Document:

Document

Certain information in this document has been excluded pursuant to Regulation S-K, Item 601(b)(10). Such excluded information is not material and would likely cause competitive harm to the registrant if publicly disclosed.

Exhibit 10.3
ELECTRIC VEHICLE FLEET PURCHASE AGREEMENT

This ELECTRIC VEHICLE FLEET PURCHASE AGREEMENT (hereinafter “AGREEMENT”) is made and entered into on July 11, 2022 (“EFFECTIVE DATE”) by and between Walmart Inc., a Delaware Corporation (hereinafter “WALMART”), and Canoo Sales, LLC., a Delaware Corporation (hereinafter “CANOO”).  WALMART and CANOO may each be referred to herein as a “PARTY” or collectively as the “PARTIES”.

RECITALS

WHEREAS, WALMART is a retailer of consumer products with a logistics program enabling localized delivery of goods by truck and automobile to customers on behalf of itself and third-party retailers.

WHEREAS, CANOO is a technology company which has developed a unique brand of electric-powered vehicles that Walmart has an interest in utilizing for purposes of its logistics program.

WHEREAS, WALMART desires to purchase from CANOO, and CANOO desires to sell to WALMART, a fleet of at least four thousand five hundred (4,500) CANOO VEHICLES (as defined below) over a five-year period pursuant to the pricing and other terms and conditions specified herein.

NOW, THEREFORE, in consideration of the mutual covenants and conditions hereof, and the payments to be made hereunder, the parties hereby agree as follows:

TERMS AND CONDITIONS

SECTION 1.  DEFINITIONS. 
For purposes of this AGREEMENT, the following terms shall have the meanings ascribed to them below.  Other defined terms not included in this section are defined elsewhere in the body of the AGREEMENT.

a.“AFFILIATE” shall mean any entity which owns or controls, is owned or controlled by, or is under common ownership or control with a PARTY. For purposes of this Agreement, control shall mean the ability to exercise, directly or indirectly, more than 50% of the voting rights attributable to the shares of the controlled corporation.
b.“ACCEPTANCE” shall mean WALMART’s acceptance of VEHICLE(s) duly DELIVERED in accordance with Section 4.c. of this AGREEMENT.

c.“CONTRACT DOCUMENTS” shall mean this AGREEMENT, its exhibits, CHANGE ORDERS, written amendments, and any other documents that are incorporated by reference or expressly made part of this AGREEMENT.

d.“CHANGE ORDER” shall mean a signed written instrument executed by both WALMART and by CANOO stating their mutual agreement to modify the quantity, quality, or other aspect of the VEHICLES purchased pursuant to a PURCHASE ORDER. 

e.“DELIVERY” shall mean the physical delivery of VEHICLES in conformity with applicable SPECIFICATIONS to a DELIVERY LOCATION (as defined in Section 6), as designated by WALMART, ready for ACCEPTANCE.

			
	

			
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f.“DELIVERY SCHEDULE” shall mean the timeframe(s) and location(s) for CANOO to deliver VEHICLES to WALMART pursuant to this AGREEMENT, which shall be reflected in Exhibit “C” the terms of which are herein incorporated by this reference.

g.“NONCONFORMING VEHICLE” shall mean any VEHICLE received from CANOO pursuant to a PURCHASE ORDER that does not fully conform to the SPECIFICATONS. Where the context requires, NONCONFORMING VEHICLES are deemed to be VEHICLES for purposes of this AGREEMENT.

h.“PAYMENT SCHEDULE” shall mean the timeframe for WALMART to make payments to CANOO for its DELIVERY of VEHICLES pursuant to this AGREEMENT, which shall be reflected in Exhibit “B” the terms of which are herein incorporated by this reference.

i.“PURCHASE ORDER” shall mean WALMART’s written submission of a request to purchase a specific model and quantity of VEHICLES within the total quantity(s) allowed under this AGREEMENT.  Such PURCHASE ORDERS shall substantially conform to the format attached hereto as Exhibit “D”. 

j.“RESIDUAL VALUE (RV)” shall mean the resale value of the vehicle after use which includes a depreciation factor to account for model year, normal driving conditions, battery depreciation, and average miles used.  The residual value may vary depending on the use case, miles logged and condition of the vehicle upon return. The guiding [***] after [***] and [***] will be between [***] MSRP. Due to very limited availability of market data, both parties review the market development after [***].

k.“SPECIFICATIONS” shall mean all the dimensions, quantities, provisions, and requirements describing the VEHICLE(s) under purchase as listed in Exhibit “A” and any applicable CHANGE ORDERS.

l.“VEHICLE(s)” shall mean the vehicles, as contemplated by the SPECIFICATIONS, including [***] to be manufactured and delivered by CANOO, and purchased by WALMART hereunder pursuant to the SPECIFICATIONS. 

SECTION 2.  VEHICLE PRODUCTION AND CHANGE ORDERS.

a.CANOO agrees to design, build, sell, and deliver to WALMART and Walmart agrees to purchase at least four thousand five hundred (4,500) VEHICLE(s) as particularly described by the SPECIFICATIONS over a five (5) year period commencing on the EFFECTIVE DATE.

b.WALMART shall specify the actual quantity of VEHICLES it desires to purchase at any given time under this AGREEMENT through the submission of PURCHASE ORDERS throughout the period of five (5) years from the EFFECTIVE DATE.

c.Each PARTY has the right to request a quality or quantity variation to PURCHASE ORDER by providing a written notice to the other PARTY within [***] after a PURCHASE ORDER is duly accepted by CANOO providing reasonable details of the requested change.  The PARTY receiving a requested change will promptly respond to such request in writing, but in any event, within [***] after receipt thereof, indicating whether or not it accepts the requested change and its good faith estimate of the effects of the change. Neither PARTY shall be obligated to accept any quality or quantity variation.  For purposes of clarity, no requested change will be implemented or binding on the PARTIES unless and until the CHANGE ORDER has been signed by both PARTIES. 

SECTION 3. PRICE AND PAYMENT. 

a.In consideration of delivering and transferring title to the VEHICLE(s) to WALMART in conformity with the SPECIFICATIONS and DELIVERY SCHEDULE in compliance with any applicable CHANGE ORDERS, WALMART agrees to pay an amount not to exceed [***] per VEHICLE (inclusive of taxes and other applicable fees) (“UNIT PRICE CAP”) for up to a total 
			
	

			
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of four thousand five hundred (4,500) VEHICLES. The actual VEHICLE purchase price shall depend on the model ordered via PURCHASE ORDER.

b.WALMART shall also have the option, at its sole discretion, to purchase up to an additional five thousand five hundred (5,500) VEHICLES at the UNIT PRICE CAP pursuant to a delivery schedule yet to be negotiated, but otherwise upon the same general terms and conditions as set forth in this AGREEMENT.  

c.For all VEHICLES purchased at or below the UNIT PRICE CAP pursuant to this AGREEMENT, there shall be [***].

d.Invoices shall be tendered to WALMART pursuant to the protocols described in Section 10.

e.Payment shall be made pursuant to the PAYMENT SCHEDULE attached as Exhibit “B”.

SECTION 4. DELIVERY; TITLE TRANSFER; AND INSPECTION. 

a.The PARTIES agree that PURCHASE ORDERS in conjunction with the DELIVERY SCHEDULE shall govern the timeframe for DELIVERY of VEHICLES hereunder. WALMART shall grant CANOO reasonable extension(s) for CANOO to comply with the DELIVERY SCHEDULE due to delays caused by WALMART or delays caused by a Force Majeure Event, and such extension(s) shall last only as long as the actual delay caused by WALMART or such Force Majeure Event.  

b.CANOO shall convey title of the VEHICLE(S) to WALMART upon CANOO’s tender of such VEHICLE(S) under any PURCHASE ORDER to [***] selected by [***]. For the avoidance of doubt, title to the VEHICLES shipped under any PURCHASE ORDER passes to WALMART upon [***] of the VEHICLES [***] (i.e., FOB [***]). 

c.WALMART shall have [***]to perform an inspection of every VEHICLE following DELIVERY and prior to ACCEPTANCE (the “INSPECTION PERIOD”). During the INSPECTION PERIOD, WALMART shall either accept or, only if any such VEHICLE is a NONCONFORMING VEHICLE, reject such VEHICLE. WALMART will be deemed to have accepted the VEHICLES unless it provides CANOO with written notice that any NONCONFORMING within [***]  following the INSPECTION PERIOD. If, due to the DELIVERY SCHEDULE, an inspection cannot be performed contemporaneous with DELIVERY, WALMART will take provisional ACCEPTANCE of the VEHICLE(s) without waiving the right to reject DELIVERY due to failure to comply with any SPECIFICATIONS.

d.CANOO agrees and covenants to execute all documents that are necessary to finalize transfer of title and registration upon the VEHICLE(s) to WALMART.  Upon DELIVERY of VEHICLES, CANOO shall provide the training consistent with the protocol described in DELIVERY SCHEDULE.

SECTION 5. TERM OF AGREEMENT. 

This AGREEMENT shall commence immediately upon mutual execution and shall continue for five (5) years, unless extended by mutual agreement in writing. CANOO’s obligations under this AGREEMENT will continue beyond the conclusion or termination of this AGREEMENT with respect to any VEHICLES ordered but not delivered prior to the conclusion or termination of this AGREEMENT, unless otherwise agreed in writing by WALMART.

SECTION 6. F.O.B. DELIVERY. 

CANOO shall, [***], transport any VEHICLE(s) called for within the CONTRACT DOCUMENTS to WALMART’S designated DELIVERY location(s) in Exhibit “C” (“DELIVERY LOCATIONS”).  Any and all risk of loss, damage or injury to the VEHICLE shall transfer to WALMART [***] for 
			
	

			
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that VEHICLE. CANOO, will coordinate the shipping of the VEHICLE to WALMART via [***]. The PARTIES agree that risk of loss to the VEHICLES shipped under a PURCHASE ORDER passes to WALMART [***] (i.e., FOB [***]). At all times prior to Delivery, the VEHICLE will be fully insured by [***] in accordance with the terms of this AGREEMENT.  

SECTION 7.  CONDITION OF TITLE AND GOODS.

CANOO represents that it owns the VEHICLE(s) free and clear of all liens and encumbrances and that it has the authority and shall convey good and marketable title to the VEHICLE(s). The VEHICLE(s) delivered shall conform in all respects to the SPECIFICATIONS. Any VEHICLE(s) purchased by WALMART pursuant to a PURCHASE ORDER shall be new and warranted to be fit for the purposes specified in the SPECIFICATIONS and any ordinary purposes for which the VEHICLES are intended to be used, including, without limitation, fit to be driven safely on the roads for the duration(s) as provided for in the SPECIFICATIONS. In the event any VEHICLE(s) delivered with [***], and even though the VEHICLE(s) [***], CANOO shall, [***]. 

SECTION 8.  VEHICLE WARRANTY; MAINTENANCE AND RECALLS.

a.CANOO sells the VEHICLE(s) with a MPP1 powertrain (skateboard) warranty for [***]), a Battery warranty of [***]and a “Top Hat” warranty covering [***] for a period of [***] (collectively “WARRANTY”). The WARRANTY covers the [***]to ensure that the VEHICLE(s) is/are mechanically operational, sound and up to SPECIFICATION.  The term of the WARRANTY shall be  [***]. [***].

b.To the extent a VEHICLE will require software updates, [***] period, CANOO [***].  

c. IN ADDITION TO ALL OTHER RIGHTS AND REMEDIES UNDER THIS AGREEMENT, IF, AFTER A REASONABLE NUMBER OF ATTEMPTS, CANOO, OR ITS AGENT IS UNABLE TO REPAIR OR CORRECT ANY NON-CONFORMITY, DEFECT, OR CONDITION WHICH RESULTS, IN EACH CASE, [***] CANOO [***] 

d.The WARRANTY and any other express warranties with respect to the VEHICLES contained in this AGREEMENT do not apply to any VEHICLE that has been damaged by being (i) [***]. Notwithstanding the foregoing [***] for which the VEHICLES will be deployed shall not void the WARRANTY or any other express warranties with respect to the VEHICLES contained in this AGREEMENT.

e.Upon the occurrence of a RECALL (as defined below) or recurring defect or non-conformity (as described in Section 8.d) involving the VEHICLES, the PARTIES agree that they shall share with each other such information as is necessary or appropriate to facilitate RECALL efforts and efforts to address such recurring defects or non-conformities, subject to the requirement of applicable laws.  The PARTIES shall cooperate reasonably in connection with any such RECALL or effort to address a recurring defects.  For purposes of this AGREEMENT, “RECALL” shall mean a determination by a governmental authority or by CANOO that a VEHICLE contains a defect related to motor vehicle safety, emissions compliance or otherwise fails to comply with applicable laws, such that a recall is necessary under applicable laws.

SECTION 9. INDEMNIFICATION. 

a. Each Party and their Affiliates, officers, employees, agents, representatives, collectively an “Indemnifying Party” subject to the terms and condition set forth herein shall indemnify, defend, release and save and hold harmless the other PARTY, its officers, employees, agents, representatives Affiliates, and all their respective officers, board, employees, agents and contractors (“the Indemnified Party”) from and against any and all (1) damages, including but not limited to loss of use, to property or injuries to or death of any person or persons, and (2) claims, demands, suits, actions, liabilities, costs, expenses (including but not limited to reasonable attorney fees, expert witness fees and all associated defense fees), 
			
	

			
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causes of action, or other legal, equitable or administrative proceedings of any kind or nature whatsoever (collectively, “LOSSES”), of or by any third-party, regardless of the legal theories upon which premised, including but not limited to contract, tort, express and/or implied warranty, strict liability, and worker’s compensation, in any way resulting from, connected with, or arising out of, directly or indirectly, a breach of this AGREEMENT and any of the CONTRACT DOCUMENTS, the tortious or negligent actions or omissions of the Indemnifying Party  in connection with the operations or performance of this AGREEMENT, including actions or omissions of sub-contractors, and the acts or omissions, of the officers, employees, agents, representatives, of CANOO; provided however, that the Indemnifying Party need not indemnify the Indemnified Party from the damages proximately caused by and apportioned to the negligence of the Indemnified Party. This indemnity clause shall not cover the Indemnified Party’s defense costs in the event the Indemnified Party, in its sole discretion, elects to provide its own defense. CANOO shall obtain, at its own expense, any additional insurance that it deems necessary to meet its obligations under of this Section 9(a). This defense and indemnification obligation shall survive the expiration or termination of this AGREEMENT.

SECTION 10. ORDER ACKNOWLEDGEMENT. 

CANOO shall provide written acknowledgment within [***] of WALMART’s submission of any PURCHASE ORDER. Such written acknowledgment shall contain a description of the order and an invoice for the price(s) associated with the order.  Such invoice(s) shall be paid pursuant to the terms of the PAYMENT SCHEDULE. If CANOO receives an order from WALMART on a Friday or holiday, then the acknowledgement shall be sent to WALMART the next business day. 

Written acknowledgement shall be sent via email to the following WALMART personnel:

[***]
SECTION 11. NOTICES. 
Other than order acknowledgments as specified above, any and all notices required to be given by either of the PARTIES shall be in writing and deemed delivered when either:

a.Delivered personally to the contact at the address below; or

b.Sent by email to the other party at the email address set forth below; or

c.Deposited in the United States Mail via certified, return receipt requested, postage pre-paid mail, addressed to the other party at the address set forth below; or

d.Transmitted by other facsimile number or mailing address as may be provided by written notice of such change given to the other in the same manner as provided above.
FOR WALMART:    Walmart Supply Chain Engineering – Last Mile Innovation
    702 SW 8th Street
        Bentonville, AR 72716
    ATTN: [***] n

    With copy to:
    [***]
    
    Walmart Legal – Last Mile
    702 SW 8th Street
			
	

			
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    Bentonville, AR 72716

FOR CANOO:              Canoo Inc.
15520 Highway 114, Suite 2C
Justin, Texas 76247
Attention: Legal Department

Email:     [***]

SECTION 12. SUBMITTALS. 

All VEHICLE(s) submittal documentation that may be required by this AGREEMENT shall include applicable purchase order numbers and other key identifying details and shall appear, to the extent practicable, on all acknowledgements, shipping labels, packing lists, and invoices.

SECTION 13.  DELIVERY OF MANUALS. 

All manuals relating to VEHICLE(s) shall be submitted to WALMART prior to, at the time of or promptly following such VEHICLE DELIVERY.  WALMART shall, upon written request, be entitled to a preview of the general VEHICLE manuals in a form and manner of DELIVERY mutually agreed by the PARTIES.

SECTION 14. INTENT OF AGREEMENT. 

It is the intent of the PARTIES by the execution of this AGREEMENT, which is integrated and incorporated as part of the CONTRACT DOCUMENTS, to adequately set forth the full agreement between the parties for the sale and purchase of the VEHICLE(s).

SECTION 15.  MULTIPLE DOCUMENTS. 

The PARTIES agree that all CONTRACT DOCUMENTS are essential parts to the complete agreement between WALMART and CANOO. A requirement occurring in one is as binding as though occurring in all. The documents are intended to be complementary.

SECTION 16. BINDING EFFECT. 

Upon the execution of this AGREEMENT by the PARTIES, it shall be binding upon and inure to the benefit of the PARTIES, their AFFILIATES, successors, and assigns.

SECTION 17. ENTIRE AGREEMENT AND MODIFICATION. 

This AGREEMENT and the CONTRACT DOCUMENTS constitute the entire understanding between the PARTIES with respect to this transaction, and cancel and supersede all prior agreements, understandings, communications, or negotiations between the PARTIES, including but not limited to any letters of intent. Any modification to the AGREEMENT or CONTRACT DOCUMENTS must be in writing and signed by both PARTIES.

SECTION 18. ASSIGNMENT. 

No order or any interest in this AGREEMENT shall be transferred by a PARTY without the written approval of the other PARTY, which shall not be unreasonably withheld, conditioned or delayed. Notwithstanding the foregoing, either PARTY may assign this AGREEMENT at its discretion to one of its AFFILIATES without the consent of the other PARTY.

			
	

			
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SECTION 19. EXCLUSIVITY.  

As of the EFFECTIVE DATE, and continuing thereafter for a period equal to the duration of this AGREEMENT, unless earlier terminated by WALMART for any reason under Section 23, CANOO agrees that:

a.It will not engage in discussions with, negotiate into any agreement with, or actually provide in the absence of an agreement with Amazon.com, Inc.  its subsidiaries or AFFILIATES (“AMAZON”), any services involving the design, manufacture, consult, advice, lease, or sale of electric vehicles; and 

b.It will not issue any equity, equity-linked or debt securities of any type to AMAZON or enter into any agreement for purposes of providing AMAZON control over CANOO. 

SECTION 20.  ACQUISITION PROPOSALS.

a.In the event that CANOO receives an ACQUISITION PROPOSAL, or CANOO’s board of directors (“BOARD”) authorizes CANOO or any of its officers, representatives or agents to initiate or pursue an ACQUISITION PROPOSAL, within seventy-two (72) hours after receipt of such offer by CANOO or such authorization by the BOARD, as applicable, CANOO will provide WALMART with written notice (the “ACQUISITION PROPOSAL NOTICE”), which indicates solely that CANOO has received or been authorized by the BOARD to initiate or pursue an ACQUISITION PROPOSAL, as applicable; provided that if the ACQUISITION PROPOSAL received or authorized by the BOARD is with a Person listed on Exhibit “E” hereto (each such Person, a “RESTRICTED PARTY”), CANOO will be required to disclose the name of the particular RESTRICTED PARTY engaged in the ACQUISITION PROPOSAL, without being required to provide any further detail. For the avoidance of doubt, CANOO will not be required to provide any further information with respect to such ACQUISITION PROPOSAL, including, without limitation, the proposed purchase price or terms. CANOO will not consummate any ACQUISITION TRANSACTION contemplated by an ACQUISITION PROPOSAL for a period of  [***] following the delivery of the ACQUISITION PROPOSAL NOTICE to WALMART.

b.The following definitions shall apply for purposes of this Section 20:

“ACQUISITION PROPOSAL” means any proposal, offer, inquiry, indication of interest or expression of intent (whether binding or non-binding, and whether communicated to CANOO, the BOARD or publicly announced to CANOO’s stockholders or otherwise) by any Person or Group relating to an Acquisition Transaction. 

“ACQUISITION TRANSACTION” means (a) any transaction or series of related transactions as a result of which any person or group (excluding WALMART or any of its Affiliates) becomes the beneficial owner, directly or indirectly, of 50% or more of the outstanding Equity Securities (measured by either voting power or economic interests) of CANOO, (b) any transaction or series of related transactions in which the stockholders of CANOO immediately prior to such transaction or series of related transactions (the “PRE-TRANSACTION STOCKHOLDERS”) cease to beneficially own, directly or indirectly, at least 50% of the outstanding Equity Securities (measured by either voting power or economic interests) of CANOO; provided that this clause (b) shall not apply if such transaction or series of related transactions is an acquisition by CANOO effected, in whole or in part, through the issuance of Equity Securities of CANOO, (c) any merger, consolidation, statutory share exchange, reorganization, recapitalization or similar extraordinary transaction (which may include a reclassification) involving CANOO, as a result of which at least 50% ownership of CANOO is transferred to another person or group (excluding 
			
	

			
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WALMART or any of its Affiliates), (d) individuals who constitute the Continuing Directors, taken together, ceasing for any reason to constitute at least a majority of the BOARD, or (e)  any sale or lease or exchange, transfer, license or disposition of a business, deposits or assets that constitute 50% or more of the consolidated assets, business, revenues, net income, assets or deposits of CANOO.

SECTION 21. DUTIES OF THE PARTIES. 

a.CANOO does herein agree to undertake its duties as set forth in the CONTRACT DOCUMENTS for the sale and DELIVERY of VEHICLE(s).  WALMART does herein agree to accept VEHICLE(s) conforming to the SPECIFICATIONS, provide notice to cure any NON-CONFORMING VEHICLES, and pay monies owed CANOO as required under the CONTRACT DOCUMENTS.

b.Each PARTY shall comply with the terms of the Mutual Non-Disclosure Agreement executed by the PARTIES on October 5, 2021.

SECTION 22. TERMINATION BY CANOO. 

The PARTIES agree that CANOO may terminate this AGREEMENT for cause based upon a material breach of WALMART’S representations, warranties, and performance obligation(s) pursuant to the CONTRACT DOCUMENTS, including without limitation, the failure of WALMART to tender payment as set forth in this AGREEMENT.  Such termination by CANOO shall take effect thirty (30) days following CANOO’s DELIVERY of written notice of default to WALMART specifying the breach, and WALMART’s failure to cure during that period.

SECTION 23. TERMINATION BY WALMART.

a.WALMART may terminate for cause if CANOO:

i.Becomes involved in an event or circumstance or a series of related events or circumstances, including with respect to non-compliance with applicable laws, that involves CANOO, its AFFILIATES or its executive officers that has, or would reasonably be expected to have, a material adverse reputational or legal impact on WALMART or WALMART’s business by reason of continued association with CANOO (a “REPUTATIONAL EVENT”). 

ii.Fails to provide ACQUISITION PROPOSAL NOTICE as required by this AGREEMENT, or otherwise fails to adhere to the terms of Section 20.

iii.Fails to begin performance under the terms of this AGREEMENT in a timely manner; or

iv.Fails to furnish conforming VEHICLE(s) and fails to cure within 90 days of notice; 

v.Performs any service required in SPECIFICATIONS unsuitably or performs work anew as may be rejected as unacceptable and unsuitable; or
vi.Fails to cure any breach of performance obligation(s) pursuant to the CONTRACT DOCUMENTS within 90 days of notice on more than three consecutive occasions; or

vii.Becomes insolvent or is declared bankrupt or commits any act of bankruptcy or insolvency; or

viii.Makes assignment for the benefit of creditors; or

			
	

			
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ix.For any other cause whatsoever, fails to perform the duties set forth in this AGREE- MENT and the CONTRACT DOCUMENTS in an acceptable manner.

b.Termination of this AGREEMENT by WALMART and any PURCHASE ORDER for cause as set forth in subsection (a) shall take effect within seven (7) days of written notice of termination.  Any costs and charges incurred by WALMART, together with the cost of completing any work due under the CONTRACT DOCUMENTS, will be deducted from any monies due or which may become due to CANOO for PURCHASE ORDERS fulfilled prior to the termination date in accordance with the terms of this AGREEMENT. WALMART shall have no obligation to tender payment for portions of PURCHASE ORDERS that remain unfulfilled at the termination date. 

c.WALMART may terminate this AGREEMENT for convenience with written notice specifying when such termination shall become effective and what remaining performance by CANOO or furnishing of VEHICLE(s) will be authorized and compensated.  In no event shall such termination take effect less than thirty (30) days following WALMART’s submission of termination notice under this subsection. Notwithstanding the above, any termination permitted under this Section 23(c) shall not affect a PURCHASE ORDER submitted to CANOO prior to such notice of termination.

d.In the event WALMART terminates this AGREEMENT for convenience as set forth in subsection (c), then:
x.After receipt of notice of termination, CANOO shall submit to WALMART a termination claim no later than [***] calendar days from the EFFECTIVE DATE of termination summarizing the amounts it claims are due and owing for PURCHASE ORDERS up through the termination date. Upon failure of CANOO to submit a termination claim, WALMART may determine, on the basis of information available, the amount, if any, due to CANOO by reason of the termination and shall thereupon pay to CANOO the amount so determined.

xi.CANOO and WALMART may agree upon the whole or any part of the amount or amounts to be paid to CANOO by reason of the total or partial termination, provided that such agreed amount or amounts, exclusive of settlement costs, shall not exceed the total contract price as reduced by the amount of payments otherwise made.

SECTION 24.  WALMART VENDOR REQUIREMENTS.  

a.WALMART’s vendor requirements are available online by visiting https://corporate.walmart.com/suppliers/requirements and are herein incorporated by this reference.  CANOO shall conform to WALMART’s vendor requirements as a material term of this AGREEMENT.

b.If CANOO receives or processes Walmart Confidential Information or receives access to Walmart Systems, CANOO shall meet the requirements of the Information Security Addendum attached as Exhibit “F.” 

SECTION 25. FORUM, GOVERNING LAW; DISPUTES. 

This AGREEMENT and the integrated CONTRACT DOCUMENTS shall be governed by, construed, and enforced in accordance with the laws of the State of Delaware. The proper forum for any legal action arising out of or related to this AGREEMENT and/or the CONTRACT DOCUMENTS shall be the state or federal courts located in Delaware.  

Any dispute, controversy, or claim arising out of or relating to this AGREEMENT, or the breach, termination or invalidity hereof (each, a "DISPUTE"), shall be submitted for negotiation and resolution to the applicable PARTY by written notice (each, a “DISPUTE NOTICE”), and the PARTIES shall negotiate in good faith to resolve the DISPUTE. If the PARTIES are unable to resolve any DISPUTE within thirty (30) days after delivery of the applicable DISPUTE NOTICE, 
			
	

			
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either PARTY may file suit in a court of competent jurisdiction in accordance with the provisions of this Section 25. Neither PARTY shall be required to submit a DISPUTE NOTICE for a DISPUTE that requires relief in less than thirty (30) days through court order.

SECTION 26. SEVERABILITY.

In the event that any portion of this AGREEMENT shall be held to be unenforceable, the remaining portions of this AGREEMENT shall remain in full force and effect.

SECTION 27.  NO PERSONAL LIABILITY.

It is agreed by the PARTIES that in no event shall any official, officer, agent, or employee of either PARTY be held in any way personally responsible for any covenant or agreement herein contained, whether expressed or implied, nor for any statement or representation made.

SECTION 28.  DISCRIMINATION PROHIBITED. 

In performing this AGREEMENT, CANOO shall not discriminate against any person on the basis of race, color, religion, sex, national origin, age or non-job related handicap or because of prior military service or current military status, and shall comply with all applicable Federal and state laws and regulations and executive order of governmental agencies relating to civil and human rights.

SECTION 29.  FORCE MAJEURE EVENT.
a.Non-performance:  Neither PARTY shall be liable for any failure to perform or delay in performance under this AGREEMENT to the extent that such failure or delay is caused by a Force Majeure Event, defined as an event beyond the reasonable control of and not the fault of the non-performing PARTY.

b.Force Majeure Events:  Force Majeure Events include, but are not limited to, flood, lightning, earthquake, fire, landslide, hurricane, tornado, explosion, war, riot, civil disturbance or commotion, terrorist act, military action, pandemic (including COVID-19 and evolutions thereof), epidemic, labor disputes, strikes or shortages, industry large scale trade or supply chain calamity or disruption, or actions of a public authority.

c.Notice:  If the non-performing PARTY seeks to assert this action, that PARTY shall provide the performing PARTY with prompt written notice of such assertion along with a written estimate of the period of time the Force Majeure Event is reasonably expected to continue.  Performance under this Agreement shall be immediately resumed once the Force Majeure Event is alleviated.

SECTION 30. CONTINUATION OF REPRESENTATIONS AND WARRANTIES.  

All representations and warranties contained in this Agreement (other than any representations and warranties related to the VEHICLES) shall continue in full force and effect after execution of this AGREEMENT.  If either PARTY later learns that a warranty or representation that it made is untrue, it is under a duty to promptly disclose this information to the other PARTY in writing.  No representation or warranty contained herein shall be deemed to have been waived or impaired by any investigation made by or acknowledge of the other PARTY to this AGREEMENT. 

SECTION 31. WARRANTY OF AUTHORITY TO EXECUTE.

a.The person executing this AGREEMENT on behalf of WALMART represents and warrants due authorization to do so on behalf of WALMART, and that upon execution of this 
			
	

			
	PAGE 10

Certain information in this document has been excluded pursuant to Regulation S-K, Item 601(b)(10). Such excluded information is not material and would likely cause competitive harm to the registrant if publicly disclosed.

AGREEMENT on behalf of WALMART, the same is binding upon, and shall inure to the benefit of, WALMART.

b.The person executing this AGREEMENT on behalf of CANOO represents and warrants due authorization to do so on behalf of CANOO, and that upon execution of this AGREEMENT on behalf of CANOO, the same is binding upon, and shall inure to the benefit of CANOO.

SECTION 32. PUBLICITY. Promptly following the execution of this Agreement, the CANOO and WALMART shall jointly issue a mutually agreeable press release (the “Mutual Press Release”) announcing the terms of this Agreement. Prior to the issuance of the Mutual Press Release, neither the CANOO and WALMART shall issue any press release or public announcement regarding this Agreement without the prior written consent of the other PARTY.  CANOO shall not use the logo, trademarks or trade names of WALMART or its subsidiaries without obtaining WALMART’s prior written consent, which consent shall be given in WALMART’s sole discretion.  Both PARTIES shall have the right to disclose any information the PARTIES mutually agreed to publicly release (including the Mutual Press Release) related to this AGREEMENT to (1) the investor community as part of required disclosures or fundraising activities; and (2) in connection with publicity releases and press interviews on a mutually agreeable timetable.  The PARTIES shall mutually agree in writing to the content and timing of any future publicity activities relating to the extended business relationship and what was publicly disclosed in the relevant press releases and regulatory related filings related to this AGREEMENT.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement the day, month, and year first above written.

CANOO SALES, LLC                                                   WALMART

_______________________________                        _______________________________
Signature                                                                       Signature

_______________________________                        _______________________________
Printed Name                                                                 Printed Name

_______________________________                        _______________________________
Title                                                                                Title

_______________________________                        _______________________________
Date                                                                               Date
			
	

			
	PAGE 11

Exhibit “A”
VEHICLE SPECIFICATIONS

[***]

			
	

Exhibit “B”
PAYMENT SCHEDULE
[***] 

			
	

Exhibit “C”
DELIVERY SCHEDULE

[***]

			
	

Exhibit “D”
[***]

			
	

Exhibit “E”
LIST OF RESTRICTED PARTIES

[***]

			
	

Exhibit “F”
INFORMATION SECURITY ADDENDUM

[***]EX-10.2(a)

  Exhibit 10.2(a)

  annexon, Inc.
2022 EMPLOYMENT INDUCEMENT AWARD PLAN

  ARTICLE I.
Purpose 

  The Plan’s purpose is to enhance the Company’s ability to attract, retain and motivate employees who are expected to make important contributions to the Company by providing these individuals with equity ownership opportunities.  

  ARTICLE II.
Definitions 

  As used in the Plan, the following words and phrases have the meanings specified below, unless the context clearly indicates otherwise:

  II.1“Administrator” means the Board or the Committee to the extent that the Board’s powers or authority under the Plan have been delegated to the Committee.  Any action taken by the Board as the Administrator in connection with the administration of the Plan shall not be deemed approved by the Board unless such actions are approved by a majority of the Non-Employee Directors of the Board.

  II.2“Applicable Law” means any applicable law, including without limitation:  (a) provisions of the Code, the Securities Act, the Exchange Act and any rules or regulations thereunder; (b) corporate, securities, tax or other laws, statutes, rules, requirements or regulations, whether federal, state, local or foreign; and (c) rules of any securities exchange or automated quotation system on which the Shares are listed, quoted or traded.

  II.3“Award” means an Option, Stock Appreciation Right, Restricted Stock award, Restricted Stock Unit award, Performance Bonus Award, Performance Stock Unit award, Dividend Equivalents award or Other Stock or Cash Based Award granted to a Participant under the Plan.

  II.4“Award Agreement” means an agreement evidencing an Award, which may be written or electronic, that contains such terms and conditions as the Administrator determines, consistent with and subject to the terms and conditions of the Plan.

  II.5“Board” means the Board of Directors of the Company.

  II.6“Change in Control” means any of the following:

  (a)A transaction or series of transactions (other than an offering of Common Stock to the general public through a registration statement filed with the Securities and Exchange Commission) whereby any “person” or related “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) directly or indirectly acquires beneficial ownership (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) of the Company’s securities possessing more than 50% of the total combined voting power of the Company’s securities outstanding immediately after such acquisition; provided, however, that the following acquisitions shall not constitute a Change in Control: (i) any acquisition by the Company or any of its Subsidiaries; (ii) any acquisition by an employee benefit plan maintained by the Company or any of its Subsidiaries, (iii) any acquisition which complies with Sections 2.6(c)(i), 2.6(c)(ii) and 2.6(c)(iii); or (iv) in respect of an Award held by a particular Participant, any acquisition by the Participant or any group of persons including the Participant (or any entity controlled by the Participant or any group of persons including the Participant);

   

   

  

   

  (b)The Incumbent Directors cease for any reason to constitute a majority of the Board;  

  (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, (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 stock 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;

  (ii)after which no person or group beneficially owns voting securities representing 50% or more of the combined voting power of the Successor Entity; provided, however, that no person or group shall be treated for purposes of this Section 2.6(c)(ii) as beneficially owning 50% or more of the 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; and 

  (iii)after which at least a majority of the members of the board of directors (or the analogous governing body) of the Successor Entity were Board members at the time of the Board's approval of the execution of the initial agreement providing for such transaction; or

  (d)The completion of a liquidation or dissolution of the Company.

  Notwithstanding the foregoing, if a Change in Control constitutes a payment event with respect to any Award (or any portion of an Award) that provides for the deferral of compensation that is subject to Section 409A, to the extent required to avoid the imposition of additional taxes under Section 409A, the transaction or event described in subsection (a), (b), (c) or (d) of this Section 2.6 with respect to such Award (or portion thereof) shall only constitute a Change in Control for purposes of the payment timing of such Award if such transaction also constitutes a “change in control event,” as defined in Treasury Regulation Section 1.409A-3(i)(5).

  The Administrator shall have full and final authority, which shall be exercised in its sole discretion, to determine conclusively whether a Change in Control has occurred pursuant to the above definition, the date of such Change in Control and any incidental matters relating thereto; provided that any exercise of authority in conjunction with a determination of whether a Change in Control is a “change in control event” as defined in Treasury Regulation Section 1.409A-3(i)(5) shall be consistent with such regulation.

  II.7“Code” means the U.S. Internal Revenue Code of 1986, as amended, and all regulations, guidance, compliance programs and other interpretative authority issued thereunder.

  II.8“Committee” means the Compensation Committee of the Board.  

  II.9“Common Stock” means the common stock of the Company. 

  II.10“Company” means Annexon, Inc., a Delaware corporation, or any successor.

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  II.11“Designated Beneficiary” means the beneficiary or beneficiaries the Participant designates, in a manner the Company determines, to receive amounts due or exercise the Participant’s rights if the Participant dies.  Without a Participant’s effective designation, “Designated Beneficiary” will mean the Participant’s estate.

  II.12“Disability” means a permanent and total disability under Section 22(e)(3) of the Code.

  II.13“Dividend Equivalents” means a right granted to a Participant to receive the equivalent value (in cash or Shares) of dividends paid on a specified number of Shares. Such Dividend Equivalent shall be converted to cash or additional Shares, or a combination of cash and Shares, by such formula and at such time and subject to such limitations as may be determined by the Administrator.

  II.14“DRO” means a “domestic relations order” as defined by the Code or Title I of the Employee Retirement Income Security Act of 1974, as amended, or the rules thereunder.

  II.15“Effective Date” has the meaning set forth in Section 11.3.

  II.16“Eligible Employee” means any Employee who has not previously been an employee or director of the Company or a Subsidiary, or is commencing employment with the Company or a Subsidiary following a bona fide period of non-employment by the Company or a Subsidiary, if he or she is granted an award in connection with his or her commencement of employment with the Company or a Subsidiary and such grant is an inducement material to his or her entering into employment with the Company or a Subsidiary. The Administrator may in its discretion adopt procedures from time to time to ensure that an Employee is eligible to participate in the Plan prior to the granting of any awards to such Employee under the Plan (including, without limitation, a requirement, that each such Employee certify to the Company prior to the receipt of an award under the Plan that he or she has not been previously employed by the Company or a Subsidiary, or if previously employed, has had a bona fide period of non-employment, and that the grant of an award under the Plan is an inducement material to his or her agreement to enter into employment with the Company or a Subsidiary).

  II.17“Employee” means any employee of the Company or any of its Subsidiaries.

  II.18“Equity Restructuring” means a nonreciprocal transaction between the Company and its stockholders, such as a stock dividend, stock split (including a reverse stock split), spin-off or recapitalization through a large, nonrecurring cash dividend, that affects the number or kind of Shares (or other Company securities) or the share price of Common Stock (or other Company securities) and causes a change in the per share value of the Common Stock underlying outstanding Awards.

  II.19“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and all regulations, guidance and other interpretative authority issued thereunder.

  II.20“Fair Market Value” means, as of any date, the value of a Share determined as follows: (i) if the Common Stock is listed on any established stock exchange, the value of a Share will be the closing sales price for a Share as quoted on such exchange for such date, or if no sale occurred on such date, the last day preceding such date during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; (ii) if the Common Stock is not listed on an established stock exchange but is quoted on a national market or other quotation system, the value of a Share will be the closing sales price for a Share on such date, or if no sales occurred on such date, then on the last date preceding such date during which a sale occurred, as reported in The Wall Street Journal or another source the Administrator deems reliable; or (iii) if the Common Stock is not listed on any established stock 

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  exchange or quoted on a national market or other quotation system, the value established by the Administrator in its sole discretion. 

  II.21“Incentive Stock Option” means an Option that meets the requirements to qualify as an “incentive stock option” as defined in Section 422 of the Code.  Incentive Stock Options may not be granted under the Plan.

  II.22“Incumbent Directors” means, for any period of 12 consecutive months, 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 Section 2.6(a) or 2.6(c)) whose election or nomination for election to the Board was approved by a vote of at least a majority (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for Director without objection to such nomination) of the Directors then still in office who either were Directors at the beginning of the 12-month period or whose election or nomination for election was previously so approved.  No individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest with respect to Directors or as a result of any other actual or threatened solicitation of proxies by or on behalf of any person other than the Board shall be an Incumbent Director.

  II.23“Non-Employee Director” means a Board member who is not an officer or employee of the Company or any Subsidiary.

  II.24“Nonqualified Stock Option” means an Option that is not an Incentive Stock Option.  

  II.25“Option” means a right granted under Article VI to purchase a specified number of Shares at a specified price per Share during a specified time period.  Each Option shall constitute a Nonqualified Stock Option.

  II.26“Other Stock or Cash Based Awards” means cash awards, awards of Shares, and other awards valued wholly or partially by referring to, or are otherwise based on, Shares or other property.

  II.27“Participant” means an Eligible Employee who has been granted an Award.

  II.28“Performance Bonus Award” has the meaning set forth in Section 8.3.

  II.29“Performance Stock Unit” means a right granted to a Participant pursuant to Section 8.1 and subject to Section 8.2, to receive Shares, the payment of which is contingent upon achieving certain performance goals or other performance-based targets established by the Administrator.

  II.30“Permitted Transferee” means, with respect to a Participant, any “family member” of the Participant, as defined in the General Instructions to Form S-8 Registration Statement under the Securities Act (or any successor form thereto), or any other transferee specifically approved by the Administrator after taking into account Applicable Law.

  II.31“Plan” means this 2019 Incentive Award Plan.

  II.32“Restricted Stock” means Shares awarded to a Participant under Article VII, subject to certain vesting conditions and other restrictions.

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  II.33“Restricted Stock Unit” means an unfunded, unsecured right to receive, on the applicable settlement date, one Share or an amount in cash or other consideration determined by the Administrator to be of equal value as of such settlement date, subject to certain vesting conditions and other restrictions.

  II.34“Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act.

  II.35“Section 409A” means Section 409A of the Code.

  II.36“Securities Act” means the Securities Act of 1933, as amended, and all regulations, guidance and other interpretative authority issued thereunder.

  II.37“Service Provider” means an Employee, Consultant or Director.

  II.38“Shares” means shares of Common Stock.

  II.39“Stock Appreciation Right” or “SAR” means a right granted under Article VI to receive a payment equal to the excess of the Fair Market Value of a specified number of Shares on the date the right is exercised over the exercise price set forth in the applicable Award Agreement.

  II.40“Subsidiary” means any entity (other than the Company), whether domestic or foreign, in an unbroken chain of entities beginning with the Company if each of the entities other than the last entity in the unbroken chain beneficially owns, at the time of the determination, securities or interests representing at least 50% of the total combined voting power of all classes of securities or interests in one of the other entities in such chain.

  II.41“Substitute Awards” means Awards granted or Shares issued by the Company in assumption of, or in substitution or exchange for, awards previously granted, or the right or obligation to make future awards, in each case by a company or other entity acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines.

  II.42“Termination of Service” means:

  (a)As to a Consultant, the time when the engagement of a Participant as a Consultant to the Company or a Subsidiary is terminated for any reason, with or without cause, including, without limitation, by resignation, discharge, death or retirement, but excluding terminations where the Consultant simultaneously commences or remains in employment or service with the Company or any Subsidiary.

  (b)As to a Non-Employee Director, the time when a Participant who is a Non‐Employee Director ceases to be a Director for any reason, including, without limitation, a termination by resignation, failure to be elected, death or retirement, but excluding terminations where the Participant simultaneously commences or remains in employment or service with the Company or any Subsidiary.

  (c)As to an Employee, the time when the employee-employer relationship between a Participant and the Company or any Subsidiary is terminated for any reason, including, without limitation, a termination by resignation, discharge, death, disability or retirement; but excluding terminations where the Participant simultaneously commences or remains in employment or service with the Company or any Subsidiary. 

  The Company, in its sole discretion, shall determine the effect of all matters and questions relating to any Termination of Service, including, without limitation, whether a Termination of Service has occurred, whether a Termination of Service resulted from a discharge for “cause” and all questions of 

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  whether particular leaves of absence constitute a Termination of Service.  For purposes of the Plan, a Participant’s employee-employer relationship or consultancy relationship shall be deemed to be terminated in the event that the Subsidiary employing or contracting with such Participant ceases to remain a Subsidiary following any merger, sale of stock or other corporate transaction or event (including, without limitation, a spin-off), even though the Participant may subsequently continue to perform services for that entity.  

  ARTICLE III.
Eligibility

  Eligible Employees are eligible to be granted Awards under the Plan, subject to the limitations described herein.  No Eligible Employee shall have any right to be granted an Award pursuant to the Plan and neither the Company nor the Administrator is obligated to treat Eligible Employees, Participants or any other persons uniformly.

  ARTICLE IV.
Administration and Delegation 

  IV.1Administration.  

  (a)The Plan is administered by the Administrator.  The Administrator has authority to determine which Eligible Employees receive Awards, grant Awards and set Award terms and conditions, subject to the conditions and limitations in the Plan. The Administrator also has the authority to take all actions and make all determinations under the Plan, to interpret the Plan and Award Agreements and to adopt, amend and repeal Plan administrative rules, guidelines and practices as it deems advisable and may impose, incidental to the grant of an award, conditions with respect to the award, including procedures to ensure that an Employee is eligible to participate in the Plan prior to the granting of any awards to such Employee under the Plan (including, without limitation, a requirement, if any, that each such Employee certify to the Company prior to the receipt of an award under the Plan that he or she has not been previously employed by the Company or a Subsidiary, or if previously employed, has had a bona fide period of non-employment, and that the grant of an award under the Plan is an inducement material to his or her agreement to enter into employment with the Company or a Subsidiary.  The Administrator may correct defects and ambiguities, supply omissions, reconcile inconsistencies in the Plan or any Award and make all other determinations that it deems necessary or appropriate to administer the Plan and any Awards. The Administrator (and each member thereof) is entitled to, in good faith, rely or act upon any report or other information furnished to it, him or her by any officer or other employee of the Company or any Subsidiary, the Company’s independent certified public accountants, or any executive compensation consultant or other professional retained by the Company to assist in the administration of the Plan. The Administrator’s determinations under the Plan are in its sole discretion and will be final, binding and conclusive on all persons having or claiming any interest in the Plan or any Award. 

  (b)Without limiting the foregoing, the Administrator has the exclusive power, authority and sole discretion to: (i) designate Participants; (ii) determine the type or types of Awards to be granted to each Participant; (iii) determine the number of Awards to be granted and the number of Shares to which an Award will relate; (iv) subject to the limitations in the Plan, determine the terms and conditions of any Award and related Award Agreement, including, but not limited to, the exercise price, grant price, purchase price, any performance criteria, any restrictions or limitations on the Award, any schedule for vesting, lapse of forfeiture restrictions or restrictions on the exercisability of an Award, and accelerations, waivers or amendments thereof; (v) determine whether, to what extent, and under what circumstances an Award may be settled in, or the exercise price of an Award may be paid in cash, Shares, or other property, or an Award may be canceled, forfeited, or surrendered; and (vi) make all other decisions and determinations that may 

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  be required pursuant to the Plan or as the Administrator deems necessary or advisable to administer the Plan.  

  ARTICLE V.
Stock Available for Awards

  V.1Number of Shares.  Subject to adjustment under Article IX and the terms of this Article V, Awards may be made under the Plan covering up to 2,000,000 Shares.  Shares issued or delivered under the Plan may consist of authorized but unissued Shares, Shares purchased on the open market or treasury Shares. 

  V.2Share Recycling.  

  (a)If all or any part of an Award expires, lapses or is terminated, converted into an award in respect of shares of another entity in connection with a spin-off or other similar event, exchanged for cash, surrendered, repurchased, canceled without having been fully exercised or forfeited, in any case, in a manner that results in the Company acquiring Shares covered by the Award at a price not greater than the price (as adjusted to reflect any Equity Restructuring) paid by the Participant for such Shares or not issuing any Shares covered by the Award, the unused Shares covered by the Award will, as applicable, become or again be available for Awards under the Plan.  The payment of Dividend Equivalents in cash in conjunction with any outstanding Awards shall not count against the number of Shares that may be issued under the Plan.   

  (b)In addition, the following Shares shall be available for future grants of Awards: (i) Shares tendered by a Participant or withheld by the Company in payment of the exercise price of an Option; (ii) Shares tendered by the Participant or withheld by the Company to satisfy any tax withholding obligation with respect to an Award; and (iii) Shares subject to a Stock Appreciation Right that are not issued in connection with the stock settlement of the Stock Appreciation Right on exercise thereof.

  V.3Substitute Awards.  In connection with an entity’s merger or consolidation with the Company or any Subsidiary or the Company’s or any Subsidiary’s acquisition of an entity’s property or stock, the Administrator may grant Awards in substitution for any options or other stock or stock-based awards granted before such merger or consolidation by such entity or its affiliate.  Substitute Awards may be granted on such terms and conditions as the Administrator deems appropriate, notwithstanding limitations on Awards in the Plan.  Substitute Awards will not count against the Shares available for issuance under the Plan (nor shall Shares subject to a Substitute Award be added to the Shares available for Awards under the Plan as provided above). Additionally, in the event that a company acquired by the Company or any Subsidiary or with which the Company or any Subsidiary combines has shares available under a pre‐existing plan approved by stockholders and not adopted in contemplation of such acquisition or combination, the shares available for grant pursuant to the terms of such pre-existing plan (as appropriately adjusted to reflect the transaction) may be used for Awards under the Plan and shall not reduce the Shares authorized for grant under the Plan (and Shares subject to such Awards may again become available for Awards under the Plan as provided under Section 5.2 above); provided that Awards using such available shares shall not be made after the date awards or grants could have been made under the terms of the pre-existing plan, absent the acquisition or combination, and shall only be made to individuals who were not employees or directors of the Company or any of its Subsidiaries prior to such acquisition or combination.

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  ARTICLE VI.
Stock Options and Stock Appreciation Rights

  VI.1General.  The Administrator may grant Options or Stock Appreciation Rights to one or more Eligible Employees, subject to such terms and conditions not inconsistent with the Plan as the Administrator shall determine.  The Administrator will determine the number of Shares covered by each Option and Stock Appreciation Right, the exercise price of each Option and Stock Appreciation Right and the conditions and limitations applicable to the exercise of each Option and Stock Appreciation Right.  A Stock Appreciation Right will entitle the Participant (or other person entitled to exercise the Stock Appreciation Right) to receive from the Company upon exercise of the exercisable portion of the Stock Appreciation Right an amount determined by multiplying the excess, if any, of the Fair Market Value of one Share on the date of exercise over the exercise price per Share of the Stock Appreciation Right by the number of Shares with respect to which the Stock Appreciation Right is exercised, subject to any limitations of the Plan or that the Administrator may impose and payable in cash, Shares valued at Fair Market Value on the date of exercise or a combination of the two as the Administrator may determine or provide in the Award Agreement.  

  VI.2Exercise Price.  The Administrator will establish each Option’s and Stock Appreciation Right’s exercise price and specify the exercise price in the Award Agreement.  The exercise price will not be less than 100% of the Fair Market Value on the grant date of the Option or Stock Appreciation Right. Notwithstanding the foregoing, in the case of an Option or Stock Appreciation Right that is a Substitute Award, the exercise price per share of the Shares subject to such Option or Stock Appreciation Right, as applicable, may be less than the Fair Market Value per share on the date of grant; provided that the exercise price of any Substitute Award shall be determined in accordance with the applicable requirements of Section 424 and 409A of the Code.  

  VI.3Duration of Options.  Subject to Section 6.6, each Option or Stock Appreciation Right will be exercisable at such times and as specified in the Award Agreement, provided that the term of an Option or Stock Appreciation Right will not exceed ten years; provided, further, that, unless otherwise determined by the Administrator, (a) no portion of an Option or Stock Appreciation Right which is unexercisable at a Participant’s Termination of Service shall thereafter become exercisable and (b) the portion of an Option or Stock Appreciation Right that is unexercisable at a Participant’s Termination of Service shall automatically expire on the date of such Termination of Service.  Notwithstanding the foregoing, if the Participant, prior to the end of the term of an Option or Stock Appreciation Right, commits an act of “cause” (as determined by the Administrator), or violates any non-competition, non-solicitation or confidentiality provisions of any employment contract, confidentiality and nondisclosure agreement or other agreement between the Participant and the Company or any of its Subsidiaries, the right to exercise the Option or Stock Appreciation Right, as applicable, may be terminated by the Company and the Company may suspend the Participant’s right to exercise the Option or Stock Appreciation Right when it reasonably believes that the Participant may have participated in any such act or violation. 

  VI.4Exercise.  Options and Stock Appreciation Rights may be exercised by delivering to the Company (or such other person or entity designated by the Administrator) a notice of exercise, in a form and manner the Company approves (which may be written, electronic or telephonic and may contain representations and warranties deemed advisable by the Administrator), signed or authenticated by the person authorized to exercise the Option or Stock Appreciation Right, together with, as applicable, payment in full of (a) the exercise price for the number of Shares for which the Option is exercised in a manner specified in Section 6.5 and (b) all applicable taxes in a manner specified in Section 10.5.  The Administrator may, in its discretion, limit exercise with respect to fractional Shares and require that any partial exercise of an Option or Stock Appreciation Right be with respect to a minimum number of Shares.  

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  VI.5Payment Upon Exercise.  The Administrator shall determine the methods by which payment of the exercise price of an Option shall be made, including, without limitation: 

  (a)Cash, check or wire transfer of immediately available funds; provided that the Company may limit the use of one of the foregoing methods if one or more of the methods below is permitted;

  (b)If there is a public market for Shares at the time of exercise, unless the Company otherwise determines, (A) delivery (including electronically or telephonically to the extent permitted by the Company) of a notice that the Participant has placed a market sell order with a broker acceptable to the Company with respect to Shares then issuable upon exercise of the Option and that the broker has been directed to deliver promptly to the Company funds sufficient to pay the exercise price, or (B) the Participant’s delivery to the Company of a copy of irrevocable and unconditional instructions to a broker acceptable to the Company to deliver promptly to the Company an amount sufficient to pay the exercise price by cash, wire transfer of immediately available funds or check; provided that such amount is paid to the Company at such time as may be required by the Company;  

  (c)To the extent permitted by the Administrator, delivery (either by actual delivery or attestation) of Shares owned by the Participant valued at their Fair Market Value on the date of delivery;

  (d)To the extent permitted by the Administrator, surrendering Shares then issuable upon the Option’s exercise valued at their Fair Market Value on the exercise date; 

  (e)To the extent permitted by the Administrator, delivery of a promissory note or any other lawful consideration; or

  (f)To the extent permitted by the Administrator, any combination of the above payment forms.

  ARTICLE VII.
Restricted Stock; Restricted Stock Units

  VII.1General.  The Administrator may grant Restricted Stock, or the right to purchase Restricted Stock, to any Eligible Employee, subject to forfeiture or the Company’s right to repurchase all or part of such shares at their issue price or other stated or formula price from the Participant if conditions the Administrator specifies in the Award Agreement are not satisfied before the end of the applicable restriction period or periods that the Administrator establishes for such Award. In addition, the Administrator may grant Restricted Stock Units, which may be subject to vesting and forfeiture conditions during the applicable restriction period or periods, as set forth in an Award Agreement, to Eligible Employees. The Administrator shall establish the purchase price, if any, and form of payment for Restricted Stock and Restricted Stock Units; provided, however, that if a purchase price is charged, such purchase price shall be no less than the par value, if any, of the Shares to be purchased, unless otherwise permitted by Applicable Law. In all cases, legal consideration shall be required for each issuance of Restricted Stock and Restricted Stock Units to the extent required by Applicable Law. The Award Agreement for each Restricted Stock and Restricted Stock Unit Award shall set forth the terms and conditions not inconsistent with the Plan as the Administrator shall determine. 

  VII.2Restricted Stock.

  (a)Stockholder Rights. Unless otherwise determined by the Administrator, each Participant holding shares of Restricted Stock will be entitled to all the rights of a stockholder with respect 

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  to such Shares, subject to the restrictions in the Plan and the applicable Award Agreement, including the right to receive all dividends and other distributions paid or made with respect to the Shares to the extent such dividends and other distributions have a record date that is on or after the date on which such Participant becomes the record holder of such Shares; provided, however, that with respect to a share of Restricted Stock subject to restrictions or vesting conditions as described in Section 8.3, except in connection with a spin-off or other similar event as otherwise permitted under Section 9.2, dividends which are paid to Company stockholders prior to the removal of restrictions and satisfaction of vesting conditions shall only be paid to the Participant to the extent that the restrictions are subsequently removed and the vesting conditions are subsequently satisfied and the share of Restricted Stock vests.

  (b)Stock Certificates.  The Company may require that the Participant deposit in escrow with the Company (or its designee) any stock certificates issued in respect of shares of Restricted Stock, together with a stock power endorsed in blank.

  (c)Section 83(b) Election. If a Participant makes an election under Section 83(b) of the Code to be taxed with respect to the Restricted Stock as of the date of transfer of the Restricted Stock rather than as of the date or dates upon which such Participant would otherwise be taxable under Section 83(a) of the Code, such Participant shall be required to deliver a copy of such election to the Company promptly after filing such election with the Internal Revenue Service along with proof of the timely filing thereof. 

  VII.3Restricted Stock Units.  The Administrator may provide that settlement of Restricted Stock Units will occur upon or as soon as reasonably practicable after the Restricted Stock Units vest or will instead be deferred, on a mandatory basis or at the Participant’s election, subject to compliance with Applicable Law.

  ARTICLE VIII.
OTHER TYPES OF AWARDS 

  VIII.1General.  The Administrator may grant Performance Stock Unit awards, Performance Bonus Awards, Dividend Equivalents or Other Stock or Cash Based Awards, to one or more Eligible Employees, in such amounts and subject to such terms and conditions not inconsistent with the Plan as the Administrator shall determine.

  VIII.2Performance Stock Unit Awards.  Each Performance Stock Unit award shall be denominated in a number of Shares or in unit equivalents of Shares or units of value (including a dollar value of Shares) and may be linked to any one or more of performance or other specific criteria, including service to the Company or Subsidiaries, determined to be appropriate by the Administrator, in each case on a specified date or dates or over any period or periods determined by the Administrator.  In making such determinations, the Administrator may consider (among such other factors as it deems relevant in light of the specific type of award) the contributions, responsibilities and other compensation of the particular Participant.

  VIII.3Performance Bonus Awards.  Each right to receive a bonus granted under this Section 8.3 shall be denominated in the form of cash (but may be payable in cash, stock or a combination thereof) (a “Performance Bonus Award”) and shall be payable upon the attainment of performance goals that are established by the Administrator and relate to one or more of performance or other specific criteria, including service to the Company or Subsidiaries, in each case on a specified date or dates or over any period or periods determined by the Administrator.

  VIII.4Dividend Equivalents.  If the Administrator provides, an Award (other than an Option or Stock Appreciation Right) may provide a Participant with the right to receive Dividend Equivalents.  

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  Dividend Equivalents may be paid currently or credited to an account for the Participant, settled in cash or Shares and subject to the same restrictions on transferability and forfeitability as the Award with respect to which the Dividend Equivalents are granted and subject to other terms and conditions as set forth in the Award Agreement.  Notwithstanding anything to the contrary herein, Dividend Equivalents with respect to an Award subject to vesting shall either (i) to the extent permitted by Applicable Law, not be paid or credited or (ii) be accumulated and subject to vesting to the same extent as the related Award.  All such Dividend Equivalents shall be paid at such time as the Administrator shall specify in the applicable Award Agreement. 

  VIII.5Other Stock or Cash Based Awards.  Other Stock or Cash Based Awards may be granted to Participants, including Awards entitling Participants to receive cash or Shares to be delivered in the future and annual or other periodic or long-term cash bonus awards (whether based on specified performance criteria or otherwise), in each case subject to any conditions and limitations in the Plan. Such Other Stock or Cash Based Awards will also be available as a payment form in the settlement of other Awards, as standalone payments and as payment in lieu of compensation to which a Participant is otherwise entitled.  Other Stock or Cash Based Awards may be paid in Shares, cash or other property, as the Administrator determines.  Subject to the provisions of the Plan, the Administrator will determine the terms and conditions of each Other Stock or Cash Based Award, including any purchase price, performance goal(s), transfer restrictions, and vesting conditions, which will be set forth in the applicable Award Agreement. Except in connection with a spin-off or other similar event as otherwise permitted under Article IX, dividends that are paid prior to vesting of any Other Stock or Cash Based Award shall only be paid to the applicable Participant to the extent that the vesting conditions are subsequently satisfied and the Other Stock or Cash Based Award vests. 

  ARTICLE IX.
Adjustments for Changes in Common Stock 
and Certain Other Events

  IX.1Equity Restructuring.  In connection with any Equity Restructuring, notwithstanding anything to the contrary in this Article IX the Administrator will equitably adjust the terms of the Plan and each outstanding Award as it deems appropriate to reflect the Equity Restructuring, which may include (i) adjusting the number and type of securities subject to each outstanding Award or with respect to which Awards may be granted under the Plan (including, but not limited to, adjustments of the limitations in Article V hereof on the maximum number and kind of shares that may be issued); (ii) adjusting the terms and conditions of (including the grant or exercise price), and the performance goals or other criteria included in, outstanding Awards; and (iii) granting new Awards or making cash payments to Participants.  The adjustments provided under this Section 9.1 will be nondiscretionary and final and binding on all interested parties, including the affected Participant and the Company; provided that the Administrator will determine whether an adjustment is equitable.

  IX.2Corporate Transactions.  In the event of any dividend or other distribution (whether in the form of cash, Common Stock, other securities, or other property), reorganization, merger, consolidation, split-up, spin off, combination, amalgamation, repurchase, recapitalization, liquidation, dissolution, or sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company, or sale or exchange of Common Stock or other securities of the Company, Change in Control, issuance of warrants or other rights to purchase Common Stock or other securities of the Company, other similar corporate transaction or event, other unusual or nonrecurring transaction or event affecting the Company or its financial statements or any change in any Applicable Law or accounting principles, the Administrator, on such terms and conditions as it deems appropriate, either by the terms of the Award or by action taken prior to the occurrence of such transaction or event (except that action to give effect to a change in Applicable Law or accounting principles may be made within a reasonable period of time after such change) and either 

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  automatically or upon the Participant’s request, is hereby authorized to take any one or more of the following actions whenever the Administrator determines that such action is appropriate in order to (x) prevent dilution or enlargement of the benefits or potential benefits intended by the Company to be made available under the Plan or with respect to any Award granted or issued under the Plan, (y) to facilitate such transaction or event or (z) give effect to such changes in Applicable Law or accounting principles:  

  (a)To provide for the cancellation of any such Award in exchange for either an amount of cash or other property with a value equal to the amount that could have been obtained upon the exercise or settlement of the vested portion of such Award or realization of the Participant’s rights under the vested portion of such Award, as applicable; provided that, if the amount that could have been obtained upon the exercise or settlement of the vested portion of such Award or realization of the Participant’s rights, in any case, is equal to or less than zero, then the Award may be terminated without payment;  

  (b)To provide that such Award shall vest and, to the extent applicable, be exercisable as to all Shares (or other property) covered thereby, notwithstanding anything to the contrary in the Plan or the provisions of such Award;

  (c)To provide that such Award be assumed by the successor or survivor corporation or entity, or a parent or subsidiary thereof, or shall be substituted for by awards covering the stock of the successor or survivor corporation or entity, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and applicable exercise or purchase price, in all cases, as determined by the Administrator;  

  (d)To make adjustments in the number and type of shares of Common Stock (or other securities or property) subject to outstanding Awards or with respect to which Awards may be granted under the Plan (including, but not limited to, adjustments of the limitations in Article V hereof on the maximum number and kind of shares which may be issued) or in the terms and conditions of (including the grant or exercise price), and the criteria included in, outstanding Awards;  

  (e)To replace such Award with other rights or property selected by the Administrator; or

  (f)To provide that the Award will terminate and cannot vest, be exercised or become payable after the applicable event.

  IX.3Change in Control. 

  (a)Notwithstanding any other provision of the Plan, in the event of a Change in Control, unless the Administrator elects to (i) terminate an Award in exchange for cash, rights or property, or (ii) cause an Award to become fully exercisable and no longer subject to any forfeiture restrictions prior to the consummation of a Change in Control, pursuant to Section 9.2, (A) such Award (other than any portion subject to performance-based vesting) shall continue in effect or be assumed or an equivalent Award substituted by the successor corporation or a parent or subsidiary of the successor corporation and (B) the portion of such Award subject to performance-based vesting shall be subject to the terms and conditions of the applicable Award Agreement and, in the absence of applicable terms and conditions, the Administrator’s discretion.

  (b)In the event that the successor corporation in a Change in Control refuses to assume or substitute for an Award, the Administrator shall cause such Award to become fully vested and, if applicable, exercisable immediately prior to the consummation of such transaction and all forfeiture restrictions on such Award to lapse and, to the extent unexercised upon the consummation of such 

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  transaction, to terminate in exchange for cash, rights or other property. Unless otherwise set forth in an applicable award agreement, for purposes of this Section 9.3(b), each award subject to performance-based vesting will be deemed earned at the greater of (i) target or (ii) actual achievement measured as of the Change in Control (to the extent then measurable).  The Administrator shall notify the Participant of any Award that becomes exercisable pursuant to the preceding sentence that such Award shall be fully exercisable for a period of 15 days from the date of such notice, contingent upon the occurrence of the Change in Control, and such Award shall terminate upon the consummation of the Change in Control in accordance with the preceding sentence.

  (c)For the purposes of this Section 9.3, an Award shall be considered assumed if, following the Change in Control, the Award confers the right to purchase or receive, for each Share subject to the Award immediately prior to the Change in Control, the consideration (whether stock, cash, or other securities or property) received in the Change in Control by holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the Change in Control was not solely common stock of the successor corporation or its parent, the Administrator may, with the consent of the successor corporation, provide for the consideration to be received upon the exercise of the Award, for each Share subject to an Award, to be solely common stock of the successor corporation or its parent equal in fair market value to the per-share consideration received by holders of Common Stock in the Change in Control.

  IX.4Administrative Stand Still.  In the event of any pending stock dividend, stock split, combination or exchange of shares, merger, consolidation or other distribution (other than normal cash dividends) of Company assets to stockholders, or any other extraordinary transaction or change affecting the Shares or the share price of Common Stock (including any Equity Restructuring or any securities offering or other similar transaction) or for reasons of administrative convenience or to facilitate compliance with any Applicable Law, the Company may refuse to permit the exercise or settlement of one or more Awards for such period of time as the Company may determine to be reasonably appropriate under the circumstances.

  IX.5General.  Except as expressly provided in the Plan or the Administrator’s action under the Plan, no Participant will have any rights due to any subdivision or consolidation of Shares of any class, dividend payment, increase or decrease in the number of Shares of any class or dissolution, liquidation, merger, or consolidation of the Company or other corporation.  Except as expressly provided with respect to an Equity Restructuring under Section 9.1 above or the Administrator’s action under the Plan, no issuance by the Company of Shares of any class, or securities convertible into Shares of any class, will affect, and no adjustment will be made regarding, the number of Shares subject to an Award or the Award’s grant or exercise price.  The existence of the Plan, any Award Agreements and the Awards granted hereunder will not affect or restrict in any way the Company’s right or power to make or authorize (i) any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, (ii) any merger, consolidation, spinoff, dissolution or liquidation of the Company or sale of Company assets or (iii) any sale or issuance of securities, including securities with rights superior to those of the Shares or securities convertible into or exchangeable for Shares.  

   

  ARTICLE X.
Provisions Applicable to Awards 

  X.1Transferability.  

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  (a)No Award may be sold, assigned, transferred, pledged or otherwise encumbered, either voluntarily or by operation of law, except by will or the laws of descent and distribution, or, subject to the Administrator’s consent, pursuant to a domestic relations order, unless and until such Award has been exercised or the Shares underlying such Award have been issued, and all restrictions applicable to such Shares have lapsed.  During the life of a Participant, Awards will be exercisable only by the Participant, unless it has been disposed of pursuant to a domestic relations order.  After the death of a Participant, any exercisable portion of an Award may, prior to the time when such portion becomes unexercisable under the Plan or the applicable Award Agreement, be exercised by the Participant’s personal representative or by any person empowered to do so under the deceased Participant’s will or under the then-Applicable Law of descent and distribution. References to a Participant, to the extent relevant in the context, will include references to a transferee approved by the Administrator. 

  (b)Notwithstanding Section 10.1(a), the Administrator, in its sole discretion, may determine to permit a Participant or a Permitted Transferee of such Participant to transfer an Award to any one or more Permitted Transferees of such Participant, subject to the following terms and conditions: (i) an Award transferred to a Permitted Transferee shall not be assignable or transferable by the Permitted Transferee other than (A) to another Permitted Transferee of the applicable Participant or (B) by will or the laws of descent and distribution or, subject to the consent of the Administrator, pursuant to a domestic relations order; (ii) an Award transferred to a Permitted Transferee shall continue to be subject to all the terms and conditions of the Award as applicable to the original Participant (other than the ability to further transfer the Award to any Person other than another Permitted Transferee of the applicable Participant); (iii) the Participant (or transferring Permitted Transferee) and the receiving Permitted Transferee shall execute any and all documents requested by the Administrator, including, without limitation documents to (A) confirm the status of the transferee as a Permitted Transferee, (B) satisfy any requirements for an exemption for the transfer under Applicable Law and (C) evidence the transfer; and (iv) any transfer of an Award to a Permitted Transferee shall be without consideration, except as required by Applicable Law.    

  (c)Notwithstanding Section 10.1(a), a Participant may, in the manner determined by the Administrator, designate a Designated Beneficiary. A Designated Beneficiary, legal guardian, legal representative, or other person claiming any rights pursuant to the Plan is subject to all terms and conditions of the Plan and any Award Agreement applicable to the Participant and any additional restrictions deemed necessary or appropriate by the Administrator. If the Participant is married or a domestic partner in a domestic partnership qualified under Applicable Law and resides in a community property state, a designation of a person other than the Participant’s spouse or domestic partner, as applicable, as the Participant’s Designated Beneficiary with respect to more than 50% of the Participant’s interest in the Award shall not be effective without the prior written or electronic consent of the Participant’s spouse or domestic partner. Subject to the foregoing, a beneficiary designation may be changed or revoked by a Participant at any time; provided that the change or revocation is delivered in writing to the Administrator prior to the Participant’s death.

  X.2Documentation.  Each Award will be evidenced in an Award Agreement in such form as the Administrator determines in its discretion. Each Award may contain such terms and conditions as are determined by the Administrator in its sole discretion, to the extent not inconsistent with those set forth in the Plan. 

  X.3Discretion.  Except as the Plan otherwise provides, each Award may be made alone or in addition or in relation to any other Award.  The terms of each Award to a Participant need not be identical, and the Administrator need not treat Participants or Awards (or portions thereof) uniformly. 

  X.4Changes in Participant’s Status.  The Administrator will determine how the disability, death, retirement, authorized leave of absence or any other change or purported change in a Participant’s 

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  Service Provider status affects an Award and the extent to which, and the period during which, the Participant, the Participant’s legal representative, conservator, guardian or Designated Beneficiary may exercise rights under the Award, if applicable.  Except to the extent otherwise required by law or expressly authorized by the Company or by the Company’s written policy on leaves of absence, no service credit shall be given for vesting purposes for any period the Participant is on a leave of absence.

  X.5Withholding.  Each Participant must pay the Company, or make provision satisfactory to the Administrator for payment of, any taxes required by law to be withheld in connection with such Participant’s Awards by the date of the event creating the tax liability.  The Company may deduct an amount sufficient to satisfy such tax obligations from any payment of any kind otherwise due to a Participant. The amount deducted shall be determined by the Company and may be up to, but no greater than, the aggregate amount of such obligations based on the maximum statutory withholding rates in the applicable Participant’s jurisdiction for federal, state, local and foreign income tax and payroll tax purposes that are applicable to such taxable income. Subject to any Company insider trading policy (including blackout periods), Participants may satisfy such tax obligations (i) in cash, by wire transfer of immediately available funds, by check made payable to the order of the Company; provided that the Company may limit the use of one of the foregoing methods if one or more of the exercise methods below is permitted, (ii) to the extent permitted by the Administrator, in whole or in part by delivery of Shares, including Shares delivered by attestation and Shares retained from the Award creating the tax obligation, valued at their Fair Market Value on the date of delivery, (iii) if there is a public market for Shares at the time the tax obligations are satisfied, unless the Administrator otherwise determines, (A) delivery (including electronically or telephonically to the extent permitted by the Company) of a notice that the Participant has placed a market sell order with a broker acceptable to the Company with respect to Shares then issuable upon exercise of the Option and that the broker has been directed to deliver promptly to the Company funds sufficient to satisfy the tax obligations, or (B) the Participant’s delivery to the Company of a copy of irrevocable and unconditional instructions to a broker acceptable to the Company to deliver promptly to the Company an amount sufficient to satisfy the tax withholding by cash, wire transfer of immediately available funds or check; provided that such amount is paid to the Company at such time as may be required by the Company, (iv) to the extent permitted by the Administrator, delivery of a promissory note or any other lawful consideration or (v) to the extent permitted by the Administrator, any combination of the foregoing payment forms.  If any tax withholding obligation will be satisfied under clause (ii) of the immediately preceding sentence by the Company’s retention of Shares from the Award creating the tax obligation and there is a public market for Shares at the time the tax obligation is satisfied, the Company may elect to instruct any brokerage firm determined acceptable to the Company for such purpose to sell on the applicable Participant’s behalf some or all of the Shares retained and to remit the proceeds of the sale to the Company or its designee, and each Participant’s acceptance of an Award under the Plan will constitute the Participant’s authorization to the Company and instruction and authorization to such brokerage firm to complete the transactions described in this sentence.

  X.6Amendment of Award; Repricing.  The Administrator may amend, modify or terminate any outstanding Award, including by substituting another Award of the same or a different type and changing the exercise or settlement date.  The Participant’s consent to such action will be required unless (i) the action, taking into account any related action, does not materially and adversely affect the Participant’s rights under the Award, or (ii) the change is permitted under Article IX or pursuant to Section 11.6.  In addition, the Administrator shall, without the approval of the stockholders of the Company, have the authority to (a) amend any outstanding Option or Stock Appreciation Right to reduce its exercise price per Share, or (b) cancel any Option or Stock Appreciation Right in exchange for cash or another Award.

  X.7Conditions on Delivery of Stock.  The Company will not be obligated to deliver any Shares under the Plan or remove restrictions from Shares previously delivered under the Plan until (i) all Award conditions have been met or removed to the Company’s satisfaction, (ii) as determined by the Company, 

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  all other legal matters regarding the issuance and delivery of such Shares have been satisfied, including any applicable securities laws and stock exchange or stock market rules and regulations, and (iii) the Participant has executed and delivered to the Company such representations or agreements as the Administrator deems necessary or appropriate to satisfy Applicable Law.  The Company’s inability to obtain authority from any regulatory body having jurisdiction, which the Administrator determines is necessary to the lawful issuance and sale of any securities, will relieve the Company of any liability for failing to issue or sell such Shares as to which such requisite authority has not been obtained.

  X.8Acceleration.  The Administrator may at any time provide that any Award will become immediately vested and fully or partially exercisable, free of some or all restrictions or conditions, or otherwise fully or partially realizable. 

  ARTICLE XI.
Miscellaneous 

  XI.1No Right to Employment or Other Status.  No person will have any claim or right to be granted an Award, and the grant of an Award will not be construed as giving a Participant the right to continue employment or any other relationship with the Company.  The Company expressly reserves the right at any time to dismiss or otherwise terminate its relationship with a Participant free from any liability or claim under the Plan or any Award, except as expressly provided in an Award Agreement or other written agreement between the Participant and the Company or any Subsidiary.

  XI.2No Rights as Stockholder; Certificates.  Subject to the Award Agreement, no Participant or Designated Beneficiary will have any rights as a stockholder with respect to any Shares to be distributed under an Award until becoming the record holder of such Shares.  Notwithstanding any other provision of the Plan, unless the Administrator otherwise determines or Applicable Law requires, the Company will not be required to deliver to any Participant certificates evidencing Shares issued in connection with any Award and instead such Shares may be recorded in the books of the Company (or, as applicable, its transfer agent or stock plan administrator).  The Company may place legends on any share certificate or book entry to reference restrictions applicable to the Shares (including, without limitation, restrictions applicable to Restricted Stock).

  XI.3Effective Date; Shareholder Approval of the Plan Not Required.  The Plan will become effective on the date the Board has adopted the Plan (the “Effective Date”).  It is expressly intended that approval of the Company’s stockholders not be required as a condition of the effectiveness of the Plan, and the Plan’s provisions shall be interpreted in a manner consistent with such intent for all purposes. Specifically, Nasdaq Stock Market Rule 5635(c) generally requires stockholder approval for stock option plans or other equity compensation arrangements adopted by companies whose securities are listed on the Nasdaq Stock Market pursuant to which stock awards or stock may be acquired by officers, directors, employees, or consultants of such companies.  Nasdaq Stock Market Rule 5635(c)(4) provides an exception to this requirement for issuances of securities to a person not previously an employee or director of the issuer, or following a bona fide period of non-employment, as an inducement material to the individual’s entering into employment with the issuer; provided, such issuances are approved by either the issuer’s compensation committee comprised of a majority of independent directors or a majority of the issuer’s independent directors.  Notwithstanding anything to the contrary herein, awards under the Plan may only be made to employees who have not previously been an employee or director of the Company or a Subsidiary, or following a bona fide period of non-employment by the Company or a Subsidiary, as an inducement material to the employee’s entering into employment with the Company or a Subsidiary. Awards under the Plan will be approved by (i) the Compensation Committee of the Board, comprised of Non-Employee Directors or (ii) a majority of the Company’s Non-Employee Directors.  Accordingly, pursuant to Nasdaq Stock Market Rule 5635(c)(4), the issuance of Awards and the Shares issuable upon 

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  exercise or vesting of such Awards pursuant to the Plan are not subject to the approval of the Company’s stockholders.  

  XI.4Amendment of Plan.  The Board may amend, suspend or terminate the Plan at any time and from time to time; provided that (a) no amendment requiring stockholder approval to comply with Applicable Law shall be effective unless approved by the Board, and (b) no amendment, other than an increase to the Shares reserved for issuance under the Plan or pursuant to Article IX or Section 11.6, may materially and adversely affect any Award outstanding at the time of such amendment without the affected Participant’s consent.  No Awards may be granted under the Plan during any suspension period or after Plan termination.  Awards outstanding at the time of any Plan suspension or termination will continue to be governed by the Plan and the Award Agreement, as in effect before such suspension or termination.  The Board will obtain stockholder approval of any Plan amendment to the extent necessary to comply with Applicable Law. 

  XI.5Provisions for Foreign Participants.  The Administrator may modify Awards granted to Participants who are foreign nationals or employed outside the United States, establish subplans or procedures under the Plan or take any other necessary or appropriate action to address Applicable Law, including (a) differences in laws, rules, regulations or customs of such foreign jurisdictions with respect to tax, securities, currency, employee benefit or other matters, (b) listing and other requirements of any foreign securities exchange, and (c) any necessary local governmental or regulatory exemptions or approvals.  

  XI.6Section 409A.  

  (a)General.  The Company intends that all Awards be structured to comply with, or be exempt from, Section 409A, such that no adverse tax consequences, interest, or penalties under Section 409A apply.  Notwithstanding anything in the Plan or any Award Agreement to the contrary, the Administrator may, without a Participant’s consent, amend this Plan or Awards, adopt policies and procedures, or take any other actions (including amendments, policies, procedures and retroactive actions) as are necessary or appropriate to preserve the intended tax treatment of Awards, including any such actions intended to (A) exempt this Plan or any Award from Section 409A, or (B) comply with Section 409A, including regulations, guidance, compliance programs and other interpretative authority that may be issued after an Award’s grant date.  The Company makes no representations or warranties as to an Award’s tax treatment under Section 409A or otherwise.  The Company will have no obligation under this Section 11.6 or otherwise to avoid the taxes, penalties or interest under Section 409A with respect to any Award and will have no liability to any Participant or any other person if any Award, compensation or other benefits under the Plan are determined to constitute noncompliant “nonqualified deferred compensation” subject to taxes, penalties or interest under Section 409A.

  (b)Separation from Service.  If an Award constitutes “nonqualified deferred compensation” under Section 409A, any payment or settlement of such Award upon a Participant’s Termination of Service will, to the extent necessary to avoid taxes under Section 409A, be made only upon the Participant’s “separation from service” (within the meaning of Section 409A), whether such “separation from service” occurs upon or after the Participant’s Termination of Service.  For purposes of this Plan or any Award Agreement relating to any such payments or benefits, references to a “termination,” “termination of employment” or like terms means a “separation from service.”

  (c)Payments to Specified Employees.  Notwithstanding any contrary provision in the Plan or any Award Agreement, any payment(s) of “nonqualified deferred compensation” required to be made under an Award to a “specified employee” (as defined under Section 409A and as the Administrator determines) due to his or her “separation from service” will, to the extent necessary to avoid taxes under Section 409A(a)(2)(B)(i) of the Code, be delayed for the six-month period immediately following such 

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  “separation from service” (or, if earlier, until the specified employee’s death) and will instead be paid (as set forth in the Award Agreement) on the day immediately following such six-month period or as soon as administratively practicable thereafter (without interest).  Any payments of “nonqualified deferred compensation” under such Award payable more than six months following the Participant’s “separation from service” will be paid at the time or times the payments are otherwise scheduled to be made.

  XI.7Limitations on Liability.  Notwithstanding any other provisions of the Plan, no individual acting as a director, officer or other employee of the Company or any Subsidiary will be liable to any Participant, former Participant, spouse, beneficiary, or any other person for any claim, loss, liability, or expense incurred in connection with the Plan or any Award, and such individual will not be personally liable with respect to the Plan because of any contract or other instrument executed in his or her capacity as an Administrator, director, officer or other employee of the Company or any Subsidiary.  The Company will indemnify and hold harmless each director, officer or other employee of the Company or any Subsidiary that has been or will be granted or delegated any duty or power relating to the Plan’s administration or interpretation, against any cost or expense (including attorneys’ fees) or liability (including any sum paid in settlement of a claim with the Administrator’s approval) arising from any act or omission concerning this Plan unless arising from such person’s own fraud or bad faith; provided that he or she gives the Company an opportunity, at its own expense, to handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf.

  XI.8Data Privacy.  As a condition for receiving any Award, each Participant explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of personal data as described in this Section by and among the Company and its Subsidiaries and affiliates exclusively for implementing, administering and managing the Participant’s participation in the Plan.  The Company and its Subsidiaries and affiliates may hold certain personal information about a Participant, including the Participant’s name, address and telephone number; birthdate; social security, insurance number or other identification number; salary; nationality; job title(s); any Shares held in the Company or its Subsidiaries and affiliates; and Award details, to implement, manage and administer the Plan and Awards (the “Data”).  The Company and its Subsidiaries and affiliates may transfer the Data amongst themselves as necessary to implement, administer and manage a Participant’s participation in the Plan, and the Company and its Subsidiaries and affiliates may transfer the Data to third parties assisting the Company with Plan implementation, administration and management.  These recipients may be located in the Participant’s country, or elsewhere, and the Participant’s country may have different data privacy laws and protections than the recipients’ country.  By accepting an Award, each Participant authorizes such recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, to implement, administer and manage the Participant’s participation in the Plan, including any required Data transfer to a broker or other third party with whom the Company or the Participant may elect to deposit any Shares.  The Data related to a Participant will be held only as long as necessary to implement, administer, and manage the Participant’s participation in the Plan.  A Participant may, at any time, view the Data that the Company holds regarding such Participant, request additional information about the storage and processing of the Data regarding such Participant, recommend any necessary corrections to the Data regarding the Participant or refuse or withdraw the consents in this Section 11.8 in writing, without cost, by contacting the local human resources representative.  The Company may cancel Participant’s ability to participate in the Plan and, in the Administrator’s sole discretion, the Participant may forfeit any outstanding Awards if the Participant refuses or withdraws the consents in this Section 11.8.  For more information on the consequences of refusing or withdrawing consent, Participants may contact their local human resources representative.

  XI.9Severability.  If any portion of the Plan or any action taken under it is held illegal or invalid for any reason, the illegality or invalidity will not affect the remaining parts of the Plan, and the Plan will be construed and enforced as if the illegal or invalid provisions had been excluded, and the illegal or invalid action will be null and void.

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  XI.10Governing Documents.  If any contradiction occurs between the Plan and any Award Agreement or other written agreement between a Participant and the Company (or any Subsidiary), the Plan will govern, unless such Award Agreement or other written agreement was approved by the Administrator and expressly provides that a specific provision of the Plan will not apply.

  XI.11Governing Law.  The Plan and all Awards will be governed by and interpreted in accordance with the laws of the State of Delaware, without regard to the conflict of law rules thereof or of any other jurisdiction.

  XI.12Clawback Provisions.  All Awards (including the gross amount of any proceeds, gains or other economic benefit the Participant actually or constructively receives upon receipt or exercise of any Award or the receipt or resale of any Shares underlying the Award) will be subject to recoupment by the Company to the extent required to comply with Applicable Law or any policy of the Company providing for the reimbursement of incentive compensation, whether or not such policy was in place at the time of grant of an Award.  

  XI.13Titles and Headings.  The titles and headings in the Plan are for convenience of reference only and, if any conflict, the Plan’s text, rather than such titles or headings, will control.

  XI.14Conformity to Applicable Law.  Participant acknowledges that the Plan is intended to conform to the extent necessary with Applicable Law.  Notwithstanding anything herein to the contrary, the Plan and all Awards will be administered only in a manner intended to conform with Applicable Law.  To the extent Applicable Law permit, the Plan and all Award Agreements will be deemed amended as necessary to conform to Applicable Law.

  XI.15Relationship to Other Benefits.  No payment under the Plan will be taken into account in determining any benefits under any pension, retirement, savings, profit sharing, group insurance, welfare or other benefit plan of the Company or any Subsidiary, except as expressly provided in writing in such other plan or an agreement thereunder.

  XI.16Unfunded Status of Awards. The Plan is intended to be an “unfunded” plan for incentive compensation. With respect to any payments not yet made to a Participant pursuant to an Award, nothing contained in the Plan or Award Agreement shall give the Participant any rights that are greater than those of a general creditor of the Company or any Subsidiary.

  XI.17Limitations Applicable to Section 16 Persons. Notwithstanding any other provision of the Plan, the Plan and any Award granted or awarded to any individual who is then subject to Section 16 of the Exchange Act shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the Exchange Act (including Rule 16b‐3 of the Exchange Act and any amendments thereto) that are requirements for the application of such exemptive rule. To the extent permitted by Applicable Law, the Plan and Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.

  XI.18Prohibition on Executive Officer Loans.  Notwithstanding any other provision of the Plan to the contrary, no Participant who is a Director or an “executive officer” of the Company within the meaning of Section 13(k) of the Exchange Act shall be permitted to make payment with respect to any Awards granted under the Plan, or continue any extension of credit with respect to such payment, with a loan from the Company or a loan arranged by the Company in violation of Section 13(k) of the Exchange Act.

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  XI.19Broker-Assisted Sales. In the event of a broker-assisted sale of Shares in connection with the payment of amounts owed by a Participant under or with respect to the Plan or Awards, including amounts to be paid under the final sentence of Section 10.5: (a) any Shares to be sold through the broker-assisted sale will be sold on the day the payment first becomes due, or as soon thereafter as practicable; (b) such Shares may be sold as part of a block trade with other Participants in the Plan in which all participants receive an average price; (c) the applicable Participant will be responsible for all broker’s fees and other costs of sale, and by accepting an Award, each Participant agrees to indemnify and hold the Company harmless from any losses, costs, damages, or expenses relating to any such sale; (d) to the extent the Company or its designee receives proceeds of such sale that exceed the amount owed, the Company will pay such excess in cash to the applicable Participant as soon as reasonably practicable; (e) the Company and its designees are under no obligation to arrange for such sale at any particular price; and (f) in the event the proceeds of such sale are insufficient to satisfy the Participant’s applicable obligation, the Participant may be required to pay immediately upon demand to the Company or its designee an amount in cash sufficient to satisfy any remaining portion of the Participant’s obligation.

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