Document:

exv10w13

 

Exhibit 10.13

EXECUTIVE SEVERANCE BENEFITS AGREEMENT

     This Executive Severance Benefits Agreement (the “Agreement”) is entered into this
___day of                     , 2006 (the “Effective Date”), between [•]
(“Executive”) and Mellanox Technologies, Ltd. (the “Company”). This
Agreement is intended to provide Executive with the compensation and benefits described herein upon
the occurrence of specific events. Certain capitalized terms used in this Agreement are defined in
Article 5.

     The Company and Executive hereby agree as follows:

ARTICLE 1.

SCOPE OF AND CONSIDERATION FOR THIS AGREEMENT

          1.1 Position and Duties. Executive is currently employed by the Company as [•]. Executive
reports directly to the [Board, IN THE CASE OF THE CEO][ CEO, IN THE CASE OF OTHER EXECUTIVES].

          1.2 Restrictions. During his employment by the Company, Executive agrees to the best of his
ability and experience that he will at all times loyally and conscientiously perform all of the
duties and obligations required of and from him as [•]. During the term of his employment,
Executive further agrees that he will devote all of his business time and attention to the business
of the Company, the Company shall be entitled to all of the benefits and profits arising from or
incident to all such work, services and advice, Executive shall not render commercial or
professional services of any nature to any person or organization, whether or not for compensation,
without the prior written consent of the Board, and Executive shall not directly or indirectly
engage or participate in any business that is competitive in any manner with the business of the
Company. Nothing in this Agreement shall prevent Executive from accepting speaking or presentation
engagements in exchange for honoraria or from service on boards of charitable organizations or
otherwise participating in civic, charitable or fraternal organizations, or from owning no more
than one percent (1%) of the outstanding equity securities of a corporation whose stock is listed
on a national stock exchange.

          1.3 Employee Proprietary Information and Inventions Agreement. Executive acknowledges that he
has previously executed and delivered to an officer of the Company the Company’s Employee
Proprietary Information and Inventions Agreement (the “Confidentiality Agreement”) and that the
Confidentiality Agreement remains in full force and effect.

          1.4 Confidentiality of Terms. Executive agrees to follow the Company’s strict policy that
employees must not disclose, either directly or indirectly, any information, including any of the
terms of this Agreement, regarding salary, bonuses, or stock purchase or option allocations to any
person, including other employees of the Company; provided, however, that Executive may discuss
such terms with members of his immediate family and any legal, tax or accounting specialists who
provide Executive with individual legal, tax or accounting advice,

 

 

and Executive may discuss such terms with other employees of the Company on a need to know
basis if required to carry out Executive’s duties as [•] or at the request of the Board.

          1.5 Benefits Upon Covered Termination. The Company and Executive wish to set forth the
benefits which Executive shall be entitled to receive in the event of a Covered Termination.

          1.6 Consideration. The duties and obligations of the Company to Executive under this
Agreement shall be in consideration for Executive’s past services to the Company, Executive’s
continued employment with the Company, and Executive’s execution of a release in accordance with
Section 4.1 hereof.

          1.7 Prior Agreement. This Agreement shall supersede any other agreement relating to severance
benefits in the event of Executive’s severance from employment.

ARTICLE 2.

SEVERANCE BENEFITS

          2.1 Covered Termination Severance Benefits. A Covered Termination of Executive’s employment
entitles Executive to receive the benefits set forth in this Section 2.1.

               (a) Additional Severance Payment. The Company shall pay to Executive during the period
commencing on the date of termination and ending six months thereafter (the “Severance Period”), in
addition to any rights and entitlements under law and the Executive’s Employment Agreement, an amount equal to his monthly Base Salary at a per annum rate of one hundred and twenty
percent (120%). The severance contemplated by this Section 2.1(a), which shall be subject to all
required tax and other applicable withholding, shall be payable in equal monthly installments
during the Severance Period, provided that the Executive is in good faith compliance with the terms
of this Agreement, including specifically with Executive’s obligations and undertakings pursuant to
Sections 1.3 and 3 hereof, as of each applicable payment date;

               (b) Option Acceleration. The vesting and/or exercisability of fifty percent (50%) of the
unvested shares subject to Executive’s Equity Awards shall be automatically accelerated immediately
effective as of the date of the Covered Termination.

          2.2 Other Terminations. If Executive’s employment is terminated by the Company for Cause, by
Executive other than pursuant to a Constructive Termination or as a result of Executive’s death or
disability, the Company shall not have any other or further obligations to Executive under this
Agreement (including any financial obligations) except that Executive shall be entitled to receive
(a) Executive’s fully earned but unpaid base salary, through the date of termination at the rate
then in effect, and (b) all other amounts or benefits to which Executive is entitled under any
compensation, retirement or benefit plan or practice of the Company at the time of termination in
accordance with the terms of such plans or practices or applicable law. In addition, subject to
the provisions of the Company’s equity compensation plans and the terms of Executive’s Equity
Awards, if Executive’s employment is terminated by the Company for Cause, by Executive other than
pursuant to a Constructive Termination or as a

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result of Executive’s death or disability, all vesting of Executive’s unvested Equity Awards
previously granted to him by the Company shall cease and none of such unvested Equity Awards shall
be exercisable following the date of such termination. The foregoing shall be in addition to, and
not in lieu of, any and all other rights and remedies that may be available to the Company under
the circumstances, whether at law or in equity.

          2.3 Mitigation. Except as otherwise specifically provided herein, Executive shall not be
required to mitigate damages or the amount of any payment provided under this Agreement by seeking
other employment or otherwise, nor shall the amount of any payment provided for under this
Agreement be reduced by any compensation earned by Executive as a result of employment by another
employer or by any retirement benefits received by Executive after the date of a Covered
Termination.

          2.4 Exclusive Remedy. Except as otherwise expressly required by law or as specifically
provided herein or in the Executive’s Employment Agreement, all of Executive’s rights to salary,
severance, benefits, bonuses and other amounts hereunder (if any) accruing after the termination of
Executive’s employment shall cease upon such termination.

ARTICLE 3.

RESTRICTIVE COVENANTS

          3.1 Non-Solicitation. In further consideration of the duties and obligations of the Company
to Executive hereunder, Executive acknowledges that during the course of his employment with the
Company, Executive will become familiar with the Company’s trade secrets and with other
confidential information concerning the Company and that Executive’s services shall be of special,
unique and extraordinary value to the Company; and, therefore, Executive agrees that, during the
one-year period commencing on the date of termination of Executive’s employment for any reason (the
“Restricted Period”), Executive shall not, directly or indirectly, through another person or
entity, (i) induce, solicit, encourage or attempt to induce, solicit or encourage any employee of
the Company to leave the employ of the Company, or in any way interfere with the relationship
between the Company and any employee thereof; or (ii) induce, solicit or encourage or attempt to
induce, solicit or encourage any customer, supplier, licensee, licensor, franchisee or other
business relation of the Company to cease doing business with the Company, or in any way interfere
with the relationship between any such customer, supplier, licensee or business relation of the
Company.

          3.2 Modification of Covenants. If, at the time of enforcement of any of the covenants
contained in Section 3.1 hereof, a court of competent jurisdiction shall hold that the duration,
scope or area restrictions stated herein are unreasonable under circumstances then existing, the
parties agree that the maximum duration, scope or area reasonable under such circumstances shall be
substituted for the stated duration, scope or area and that the court shall be allowed to revise
the restrictions contained herein to cover the maximum period, scope and area permitted by law.

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ARTICLE 4.

LIMITATIONS AND CONDITIONS ON BENEFITS

          4.1 Release Prior to Payment of Benefits. Upon a Covered Termination, and prior to the
payment of any benefits under this Agreement on account of such Covered Termination, Executive
shall execute and deliver to the Company an effective general release (the “Release”) in the form
attached hereto and incorporated herein as Exhibit A or Exhibit B, as applicable. Such Release
shall specifically relate to all of Executive’s rights and claims in existence at the time of such
execution and shall confirm Executive’s obligations under the Confidentiality Agreement. It is
understood that, as specified in the applicable Release, Executive has a specified number of
calendar days to consider whether to execute such Release, and Executive may revoke such Release
within seven (7) calendar days after execution. In the event Executive does not execute and
deliver such Release within the applicable period, or if Executive revokes such Release within the
subsequent seven (7) day period, no benefits shall be payable under this Agreement.

          4.2 Termination of Benefits. Benefits under this Agreement shall terminate immediately if
Executive, at any time, violates any proprietary information or confidentiality obligation to the
Company, including, without limitation, the Confidentiality Agreement.

ARTICLE 5.

DEFINITIONS

     For purposes of the Agreement, the following terms are defined as follows:

          5.1 “Base Salary” means Executive’s annual base salary as in effect during the last regularly
scheduled payroll period immediately preceding a Covered Termination.

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

          5.3 “Cause” means that, in the reasonable determination of the [Board, IN THE CASE OF THE
CEO][Company, IN THE CASE OF THE OTHER EXECUTIVES], Executive:

               (a) has committed an act of fraud or embezzlement or has intentionally committed some other
illegal act that has a material adverse impact on the Company or any successor or parent or
subsidiary thereof;

               (b) has been convicted of, or entered a plea of “guilty” or “no contest” to, a felony which
causes or may reasonably be expected to cause substantial economic injury to or substantial injury
to the reputation of the Company or any subsidiary or affiliate of the Company;

               (c) has made any unauthorized use or disclosure of confidential information or trade secrets
of the Company or any successor or parent or subsidiary thereof that has a material adverse impact
on any such entity;

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               (d) has committed any other intentional misconduct that has a material adverse impact on the
Company or any successor or parent or subsidiary thereof, or

               (e) has intentionally refused or intentionally failed to act in accordance with any lawful and
proper direction or order of the Board or the appropriate individual to whom Executive reports,
provided such direction is not materially inconsistent with Executive’s customary duties and
responsibilities.

          5.4 “Change of Control” means and includes each of the following:

               (a) A transaction or series of transactions (other than an offering of Shares to the general
public through a registration statement filed under the laws of any applicable jurisdiction)
whereby any person or related group of persons (other than the Company, any of its subsidiaries, an
employee benefit plan maintained by the Company or any of its subsidiaries or a person that, prior
to such transaction, directly or indirectly controls, is controlled by, or is under common control
with, the Company) directly or indirectly acquires beneficial ownership of securities of the
Company possessing more than 50% of the total combined voting power of the Company’s securities
outstanding immediately after such acquisition; or

               (b) During any period of two consecutive years, individuals who, at the beginning of such
period, constitute the Board together with any new director(s) (other than a director designated by
a person who shall have entered into an agreement with the Company to effect a transaction
described in Subsections (a) or (c) hereof) whose election by the Board or nomination for election
by the Company’s shareholders was approved by a vote of at least two thirds of the directors then
still in office who either were directors at the beginning of the two-year period or whose election
or nomination for election was previously so approved, cease for any reason to constitute a
majority thereof; or

               (c) The consummation by the Company (whether directly involving the Company or indirectly
involving the Company through one or more intermediaries) of (x) a merger, consolidation,
reorganization, or business combination or (y) a sale or other disposition of all or substantially
all of the Company’s assets in any single transaction or series of related transactions or (z) the
acquisition of assets or shares of another entity, in each case other than a transaction:

                    (i) Which results in the Company’s voting securities outstanding immediately before the
transaction continuing to represent (either by remaining outstanding or by being converted into
voting securities of the Company or the person that, as a result of the transaction, controls,
directly or indirectly, the Company or owns, directly or indirectly, all or substantially all of
the Company’s assets or otherwise succeeds to the business of the Company (the Company or such
person, the “Successor Entity”)) directly or indirectly, at least a majority of the combined voting
power of the Successor Entity’s outstanding voting securities immediately after the transaction,
and

                    (ii) After which no person or group beneficially owns voting securities representing 50% or
more of the combined voting power of the Successor Entity;

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provided, however, that no person or group shall be treated for purposes of this Subsection
(c)(ii) as beneficially owning 50% or more of combined voting power of the Successor Entity solely
as a result of the voting power held in the Company prior to the consummation of the transaction;
or

               (d) The Company’s shareholders approve a liquidation or dissolution of the Company.

     The Board shall have full and final authority, which shall be exercised in its discretion, to
determine conclusively whether a Change of Control has occurred pursuant to the above definition,
and the date of the occurrence of such Change of Control and any incidental matters relating
thereto.

          5.5 “Company” means Mellanox Technologies, Ltd., company organized under the laws of the State
of Israel, or, following a Change of Control, the surviving entity resulting from such transaction.

          5.6 “Constructive Termination” means that Executive voluntarily terminates his employment with
the Company after any of the following are undertaken without Executive’s express written consent:

               (a) the removal of or a material reduction in the nature or scope of Executive’s
responsibilities, or the assignment to Executive of duties that are materially inconsistent with
Executive’s position other than a change in reporting relationship;

               (b) a change in Executive’s direct reporting relationship so that Executive no longer reports
directly to the [Board, IN THE CASE OF CEO] [CEO, IN THE CASE OF OTHER EXECUTIVES];

               (c) a reduction in Executive’s base salary, unless the base salaries of all other executives
are similarly reduced; or

               (d) a relocation of Executive’s place of employment by more than thirty (30) miles from such
Executive’s place of employment on the Effective Date.

     The termination of Executive’s employment as a result of Executive’s death or disability shall
not be deemed to be a Constructive Termination.

          5.7 “Covered Termination” means an Involuntary Termination Without Cause or a Constructive
Termination, in each case, which occurs within 12 months following a Change of Control.

          5.8 “Employment Agreement” means that employment agreement dated [ ] by and between the
Company and Executive.

          5.9 “Equity Awards” means all options to purchase ordinary shares, awards of restricted
ordinary shares and such other awards granted pursuant to the Company’s option

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and other equity incentive award plans or agreements and any ordinary shares issued upon
exercise thereof.

     5.10 “Involuntary Termination Without Cause” means Executive’s dismissal or discharge by the
Company other than for Cause. The termination of Executive’s employment as a result of Executive’s
death or disability shall not be deemed to be an Involuntary Termination Without Cause.

ARTICLE 6.

GENERAL PROVISIONS

          6.1 Employment Status. This Agreement does not constitute a contract of employment or impose
upon Executive any obligation to remain as an employee, or impose on the Company any obligation (a)
to retain Executive as an employee, (b) to change the status of Executive as an at-will employee,
or (c) to change the Company’s policies regarding termination of employment.

          6.2 Notices. Any notices provided hereunder must be in writing, and such notices or any other
written communication shall be deemed effective upon the earlier of personal delivery (including
personal delivery by facsimile) or the third day after mailing by first class mail to the Company
at its primary office location and to Executive at Executive’s address as listed in the Company’s
payroll records. Any payments made by the Company to Executive under the terms of this Agreement
shall be delivered to Executive either in person or at the address as listed in the Company’s
payroll records.

          6.3 Severability. Whenever possible, each provision of this Agreement will be interpreted in
such manner as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law
or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any
other provision or any other jurisdiction, but this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or unenforceable provisions had never
been contained herein.

          6.4 Waiver. If either party should waive any breach of any provisions of this Agreement, he
or it shall not thereby be deemed to have waived any preceding or succeeding breach of the same or
any other provision of this Agreement.

          6.5 Complete Agreement. This Agreement, including Exhibit A and Exhibit B, constitutes the
entire agreement between Executive and the Company and is the complete, final, and exclusive
embodiment of their agreement with regard to this subject matter, wholly superseding all written
and oral agreements with respect to severance benefits to Executive in the event of employment
termination. It is entered into without reliance on any promise or representation other than those
expressly contained herein. Notwithstanding anything herein to the contrary, this Agreement shall
not supersede the Employment Agreement or any indemnification agreement between Executive and the Company.

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          6.6 Amendment or Termination of Agreement. This Agreement may be changed or terminated only
upon the mutual written consent of the Company and Executive. The written consent of the Company
to a change or termination of this Agreement must be signed by an executive officer of the Company
after such change or termination has been approved by the Board.

          6.7 Counterparts. This Agreement may be executed in separate counterparts, any one of which
need not contain signatures of more than one party, but all of which taken together will constitute
one and the same Agreement.

          6.8 Headings. The headings of the Articles and Sections hereof are inserted for convenience
only and shall not be deemed to constitute a part hereof nor to affect the meaning thereof.

          6.9 Successors and Assigns. This Agreement is intended to bind and inure to the benefit of
and be enforceable by Executive, and the Company, and any surviving entity resulting from a Change
of Control and upon any other person who is a successor by merger, acquisition, consolidation or
otherwise to the business formerly carried on by the Company, and their respective successors,
assigns, heirs, executors and administrators, without regard to whether or not such person actively
assumes any rights or duties hereunder; provided, however, that Executive may not assign any duties
hereunder and may not assign any rights hereunder without the written consent of the Company, which
consent shall not be withheld unreasonably.

          6.10 Choice of Law. All questions concerning the construction, validity and interpretation of
this Agreement will be governed by the law of the State of Israel, without regard to its conflict
of laws rules.

          6.11 Non-Publication. The parties mutually agree not to disclose publicly the terms of this
Agreement except to the extent that disclosure is mandated by applicable law or regulation or to
their respective advisors (e.g., attorneys, accountants).

          6.12 Construction of Agreement. In the event of a conflict between the text of the Agreement
and any summary, description or other information regarding the Agreement, the text of the
Agreement shall control.

 (Signature Page Follows)

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     In Witness Whereof, the parties have executed this Agreement on the Effective Date
written above.

	 	 	 	 	 
	Mellanox Technologies, Ltd.	 	[NAME OF EXECUTIVE]
	 
	 	 	 	 
	By:
	 	 	 	 
	 

	 	 
	 	 
	Name:
	 	 	 	 
	 

	 	 	 	 
	Title:
	 	 	 	 
	 

	 	 	 	 

Exhibit A: Release (Individual Termination)

Exhibit B: Release (Group Termination)

[Signature Page To Executive Severance Benefits Agreement]

 

 

Exhibit A

RELEASE

(Individual Termination)

     Certain capitalized terms used in this Release are defined in the Executive Severance Benefits
Agreement (the “Agreement”), which I have executed and of which this Release is a part.

     I hereby confirm my obligations under the Company’s Employee Proprietary Information and
Inventions Agreement.

     I also hereby confirm that of the date hereof, I have received all amounts and/or entitlements
to which I am due as a result of or in connection with my employment with the Company including,
without limitation, with respect to salary, wages, back wages, contributions to managers insurance
(*) and education fund (**), severance pay, annual vacation, overtime pay,
travel allowance, recreation pay (***), sick pay, commissions, incentives, bonuses, options,
notice period or payment in lieu of notice, deferred compensation payments, expenses, benefits, and
reimbursement of any kind and any other payment or benefits or rights whatsoever in connection with
my employment with the Company or termination of my employment or that otherwise might be owed to
me by the Company.

     In accordance with the termination of my employment at the Company I am entitled to all sums
as described in the List of Final Payments, attached to this letter. I accept the payments
described in the List of Final Payments as full, complete and unconditional payment, settlement and
satisfaction of any and all obligations of the Company arising out of my employment or the
termination of my employment, or that otherwise might be owed to me by the Company.

     Upon completion by the Company of the payments listed in the attached “List of Final Payments”
in connection with my employment with the Company and/or the termination of such employment,
neither myself, nor anyone on my behalf, has or will have any claim, demand and/or cause of action,
including with respect to my dismissal and/or entitlement to severance pay, whether or not now
known, suspected or claimed, which I have ever had, now have, or may claim to have against the
Company and/or its affiliates (whether directly or indirectly) pursuant to the Employment Agreement
or otherwise against Company and/or its affiliates and/or anyone on its behalf, including partners,
investors, predecessors, successors, heirs, assigns, directors, employees or shareholders or any of
their representatives of successors or affiliated corporations or organizations, whether previously
or hereinafter affiliated in any manner. Without derogating in any way from the above, I
acknowledge that this Release is a “Settlement and Acknowledgement of Discharge” as defined in
Section 29 of the Severance Pay Law, 5723 — 1963.

     I acknowledge that I have read and understand Section 1542 of the California Civil Code which
reads as follows: “A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which if known by him or
her must have materially affected his or her settlement with the debtor.” I hereby

 

			
	(*)	 	
	 
	(**)	 	
	 
	(***)	 	

Exhibit A-1

 

expressly waive and relinquish all rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any claims I may have against the
Company.

     Except as otherwise set forth in this Release, I hereby release, acquit and forever discharge
the Company, its parents and subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and from any and all claims,
liabilities, demands, causes of action, costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise, known and unknown, suspected
and unsuspected, disclosed and undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment with the Company), arising out
of or in any way related to agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such claims and demands directly or
indirectly arising out of or in any way connected with my employment with the Company or the
termination of that employment, including but not limited to, with respect to salary, wages, back
wages, contributions to managers insurance (*) and education fund (**),
severance pay, annual vacation, overtime pay, travel allowance,
recreation pay (***), sick pay, commissions, incentives, bonuses, options, notice period or payment in lieu
of notice, deferred compensation payments, expenses, benefits, and reimbursement of any kind and
any other payment or benefits or rights whatsoever in connection with my employment with the
Company or termination of my employment or that otherwise might be owed to me by the Company;
claims of intentional and negligent infliction of emotional distress, any and all tort claims for
personal injury; claims pursuant to any federal, state or local law or cause of action including,
but not limited to, the federal Civil Rights Act of 1866 and 1867; Title VII of the Civil Rights
Act of 1964, as amended; the federal Civil Rights and Women’s Equity Act of 1991; Sections 1981
through 1988 of Title 42 of the Unites States Code, as amended; the federal Occupational Safety and
Health Act of 1970; the Consolidated Omnibus Budge Reconciliation Act of 1985; the federal Family
and Medical Leave Act of 1992; the Federal Worker Adjustment and Retraining Notification Act of
1988; the federal Vocational Rehabilitation Act of 1973; the federal Equal Pay Act of 1963; the
federal Fair Labor Standards Act; the National Labor Relations Act, as amended; the federal Age
Discrimination in Employment Act of 1967, as amended (“ADEA”); the federal Employee Retirement
Income Security Act of 1974, as amended; the federal Americans with Disabilities Act of 1990; the
California Fair Employment and Housing Act, as amended; the California Workers’ Compensation Act;
the California Unruh and Ralph Civil Rights Act; the California Alcohol and Drug Rehabilitation
Law; the California Equal Pay Law; tort law; contract law; statutory law; common law; wrongful
discharge; discrimination; fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that nothing in this paragraph shall be
construed in any way to release the Company from its obligation to indemnify me pursuant to the
Company’s indemnification obligation pursuant to agreement or applicable law.

     I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have
under ADEA. I also acknowledge that the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything of value to which I was
already entitled. I further acknowledge that I have been advised by this writing, as

Exhibit A-2

 

			
	(*)	 	
	 
	(**)	 	
	 
	(***)	 	

 

required by the ADEA, that: (A) my waiver and release do not apply to any rights or claims
that may arise on or after the date I execute this Release; (B) I have the right to consult with an
attorney of my choice prior to executing this Release; (C) I have twenty-one (21) days to consider
this Release (although I may choose to voluntarily execute this Release earlier); (D) I have seven
(7) days following the execution of this Release by the parties to revoke the Release; and (E) this
Release shall not be effective until the date upon which the revocation period has expired, which
shall be the eighth day after this Release is executed by me. I hereby understand that the
revocation contemplated in this paragraph shall not be effective unless it is in writing and signed
by me and received by the Company prior to the expiration of the revocation period. I further
acknowledge that I have read this Release carefully and completely understand each of the terms of
this Release. I acknowledge that the undertakings contained in this Release are irrevocable and the
Company and its representatives and successors are relying upon my undertakings. I declare that I
am fully aware of my rights under law and that this waiver is signed by me upon my own free will
after I was given the opportunity to receive any and all explanations regarding my rights to my
full satisfaction, and to check all my accounts with the Company and after I have examined all my
rights against the Company. I further acknowledge that I have been afforded sufficient time to
understand the terms and effects of this Release, and that the agreements and obligations herein
are made voluntarily, knowingly and without duress, and that neither the Company nor its agents or
representatives have made any representations inconsistent with the provisions of this Release.

	 	 	 	 	 
	 	 	[NAME OF EXECUTIVE]
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 

	 	Date:	 	 
	 

	 	 	 	 

Exhibit A-3

 

LIST OF FINAL PAYMENTS

On or subsequent to the date of termination of your employment with the Company (the “Termination
Date”), the Company shall pay and/or release to you the following:

	1.	 	Last Monthly Salary:

	 	 	A gross sum for Salary through Termination Date.
	 
	2.	 	Severance Pay: (gross)
	 
	 	 	Release of all amount accumulated in your managers insurance policy
shall be on account of your statutory severance pay entitlement, and
the Company will complete payment of the statutory severance
entitlement.
	 
	3.	 	Vacation Days:
	 
	 	 	A gross payment for accrued and unused vacation days
	 
	4.	 	Recuperation Pay (d’mei havra’ah):
	 
	 	 	A gross payment for unpaid d’mei havra’ah due as of the Termination Date
	 
	5.	 	Prior Notice of Termination
	 
	 	 	A gross payment in lieu of prior notice for                      days, including
a payment for social benefits payable thereupon. [If applicable]
	 
	6.	 	Additional Severance Payment
	 
	 	 	Subject to the terms and conditions of the Agreement

Exhibit A-4

 

Exhibit B

RELEASE

(Group Termination)

     Certain capitalized terms used in this Release are defined in the Executive Severance Benefits
Agreement (the “Agreement”), which I have executed and of which this Release is a part.

     I hereby confirm my obligations under the Company’s Employee Proprietary Information and
Inventions Agreement.

     I also hereby confirm that of the date hereof, I have received all amounts and/or entitlements
to which I am due as a result of or in connection with my employment with the Company including,
without limitation, with respect to salary, wages, back wages, contributions to managers insurance
(*) and education fund (**), severance pay, annual vacation, overtime pay,
travel allowance, recreation pay (***), sick pay, commissions, incentives, bonuses, options,
notice period or payment in lieu of notice, deferred compensation payments, expenses, benefits, and
reimbursement of any kind and any other payment or benefits or rights whatsoever in connection with
my employment with the Company or termination of my employment or that otherwise might be owed to
me by the Company.

     In accordance with the termination of my employment at the Company I am entitled to all sums
as described in the List of Final Payments, attached to this letter. I accept the payments
described in the List of Final Payments as full, complete and unconditional payment, settlement and
satisfaction of any and all obligations of the Company arising out of my employment or the
termination of my employment, or that otherwise might be owed to me by the Company.

     Upon completion by the Company of the payments listed in the attached “List of Final Payments”
in connection with my employment with the Company and/or the termination of such employment,
neither myself, nor anyone on my behalf, has or will have any claim, demand and/or cause of action,
including with respect to my dismissal and/or entitlement to severance pay, whether or not now
known, suspected or claimed, which I have ever had, now have, or may claim to have against the
Company and/or its affiliates (whether directly or indirectly) pursuant to the Employment Agreement
or otherwise against Company and/or its affiliatesand/or anyone on its behalf, including its
partners, investors, predecessors, successors, heirs, assigns, directors, employees or shareholders
or any of their representatives of successors or affiliated corporations or organizations, whether
previously or hereinafter affiliated in any manner. Without derogating in any way from the above,
I acknowledge that this Release is a “Settlement and Acknowledgement of Discharge” as defined in
Section 29 of the Severance Pay Law, 5723 — 1963.

     I acknowledge that I have read and understand Section 1542 of the California Civil Code which
reads as follows: “A general release does not extend to claims which the creditor does not know or
suspect to exist in his or her favor at the time of executing the release, which if known by him or
her must have materially affected his or her settlement with the debtor.” I hereby

 

			
	(*)	 	
	 
	(**)	 	
	 
	(***)	 	

Exhibit B-1

 

expressly waive and relinquish all rights and benefits under that section and any law of any
jurisdiction of similar effect with respect to my release of any claims I may have against the
Company.

     Except as otherwise set forth in this Release, I hereby release, acquit and forever discharge
the Company, its parents and subsidiaries, and their officers, directors, agents, servants,
employees, shareholders, successors, assigns and affiliates, of and from any and all claims,
liabilities, demands, causes of action, costs, expenses, attorneys fees, damages, indemnities and
obligations of every kind and nature, in law, equity, or otherwise, known and unknown, suspected
and unsuspected, disclosed and undisclosed (other than any claim for indemnification I may have as
a result of any third party action against me based on my employment with the Company), arising out
of or in any way related to agreements, events, acts or conduct at any time prior to the date I
execute this Release, including, but not limited to: all such claims and demands directly or
indirectly arising out of or in any way connected with my employment with the Company or the
termination of that employment, including but not limited to, with respect to salary, wages, back
wages, contributions to managers insurance (*) and education fund (**),
severance pay, annual vacation, overtime pay, travel allowance,
recreation pay (***) , sick pay, commissions, incentives, bonuses, options, notice period or payment in lieu
of notice, deferred compensation payments, expenses, benefits, and reimbursement of any kind and
any other payment or benefits or rights whatsoever in connection with my employment with the
Company or termination of my employment or that otherwise might be owed to me by the Company;
claims of intentional and negligent infliction of emotional distress, any and all tort claims for
personal injury; claims pursuant to any federal, state or local law or cause of action including,
but not limited to, the federal Civil Rights Act of 1866 and 1867; Title VII of the Civil Rights
Act of 1964, as amended; the federal Civil Rights and Women’s Equity Act of 1991; Sections 1981
through 1988 of Title 42 of the Unites States Code, as amended; the federal Occupational Safety and
Health Act of 1970; the Consolidated Omnibus Budge Reconciliation Act of 1985; the federal Family
and Medical Leave Act of 1992; the Federal Worker Adjustment and Retraining Notification Act of
1988; the federal Vocational Rehabilitation Act of 1973; the federal Equal Pay Act of 1963; the
federal Fair Labor Standards Act; the National Labor Relations Act, as amended; the federal Age
Discrimination in Employment Act of 1967, as amended (“ADEA”); the federal Employee Retirement
Income Security Act of 1974, as amended; the federal Americans with Disabilities Act of 1990; the
California Fair Employment and Housing Act, as amended; the California Workers’ Compensation Act;
the California Unruh and Ralph Civil Rights Act; the California Alcohol and Drug Rehabilitation
Law; the California Equal Pay Law; tort law; contract law; statutory law; common law; wrongful
discharge; discrimination; fraud; defamation; emotional distress; and breach of the implied
covenant of good faith and fair dealing; provided, however, that nothing in this paragraph shall be
construed in any way to release the Company from its obligation to indemnify me pursuant to the
Company’s indemnification obligation pursuant to agreement or applicable law.

     I acknowledge that I am knowingly and voluntarily waiving and releasing any rights I may have
under ADEA. I also acknowledge that the consideration given under the Agreement for the waiver and
release in the preceding paragraph hereof is in addition to anything of value to which I was
already entitled. I further acknowledge that I have been advised by this writing, as

 

			
	(*)	 	
	 
	(**)	 	
	 
	(***)	 	

Exhibit B-2

 

required by the ADEA, that: (A) my waiver and release do not apply to any rights or claims
that may arise on or after the date I execute this Release; (B) I have the right to consult with an
attorney of my choice prior to executing this Release; (C) I have forty-five (45) days to consider
this Release (although I may choose to voluntarily execute this Release earlier); (D) I have seven
(7) days following the execution of this Release by the parties to revoke the Release; (E) this
Release shall not be effective until the date upon which the revocation period has expired, which
shall be the eighth day after this Release is executed by me. I hereby understand that the
revocation contemplated in this paragraph shall not be effective unless it is in writing and signed
by me and received by the Company prior to the expiration of the revocation period. I further
acknowledge that I have read this Release carefully and completely understand each of the terms of
this Release; and, as required by ADEA, that I have received with this Release a detailed list of
the job titles and ages of all employees who were terminated in this group termination and the ages
of all employees of the Company in the same job classification or organizational unit who were not
terminated. I acknowledge that the undertakings contained in this Release are irrevocable and the
Company and its representatives and successors are relying upon my undertakings. I declare that I
am fully aware of my rights under law and that this waiver is signed by me upon my own free will
after I was given the opportunity to receive any and all explanations regarding my rights to my
full satisfaction, and to check all my accounts with the Company and after I have examined all my
rights against the Company. I further acknowledge that I have been afforded sufficient time to
understand the terms and effects of this Release, and that the agreements and obligations herein
are made voluntarily, knowingly and without duress, and that neither the Company nor its agents or
representatives have made any representations inconsistent with the provisions of this Release.

	 	 	 	 	 
	 	 	[NAME OF EXECUTIVE]
	 
	 	 	 	 
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 

	 	Date:	 	 
	 

	 	 	 	 

Exhibit B-3

 

LIST OF FINAL PAYMENTS

On or subsequent to the date of termination of your employment with the Company (the “Termination
Date”), the Company shall pay and/or release to you the following:

	1.	 	Last Monthly Salary:

A gross sum for Salary through Termination Date.
	 
	2.	 	Severance Pay: (gross)
	 
	 	 	Release of all amount accumulated in your managers insurance policy
shall be on account of your statutory severance pay entitlement, and
the Company will complete payment of the statutory severance
entitlement.
	 
	3.	 	Vacation Days:
	 
	 	 	A gross payment for accrued and unused vacation days
	 
	4.	 	Recuperation Pay (d’mei havra’ah):
	 
	 	 	A gross payment for unpaid d’mei havra’ah due as of the Termination Date
	 
	5.	 	Prior Notice of Termination
	 
	 	 	A gross payment in lieu of prior notice for                      days, including
a payment for social benefits payable thereupon. [ If applicable]
	 
	6.	 	Additional Severance Payment
	 
	 	 	Subject to the terms and conditions of the Agreement

Exhibit B-4<PAGE>

                                                                    EXHIBIT 10.1

                           INFRASOURCE SERVICES, INC.

                        2004 OMNIBUS STOCK INCENTIVE PLAN

SECTION 1. GENERAL PURPOSE OF PLAN; DEFINITIONS.

      The name of this plan is the InfraSource Services, Inc. 2004 Omnibus Stock
Incentive Plan (the "Plan"). The Plan was adopted by the Board (defined below)
on April 29, 2004, subject to the approval of the stockholders of the Company
(defined below). The purpose of the Plan is to enable the Company to attract and
retain highly qualified personnel who will contribute to the Company's success
and to provide incentives to Participants (defined below) that are linked
directly to increases in stockholder value and will therefore inure to the
benefit of all stockholders of the Company.

      For purposes of the Plan, the following terms shall be defined as set
forth below:

            (a) "Administrator" means the Board, or if and to the extent the
Board does not administer the Plan, the Committee in accordance with Section 2
below.

            (b) "Board" means the Board of Directors of the Company.

            (c) "Code" means the Internal Revenue Code of 1986, as amended from
time to time, or any successor thereto.

            (d) "Committee" means any committee the Board may appoint to
administer the Plan. To the extent necessary and desirable, the Committee shall
be composed entirely of individuals who meet the qualifications referred to in
Section 162(m) of the Code and Rule 16b-3 under the Exchange Act. If at any time
or to any extent the Board shall not administer the Plan, then the functions of
the Board specified in the Plan shall be exercised by the Committee.

            (e) "Company" means InfraSource Services, Inc., a Delaware
corporation (or any successor corporation).

            (f) "Deferred Stock" means the right to receive Stock at the end of
a specified deferral period granted pursuant to Section 7 below.

            (g) "Disability" means with respect to any Participant, Disability
as defined in the Management Agreement between the Company (or its Subsidiary)
and such Participant, or in the absence of any such Management Agreement
defining Disability, the inability of a Participant to perform substantially his
or her duties and responsibilities to the Company or to any Parent or Subsidiary
by reason of a physical or mental disability or infirmity (i) for a continuous
period of six months, or (ii) at such earlier time as the Participant submits
medical evidence satisfactory to the Administrator that the Participant has a
physical or mental disability or infirmity that will likely prevent the
Participant from returning to the performance of the Participant's work duties
for six months or longer. The date of such Disability shall be the last day of
such six-month period or the day on which the Participant submits such
satisfactory medical evidence, as the case may be.

<PAGE>

            (h) "Eligible Recipient" means an officer, director, employee,
consultant or advisor of the Company or of any Parent or Subsidiary.

            (i) "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.

            (j) "Fair Market Value" means, as of any given date, with respect to
any awards granted hereunder, (A) the closing sale price of a share of Stock on
such date on the principal securities exchange on which the Company's equity
securities are listed or traded, (B) the fair market value of a share of Stock
as determined in accordance with a method prescribed in the agreement evidencing
any award hereunder, or (C) the fair market value of a share of Stock as
otherwise determined by the Administrator in the good faith exercise of its
discretion.

            (k) "Incentive Stock Option" means any Stock Option intended to be
designated as an "incentive stock option" within the meaning of Section 422 of
the Code.

            (l) "Non-Qualified Stock Option" means any Stock Option that is not
an Incentive Stock Option, including any Stock Option that provides (as of the
time such Stock Option is granted) that it will not be treated as an Incentive
Stock Option.

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

            (n) "Participant" means any Eligible Recipient selected by the
Administrator, pursuant to the Administrator's authority in Section 2 below, to
receive grants of Stock Options, Stock Appreciation Rights, awards of Restricted
Stock, Deferred Stock, or Performance Shares or any combination of the
foregoing.

            (o) "Performance Shares" means shares of Stock that are subject to
restrictions based upon the attainment of specified performance objectives
granted pursuant to Section 7 below.

            (p) "Registration Statement" means the registration statement on
Form S-1 filed with the Securities and Exchange Commission for the initial
underwritten public offering of the Company's Stock.

            (q) "Restricted Stock" means shares of Stock subject to certain
restrictions granted pursuant to Section 7 below.

            (r) "Stock" means the common stock, par value $0.001 per share, of
the Company.

            (s) "Stock Appreciation Right" means the right pursuant to an award
granted under Section 6 below to receive an amount equal to the excess, if any,
of (A) the Fair Market Value, as of the date such Stock Appreciation Right or
portion thereof is surrendered, of the

                                       2

<PAGE>

shares of Stock covered by such right or such portion thereof, over (B) the
aggregate exercise price of such right or such portion thereof.

            (t) "Stock Option" means an option to purchase shares of Stock
granted pursuant to Section 5 below.

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

SECTION 2. ADMINISTRATION.

      The Plan shall be administered in accordance with the requirements of
Section 162(m) of the Code (but only to the extent necessary and desirable to
maintain qualification of awards under the Plan under Section 162(m) of the
Code) and, to the extent applicable, Rule 16b-3 under the Exchange Act ("Rule
16b-3"), by the Board or, at the Board's sole discretion, by the Committee,
which shall be appointed by the Board, and which shall serve at the pleasure of
the Board.

      Pursuant to the terms of the Plan, the Administrator shall have the power
and authority to grant to Eligible Recipients pursuant to the terms of the Plan:
(i) Stock Options, (ii) Stock Appreciation Rights, (iii) awards of Restricted
Stock, Deferred Stock or Performance Shares or (iv) any combination of the
foregoing. The Administrator shall have the authority:

            (a) to select those Eligible Recipients who shall be Participants;

            (b) to determine whether and to what extent Stock Options, Stock
Appreciation Rights, awards of Restricted Stock, Deferred Stock or Performance
Shares or a combination of any of the foregoing, are to be granted hereunder to
Participants;

            (c) to determine the number of shares of Stock to be covered by each
award granted hereunder;

            (d) to determine the terms and conditions, not inconsistent with the
terms of the Plan, of each award granted hereunder (including, but not limited
to, (x) the restrictions applicable to awards of Restricted Stock or Deferred
Stock and the conditions under which restrictions applicable to such awards of
Restricted Stock or Deferred Stock shall lapse, and (y) the performance goals
and periods applicable to awards of Performance Shares); and

            (e) to determine the terms and conditions, not inconsistent with the
terms of the Plan, which shall govern all written instruments evidencing Stock
Options, Stock Appreciation Rights, awards of Restricted Stock, Deferred Stock
or Performance Shares or any combination of the foregoing granted hereunder.

      The Administrator shall have the authority, in its sole discretion, to
adopt, alter and repeal such administrative rules, guidelines and practices
governing the Plan as it shall from time to time deem advisable; to interpret
the terms and provisions of the Plan and any award issued

                                       3

<PAGE>

under the Plan (and any agreements relating thereto); and to otherwise supervise
the administration of the Plan.

      All decisions made by the Administrator pursuant to the provisions of the
Plan shall be final, conclusive and binding on all persons, including the
Company and the Participants.

SECTION 3. STOCK SUBJECT TO PLAN.

      The total number of shares of Stock reserved and available for issuance
under the Plan shall be 800,000 shares; provided, however, that commencing on
the first day of the Company's fiscal year beginning in calendar year 2005, the
number of shares reserved and available for issuance shall be increased annually
by an amount equal to the lesser of (i) 1,000,000 shares or (ii) two percent
(2%) of the number of outstanding shares of Common Stock on the last day of the
immediately preceding fiscal year. Such shares may consist, in whole or in part,
of authorized and unissued shares or treasury shares. The aggregate number of
shares of Stock as to which Stock Options, Stock Appreciation Rights, and awards
of Restricted Stock, Deferred Stock and Performance Shares may be granted to any
Participant during any calendar year may not, subject to adjustment as provided
in this Section 3, exceed 800,000 shares of Stock reserved for the purposes of
the Plan.

      To the extent that (i) a Stock Option expires or is otherwise terminated
without being exercised, or (ii) any shares of Stock subject to any award of
Restricted Stock, Deferred Stock or Performance Shares granted hereunder are
forfeited, such shares of Stock shall again be available for issuance in
connection with future awards granted under the Plan. If any shares of Stock
have been pledged as collateral for indebtedness incurred by a Participant in
connection with the exercise of a Stock Option and such shares of Stock are
returned to the Company in satisfaction of such indebtedness, such shares of
Stock shall again be available for issuance in connection with future awards
granted under the Plan.

      In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend or other change in corporate structure
affecting the Stock, an equitable substitution or proportionate adjustment shall
be made in (i) the aggregate number of shares of Stock reserved for issuance
under the Plan and the maximum number of shares of Stock that may be granted to
any Participant in any calendar year, (ii) the kind, number and option price of
shares of Stock subject to outstanding Stock Options and Stock Appreciation
Rights granted under the Plan, and (iii) the kind, number and purchase price of
shares of Stock subject to outstanding awards of Restricted Stock, Deferred
Stock and Performance Shares granted under the Plan, in each case as may be
determined by the Administrator, in its sole discretion. Such other
substitutions or adjustments shall be made as may be determined by the
Administrator, in its sole discretion. An adjusted option price shall also be
used to determine the amount payable by the Company upon the exercise of any
Stock Appreciation Right related to any Stock Option. In connection with any
event described in this paragraph, the Administrator may provide, in its sole
discretion, for the cancellation of any outstanding awards and payment in cash
or other property therefor.

                                       4

<PAGE>

SECTION 4. ELIGIBILITY.

      Eligible Recipients shall be eligible to be granted Stock Options, Stock
Appreciation Rights, awards of Restricted Stock, Deferred Stock or Performance
Shares or any combination of the foregoing hereunder. The Participants under the
Plan shall be selected from time to time by the Administrator, in its sole
discretion, from among the Eligible Recipients, and the Administrator shall
determine, in its sole discretion, the number of shares of Stock covered by each
such award.

SECTION 5. STOCK OPTIONS.

      Stock Options may be granted alone or in addition to other awards granted
under the Plan. Any Stock Option granted under the Plan shall be in such form as
the Administrator may from time to time approve, and the provisions of Stock
Option awards need not be the same with respect to each Participant.
Participants who are granted Stock Options shall enter into a subscription
and/or award agreement with the Company, in such form as the Administrator shall
determine, which agreement shall set forth, among other things, the option price
of the Stock Option, the term of the Stock Option and provisions regarding
exercisability of the Stock Option granted thereunder.

      The Stock Options granted under the Plan may be of two types: (i)
Incentive Stock Options and (ii) Non-Qualified Stock Options.

      The Administrator shall have the authority to grant to any officer or
employee of the Company or of any Parent or Subsidiary (including directors who
are also officers of the Company) Incentive Stock Options, Non-Qualified Stock
Options, or both types of Stock Options (in each case with or without Stock
Appreciation Rights). Directors who are not also officers of the Company or of
any Parent or Subsidiary, consultants or advisors to the Company or to any
Parent or Subsidiary may only be granted Non-Qualified Stock Options (with or
without Stock Appreciation Rights). To the extent that any Stock Option does not
qualify as an Incentive Stock Option, it shall constitute a separate
Non-Qualified Stock Option. More than one Stock Option may be granted to the
same Participant and be outstanding concurrently hereunder.

      Stock Options granted under the Plan shall be subject to the following
terms and conditions and shall contain such additional terms and conditions, not
inconsistent with the terms of the Plan, as the Administrator shall deem
desirable:

            (a) Option Price. The option price per share of Stock purchasable
under a Stock Option shall be determined by the Administrator in its sole
discretion at the time of grant but shall not, (i) in the case of Incentive
Stock Options, be less than 100% of the Fair Market Value of the Stock on such
date, (ii) in the case of Non-Qualified Stock Options intended to qualify as
"performance-based compensation" within the meaning of Section 162(m) of the
Code, be less than 100% of the Fair Market Value of the Stock on such date and
(iii) in any event, be less than the par value (if any) of the Stock. If a
Participant owns or is deemed to own (by reason of the attribution rules
applicable under Section 424(d) of the Code) more than 10% of the combined
voting power of all classes of stock of the Company or of any Parent or
Subsidiary and an Incentive Stock Option is granted to such Participant, the
option price of such Incentive Stock Option (to the extent required at the time
of grant by the Code shall be no less than 110% of the Fair Market Value of the
Stock on the date such Incentive Stock Option is granted.

            (b) Option Term. The term of each Stock Option shall be fixed by the
Administrator, but no Stock Option shall be exercisable more than ten years
after the date such Stock Option is granted; provided, however, that if an
employee owns or is deemed to own (by reason of the attribution rules of Section
424(d) of the Code) more than 10% of the combined voting power of all classes of
stock of the Company or of any Parent or Subsidiary and an Incentive Stock
Option is granted to such employee, the term of such

                                       5

<PAGE>

Incentive Stock Option (to the extent required by the Code at the time of grant)
shall be no more than five years from the date of grant.

            (c) Exercisability. Stock Options shall be exercisable at such time
or times and subject to such terms and conditions as shall be determined by the
Administrator at or after the time of grant. The Administrator may provide at
the time of grant, in its sole discretion, that any Stock Option shall be
exercisable only in installments, and the Administrator may waive such
installment exercise provisions at any time, in whole or in part, based on such
factors as the Administrator may determine, in its sole discretion, including
but not limited to in connection with any "change in control" of the Company (as
defined in the agreement evidencing such Stock Option).

            (d) Method of Exercise. Subject to paragraph (c) of this Section 5,
Stock Options may be exercised in whole or in part at any time during the option
period, by giving written notice of exercise to the Company specifying the
number of shares of Stock to be purchased, accompanied by payment in full of the
purchase price in cash or its equivalent, as determined by the Administrator. As
determined by the Administrator, in its sole discretion, payment in whole or in
part may also be made (i) by means of any cashless exercise procedure approved
by the Administrator, (ii) in the form of unrestricted Stock already owned by
the Participant which, (x) in the case of unrestricted Stock acquired upon
exercise of an option, have been owned by the Participant for more than six
months on the date of surrender, and (y) has a Fair Market Value on the date of
surrender equal to the aggregate option price of the Stock as to which such
Stock Option shall be exercised and the minimum statutory withholding taxes with
respect thereto, (iii) any other form of consideration approved by the
Administrator and permitted by applicable law or (iv) any combination of the
foregoing. A Participant shall generally have the rights to dividends and any
other rights of a stockholder with respect to the Stock subject to the Stock
Option only after the Participant has given written notice of exercise, has paid
in full for such shares, and, if requested, has given the representation
described in paragraph (b) of Section 10 below.

            Notwithstanding anything to the contrary contained herein, a Stock
Option may not be exercised for a fraction of a share of Stock.

            The Administrator may require the surrender of all or a portion of
any Stock Option granted under the Plan as a condition precedent to the grant of
a new Stock Option. Subject to the provisions of the Plan, such new Stock Option
shall be exercisable at the price, during such period and on such other terms
and conditions as are specified by the Administrator

                                       6

<PAGE>

at the time the new Stock Option is granted. Consistent with the provisions of
Section 162(m), to the extent applicable, upon their surrender, Stock Options
shall be canceled and the shares of Stock previously subject to such canceled
Stock Options shall again be available for future grants of Stock Options and
other awards hereunder.

            (e) Non-Transferability of Options. Except under the laws of descent
and distribution or as otherwise permitted by the Administrator, the Participant
shall not be permitted to sell, transfer, pledge or assign any Option, and all
Options shall be exercisable, during the Participant's lifetime, only by the
Participant; provided, however, that the Participant shall be permitted to
transfer one or more Non-Qualified Stock Options to a trust, partnership,
limited liability company or corporation (or other entity approved by the
Administrator in its sole discretion) controlled by the Participant during the
Participant's lifetime for estate planning purposes.

            (f) Termination of Employment or Service. If a Participant's
employment with or service as a director, consultant or advisor to the Company
or to any Parent or Subsidiary terminates by reason of his or her death,
Disability or for any other reason, the Stock Option may thereafter be exercised
to the extent provided in the agreement evidencing such Stock Option, or as
otherwise determined by the Administrator.

            (g) Annual Limit on Incentive Stock Options. To the extent that the
aggregate Fair Market Value (determined as of the date the Incentive Stock
Option is granted) of shares of Stock with respect to which Incentive Stock
Options granted to a Participant under this Plan and all other option plans of
the Company or of any Parent or Subsidiary become exercisable for the first time
by the Participant during any calendar year exceeds $100,000 (as determined in
accordance with Section 422(d) of the Code), the portion of such Incentive Stock
Options in excess of $100,000 shall be treated as Non-Qualified Stock Options.

SECTION 6. STOCK APPRECIATION RIGHTS.

      Stock Appreciation Rights may be granted either alone ("Free Standing
Rights") or in conjunction with all or part of any Stock Option granted under
the Plan ("Related Rights"). In the case of a Non-Qualified Stock Option,
Related Rights may be granted either at or after the time of the grant of such
Stock Option. In the case of an Incentive Stock Option, Related Rights may be
granted only at the time of the grant of the Incentive Stock Option. The
Administrator shall determine the Eligible Recipients to whom, and the time or
times at which, grants of Stock Appreciation Rights shall be made; the number of
shares of Stock to be awarded, the exercise price, and all other conditions of
Stock Appreciation Rights. The provisions of Stock Appreciation Rights need not
be the same with respect to each Participant.

      Stock Appreciation Rights granted under the Plan shall be subject to the
following terms and conditions and shall contain such additional terms and
conditions, not inconsistent with the terms of the Plan, as the Administrator
shall deem desirable:

            (a) Awards. The prospective recipient of a Stock Appreciation Right
shall not have any rights with respect to such award, unless and until such
recipient has executed an agreement evidencing the award (a "Stock Appreciation
Right Agreement") and delivered a fully

                                       7

<PAGE>

executed copy thereof to the Company, within a period of sixty days (or such
other period as the Administrator may specify) after the award date.
Participants who are granted Stock Appreciation Rights shall have no rights as
stockholders of the Company with respect to the grant or exercise of such
rights.

            (b) Exercisability.

                  (i) Stock Appreciation Rights that are Free Standing Rights
            ("Free Standing Stock Appreciation Rights") shall be exercisable at
            such time or times and subject to such terms and conditions as shall
            be determined by the Administrator at or after grant; provided,
            however, that no Free Standing Stock Appreciation Right shall be
            exercisable during the first six months of its term, except that
            this additional limitation shall not apply in the event of a
            Participant's death or Disability prior to the expiration of such
            six-month period.

                  (ii) Stock Appreciation Rights that are Related Rights
            ("Related Stock Appreciation Rights") shall be exercisable only at
            such time or times and to the extent that the Stock Options to which
            they relate shall be exercisable in accordance with the provisions
            of Section 5 above and this Section 6 of the Plan; provided,
            however, that a Related Stock Appreciation Right granted in
            connection with an Incentive Stock Option shall be exercisable only
            if and when the Fair Market Value of the Stock subject to the
            Incentive Stock Option exceeds the option price of such Stock
            Option; provided, further, that no Related Stock Appreciation Right
            shall be exercisable during the first six months of its term, except
            that this additional limitation shall not apply in the event of a
            Participant's death or Disability prior to the expiration of such
            six-month period.

            (c) Payment Upon Exercise.

                  (i) Upon the exercise of a Free Standing Stock Appreciation
            Right, the Participant shall be entitled to receive up to, but not
            more than, an amount in cash or that number of shares of Stock (or
            any combination of cash and shares of Stock) equal in value to the
            excess of the Fair Market Value of one share of Stock as of the date
            of exercise over the price per share specified in the Free Standing
            Stock Appreciation Right (which price shall be no less than 100% of
            the Fair Market Value of the Stock on the date of grant) multiplied
            by the number of shares of Stock in respect of which the Free
            Standing Stock Appreciation Right is being exercised, with the
            Administrator having the right to determine the form of payment.

                  (ii) A Related Right may be exercised by a Participant by
            surrendering the applicable portion of the related Stock Option.
            Upon such exercise and surrender, the Participant shall be entitled
            to receive up to, but not more than, an amount in cash or that
            number of shares of Stock (or any combination of cash and shares of
            Stock) equal in value to the excess of the Fair Market Value of one
            share of Stock as of the date of exercise over the option price per
            share specified in the related Stock Option multiplied by the number
            of shares of Stock in respect of

                                       8

<PAGE>

            which the Related Stock Appreciation Right is being exercised, with
            the Administrator having the right to determine the form of payment.
            Stock Options which have been so surrendered, in whole or in part,
            shall no longer be exercisable to the extent the Related Rights have
            been so exercised.

            (d) Non-Transferability.

                  (i) Free Standing Stock Appreciation Rights shall be
            transferable only when and to the extent that a Stock Option would
            be transferable under Section 5 of the Plan.

                  (ii) Related Stock Appreciation Rights shall be transferable
            only when and to the extent that the underlying Stock Option would
            be transferable under Section 5 of the Plan.

            (e) Termination of Employment or Service.

                  (i) In the event of the termination of employment or service
            of a Participant who has been granted one or more Free Standing
            Stock Appreciation Rights, such rights shall be exercisable at such
            time or times and subject to such terms and conditions as shall be
            determined by the Administrator at or after grant.

                  (ii) In the event of the termination of employment or service
            of a Participant who has been granted one or more Related Stock
            Appreciation Rights, such rights shall be exercisable at such time
            or times and subject to such terms and conditions as set forth in
            the related Stock Options.

            (f) Term.

                  (i) The term of each Free Standing Stock Appreciation Right
            shall be fixed by the Administrator, but no Free Standing Stock
            Appreciation Right shall be exercisable more than ten years after
            the date such right is granted.

                  (ii) The term of each Related Stock Appreciation Right shall
            be the term of the Stock Option to which it relates, but no Related
            Stock Appreciation Right shall be exercisable more than ten years
            after the date such right is granted.

SECTION 7. RESTRICTED STOCK, DEFERRED STOCK AND PERFORMANCE SHARES.

      Awards of Restricted Stock, Deferred Stock or Performance Shares may be
issued either alone or in addition to other awards granted under the Plan. The
Administrator shall determine the Eligible Recipients to whom, and the time or
times at which, awards of Restricted Stock, Deferred Stock or Performance Shares
shall be made; the number of shares to be awarded; the price, if any, to be paid
by the Participant for the acquisition of Restricted Stock, Deferred Stock or
Performance Shares; the Restricted Period (as defined in paragraph (b) of this
Section 7) applicable to awards of Restricted Stock or Deferred Stock; the
performance objectives applicable to awards of Deferred Stock or Performance
Shares; and all other conditions of the awards of Restricted Stock, Deferred
Stock and Performance Shares. Subject to the requirements

                                       9

<PAGE>

of Section 162(m) of the Code, as applicable, the Administrator may also
condition the grant of the award of Restricted Stock, Deferred Stock or
Performance Shares upon the exercise of Stock Options, or upon such other
criteria as the Administrator may determine, in its sole discretion. The
provisions of the awards of Restricted Stock, Deferred Stock or Performance
Shares need not be the same with respect to each Participant.

            (a) Awards and Certificates. The prospective recipient of awards of
Restricted Stock, Deferred Stock or Performance Shares shall not have any rights
with respect to any such award, unless and until such recipient has executed an
agreement evidencing the award (a "Restricted Stock Award Agreement," "Deferred
Stock Award Agreement" or "Performance Shares Award Agreement," as appropriate)
and delivered a fully executed copy thereof to the Company, within a period of
sixty days (or such other period as the Administrator may specify) after the
award date. Except as otherwise provided below in this Section 7(b), (i) each
Participant who is granted an award of Restricted Stock or Performance Shares
shall be issued a stock certificate (or issued shares in book entry form) in
respect of such shares of Restricted Stock or Performance Shares; and (ii) such
certificate shall be registered in the name of the Participant, and shall bear
an appropriate legend referring to the terms, conditions, and restrictions
applicable to any such award.

      The Company may require that the stock certificates evidencing Restricted
Stock or Performance Shares granted hereunder be held in the custody of the
Company until the restrictions thereon shall have lapsed, and that, as a
condition of any award of Restricted Stock or Performance Shares, the
Participant shall have delivered a stock power, endorsed in blank, relating to
the Stock covered by such award.

      With respect to awards of Deferred Stock, at the expiration of the
Restricted Period, stock certificates in respect of such shares of Deferred
Stock shall be delivered to the Participant, or his legal representative, in a
number equal to the number of shares of Stock covered by the Deferred Stock
award.

            (b) Restrictions and Conditions. The awards of Restricted Stock,
Deferred Stock and Performance Shares granted pursuant to this Section 7 shall
be subject to the following restrictions and conditions:

                  (i) Subject to the provisions of the Plan and the Restricted
            Stock Award Agreement, Deferred Stock Award Agreement or Performance
            Shares Award Agreement, as appropriate, governing any such award,
            during such period as may be set by the Administrator commencing on
            the date of grant (the "Restricted Period"), the Participant shall
            not be permitted to sell, transfer, pledge or assign shares of
            Restricted Stock, Deferred Stock or Performance Shares awarded under
            the Plan; provided, however, that the Administrator may, in its sole
            discretion, provide for the lapse of such restrictions in
            installments and may accelerate or waive such restrictions in whole
            or in part based on such factors and such circumstances as the
            Administrator may determine, in its sole discretion, including, but
            not limited to, the attainment of certain performance related goals,
            the Participant's termination of employment or service as a
            director, consultant or advisor to the Company or any Parent or
            Subsidiary, the Participant's death or

                                       10

<PAGE>

            Disability or the occurrence of a "change in control" as defined in
            the Restricted Stock Award Agreement, Deferred Stock Award Agreement
            or Performance Shares Award Agreement, as appropriate, evidencing
            such award.

                  (ii) Except as provided in paragraph (b)(i) of this Section 7,
            the Participant shall generally have the rights of a stockholder of
            the Company with respect to Restricted Stock or Performance Shares
            during the Restricted Period. The Participant shall generally not
            have the rights of a stockholder with respect to Stock subject to
            awards of Deferred Stock during the Restricted Period; provided,
            however, that dividends declared during the Restricted Period with
            respect to the number of shares of Stock covered by Deferred Stock
            shall be paid to the Participant. Certificates for shares of
            unrestricted Stock shall be delivered to the Participant promptly
            after, and only after, the Restricted Period shall expire without
            forfeiture in respect of such awards of Restricted Stock, Deferred
            Stock or Performance Shares except as the Administrator, in its sole
            discretion, shall otherwise determine.

                  (iii) The rights of Participants granted awards of Restricted
            Stock, Deferred Stock or Performance Shares upon termination of
            employment or service as a director, consultant or advisor to the
            Company or to any Parent or Subsidiary terminates for any reason
            during the Restricted Period shall be set forth in the Restricted
            Stock Award Agreement, Deferred Stock Award Agreement or Performance
            Shares Award Agreement, as appropriate, governing such awards.

            (c) Tax Withholding. Upon the expiration of the Restricted Period
for any Restricted Stock, Deferred Stock or Performance Shares award, a
Participant may pay the Company, in cash, an amount equal to all applicable
withholding taxes or surrender already owned shares of Stock or forego delivery
of shares of Stock due as a result of such expiration of the Restricted Period
in order to pay any withholding tax required to be collected upon such
expiration. Any such Stock so surrendered or foregone shall be valued at its
Fair Market Value as of the date of such expiration of the Restricted Period.

SECTION 8. AMENDMENT AND TERMINATION.

      The Board may amend, alter or discontinue the Plan, or any part thereof,
and the Board or the Administrator may amend the terms of any Award theretofore
granted, prospectively or retroactively; provided, however, that subject to
Section 3 of the Plan, no such amendment to any existing Award shall impair the
rights of any Participant without his or her consent; and provided further that
no such amendment, alteration or discontinuation of the Plan or any existing
Award shall be made, without the approval of the stockholders that would:

            (a) except as provided in Section 3 of the Plan, increase the total
number of shares of Stock reserved for issuance under the Plan;

            (b) change the class of officers, directors, employees, consultants
and advisors eligible to participate in the Plan;

                                       11

<PAGE>

            (c) extend the maximum option period under paragraph (b) of Section
5 of the Plan;

            (d) reduce the exercise price of Stock Options previously awarded to
any Participant, whether through amendment, cancellation and replacement grant,
or any other means; or

            (e) require stockholder approval in order to comply with the Code,
Federal or state securities laws, or any other applicable laws, rules or
regulations, including those of any stock exchange on which the Company's common
stock may be listed.

SECTION 9. UNFUNDED STATUS OF PLAN.

      The Plan is intended to constitute an "unfunded" plan for incentive
compensation. With respect to any payments not yet made to a Participant by the
Company, nothing contained herein shall give any such Participant any rights
that are greater than those of a general creditor of the Company.

SECTION 10. GENERAL PROVISIONS.

            (a) Shares of Stock shall not be issued pursuant to the exercise of
any award granted hereunder unless the exercise of such award and the issuance
and delivery of such shares of Stock pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act of
1933, as amended, the Exchange Act and the requirements of any stock exchange
upon which the Stock may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance.

            (b) The Administrator may require each person acquiring shares of
Stock hereunder to represent to and agree with the Company in writing that such
person is acquiring the shares of Stock without a view to distribution thereof.
The certificates for such shares of Stock may include any legend which the
Administrator deems appropriate to reflect any restrictions on transfer.

            All certificates for shares of Stock delivered under the Plan shall
be subject to such stop-transfer orders and other restrictions as the
Administrator may deem advisable under the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange upon
which the Stock is then listed, and any applicable Federal or state securities
law, and the Administrator may cause a legend or legends to be placed on any
such certificates to make appropriate reference to such restrictions.

            (c) Nothing contained in the Plan shall prevent the Board from
adopting other or additional compensation arrangements, subject to stockholder
approval, if such approval is required; and such arrangements may be either
generally applicable or applicable only in specific cases. The adoption of the
Plan shall not confer upon any Eligible Recipient any right to continued
employment or service with the Company or any Parent or Subsidiary, as the case
may be, nor shall it interfere in any way with the right of the Company or any
Parent or Subsidiary to terminate the employment or service of any of its
Eligible Recipients at any time.

                                       12

<PAGE>

            (d) Each Participant shall, no later than the date as of which the
value of an award first becomes includible in the gross income of the
Participant for Federal income tax purposes, pay to the Company, or make
arrangements satisfactory to the Administrator regarding payment of, any
Federal, state, or local taxes of any kind required by law to be withheld with
respect to such award. The obligations of the Company under the Plan shall be
conditional on the making of such payments or arrangements, and the Company
shall, to the extent permitted by law, have the right to deduct any such taxes
from any payment of any kind otherwise due to the Participant.

            (e) No member of the Board or the Administrator, nor any officer or
employee of the Company acting on behalf of the Board or the Administrator,
shall be personally liable for any action, determination, or interpretation
taken or made in good faith with respect to the Plan, and all members of the
Board or the Administrator and each and any officer or employee of the Company
acting on their behalf shall, to the extent permitted by law, be fully
indemnified and protected by the Company in respect of any such action,
determination or interpretation.

SECTION 11. STOCKHOLDER APPROVAL; EFFECTIVE DATE OF PLAN.

            (a) The grant of any award hereunder shall be contingent upon
stockholder approval of the Plan being obtained within 12 months before or after
the date the Board adopts the Plan.

            (b) Subject to the approval of the Plan by the stockholders of the
Company within twelve (12) months before or after the date the Plan is adopted
by the Board, the Plan shall be effective as of the date and time on which the
Securities and Exchange Commission declares the Company's Registration Statement
effective (the "Effective Date").

SECTION 12. TERM OF PLAN.

      No Stock Option, Stock Appreciation Right, or awards of Restricted Stock,
Deferred Stock or Performance Shares shall be granted pursuant to the Plan on or
after the tenth anniversary of the Effective Date, but awards theretofore
granted may extend beyond that date.

As amended by the Board of Directors at its meeting on October 26, 2006 to
revise Sections 2 and 8 to prohibit repricing without stockholder consent, and
to add Section 7(c) to provide for the delivery by the Participant of Stock or
cash to pay applicable withholding taxes associated with the vesting of
Restricted Stock, Deferred Stock or Performance Shares awards.

                                       13

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