Document:

cc-ex101_17.htm

EXHIBIT 10.1

   

AGREEMENT AND RELEASE

 

This Special Employment and Separation Agreement and Release ("Release" or “Agreement”) is made and entered into this 19 day of August 2022 by and between and The Chemours Company (“Chemours” or "Employer" or “Company”) and David C. Shelton ("Employee"), in connection with Employee's change of role effective October 1, 2022 (the “Effective Date”) and separation of employment with Employer, effective December 31, 2023 (the “Separation Date”). Together, Employer and Employee are the “Parties”.

 

 

In consideration of the mutual promises and releases contained herein and other good and valuable consideration as set forth herein, it is hereby agreed as follows:

 

	
 
	
1.
	
In full and final settlement of any claims and demands for relief which may be asserted by Employee against Employer, its predecessors, successors and assigns, and the Employer’s  directors, officers, agents, attorneys and representatives, and in exchange for the mutual promises and obligations of the Parties as set forth in this Release, the Parties agree as follows:

	
 
	
(a)
	
Employee shall remain employed by Employer as an employee until December 31, 2023.

	
 
	
i.
	
Except as noted below, between the time of the Effective Date and December 31, 2023, Employee will be a full service employee and his base salary and short and long term incentive awards and other forms of compensation and benefits will remain the same as he has been receiving prior to the Effective Date; however, the 2023 annual bonus will be paid pursuant to 1(b)i below, and on the first payroll period after the Separation Date.  Employee’s work will be as Special Counsel to the CEO, counseling on legacy liabilities and providing any knowledge transfer as requested by the CEO.  With respect to Employee’s long term incentive awards those awards will remain subject to, and will be paid under, the terms of the applicable award agreement(s). 

 

	
 
	
(b)
	
In exchange for his continued employment through 2023 as Special Counsel, in the Payroll period following the Separation Date the Company will make the following lump sum payments to Employee:

	
 
	
i.
	
$250,000 retention pay equal to one half a year’s salary (1 week of pay per year of service to a maximum of 26 weeks), and $350,000 that reflects the 2023 Annual Incentive Plan at target of 100%.

 

	
 
	
ii.
	
Payment for unused accrued vacation pay as of Separation Date and any other sums which Employee has accumulated under Employer’s Retirement Savings Restoration Plan to be paid pursuant to the terms and conditions of that plan. 

 

EXHIBIT 10.1

 

 

	
 
	
iii.
	
A lump sum payment equivalent to two weeks’ paid notice of termination, in the amount of $19,230.77.

 

	
 
	
iv.
	
A lump sum payment of $1,888 to maintain insurance coverage under Employer’s group health plans in which Employee is already enrolled.  Employee may use this lump sum payment to elect continuation of health benefits under COBRA by electing COBRA before that option ends, and if so elected Employee agrees to complete the required forms to elect continuation of benefits and to pay the premium and administrative fee amount directly to Employer’s third-party administrator for COBRA. Employee agrees that the provision of continuation of benefits will count towards the 18-month total period of coverage required to be provided pursuant to the Consolidated Omnibus Reconciliation Act (“COBRA”). Employee agrees that Employee must continue to pay the premium and any administrative fee pursuant to the COBRA election forms that will be provided to Employee at termination if COBRA is chosen.

 

	
 
	
(c)
	
The Company further commits to pay Employee an additional $400,000 in exchange for the Employee’s agreement that at Separation, he will sign the attached Exhibit B to this Agreement, to go into effect on January 1, 2024, after Separation. Exhibit B comprises Employee’s agreement to recommit to the promises and obligations described generally in this Release and that they will apply to the period between the Effective date and December 31, 2023.  Additionally, Employee will agree to Non-Competition, Non-Solicitation and mutual Non-Disparagement as described in Exhibit B.  Payment of the additional $400,000 will be made in 2024, no later than January 31, 2024, after the Exhibit B is signed agreeing to recommit to the provisions of this Agreement and the additional terms outlined in Exhibit B. 

	
 
	
(d)
	
The Company agrees to retain Employee as a Consultant as outlined in the attached consulting agreement at Exhibit C for $22,222.00 per month, to provide consulting services of no more than 20% of the average time spent during full-time employment from January 1, 2024 through June 30, 2025, or thereafter if both parties continue the arrangement. 

	
 
	
(e)
	
All settlement payments shall be subject to applicable federal, state, or local withholding, taxes, or other deductions or withholdings required by law or Employer’s Employee Welfare Benefits Plan, if any, and shall be payable in accordance with Employer’s ordinary payroll practices. Employee will be separately notified of Employee’s rights to benefits continuation pursuant to COBRA and entirely responsible for timely signing up, paying premiums and meeting associated deadlines for the COBRA option.

	
 
	
2.
	
Adequacy of Consideration.  Employee agrees that this consideration is adequate to support this Agreement. For the avoidance of doubt, if Employee revokes or does not timely return the executed Agreement Employee shall not be entitled to the payments and benefits set forth in the Agreement.  Similarly, with regard to the post separation Exhibits, if Employee fails to 

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timely sign the Certificate of Compliance attached hereto as Exhibit A, or Exhibits B and C at separation Employee shall not be entitled to the payments and benefits set forth in those Exhibits.  

 

	
 
	
3.
	
No Additional Benefits. Other than those payments and benefits described in this Agreement, which shall be paid subject to the terms and conditions of this Agreement, and the additional obligations and agreements at Separation, provided that Exhibits A, B and C are signed by Employee on or before January 22, 2024, Employee acknowledges and agrees that Employee is not entitled to any additional payments or benefits in connection with termination of Employee’s employment with Employer, including without limitation, the accrual of any additional benefits. 

	
 
	
4.
	
Tax Liability. Employee, on behalf of himself and his heirs, successors and assigns, agrees that, in the event he incurs any tax liability resulting from any payments described herein, he shall be solely responsible for such taxes and shall indemnify and hold Employer harmless from such taxes, interest and penalties.

	
 
	
5.
	
Duty of Cooperation. Employee agrees to reasonably cooperate with Employer and to provide all information and sign any corporate records and instruments that Employer may reasonably request with respect to any matter involving Employee’s employment relationship with Employer, the work Employee has performed, or present or former employees of Employer, including but not limited to any litigation with respect to such matters. 

	
 
	
6.
	
No Obligation to Mitigate. In no event shall Employee be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to Employee under any of the provisions of this Agreement, and such amounts shall not be reduced whether or not Employee obtains other employment, which he is freely permitted to do after the Separation Date and subject to the limitations outlined in Exhibit B.

 

	
 
	
7.
	
Indemnification/D&O.  Employee shall continue to be indemnified by the Company to the maximum extent permitted by applicable law and by the Company’s by-laws and shall continue to be covered as an officer and as a director of the Company under the Company’s applicable directors’ and officers’ or other third party liability insurance, including any “tail” coverage following Separation Date.  

 

	
 
	
8.
	
Acknowledgement No Claim for Wages or Compensation or FMLA leave. Except for any payments, short or long term incentive awards, or accrued vacation, or other forms of compensation referenced in Section 1 above, Employee acknowledges that Employee has been paid in full all compensation and benefits due to Employee as of the date of Employee’s signature on this Agreement including, but not limited to, having received all wages, overtime, meal and rest break pay, salary, expense reimbursement, penalty, bonus or other compensation of any kind which Employee is due or to which Employee believes Employee may be entitled. To the extent permitted by law, Employee waives any claim for wages, salary, reimbursement, penalty, bonus or other compensation earned or accrued through the date Employee signs this Agreement. Employee further warrants that, if applicable, Employee has exercised without interference all leave rights available to Employee under the Family and Medical Leave Act.

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EXHIBIT 10.1

 

	
 
	
9.
	
Age Discrimination Release Notification. This Agreement includes a release of all charges and claims under the Age Discrimination in Employment Act (“ADEA”) and, therefore, pursuant to 29 U.S.C. § 626(f), Employee acknowledges that:

	
 
	
(a)
	
Employee is releasing claims Employee may have under the ADEA; 

	
 
	
(b)
	
Employee has read and fully understands the terms of this Agreement; 

	
 
	
(c)
	
Employee has agreed to execute this Agreement knowingly and voluntarily;

	
 
	
(d)
	
As with any legal document, Employee is advised to consult with an attorney of Employee’s own choosing and to discuss all aspects of this Agreement with an attorney of Employee’s own choosing before signing this Agreement;

	
 
	
(e)
	
Employee is releasing all claims arising up to and including the date of this release until the end of his employment and Consulting Agreement;

	
 
	
(f)
	
Employee may sign at any time, but acknowledges that Employee has twenty-one (21) days in which to consider this release of claims under the ADEA, which Employee acknowledges to be a reasonable and sufficient period of time for review, deliberation, and negotiation; 

	
 
	
(g)
	
Employee has full knowledge of the implications of such settlement and release of claims; and 

	
 
	
(h)
	
Employee may revoke Employee’s release of claims under the ADEA for a period of seven (7) days from the date of Employee’s execution of the Agreement by delivering a written notice of revocation to Employer, to Susan Kelliher, Senior Vice President, People 1007 N. Market Street, Wilmington DE 19801 or Susan.Kelliher@chemours.com.

	
 
	
(i) 
	
No payment called for under paragraph 1 hereof will be made until the revocation period has passed.

	
 
	
12.
	
Unconditional General Release. Except as specifically provided elsewhere in this Agreement, in consideration of the benefits to Employee in this Agreement, the adequacy of which is hereby acknowledged, and as a material inducement to Employee to enter into this Agreement, Employee agrees for Employee’s heirs and personal or legal representatives, that by Employee’s signature, Employee is forever giving up and waiving any claims, whether known or unknown, Employee ever has had or may have against Employer, for any personal or monetary relief that is based, in whole or in part, on conduct that occurred by Employer on or before the date Employee signs this Agreement. Employee represents and warrants that Employee has no suits, claims, charges, complaints except as specifically provided elsewhere in this Agreement, in consideration of the benefits to Employee in this Agreement, the adequacy of which is hereby acknowledged, and as a material inducement to Employee to enter into this Agreement, Employee agrees for Employee’s heirs and personal or legal representatives, that by Employee’s signature, Employee is forever giving up and waiving any claims, whether known or unknown, Employee ever has had or may have against Employer, for any personal or monetary relief that is based, in whole or in part, on conduct that occurred by Employer on or before the date Employee signs this Agreement.

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13.
	
Waiver. By waiving and giving up such claims Employee understands that Employee is releasing Employer from any liability or obligation for any expense, damage, or loss Employee did or might claim based on, among other things, the following: (a) Employee’s employment with Employer or the termination of that employment; (b) any Employer policy, practice, contract, agreement, promise, publication, or other communication; (c) any tort or personal injury; (d) any policies, practices, laws or agreements governing the payment of wages, commissions or other compensation; (e) any laws governing employment discrimination, including, but not limited to, Title VII of the Civil Rights Act of 1964; Sections 1981 through 1988 of Title 42 of the United States Code; The Employee Retirement Income Security Act of 1974 ("ERISA") (except for any vested benefits under any tax qualified benefit plan); The Immigration Reform and Control Act; The Americans with Disabilities Act of 1990; the Delaware Whistleblowers’ Protection Act; The Age Discrimination in Employment Act of 1967 (“ADEA”);The Worker Adjustment and Retraining Notification Act; The Fair Credit Reporting Act; The Family and Medical Leave Act; The Genetic Information Nondiscrimination Act; The Equal Pay Act; The Sarbanes-Oxley Act retaliation provisions; The False Claims Act retaliation provisions; The Dodd-Frank Wall Street Reform and Consumer Protection Act retaliation provisions; The Older Worker Benefit Protection Act; and any similar federal, state, or local law or ordinance; (f) any claim of retaliation based on any federal, state, or local law or ordinance; (g) any laws or agreements that provide for punitive, exemplary or statutory damages; (h) any implied contract, covenant of good faith and fair dealing, or violation of public policy or claims that Employee was fraudulently induced to enter into this Agreement; interference with business opportunity or contracts, negligence, misrepresentation, fraud, detrimental reliance, personal injury, assault, battery, defamation, false light, invasion of privacy, infliction of emotional distress, retaliation, constructive discharge, or wrongful discharge; (i) any other federal, state or local law or ordinance relating to employment or benefits associated with employment; and (j) any laws or agreements that provide for payment of attorneys’ fees, costs or expenses.

	
 
	
14.
	
Claims Not Waived and Cooperation with Governmental Entities. This Agreement does not waive any claim for breach of this Agreement or claims that Employee may have that by law cannot be waived or released. Employee is not waiving any rights he/she may have to: (a) his/her own vested or accrued employee benefits under Employer’s health, welfare, or retirement plans as of Separation Date; (b) benefits and/or the right to seek benefits under applicable workers’ compensation and/or unemployment compensation statutes; (c) any bounty that may be recoverable as a result of participating in the Securities and Exchange Commission’s whistleblower program, or any other bounty program for which recovery cannot be waived as a matter of law; (d) pursue claims which by law cannot be waived by signing this Agreement; (e) enforce this Agreement; and/or (f) challenge the validity of this Agreement. Further, notwithstanding any other provision of this Agreement (including the non-disparagement provision and confidentiality provision), Employee may file a charge, or cooperate with any government agency (including but not limited to the Equal Employment Opportunity Commission (“EEOC”)) for claims not covered in this release, although this Agreement does prohibit Employee from obtaining any personal or monetary relief for Employee based on such a charge or based on Employee’s providing information to or cooperating with the EEOC or any other governmental agency or demands of any kind whatsoever currently pending against Chemours with any local, state, or federal court or any governmental, administrative, investigative, civil rights or other agency or board.  

	
 
	
15.
	
Non-Admission. Employee understands and agrees that Employer expressly denies any liability or any wrongdoing in connection with Employee’s separation from employment or in connection 

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with any dispute Employee may have with or about Employer. Employee further understands and agrees that Employer expressly denies any responsibility for any injury or loss Employee has or may allege.

	
 
	
16.
	
Section 409A. It is intended that this Agreement will comply with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the interpretive guidance thereunder, including the exemptions for short-term deferrals, reimbursements, limited payments, and in-kind distributions, and this Agreement shall be administered accordingly, and interpreted and construed on a basis consistent with such intent. To the extent that any provision of this Agreement would fail to comply with the applicable requirements of Code Section 409A, the Company may, in its sole discretion, make such modifications to the Agreement and/or payments to be made thereunder to the extent it determines necessary to comply with the requirements of Code Section 409A; provided, however, that the Company shall in no event be obligated to pay any interest, compensation, or penalties in respect of any such modifications; and provided, further, that neither the Company nor Employee will have the right to accelerate or defer the delivery of any payments or benefits except to the extent specifically permitted or required by Section 409A. Employee hereby releases and holds harmless the Company, its directors, officers, and stockholders from any and all claims that may arise from or relate to any tax liability, penalties, interest, costs, fees, or other liability incurred by Employee as a result of the application of Code Section 409A. Nothing in this Agreement shall be construed as a guarantee of any particular tax effect for the Employee’s compensation and benefits, and the Company does not guarantee that any compensation or benefits provided under this Agreement will satisfy the provisions of Code Section 409A. 

	
 
	
17.
	
Severability. If any portion or clause of this Agreement is void or deemed unenforceable for any reason, the unenforceable portion or clause shall be deemed severed from the remaining portions of this Agreement, which shall otherwise remain in full force.

18. No Assignment of Claims Released. Employee represents that Employee has not assigned, given or sold any portion of any claim represented to be released in this Agreement to anyone else. If Employee shall die before all the payments required by this Agreement and those payments required in Exhibit B  to be made to Employee have been made, then all remaining payments, except those outlined in Exhibit C which are not included in this provision, shall be made to Employee’s estate or such person or trust as Employee shall designate. 

	
 
	
19.
	
Governing Law and Venue. This Agreement shall be interpreted in accordance with the laws of the State of Delaware. Any dispute or controversy related to, or arising from, this Agreement shall be brought exclusively in the state or federal court located in New Castle County, Delaware.  Employee submits to personal jurisdiction in these courts.  

	
 
	
20.
	
DTSA Notification. Under the federal Defend Trade Secrets Act of 2016, Employee shall not be held criminally or civilly liable under any federal or state trade secret law for the disclosure of a trade secret that: (a) is made (i) in confidence to a federal, state, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law; or (b) is made to Employee’s attorney in relation to a lawsuit for retaliation against Employee for reporting a suspected violation of law; or (c) is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal.

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21. Entire Agreement. Each of the parties to this Agreement represents and warrants to the other that, except for the obligations contained in this Agreement and those continuing obligations under his Employment Agreement and Exhibit A , Exhibit B and in his Consulting Agreement (Exhibit C), there are no other obligations of any kind between the parties. Employee agrees that in executing this Agreement Employee does not rely upon and has not relied upon any representation or statement not set forth in this Agreement with regard to the subject matter, basis or effect of this Agreement. Employee represents that Employee has carefully read the Agreement, that Employee has been fully and fairly advised as to its terms and that Employee executes this Agreement as Employee’s own free act and deed.

	
 
	
22.
	
Binding Agreement. This Agreement is binding upon and its benefits accrue to the parties hereto and their respective successors, executors, administrators, and permitted assigns. 

IN WITNESS WHEREOF, the parties hereto, have executed this Agreement on the date(s) set forth below, intending to be legally bound hereby.

 

 

			
	
 
	
 
	
/s/ David C. Shelton

	
Witness
	
 
	
David C. Shelton

	
 
	
 
	
 

	
Date: August 19, 2022     
	
 
	
 

 

 

 

			
	
 
	
 
	
FOR: The Chemours Company

	
Witness
	
 
	
 

	
 
	
 
	
 

	
Date: August 19, 2022     
	
 
	
By: /s/ Susan Kelliher

 

 

 

 

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EXHIBIT 10.1

 

 

  

EXHIBIT “A”

 

THE CHEMOURS COMPANY

Certificate of Compliance

 

This to certify that in connection with the termination of my employment with The Chemours Company, I do not have in my possession, nor have I have failed to return, any records, documents, laboratory notebooks, data, specifications, materials, drawings, blueprints, reproductions, sketches, notes, reports, proposals, customer lists, computer software (including source or object code listings therefor), documentation accompanying computer software, flow charts, data structures, data files, algorithms, programs structures and logic, prototypes and like items or copies of the foregoing or any other documents, materials or written or computerized information belonging to The Chemours Company or to any of its subsidiaries, joint ventures, or affiliated companies, or to their clients, customers, or licensees.

 

I further state that I have been advised that I am obligated to preserve in confidence and not use for my own benefit or for the benefit of any third party (including any future employer or client) any and all confidential and proprietary company information that I learned about during my employment with the company, including any such information relating to trade secrets; research initiatives and projects; manufacturing and research processes and methods; experimental and test results; computer software and code; data or information relating to company’s products or services; mailing lists; cost and pricing information; lists of customers or prospective customers; marketing or strategy information; competitive intelligence; employee compensation information; and including any such confidential or proprietary information pertaining to any of company’s subsidiaries, joint ventures, suppliers, customers, consultants or licensees. I understand that this Certificate of Compliance is not to be construed as a substitute for my Employment Agreement and that to the extent that I have obligations under such an agreement, I hereby state and affirm that I intend to comply with those obligations.

 

We also take this opportunity to remind you that under the Employee Agreement which you signed at the commencement of your employment with the company, you are obligated to preserve in confidence and not divulge or use for your own benefit or the benefit of any third party (including any future employer or client) any of the following:  all confidential and proprietary information, knowledge, data, documents or other information relating to company’s products, systems, manufacturing facilities, technology, research programs, know-how, designs, data, customer lists, shareholders or any other proprietary information pertaining to any business of The Chemours Company or any of its subsidiaries, parents, or affiliated companies, or information pertaining to any of company’s suppliers, customers, consultants or licensees that you have learned during your term of employment.

 

ACKNOWLEDGED AND AGREED this ____ day of December, 2023 

 

 

___________________________________________________________________________________________

_____________________________

David Shelton

 

 

 

FOR: The Chemours Company 

 

By:____________________________________________________________

 

 

____________________________________________________________

Print name, title

 

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Exhibit B – Post Separation Agreement

 

This Exhibit B (Post Separation Agreement) is made and entered into this ___ day of January 2024 by and between and The Chemours Company (“Chemours” or "Employer" or “Company”) and David Shelton ("Employee"), in connection with Employee's Separation of Employment effective December 31, 2023 (the “Separation Date”).

 

In exchange for a payment of $400,000, Employee agrees to the following:

 

A. Employee agrees and recommits and incorporates to all of the obligations and terms in the Special Employment and Separation Agreement and Release signed 19 August 2022, and specifically additionally agrees that all of the terms of that Agreement apply to the entire time period between 19 August 2022 and the signing of this Exhibit B.

 

B. Additionally, Employee will abide by the following Non-Competition, Non-Solicitation and Non-disparagement provisions:

 

a.Unless Employee first obtains the Company’s written consent, Employee will not disclose or use at any time in any way any Chemours’ trade secret, or technical or nontechnical confidential information of Chemours of which he became or becomes aware either before or after Employee’s departure from Chemours, except where such disclosure is required by law.

b.For 2 year(s) from the end of Employee’s Consulting agreement on June 30, 2025, refrain from entering into an employment or consulting relationship with DuPont or Corteva, or the following direct competitors of Chemours:  Tronox, Venator, Lomon Billons, Kronos, Honeywell, Arkema, or Solvay.

c.For 2 year(s) from the end of Employee’s Consulting agreement on June 30, 2025, Employee agrees not to hire, recruit, solicit or induce any employee of the Company to terminate his or her employment with the Company and/or to seek employment with his subsequent or prospective employer; 

d.Upon request, Employer will provide Employee’s last job title, date of hire and last salary through the termination date. 

e. Employee and Employer mutually agree that they will not make any disparaging, slanderous or libelous verbal or written statements or in any way communicate information to third parties for the purpose of damaging any Parties’ business standing or reputation.  

 

C. Employer agrees to make the payment of $400,000 on or before January 31, 2024 in exchange for these additional agreements in Exhibit B to the Special Employment and Separation Agreement.

 

Acknowledged and Agreed this ___ day of December, 2023.

 

 

_____________________________

David C. Shelton

 

 

Date:  _____________________

 

For: The Chemours Company

 

 

______________________________

 

Date: ___________________________

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Exhibit C

Consulting Agreement for Private Consulting Activities

 

 

 

The Chemours Company FC, LLC (hereinafter "COMPANY") and David Shelton (hereinafter "CONSULTANT") agree that CONSULTANT will advise COMPANY on matters relating to his previous roles as Special Counsel to the CEO and Senior Vice President, General Counsel and Corporate Secretary under the following terms and conditions (“this Agreement”):

 

1.Consulting Services. CONSULTANT's responsibilities shall include, without limitation, the following activities (hereinafter collectively referred to as "Services"):  Advice, counsel, assistance and/or advocacy with Chemours as requested by Mark Newman.  

 

CONSULTANT shall perform the Services only upon COMPANY's request and after the scope of the Services has been approved by COMPANY.  The Services may be performed via telephone and digitally and may include meetings with personnel and other consultants at times and locations to be mutually agreed upon. 

 

2.Compensation.  In consideration for CONSULTANT's services hereunder, COMPANY shall pay CONSULTANT as follows:  

 

a.$22,222.00 per month (“Base Fee”) for no more than 20% of average prior full time service a month.

b.Pre-approved, reasonable out-of-pocket expenses (upon presentation of appropriate receipts) incurred by CONSULTANT, including all travel, food and lodging, in connection with the Services provided hereunder.

i. CONSULTANT shall perform services at the Company’s request, but in no event shall CONSULTANT be required to provide more than 20% of average prior full time service a month.  Payment for the Base Fee and any out-of-pocket expenses shall be made within sixty days (60) days of receipt of services and, in the case of out-of-pocket expenses, submission of appropriate vouchers and receipts as may be reasonably necessary to substantiate CONSULTANT's out-of-pocket expenses. 

ii. Any reimbursements that constitute deferred compensation for purposes of Section 409A of the Internal Revenue Code shall be provided in a manner that complies with Treasury Regulation Section 1.409A-3(i)(1)(iv). Accordingly, (i) such reimbursements will be made not later than the last day of the calendar year after the calendar year in which the expenses were incurred, (ii) any right to such reimbursements will not be subject to liquidation or exchange for another benefit, and (iii) the amount of the expenses eligible for reimbursement during any taxable year will not affect the amount of expenses eligible for reimbursement in any other taxable year.  

iii. CONSULTANT shall not be paid and is not entitled to vacation, holiday or sick time during the term of Agreement.  In the event of premature termination of the Agreement COMPANY shall pay CONSULTANT for the Services performed and expenses incurred through the date of termination.  

 

3.Term and Termination.  This Agreement shall be effective upon full execution of this Agreement and continue for a period of eighteen months (18) months beginning January 1, 2024, through June 30, 2025, to be extended beyond June 30, 2025 at COMPANY’s discretion on a month-to-month basis, not to exceed 12 months. 

a. The Agreement may be extended by written agreement signed by the parties.  Termination or expiration of this Agreement shall not affect any rights or obligations which have accrued prior thereto or in connection therewith. Any written agreements altering the term and/or conditions of this agreement must be reviewed and approved in advance by the Senior Vice President, People.

 

 

 

 

 

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4.Confidential Information.  

 

a.With respect to any Company information shared with CONSULTANT pursuant to this agreement, or information of a technical or business information of a proprietary or confidential nature which CONSULTANT may consult or obtain from COMPANY under this Agreement, or which is developed by CONSULTANT as a result of CONSULTANT's Services hereunder (all of such information being referred to hereinafter as "Company Information"), it is understood that until the Company Information in question has been disclosed by COMPANY to the public generally or until COMPANY grants CONSULTANT specific written approval to deal otherwise with Company Information, CONSULTANT will:

 

i)treat and maintain all Company Information as confidential;

 

ii)not use any Company Information except as required by law and to the extent necessary for the aforesaid consulting tasks; and

 

iii)not disclose any Company Information to any third party without prior written approval from COMPANY: and

 

iv)Upon a conclusion of this Agreement CONSULTANT shall promptly return all Confidential Information.

 

b.Consultant’s obligations set forth in this Section 4 shall not apply with respect to any portion of the Company Information that is required to be disclosed in response to a valid order by a court or other governmental body, or as otherwise required by law.

 

5. Computer Access.  If CONSULTANT will be provided access to COMPANY’s computer systems, CONSULTANT shall execute and comply with the "Chemours Electronic Access Agreement".

 

6.Privacy.  If any personal information (i.e., information that can reveal the identity of a person) will be transferred to or processed by CONSULTANT, CONSULTANT shall execute and comply with COMPANY’s "Data Transfer Agreement".  Any personal information provided by one Party to the other may only be used in connection with this Agreement and may not be used for direct marketing or transferred to any third party.

 

7.Records Retention and Audits.  CONSULTANT shall maintain, in secure locations (to prevent destruction and unauthorized access) and in accordance with Generally Accepted Accounting Principles and Practices and statutory requirements, records sufficient to document all charges.  Upon notice from COMPANY, CONSULTANT shall provide COMPANY (and its accountants and auditors) with access to such records (except for records regarding CONSULTANT’S internal costs) to determine if the charges are accurate according to this Agreement and to otherwise audit compliance with this Agreement

 

8.Compliance.  In the performance of the Services hereunder, CONSULTANT shall comply with all applicable federal, state and local laws, regulations and guidelines.  CONSULTANT shall also comply with COMPANY's polices and Code of Conduct when performing duties for COMPANY.

 

9.Independent Contractor.  CONSULTANT's status under this Agreement is that of an independent contractor.  CONSULTANT shall not be deemed an employee, agent, partner or joint venturer of COMPANY for any purpose whatsoever, and CONSULTANT shall have no authority to bind or act on behalf of COMPANY.  This Agreement shall not entitle CONSULTANT to participate in any benefit plan or program of COMPANY.  CONSULTANT shall be responsible for, and agrees to comply with, obligations under federal and state tax laws for payment of income and, if applicable, self-employment tax.

 

10.Assignment.  CONSULTANT may not assign this Agreement or any interest herein, or delegate any of its duties hereunder, to any third party without COMPANY's prior written consent, which consent is within 

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COMPANY's sole discretion to grant or withhold.  Any attempted assignment or delegation without such consent shall be null and void. 

 

11. Indemnification.  The terms of Chemours executive D&O Indemnification Agreement are incorporated by reference herein, and shall apply to CONSULTANT to Services specifically requested and authorized under this Agreement.

 

12.Liability.

(a) Except as provided in clause (b):  (i) neither Party shall be liable to the other Party under this Agreement for any indirect, incidental, special, consequential or punitive damages; and (ii) the aggregate liability of either Party to the other Party for damages under this Agreement shall not exceed $250,000 or the aggregate charges under this Agreement, whichever is greater.

(b) The limitations of liability in clause (a) shall not apply to:  (i) breach of the "Confidential Information" Section by CONSULTANT or the obligations of either Party pursuant to the "Indemnification" Section.

 

11. Entire Agreement.  This Agreement contains the entire understanding of the parties with respect to the matters herein contained.  This agreement may be modified only by written agreement signed by the parties.

 

12.  Choice of Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of  Delaware without regard to its conflicts of laws rules. Each Party consents to the exclusive jurisdiction of, and service of process by, the United States District Court for Delaware or the state courts of Delaware with respect to this Agreement.

 

 

 

 

COMPANY

(Address)  By:  _________________________________ Date:  _______________

 

 

 

CONSULTANT

(Address) By:  ___________________________________   Date:  ______________

 

 

 

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Exhibit 10.1

HARMONIC INC.

2002 EMPLOYEE STOCK PURCHASE PLAN

(Amended and Restated, June 9, 2022)

The following constitute the provisions of the 2002 Employee Stock Purchase Plan (the “Plan”) of Harmonic Inc.

1)    Purpose. The purpose of the Plan is to provide employees of the Company and its Designated Companies with an opportunity to purchase Common Stock of the Company through accumulated payroll deductions. 

    The Plan includes two components: a Code Section 423 component (the “423 Component”) and a non-Code Section 423 component (the “Non-423 Component”).  It is the intention of the Company to have the 423 Component qualify as an “Employee Stock Purchase Plan” under Section 423 of the Code, and the 423 Component, accordingly, shall be construed so as to extend and limit participation in a uniform and nondiscriminatory basis consistent with the requirements of Section 423.  Under the Non-423 Component, which does not qualify as an “Employee Stock Purchase Plan” under Section 423 of the Code, options will be granted pursuant to rules, procedures or sub-plans adopted by the Administrator designed to achieve tax, securities laws or other objectives for eligible employees.  Except as otherwise provided herein, the Non-423 Component will operate and be administered in the same manner as the 423 Component.

2)    Definitions. 

a)    “Administrator” shall mean the Board or any Committee designated by the Board to administer the Plan pursuant to Section 15.

b)    “Affiliate” means any entity that, directly or indirectly through one or more intermediaries, controls, is controlled by or is under the common control with, the Company. 

c)    “Board” shall mean the Board of Directors of the Company. 

d)    “Change-of-Control” shall mean the occurrence of any of the following events:

i)    any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the total voting power represented by the Company’s then outstanding voting securities; 

ii)    the consummation of the sale or disposition by the Company of all or substantially all of the Company’s assets; 

iii)    the consummation of a merger or consolidation of the Company, with any other corporation, other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) at least fifty percent (50%) of the total voting power represented by the voting securities of the Company, or such surviving entity or its parent outstanding immediately after such merger or consolidation; or

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iv)    a change in the composition of the Board, as a result of which fewer than a majority of the Directors are Incumbent Directors. “Incumbent Directors” shall mean Directors who either (A) are Directors of the Company, as applicable, as of the date hereof, or (B) are elected, or nominated for election, to the Board with the affirmative votes of at least a majority of those Directors whose election or nomination was not in connection with any transaction described in subsections (i), (ii) or (iii) or in connection with an actual or threatened proxy contest relating to the election of Directors of the Company.

e)    “Code” shall mean the U.S. Internal Revenue Code of 1986, as amended. 

f)    “Committee” means a committee of the Board appointed by the Board in accordance with Section 15 hereof.

g)    “Common Stock” shall mean the common stock, par value $.001 per shares, of the Company (including any new, additional or different stock or securities resulting from any change in capitalization pursuant to Section 20 hereof). 

h)    “Company” shall mean Harmonic Inc., a Delaware corporation, and any Designated Company of the Company.

i)    “Compensation” shall mean all base straight time gross earnings, including commissions and payments for overtime and shift premiums, but exclusive of payments for incentive compensation, incentive payments, bonuses and other compensation. The Administrator shall have the discretion to determine the application of this definition to participants outside the U.S.

j)    “Designated Company” shall mean any Subsidiary or Affiliate (in the case of a Non-423 Component) selected by the Administrator as eligible to participate in the Plan. The Administrator may so designate any Subsidiary or Affiliate, or revoke any such designation, at any time and from time to time, and may further designate such companies or participants as participating in the 423 Component or the Non-423 Component. The Administrator may also determine which Affiliates or eligible employees may be excluded from participation in the Plan, to the extent consistent with Section 423 of the Code or as implemented under the Non-423 Component. For purposes of the 423 Component, only the Company and its Subsidiaries may be Designated Companies; provided, however, that at any given time, a Subsidiary that is a Designated Company under the 423 Component will not be a Designated Company under the Non-423 Component. 

k)    “Director” shall mean a member of the Board. 

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l)    “Employee” shall mean any individual who is an employee of the Company or any Designated Company on the payroll records thereof.  For purposes of clarity, the term “Employee” shall not include the following, regardless of any subsequent reclassification as an employee by the Company or a Designated Company, any governmental agency, or any court: (i) any independent contractor; (ii) any consultant; (iii) any individual performing services for the Company or a Designated Company who has entered into an independent contractor or consultant agreement with the Company or a Designated Company; (iv) any individual performing services for the Company or a Designated Company under an independent contractor or consultant agreement, a purchase order, a supplier agreement or any other agreement that the Company or a Designated Company enters into for services; (v) any individual classified by the Company or a Designated Company as contract labor (such as contractors, contract employees, job shoppers), regardless of length of service; and (vi) any leased employee.  The Administrator shall have discretion to determine whether an individual is an Employee for purposes of the Plan.  For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual is on sick leave or other leave of absence approved by the Company; provided, however, for purposes of the Non-423 Component, where the period of leave exceeds 90 days and the individual’s right to reemployment is not guaranteed either by statute or by contract, the employment relationship shall be deemed to have terminated on the 91st day of such leave.

m)    “Eligible Employee” shall mean an Employee whose customary employment with the Company or a Designated Company is at least twenty (20) hours per week and more than five (5) months in any calendar year, unless otherwise required under applicable law. 

n)    “Exchange Act” shall mean the U.S. Securities Exchange Act of 1934, as amended. 

o)    “Exercise Date” shall mean the last Trading Day of each Purchase Period.

p)    “Fair Market Value” shall mean, as of any date, the value of Common Stock determined as follows:

(i)    if the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq Global Select Market, the Nasdaq Global Market or the Nasdaq Capital Market of the Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system on the date of determination, as reported in The Wall Street Journal or such other source as the Board deems reliable;

(ii)    if the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean of the closing bid and asked prices for the Common Stock on the date of determination, as reported in The Wall Street Journal or such other source as the Board deems reliable; and

(iii)    in the absence of an established market for the Common Stock, the Fair Market Value thereof shall be determined in good faith by the Board.

q)    “Offering Date” shall mean the first Trading Day of each Offering Period. 

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r)     “Offering Periods” shall mean the periods of approximately 6 (six) months during which an option granted pursuant to the Plan may be exercised, commencing on the first Trading Day on or after July 1 and January 1 of each year and terminating on the last Trading Day on or after the January 1 and July 1 Offering Period commencement date approximately 6 (six) months later. The duration and timing of Offering Periods may be changed pursuant to Section 4 of this Plan.  Unless otherwise specified by the Administrator, each Offering Period under the Plan to the Eligible Employees of the Company or a Designated Company shall be deemed a separate Offering Period, even if the dates of the applicable Offering Periods of each such Offering Period are identical, and the provisions of the Plan will separately apply to each Offering Period. To the extent permitted by U.S. Treasury Regulation Section 1.423-2(a)(1), the terms of each Offering Period need not be identical provided that the terms of the Plan and an Offering Period together satisfy any applicable provisions under U.S. Treasury Regulation Section 1.423-2(a)(2) and (a)(3).

s)    “Plan” shall mean this 2002 Employee Stock Purchase Plan, as amended from time to time. 

t)    “Purchase Period” shall mean the approximately six (6) month period commencing on one Exercise Date and ending with the next Exercise Date, except that the first Purchase Period of any Offering Period shall commence on the Offering Date and end with the next Exercise Date.

u)    “Purchase Price” shall mean 85% (eighty-five percent) of the Fair Market Value of a share of Common Stock on the Offering Date or on the Exercise Date, whichever is lower; provided however, that the Purchase Price may be adjusted by the Administrator pursuant to Section 20.

v)    “Subsidiary” shall mean a “subsidiary corporation,” whether now or hereafter existing, as defined in Section 424(f) of the Code.

w)    “Trading Day” shall mean a day on which the Nasdaq Global Select Market or such other securities exchange or inter-dealer quotation system as may at the applicable time be the principal market for the Common Stock System is open for trading.

3)    Eligibility. 

(a)    Offering Periods. Any Eligible Employee on a given Offering Date shall be eligible to participate in the Plan.

(b)    Limitations. Any provisions of the Plan to the contrary notwithstanding, no Eligible Employee shall be granted an option under the Plan (i) to the extent that, immediately after the grant, such Eligible Employee (or any other person whose stock would be attributed to such Eligible Employee pursuant to Section 424(d) of the Code) would own capital stock of the Company and/or hold outstanding options to purchase such stock possessing 5% (five percent) or more of the total combined voting power or value of all classes of the capital stock of the Company or of any Subsidiary, or (ii) to the extent that his or her rights to purchase stock under all employee stock purchase plans of the Company and its subsidiaries accrues at a rate which exceeds $25,000 (twenty-five thousand dollars) worth of stock (determined at the fair market value of the shares at the time such option is granted) for each calendar year in which such option is outstanding at any time.

4)    Offering Periods. The Plan shall be implemented by consecutive Offering Periods with a new Offering Period commencing on the first Trading Day on or after July 1 and January 1 each year, or on such other date as the Board shall determine, and continuing thereafter until terminated in accordance with Section 20 hereof. The Board shall have the power to change the duration of Offering Periods (including the commencement dates thereof) with respect to future offerings without stockholder approval if such change is announced prior to the scheduled beginning of the first Offering Period to be affected thereafter.
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5)    Participation. 

(a)    Offering Periods. An Eligible Employee may become a participant in the Plan by completing a subscription agreement in the form provided by the Company authorizing payroll deductions and filing it with the Company’s payroll office at least 5 (five) days prior to the applicable Offering Date or as otherwise determined by the Administrator.

(b)    Payroll Deductions. Payroll deductions for a participant shall commence on the first pay day following the first day of the applicable Offering Period and shall end on the last pay day in the Offering Period to which such authorization is applicable, unless sooner terminated by the participant as provided in Section 11 hereof. If payroll deductions for purposes of the Plan are prohibited or otherwise problematic under applicable law (as determined by the Administrator in its discretion), the Administrator may require participants to contribute to the Plan by such other means as determined by the Administrator. Any reference to “payroll deductions” in Section 6 (or in any other section of the Plan) will similarly cover contributions by other means made pursuant to this Section 5.

6)    Payroll Deductions. 

(a)    At the time a participant files his or her subscription agreement, he or she shall elect to have payroll deductions made on each pay day during the Offering Period in an amount not exceeding 10% (ten percent) of the Compensation which he or she receives on each pay day during the Offering Period; provided, however, that should a pay day occur on an Exercise Date, a participant shall have the payroll deductions made on such day applied to his or her account under the new Offering Period or Purchase Period, as the case may be. A participant’s subscription agreement shall remain in effect for successive Offering Periods unless terminated as provided in Section 11 hereof.

(b)    Payroll deductions for a participant shall commence on the first pay day following the Offering Date and shall end on the last pay day in the Offering Period to which such authorization is applicable, unless sooner terminated by the participant as provided in Section 11 hereof, for any Offering Period as determined.

(c)    All payroll deductions made for a participant shall be credited to his or her account under the Plan and shall be withheld in whole percentages only. A participant may not make any additional payments into such account.

(d)    A participant may discontinue his or her participation in the Plan as provided in Section 11 hereof, or may decrease, but not increase, the rate of his or her payroll deductions during the Offering Period by completing or filing with the Company a new subscription agreement authorizing a change in payroll deduction rate. The Administrator may, in its discretion, limit the nature and/or number of participation rate changes during any Offering Period. The change in rate shall be effective with the first full payroll period following 5 (five) business days after the Company’s receipt of the new subscription agreement unless the Company elects to process a given change in participation more quickly.

(e)    Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of the Code and Section 3(b) hereof, a participant’s payroll deductions may be decreased to zero percent (0%) at any time during a Purchase Period. Payroll deductions shall recommence at the rate provided in such participant’s subscription agreement at the beginning of the first Purchase Period which is scheduled to end in the following calendar year, unless terminated by the participant as provided in Section 11 hereof.
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7)    Grant of Option. On the Offering Date of each Offering Period, each Eligible Employee participating in such Offering Period shall be granted an option to purchase on each Exercise Date during such Offering Period (at the applicable Purchase Price) up to a number of shares of the Company’s Common Stock determined by dividing such Eligible Employee’s payroll deductions accumulated prior to such Exercise Date and retained in the Participant’s account as of the Exercise Date by the applicable Purchase Price; provided that in no event shall an Eligible Employee be permitted to purchase during each Purchase Period more than 1,500 shares of the Company’s Common Stock (subject to any adjustment pursuant to Section 20), and provided further that such purchase shall be subject to the limitations set forth in Sections 3(b), 7 and 12 hereof. The Eligible Employee may accept the grant of such option by turning in a completed subscription agreement to the Company at least 5 (five) days prior to an Offering Date or as otherwise determined by the Administrator. The Administrator may, for future Offering Periods, increase or decrease, in its absolute discretion, the maximum number of shares of the Company’s Common Stock an Eligible Employee may purchase during each Purchase Period of such Offering Period. Exercise of the option shall occur as provided in Section 8 hereof, unless the participant has withdrawn pursuant to Section 11 hereof. The option shall expire on the last day of the Offering Period.

8)    Exercise of Option. 

(a)    Unless a participant withdraws from the Plan as provided in Section 11 hereof, his or her option for the purchase of shares shall be exercised automatically on the Exercise Date, and the maximum number of full shares subject to option shall be purchased for such participant at the applicable Purchase Price with the accumulated payroll deductions in his or her account. No fractional shares shall be purchased. Unless otherwise determined by the Administrator in advance of an Offering Period, any payroll deductions accumulated in a participant’s account which are not sufficient to purchase a full share shall be retained in the participant’s account for the subsequent Purchase Period or Offering Period, subject to earlier withdrawal by the participant as provided in Section 11 hereof. Any other funds left over in a participant’s account after the Exercise Date shall be returned to the participant. During a participant’s lifetime, a participant’s option to purchase shares hereunder is exercisable only by him or her.

(b)    If the Administrator determines that, on a given Exercise Date, the number of shares with respect to which options are to be exercised may exceed (i) the number of shares of Common Stock that were available for sale under the Plan on the Offering Date of the applicable Offering Period, or (ii) the number of shares available for sale under the Plan on such Exercise Date, the Administrator may in its sole discretion (x) provide that the Company shall make a pro rata allocation of the shares of Common Stock available for purchase on such Offering Date or Exercise Date, as applicable, in as uniform a manner as shall be practicable and as it shall determine in its sole discretion to be equitable among all participants exercising options to purchase Common Stock on such Exercise Date, and continue all Offering Periods then in effect, or (y) provide that the Company shall make a pro rata allocation of the shares available for purchase on such Offering Date or Exercise Date, as applicable, in as uniform a manner as shall be practicable and as it shall determine in its sole discretion to be equitable among all participants exercising options to purchase Common Stock on such Exercise Date, and terminate any or all Offering Periods then in effect pursuant to Section 20 hereof. The Company may make pro rata allocation of the shares available on the Offering Date of any applicable Offering Period pursuant to the preceding sentence, notwithstanding any authorization of additional shares for issuance under the Plan by the Company’s stockholders subsequent to such Offering Date.

9)    Delivery. As soon as reasonably practicable after each Exercise Date on which a purchase of shares occurs, the Company shall arrange the delivery to each participant the shares purchased upon exercise of his or her option in a form determined by the Administrator.
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10)    Tax Withholding. At the time the participant realizes income in connection with the Plan, the participant must make adequate provision for the U.S. and non-U.S. federal, state, local or other tax withholding obligations, if any, of the Company or (if different) the Subsidiary or Affiliate employing the participant. At any time, the Company and/or the applicable Subsidiary or Affiliate may, but shall not be obligated to, withhold from the participant’s compensation the amount necessary for the Company to meet applicable withholding obligations, including any withholding required to make available to the Company any tax deductions or benefits attributable to sale or early disposition of Common Stock by the Eligible Employee. In addition, the Company and/or the applicable Subsidiary or Affiliate may, but will not be obligated to, withhold from the proceeds of the sale of Common Stock or any other method of withholding that the Company or the Subsidiary or Affiliate deems appropriate to the extent permitted by U.S. Treasury Regulation Section 1.423-2(f) with respect to the 423 Component.  The Company will not be required to issue any Common Stock under the Plan until such obligations are satisfied.

11)    Withdrawal. 

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

(b)    A participant’s withdrawal from an Offering Period shall not have any effect upon his or her eligibility to participate in any similar plan that may hereafter be adopted by the Company or in succeeding Offering Periods which commence after the termination of the Offering Period from which the participant withdraws.

12)    Termination of Employment. In the event a participant ceases to be an Eligible Employee of the Company or any Designated Company, as applicable, he or she will be deemed to have elected to withdraw from the Plan and the payroll deductions credited to such participant’s account during the Offering Period but not yet used to exercise the option will be returned to such participant or, in the case of his or her death, to the person or persons entitled thereto under Section 16 hereof, and such participant’s option will be automatically terminated.

13)    Interest. No interest shall accrue on the payroll deductions of a participant in the Plan, unless otherwise required under applicable law.

14)    Stock. 

(a)    Subject to adjustment upon changes in capitalization of the Company as provided in Section 20 hereof, the maximum number of shares of the Company’s Common Stock which shall be made available for sale under the Plan shall be 19,800,000 shares.

(b)    Until the shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), a participant shall only have the rights of an unsecured creditor with respect to such shares, and no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to such shares.

(c)    Shares to be delivered to a participant under the Plan shall be registered in the name of the participant or in the name of the participant and his or her spouse.

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15)    Administration. The Administrator shall administer the Plan and shall have full and exclusive discretionary authority to construe, interpret and apply the terms of the Plan, to determine eligibility, and to adjudicate all disputed claims filed under the Plan.  The Administrator shall also have full and exclusive discretionary authority to accommodate the specific requirements of local laws, regulations and procedures for jurisdictions outside the U.S., and to adopt special rules or sub-plans applicable to employees of a particular Designated Company, whenever the Administrator determines that such rules are necessary or appropriate for the implementation of the Plan in a jurisdiction where such Designated Company has employees, regarding, without limitation, eligibility to participate in the Plan, handling and making of payroll deductions or contribution by other means, establishment of bank or trust accounts to hold payroll deductions, payment of interest, conversion of local currency, obligations to pay payroll tax, withholding procedures and handling of share issuances, any of which may vary according to applicable requirements; provided that if such special rules or sub-plans are inconsistent with the requirements of Section 423(b) of the Code, the employees subject to such special rules or sub-plans will participate in the Non-423 Component. Every finding, decision and determination made by the Administrator shall, to the full extent permitted by law, be final and binding upon all parties.

16)    Designation of Beneficiary. 

(a)    A participant may file a written designation of a beneficiary who is to receive any shares and cash, if any, from the participant’s account under the Plan in the event of such participant’s death subsequent to an Exercise Date on which the option is exercised but prior to delivery to such participant of such shares and cash. In addition, a participant may file a written designation of a beneficiary who is to receive any cash from the participant’s account under the Plan in the event of such participant’s death prior to exercise of the option. If a participant is married and the designated beneficiary is not the spouse, spousal consent shall be required for such designation to be effective.

(b)    Such designation of beneficiary may be changed by the participant at any time by written notice. In the event of the death of a participant and in the absence of a beneficiary validly designated under the Plan who is living at the time of such participant’s death, the Company shall deliver such shares and/or cash to the executor or administrator of the estate of the participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such shares and/or cash to the spouse or to any one or more dependents or relatives of the participant, or if no spouse, dependent or relative is known to the Company, then to such other person as the Company may designate.

(c)    All beneficiary designations shall be in such form and manner as the Administrator may designate from time to time. For participants outside the U.S., the designation of beneficiary is subject to the Administrator’s prior approval.  

17)    Transferability. Neither payroll deductions credited to a participant’s account nor any rights with regard to the exercise of an option or to receive shares under the Plan may be assigned, transferred, pledged or otherwise disposed of in any way (other than by will, the laws of descent and distribution or as provided in Section 16 hereof) by the participant. Any such attempt at assignment, transfer, pledge or other disposition shall be without effect, except that the Company may treat such act as an election to withdraw funds from an Offering Period in accordance with Section 11 hereof.

18)    Use of Funds. All payroll deductions received or held by the Company under the Plan may be used by the Company for any corporate purpose, and the Company shall not be obligated to segregate such payroll deductions, unless otherwise required under applicable law. Until shares are issued, participants shall only have the rights of an unsecured creditor.

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19)    Reports. Individual accounts shall be maintained for each participant in the Plan. Statements of account shall be given to participating Eligible Employees at least annually, which statements shall set forth the amounts of payroll deductions, the Purchase Price, the number of shares purchased and the remaining cash balance, if any.

20)    Adjustments Upon Changes in Capitalization, Dissolution, Liquidation, Merger or Change-in-Control.

(a)    Changes in Capitalization. Subject to any required action by the stockholders of the Company, the maximum number of shares of the Company’s Common Stock which shall be made available for sale under the Plan, the maximum number of shares each participant may purchase each Purchase Period (pursuant to Sections 3(b), and 7), as well as the price per share and the number of shares of Common Stock covered by each option under the Plan which has not yet been exercised shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other change in the number of shares of Common Stock effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” Such adjustment shall be made by the Administrator, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock subject to an option.

(b)    Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Offering Period then in progress shall be shortened by setting a New Exercise Date (the “New Exercise Date”), and shall terminate immediately prior to the consummation of such proposed dissolution or liquidation, unless provided otherwise by the Administrator. The New Exercise Date shall be before the date of the Company’s proposed dissolution or liquidation. The Administrator shall notify each participant in writing, at least 10 (ten) business days prior to the New Exercise Date, that the Exercise Date for the participant’s option has been changed to the New Exercise Date and that the participant’s option shall be exercised automatically on the New Exercise Date, unless prior to such date the participant has withdrawn from the Offering Period as provided in Section 11 hereof.

(c)    Merger or Change-of-Control. In the event of a merger or Change-of-Control, each outstanding option shall be assumed or an equivalent option substituted by the successor corporation or a Parent or Subsidiary of the successor corporation. In the event that the successor corporation refuses to assume or substitute for the option, any Purchase Periods then in progress shall be shortened by setting a New Exercise Date and any Offering Periods then in progress shall end on the New Exercise Date. The New Exercise Date shall be before the date of the Company’s proposed merger or Change-of-Control. The Administrator shall notify each participant in writing, at least 10 (ten) business days prior to the New Exercise Date, that the Exercise Date for the participant’s option has been changed to the New Exercise Date and that the participant’s option shall be exercised automatically on the New Exercise Date, unless prior to such date the participant has withdrawn from the Offering Period as provided in Section 11 hereof.

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21)    Amendment or Termination. 

(a)    The Administrator may at any time and for any reason terminate or amend the Plan. Except as otherwise provided in the Plan, no such termination can affect options previously granted, provided that an Offering Period may be terminated by the Administrator on any Exercise Date if the Administrator determines that the termination of the Offering Period or the Plan is in the best interests of the Company and its stockholders. Except as provided in Section 20 and this Section 21 hereof, no amendment may make any change in any option theretofore granted which adversely affects the rights of any participant. To the extent necessary to comply with Section 423 of the Code (or any successor rule or provision or any other applicable law, regulation or stock exchange rule), the Company shall obtain stockholder approval in such a manner and to such a degree as required.

(b)    Without stockholder consent and without regard to whether any participant rights may be considered to have been “adversely affected,” the Administrator shall be entitled to change the Offering Periods, limit the frequency and/or number of changes in the amount withheld during an Offering Period, establish the exchange ratio applicable to amounts withheld in a currency other than U.S. dollars, permit payroll withholding in excess of the amount designated by a participant in order to adjust for delays or mistakes in the Company’s processing of properly completed withholding elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Common Stock for each participant properly correspond with amounts withheld from the participant’s Compensation, and establish such other limitations or procedures as the Administrator determines in its sole discretion advisable which are consistent with the Plan.

(c)    In the event the Administrator determines that the ongoing operation of the Plan may result in unfavorable financial accounting consequences, the Board may, in its discretion and, to the extent necessary or desirable, modify or amend the Plan to reduce or eliminate such accounting consequence including, but not limited to:

(i)    increasing the Purchase Price for any Offering Period including an Offering Period underway at the time of the change in Purchase Price;

(ii)    shortening any Offering Period so that Offering Period ends on a new Exercise Date, including an Offering Period underway at the time of the Board action; and

(iii)    allocating shares. 

    Such modifications or amendments shall not require stockholder approval or the consent of any Plan participants.

22)    Notices. All notices or other communications by a participant to the Company under or in connection with the Plan shall be deemed to have been duly given when received in the form and manner specified by the Company at the location, or by the person, designated by the Company for the receipt thereof.
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23)    Conditions Upon Issuance of Shares. Shares shall not be issued with respect to an option unless the exercise of such option and the issuance and delivery of such shares pursuant thereto shall comply with all applicable provisions of law, domestic or foreign, including, without limitation, the U.S. Securities Act of 1933, as amended, the Exchange Act, the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance.

    As a condition to the exercise of an option, the Company may require the person exercising such option to represent and warrant at the time of any such exercise that the shares are being purchased only for investment and without any present intention to sell or distribute such shares if, in the opinion of counsel for the Company, such a representation is required by any of the aforementioned applicable provisions of law.

24)    Term of Plan. The Plan shall become effective upon the earlier to occur of its adoption by the Board of Directors or its approval by the stockholders of the Company. It shall continue in effect until terminated under Section 21 hereof.
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