Awards that are based on Performance Goals but that are not intended to qualify as performance-based compensation.  With respect to any Award that is intended to qualify as performance-based compensation, the Committee shall designate the Performance Goal(s) applicable to, and the formula for calculating the amount payable under, an Award within 90 days following commencement of the applicable Performance Period (or such earlier time as may be required under Code Section 162(m)), and in any event at a time when achievement of the applicable Performance Goal(s) remains substantially uncertain.  Prior to the payment of any Award that is intended to constitute performance-based compensation, the Committee shall certify in writing whether and the extent to which the Performance Goal(s) were achieved for such Performance Period.  The Committee shall have the right to reduce or eliminate (but not to increase) the amount payable under an Award that is intended to constitute performance-based compensation.

 

12.4                        Section 409A Matters.  Except as otherwise expressly set forth in an Award Agreement, it is intended that Awards granted under the Plan either be exempt from, or comply with, the requirements of Code Section 409A.  To the extent an Award is subject to Code Section 409A (a “409A Award”), the terms of the Plan, the Award and any written agreement governing the Award shall be interpreted to comply with the requirements of Code Section 409A so that the Award is not subject to additional tax or interest under Code Section 409A, unless the 

 

12

 

Committee expressly provides otherwise.  A 409A Award shall be subject to such additional rules and requirements as specified by the Committee from time to time in order for it to comply with the requirements of Code Section 409A.  In this regard, if any amount under a 409A Award is payable upon a “separation from service” to an individual who is considered a “specified employee” (as each term is defined under Code Section 409A), then no such payment shall be made prior to the date that is the earlier of (i) six months and one day after the Participant’s separation from service or (ii) the Participant’s death, but only to the extent such delay is necessary to prevent such payment from being subject to Code Section 409A(a)(1).

 

12.5                        Limitation on Liability.  Neither the Company nor any person serving as Committee shall have any liability to a Participant in the event an Award held by the Participant fails to achieve its intended characterization under applicable tax law.

 

ARTICLE 13.   FUTURE OF THE PLAN.

 

13.1                        Term of the Plan.  The Plan, as set forth herein, shall become effective on the IPO Date.  The Plan shall remain in effect until the earlier of (a) the date when the Plan is terminated under Section 13.2 or (b) the 10th anniversary of the date when the Board adopted the Plan.

 

13.2                        Amendment or Termination.  The Board may, at any time and for any reason, amend or terminate the Plan.  No Awards shall be granted under the Plan after the termination thereof.  The termination of the Plan, or any amendment thereof, shall not affect any Award previously granted under the Plan.

 

13.3                        Stockholder Approval.  An amendment of the Plan shall be subject to the approval of the Company’s stockholders only to the extent required by applicable laws, regulations or rules.

 

ARTICLE 14.   DEFINITIONS.

 

14.1                           “Affiliate” means any entity other than a Subsidiary, if the Company and/or one or more Subsidiaries own not less than 50% of such entity.

 

14.2                           “Award” means any award granted under the Plan, including as Options, SARs, Restricted Shares or Stock Units.

 

14.3                           “Board” means the Company’s Board of Directors, as constituted from time to time.

 

14.4                           “Change in Control” means:

 

(a)                                  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 more than fifty percent (50%) of the total voting power represented by the Company’s then-outstanding voting securities;

 

13

 

(b)                                 The consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets;

 

(c)                                  The consummation of a merger or consolidation of the Company with or into any other entity, other than a merger or consolidation which 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) more than 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; or

 

(d)                                 Individuals who are members of the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the members of the Board over a period of 12 months; provided, however, that if the appointment or election (or nomination for election) of any new Board member was approved or recommended by a majority vote of the members of the Incumbent Board then still in office, such new member shall, for purposes of this Plan, be considered as a member of the Incumbent Board.

 

A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction.  In addition, if a Change in Control constitutes a payment event with respect to any Award which provides for a deferral of compensation and is subject to Code Section 409A, then notwithstanding anything to the contrary in the Plan the transaction with respect to such Award must also constitute a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5) to the extent required by Code Section 409A.

 

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

 

14.6                           “Committee” means a committee of one or more members of the Board, or of other individuals satisfying applicable laws, appointed by the Board to administer the Plan.

 

14.7                           “Common Share” means one share of the common stock of the Company.

 

14.8                           “Company” means Boingo Wireless, Inc., a Delaware corporation.

 

14.9                           “Consultant” means a consultant or adviser who provides bona fide services to the Company, a Parent, a Subsidiary or an Affiliate as an independent contractor and who qualifies as a consultant or advisor under Instruction A.1.(a)(1) of Form S-8 under the Securities Act.(2)

 

14.10                     “Employee” means a common-law employee of the Company, a Parent, a Subsidiary or an Affiliate.(3)

 

(2)  Special considerations apply with respect to Options granted to Consultants of a Parent.

(3)  Special considerations apply with respect to Options granted to Consultants of a Parent.

 

14

 

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

 

14.12                     “Exercise Price,” in the case of an Option, means the amount for which one Common Share may be purchased upon exercise of such Option, as specified in the applicable Stock Option Agreement.  “Exercise Price,” in the case of a SAR, means an amount, as specified in the applicable SAR Agreement, which is subtracted from the Fair Market Value of one Common Share in determining the amount payable upon exercise of such SAR.

 

14.13                     “Fair Market Value” means the closing price of a Common Share on any established stock exchange or a national market system on the applicable date or, if the applicable date is not a trading day, on the last trading day prior to the applicable date, as reported in a source that the Committee deems reliable.  If Common Shares are no longer traded on an established stock exchange or a national market system, the Fair Market Value shall be determined by the Committee in good faith on such basis as it deems appropriate.  The Committee’s determination shall be conclusive and binding on all persons.

 

14.14                     “IPO Date” means the effective date of the registration statement filed by the Company with the Securities and Exchange Commission for its initial offering of Common Shares to the public.

 

14.15                     “ISO” means an incentive stock option described in Code Section 422(b).

 

14.16                     “NSO” means a stock option not described in Code Sections 422 or 423.

 

14.17                     “Option” means an ISO or NSO granted under the Plan and entitling the holder to purchase Common Shares.

 

14.18                     “Optionee” means an individual or estate holding an Option or SAR.

 

14.19                     “Outside Director” means a member of the Board who is not an Employee.

 

14.20                     “Parent” means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company, if each of the 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.  A corporation that attains the status of a Parent on a date after the adoption of the Plan shall be considered a Parent commencing as of such date.

 

14.21                     “Participant” means an individual or estate holding an Award.

 

14.22                     “Performance Cash Award” means an award of cash granted under Section 10.1 of the Plan.

 

14.23                     “Performance Goal” means a goal established by the Committee for the applicable Performance Period based on one or more of the performance criteria set forth in Appendix A.  Depending on the performance criteria used, a Performance Goal may be established and measured either on a Company-wide basis or with respect to one or more 

 

15

 

business units, divisions, Subsidiaries, Affiliates, business segments or an individual, and either in absolute terms or relative to the performance of one or more comparable companies or one or more relevant indices.  To the extent consistent with Code Section 162(m), the Committee may adjust the results under any performance criterion to exclude any of the following events that occurs during a Performance Period: (a) asset write-downs, (b) litigation, claims, judgments or settlements, (c) the effect of changes in tax laws, accounting principles or other laws or provisions affecting reported results, (d) accruals for reorganization and restructuring programs, (e) extraordinary, unusual or non-recurring items, (f) exchange rate effects for non-U.S. dollar denominated net sales and operating earnings, or (g) statutory adjustments to corporate tax rates.

 

14.24                     “Performance Period” means a period of time selected by the Committee over which the attainment of one or more Performance Goals will be measured for the purpose of determining a Participant’s right to a Performance Cash Award or an Award of Restricted Shares or Stock Units that vests based upon achievement of Performance Goals.  Performance Periods may be of varying and overlapping duration, at the sole discretion of the Committee.

 

14.25                     “Plan” means this Boingo Wireless, Inc. 2011 Equity Incentive Plan, as amended from time to time.

 

14.26                     “Restricted Share” means a Common Share awarded under the Plan.

 

14.27                     “Restricted Stock Agreement” means the agreement between the Company and the recipient of a Restricted Share that contains the terms, conditions and restrictions pertaining to such Restricted Share.

 

14.28                     “SAR” means a stock appreciation right granted under the Plan.

 

14.29                     “SAR Agreement” means the agreement between the Company and an Optionee that contains the terms, conditions and restrictions pertaining to his or her SAR.

 

14.30                     “Service” means service as an Employee, Outside Director or Consultant.

 

14.31                     “Service Provider” means any Employee, Outside Director or Consultant.

 

14.32                     “Stock Option Agreement” means the agreement between the Company and an Optionee that contains the terms, conditions and restrictions pertaining to his or her Option.

 

14.33                     “Stock Unit” means a bookkeeping entry representing the equivalent of one Common Share, as awarded under the Plan.

 

14.34                     “Stock Unit Agreement” means the agreement between the Company and the recipient of a Stock Unit that contains the terms, conditions and restrictions pertaining to such Stock Unit.

 

14.35                     “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 

 

16

 

combined voting power of all classes of stock in one of the other corporations in such chain.  A corporation that attains the status of a Subsidiary on a date after the adoption of the Plan shall be considered a Subsidiary commencing as of such date

 

14.36                     “Substitute Awards” means Awards or Common Shares issued by the Company in assumption of, or substitution or exchange for, Awards previously granted, or the right or obligation to make future awards, in each case by a corporation acquired by the Company or any Affiliate or with which the Company or any Affiliate combines to the extent permitted by NASDAQ Marketplace Rule 5635 or any successor thereto.

 

17

 

APPENDIX A

 

PERFORMANCE CRITERIA

 

The Committee may establish Performance Goals derived from one or more of the following criteria when it makes Awards of Restricted Shares or Stock Units that vest entirely or in part on the basis of performance:

 

	
·                  Earnings (before or after   taxes)
    	
 
    	
·                  Sales or revenue (using a   measure thereof that complies with Section 162(m))
    
	
 
    	
 
    	
 
    
	
·                  Earnings per share
    	
 
    	
·                  Expense or cost reduction
    
	
 
    	
 
    	
 
    
	
·                  Earnings before interest,   taxes and depreciation
    	
 
    	
·                  Working capital
    
	
 
    	
 
    	
 
    
	
·                  Earnings before interest,   taxes, depreciation and amortization
    	
 
    	
·                  Economic value added (or   an equivalent metric)
    
	
 
    	
 
    	
 
    
	
·                  Total stockholder return
    	
 
    	
·                  Market share
    
	
 
    	
 
    	
 
    
	
·                  Return on equity or   average stockholders’ equity
    	
 
    	
·                  Cash measures including   cash flow and cash balance
    
	
 
    	
 
    	
 
    
	
·                  Return on assets,   investment or capital employed
    	
 
    	
·                  Operating cash flow
    
	
 
    	
 
    	
 
    
	
·                  Operating income
    	
 
    	
·                  Cash flow per share
    
	
 
    	
 
    	
 
    
	
·                  Gross margin
    	
 
    	
·                  Share price
    
	
 
    	
 
    	
 
    
	
·                  Operating margin
    	
 
    	
·                  Debt reduction
    
	
 
    	
 
    	
 
    
	
·                  Net operating income
    	
 
    	
·                  Customer satisfaction
    
	
 
    	
 
    	
 
    
	
·                  Net operating income after   tax
    	
 
    	
·                  Stockholders’ equity
    
	
 
    	
 
    	
 
    
	
·                  Return on operating   revenue
    	
 
    	
·                  Contract awards or backlog
    
	
 
    	
 
    	
 
    
	
·                  Objective corporate or   individual strategic goals
    	
 
    	
·                  Objective individual   performance goals
    
	
 
    	
 
    	
 
    
	
·                  To the extent that an   Award is not intended to comply with Code Section 162(m), other measures   of performance selected by the Committee
    

 

 

BOINGO WIRELESS, INC. 
 2011 EQUITY INCENTIVE PLAN

NOTICE OF STOCK OPTION GRANT

 

You have been granted the following option to purchase shares of the common stock of Boingo Wireless, Inc. (the “Company”):

 

	
Name of Optionee:
    	
 
    	
«Name»
    
	
 
    	
 
    	
 
    
	
Total   Number of Shares:
    	
 
    	
«TotalShares»
    
	
 
    	
 
    	
 
    
	
Type   of Option:
    	
 
    	
«ISO» Incentive Stock Option
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
«NSO» Nonstatutory Stock Option
    
	
 
    	
 
    	
 
    
	
Exercise   Price per Share:
    	
 
    	
$«PricePerShare»
    
	
 
    	
 
    	
 
    
	
Date of Grant:
    	
 
    	
«DateGrant»
    
	
 
    	
 
    	
 
    
	
Vesting Commencement Date:
    	
 
    	
«VestDay»
    
	
 
    	
 
    	
 
    
	
Vesting Schedule:
    	
 
    	
This option vests and becomes exercisable with respect to the first «CliffPercent»% of the shares subject to this   option when you complete «CliffPeriod»   months of continuous “Service” (as defined in the Plan) from the Vesting   Commencement Date. Thereafter, this option vests and becomes exercisable with   respect to an additional «Percent»% of   the shares subject to this option when you complete each additional «IncrementPeriod» of continuous Service.
    
	
 
    	
 
    	
 
    
	
Expiration   Date:
    	
 
    	
«ExpDate». This option expires earlier if your   Service terminates earlier, as described in the Stock Option Agreement.
    

 

You and the Company agree that this option is granted under and governed by the terms and conditions of the 2011 Equity Incentive Plan (the “Plan”) and the Stock Option Agreement, both of which are attached to, and made a part of, this document.

 

You further agree to accept by email all documents relating to the Plan or this option (including, without limitation, prospectuses required by the Securities and Exchange Commission) and all other documents that the Company is required to deliver to its security holders (including, without limitation, annual reports and proxy statements).  You also agree that the Company may deliver these documents by posting them on a website maintained by the Company or by a third party under contract with the Company.  If the Company posts these documents on a website, it will notify you by email.

 

You further agree to comply with the Company’s Securities Trading Policy when selling shares of the Company’s common stock.

 

	
OPTIONEE
    	
 
    	
BOINGO   WIRELESS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

 

BOINGO WIRELESS, INC. 
 2011 EQUITY INCENTIVE PLAN

STOCK OPTION AGREEMENT

 

	
Grant   of Option
    	
 
    	
Subject   to all of the terms and conditions set forth in the Notice of Stock Option   Grant, this Agreement and the Plan, the Company has granted you an option to   purchase up to the total number of shares specified in the Notice of Stock   Option Grant at the exercise price indicated in the Notice of Stock Option   Grant.

 

All   capitalized terms used in this Agreement shall have the meanings assigned in   this Agreement, the Notice of Stock Option Grant or the Plan.
    
	
 
    	
 
    	
 
    
	
Tax   Treatment
    	
 
    	
This   option is intended to be an incentive stock option under Section 422 of   the Code or a nonstatutory stock option, as provided in the Notice of Stock   Option Grant.  However, even if this   option is designated as an incentive stock option in the Notice of Stock   Option Grant, it shall be deemed to be a nonstatutory stock option to the   extent (and only to the extent) required by the $100,000 annual limitation   under Section 422(d) of the Code.
    
	
 
    	
 
    	
 
    
	
Vesting
    	
 
    	
This option vests and becomes exercisable in accordance with the   vesting schedule set forth in the Notice of Stock Option Grant.

 

In   no event will this option vest or become exercisable for additional shares   after your Service has terminated for any reason.
    
	
 
    	
 
    	
 
    
	
Term
    	
 
    	
This   option expires in any event at the close of business at Company headquarters   on the day before the 10th anniversary of the Date of Grant, as shown in the   Notice of Stock Option Grant.  (This   option will expire earlier if your Service terminates, as described below,   and this option may be terminated earlier as provided in Article 9 of   the Plan.)
    
	
 
    	
 
    	
 
    
	
Termination   of Service
    	
 
    	
If   your Service terminates for any reason, this option will expire immediately   to the extent the option is unvested as of your termination date and does not   vest as a result of your termination of Service. The Company determines when   your Service terminates for this purpose.
    
	
 
    	
 
    	
 
    
	
Regular   Termination
    	
 
    	
If   your Service terminates for any reason except death or total and permanent   disability, then this option, to the extent vested as of your termination   date, will expire at the close of business at Company headquarters on the   date three months after your termination date.  
    
	
 
    	
 
    	
 
    
	
Death
    	
 
    	
If   you die before your Service terminates, then this option will expire at the   close of business at Company headquarters on the date 12 months after the   date of death.
    

 

2

 

	
Disability
    	
 
    	
If your Service terminates because of your total and permanent   disability, then this option will expire at the close of business at Company   headquarters on the date 12 months after your termination date.

 

For   all purposes under this Agreement, “total and permanent disability” means   that you are unable to engage in any substantial gainful activity by reason   of any medically determinable physical or mental impairment which can be   expected to result in death or which has lasted, or can be expected to last,   for a continuous period of not less than one year.
    
	
 
    	
 
    	
 
    
	
Leaves   of Absence and Part-Time Work
    	
 
    	
For purposes of this option, your Service does not terminate when you   go on a military leave, a sick leave or another bona fide   leave of absence, if the leave was approved by the Company in writing and if   continued crediting of Service is required by applicable law, the Company’s   leave of absence policy, or the terms of your leave.  But your Service terminates when the   approved leave ends, unless you immediately return to active work.

 

If you go on a leave of absence, then the vesting schedule specified   in the Notice of Stock Option Grant may be adjusted in accordance with the   Company’s leave of absence policy or the terms of your leave.  If you commence working on a part-time   basis, the Company may adjust the vesting schedule so that the rate of   vesting is commensurate with your reduced work schedule.
    
	
 
    	
 
    	
 
    
	
Restrictions   on Exercise
    	
 
    	
The Company will not permit you to exercise this option if the   issuance of shares at that time would violate any law or regulation.
    
	
 
    	
 
    	
 
    
	
Notice   of Exercise
    	
 
    	
When you wish to exercise this option, you must notify the Company by   filing the proper “Notice of Exercise” form at the address given on the   form.  Your notice must specify how   many shares you wish to purchase.  The   notice will be effective when the Company receives it.

 

However, if you wish to exercise this option by executing a same-day   sale (as described below), you must follow the instructions of the Company   and the broker who will execute the sale.

 

If someone else wants to exercise this option after your death, that   person must prove to the Company’s satisfaction that he or she is entitled to   do so.

 

You may only exercise your option for whole shares.
    

 

3

 

	
Form of   Payment
    	
 
    	
When you submit your notice of exercise, you must include payment of   the option exercise price for the shares that you are purchasing.  To the extent permitted by applicable law,   payment may be made in one (or a combination of two or more) of the following   forms:

 

·                  By delivering to the   Company your personal check, a cashier’s check or a money order.

 

·                  By delivering to the   Company certificates for shares of Company stock that you own, along with any   forms needed to effect a transfer of those shares to the Company.  The value of the shares, determined as of   the effective date of the option exercise, will be applied to the option   exercise price.  Instead of   surrendering shares of Company stock, you may attest to the ownership of   those shares on a form provided by the Company and have the same number of   shares subtracted from the option shares issued to you.

 

·                  By giving to a securities   broker approved by the Company irrevocable directions to sell all or part of   your option shares and to deliver to the Company, from the sale proceeds, an   amount sufficient to pay the option exercise price and any withholding taxes.  (The balance of the sale proceeds, if any,   will be delivered to you.)  The   directions must be given in accordance with the instructions of the Company   and the broker.  This exercise method   is sometimes called a “same-day sale.”
    
	
 
    	
 
    	
 
    
	
Withholding   Taxes
    	
 
    	
You will not be allowed to exercise this option unless you make   arrangements acceptable to the Company to pay any withholding taxes that may   be due as a result of the option exercise.    These arrangements include payment in cash. With the Company’s consent,   these arrangements may also include (a) payment from the proceeds of the   sale of shares through a Company-approved broker, (b) withholding shares   of Company stock that otherwise would be issued to you when you exercise this   option with a fair market value no greater than the minimum amount required   to be withheld by law, (c) surrendering shares that you previously   acquired with a fair market value no greater than the minimum amount required   to be withheld by law, or (d) withholding cash from other compensation.  The fair market value of withheld or   surrendered shares, determined as of the date when taxes otherwise would have   been withheld in cash, will be applied to the withholding taxes.
    
	
 
    	
 
    	
 
    
	
Restrictions   on Resale
    	
 
    	
You agree not to sell any option shares at a time when applicable   laws, Company policies or an agreement between the Company and its   underwriters prohibit a sale.  This   restriction will apply as long as your Service continues and for such period   of time after the termination of your Service as the Company may specify.
    

 

4

 

	
Transfer   of Option
    	
 
    	
Prior to your death, only you may exercise this option.  You cannot transfer or assign this   option.  For instance, you may not sell   this option or use it as security for a loan.    If you attempt to do any of these things, this option will immediately   become invalid.  You may, however,   dispose of this option in your will or by means of a written beneficiary   designation.

 

Regardless of any marital property settlement agreement, the Company   is not obligated to honor a notice of exercise from your former spouse, nor   is the Company obligated to recognize your former spouse’s interest in your   option in any other way.
    
	
 
    	
 
    	
 
    
	
Retention   Rights
    	
 
    	
Your option or this Agreement does not give you the right to be   retained by the Company, a Parent, Subsidiary, or an Affiliate in any   capacity.  The Company and its Parents,   Subsidiaries, and Affiliates reserve the right to terminate your Service at   any time, with or without cause.
    
	
 
    	
 
    	
 
    
	
Stockholder   Rights
    	
 
    	
You, or your estate or heirs, have no rights as a stockholder of the   Company until you have exercised this option by giving the required notice to   the Company, paying the exercise price, and satisfying any applicable   withholding taxes.  No adjustments are   made for dividends or other rights if the applicable record date occurs   before you exercise this option, except as described in the Plan.
    
	
 
    	
 
    	
 
    
	
Adjustments
    	
 
    	
In the event of a stock split, a stock dividend or a similar change   in Company stock, the number of shares covered by this option and the   exercise price per share will be adjusted pursuant to the Plan.
    
	
 
    	
 
    	
 
    
	
Effect of Significant Corporate Transactions
    	
 
    	
If the Company is a party to a merger, consolidation, or certain   change in control transactions, then this option will be subject to the   applicable provisions of Article 9 of the Plan.
    
	
 
    	
 
    	
 
    
	
Applicable   Law
    	
 
    	
This Agreement will be interpreted and enforced under the laws of the   State of Delaware (without regard to its choice-of-law provisions).
    
	
 
    	
 
    	
 
    
	
The   Plan and Other Agreements
    	
 
    	
The text of the Plan is incorporated in this Agreement by   reference.  In the event of any   conflict between the terms and conditions of the Plan and the terms and   conditions of this Agreement, the terms and conditions of the Plan will   prevail.

 

This Agreement and the Plan constitute the entire understanding   between you and the Company regarding this option.  Any prior agreements, commitments or   negotiations concerning this option are superseded.  This Agreement may be amended only by   another written agreement between the parties.
    

 

BY SIGNING THE COVER SHEET OF THIS AGREEMENT, YOU AGREE TO ALL OF THE TERMS AND CONDITIONS DESCRIBED ABOVE AND IN THE PLAN.

 

5

 

BOINGO WIRELESS, INC. 
 2011 EQUITY INCENTIVE PLAN
 NOTICE OF STOCK UNIT AWARD

 

You have been granted stock units representing shares of common stock of Boingo Wireless, Inc. (the “Company”) on the following terms:

 

	
Name   of Recipient:
    	
 
    	
«Name»
    
	
 
    	
 
    	
 
    
	
Total   Number of Stock Units Granted:
    	
 
    	
«TotalUnits»
    
	
 
    	
 
    	
 
    
	
Date   of Grant:
    	
 
    	
«DateGrant»
    
	
 
    	
 
    	
 
    
	
Vesting   Commencement Date:
    	
 
    	
«VestDay»
    
	
 
    	
 
    	
 
    
	
Vesting   Schedule:
    	
 
    	
The   first «CliffPercent»% of the stock   units subject to this award will vest when you complete «CliffPeriod» months of continuous “Service”   (as defined in the Plan) after the Vesting Commencement Date. Thereafter, an   additional «IncrementPercent»% of the   stock units subject to this award will vest when you complete each «IncrementPeriod»-month period of continuous   Service.
    

 

You and the Company agree that these stock units are granted under and governed by the terms and conditions of the 2011 Equity Incentive Plan (the “Plan”) and the Stock Unit Agreement, both of which are attached to, and made a part of, this document.

 

You further agree to accept by email all documents relating to the Plan or this award (including, without limitation, prospectuses required by the Securities and Exchange Commission) and all other documents that the Company is required to deliver to its security holders (including, without limitation, annual reports and proxy statements).  You also agree that the Company may deliver these documents by posting them on a website maintained by the Company or by a third party under contract with the Company.  If the Company posts these documents on a website, it will notify you by email.

 

You further agree to comply with the Company’s Securities Trading Policy when selling shares of the Company’s common stock.

 

 

	
RECIPIENT
    	
 
    	
BOINGO   WIRELESS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    

 

 

BOINGO WIRELESS, INC. 
 2011 EQUITY INCENTIVE PLAN

 

STOCK UNIT AGREEMENT

 

	
Grant of Units
    	
 
    	
Subject to all of the terms and conditions set forth in the Notice of   Stock Unit Award, this Agreement and the Plan, the Company has granted to you   the number of stock units set forth in the Notice of Stock Unit Award.

 

All capitalized terms used in this Agreement shall have the meanings   assigned in this Agreement, the Notice of Stock Unit Grant or the Plan.
    
	
 
    	
 
    	
 
    
	
Payment for Units
    	
 
    	
No payment is required for the stock units that you are receiving.
    
	
 
    	
 
    	
 
    
	
Vesting
    	
 
    	
The stock units vest in accordance with the vesting schedule set   forth in the Notice of Stock Unit Award.    No additional stock units vest after your Service has terminated for   any reason.
    
	
 
    	
 
    	
 
    
	
Forfeiture
    	
 
    	
If your Service terminates for any reason, then your stock units will   be forfeited to the extent that they have not vested before the termination   date and do not vest as a result of the termination of your Service.  This means that any stock units that have   not vested under this Agreement will be cancelled immediately.  You receive no payment for stock units that   are forfeited.  The Company determines   when your Service terminates for this purpose.
    
	
 
    	
 
    	
 
    
	
Leaves of Absence and Part-Time Work
    	
 
    	
For purposes of this award, your Service does not terminate when you   go on a military leave, a sick leave or another bona fide   leave of absence, if the leave was approved by the Company in writing and if   continued crediting of Service is required by applicable law, the Company’s   leave of absence policy, or the terms of your leave.  But your Service terminates when the   approved leave ends, unless you immediately return to active work.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
If you go on a leave of absence, then the vesting schedule specified   in the Notice of Stock Unit Award may be adjusted in accordance with the   Company’s leave of absence policy or the terms of your leave.  If you commence working on a part-time   basis, the Company may adjust the vesting schedule so that the rate of   vesting is commensurate with your reduced work schedule.  
    

 

 

	
Settlement of Units
    	
 
    	
Each stock unit will be settled on the first Permissible Trading Day   that occurs on or after the day when the stock unit vests.  However, each stock unit must be settled   not later than March 15th of the calendar year following the calendar   year in which the stock unit vests.

 

At the time of settlement, you will receive one share of the   Company’s common stock for each vested stock unit.  But the Company, at its sole discretion,   may substitute an equivalent amount of cash if the distribution of stock is   not reasonably practicable due to the requirements of applicable law.  The amount of cash will be determined on   the basis of the market value of the Company’s common stock at the time of   settlement.

 

No fractional shares will be issued upon settlement.  
    
	
 
    	
 
    	
 
    
	
“Permissible Trading Day”
    	
 
    	
“Permissible Trading Day” means a day that satisfies each of the   following requirements:

 

·    The   Nasdaq Global Market is open for trading on that day;

 

·    You are   permitted to sell shares of the Company’s common stock on that day without   incurring liability under Section 16(b) of the Securities Exchange   Act of 1934, as amended;

 

·    Either   (a) you are not in possession of material non-public information that   would make it illegal for you to sell shares of the Company’s common stock on   that day under Rule 10b-5 of the Securities and Exchange Commission or   (b) Rule 10b5 1 of the Securities and Exchange Commission is   applicable;

 

·    Under the   Company’s Securities Trading Policy, you are   permitted to sell shares of the Company’s common stock on that day; and

 

·    You are   not prohibited from selling shares of the Company’s common stock on that day   by a written agreement between you and the Company or a third party.
    

 

3

 

	
Section 409A
    	
 
    	
This paragraph applies only if the Company determines that you are a   “specified employee,” as defined in the regulations under Code Section 409A   at the time of your “separation from service,” as defined in Treasury   Regulation Section 1.409A-1(h) and it is determined that settlement   of these stock units is not exempt from Code Section 409A.  If this paragraph applies, then any stock   units that otherwise would have been settled during the first six months   following your “separation from service” will instead be settled on the first   business day following the earlier of (i) the six-month anniversary of   your separation from service, or (ii) your death. 
    
	
 
    	
 
    	
 
    
	
Nature of Units
    	
 
    	
Your stock units are mere bookkeeping entries.  They represent only the Company’s unfunded   and unsecured promise to issue shares of common stock (or distribute cash) on   a future date.  As a holder of stock units,   you have no rights other than the rights of a general creditor of the Company.
    
	
 
    	
 
    	
 
    
	
No Voting Rights or Dividends
    	
 
    	
Your stock units carry neither voting rights nor rights to cash   dividends.  You have no rights as a   stockholder of the Company unless and until your stock units are settled by   issuing shares of the Company’s common stock.
    
	
 
    	
 
    	
 
    
	
Units Nontransferable
    	
 
    	
You may not sell, transfer, assign, pledge or otherwise dispose of   any stock units.  For instance, you may   not use your stock units as security for a loan.
    
	
 
    	
 
    	
 
    
	
Beneficiary Designation
    	
 
    	
You may dispose of your stock units in a written beneficiary   designation.  A beneficiary designation   must be filed with the Company on the proper form.  It will be recognized only if it has been   received at the Company’s headquarters before your death.  If you file no beneficiary designation or   if none of your designated beneficiaries survives you, then your estate will   receive any vested stock units that you hold at the time of your death.
    

 

4

 

	
Withholding Taxes
    	
 
    	
No stock certificates or cash will be distributed to you unless you   have made arrangements satisfactory to the Company for the payment of any   withholding taxes that are due as a result of the vesting or settlement of   stock units.  At the discretion of the   Company, these arrangements may include (a) payment in cash,   (b) payment from the proceeds of the sale of shares through a   Company-approved broker, (c) withholding shares of Company stock that   otherwise would be issued to you when the stock units are settled with a fair   market value no greater than the minimum amount required to be withheld by   law, (d) surrendering shares that you previously acquired with a fair   market value no greater than the minimum amount required to be withheld by   law, or (e) withholding cash from other compensation. The fair market   value of withheld or surrendered shares, determined as of the date when taxes   otherwise would have been withheld in cash, will be applied to the   withholding taxes.

 

To the extent you fail to make satisfactory arrangements for the payment   of any required withholding taxes, you will permanently forfeit the   applicable stock units.  
    
	
 
    	
 
    	
 
    
	
Restrictions on Resale
    	
 
    	
You agree not to sell any shares at a time when applicable laws,   Company policies or an agreement between the Company and its underwriters   prohibit a sale.  This restriction will   apply as long as your Service continues and for such period of time after the   termination of your Service as the Company may specify.
    
	
 
    	
 
    	
 
    
	
Retention Rights
    	
 
    	
Your award or this Agreement does not give you the right to be   retained by the Company or a subsidiary of the Company in any capacity.  The Company and its subsidiaries reserve   the right to terminate your Service at any time, with or without cause.
    
	
 
    	
 
    	
 
    
	
Adjustments
    	
 
    	
In the event of a stock split, a stock dividend or a similar change   in Company stock, the number of your stock units will be adjusted   accordingly, as the Company may determine pursuant to the Plan.
    
	
 
    	
 
    	
 
    
	
Effect of Significant Corporate Transactions
    	
 
    	
If the Company is a party to a merger, consolidation, or certain   change in control transactions, then your stock units will be subject to the   applicable provisions of Article 9 of the Plan, provided that any action   taken must either (a) preserve the exemption of your stock units from   Section 409A of the Code or (b) comply with Section 409A of   the Code.
    
	
 
    	
 
    	
 
    
	
Applicable Law
    	
 
    	
This Agreement will be interpreted and enforced under the laws of the   State of Delaware (without regard to its choice-of-law provisions).
    

 

5

 

	
The Plan and Other Agreements
    	
 
    	
The text of the Plan is incorporated in this Agreement by   reference.  In the event of any   conflict between the terms and conditions of the Plan and the terms and   conditions of this Agreement, the terms and conditions of the Plan will   prevail.

 

The Plan, this Agreement and the Notice of Stock Unit Award   constitute the entire understanding between you and the Company regarding   this award.  Any prior agreements,   commitments or negotiations concerning this award are superseded.  This Agreement may be amended only by   another written agreement between the parties.
    

 

BY SIGNING THE COVER SHEET OF THIS AGREEMENT, YOU AGREE TO ALL OF THE
 TERMS AND CONDITIONS DESCRIBED ABOVE AND IN THE PLAN.

 

6

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