Document:

Amended and Restated Omnibus Stock Plan

 Exhibit 4.2 
 VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC. 
 AMENDED AND RESTATED
OMNIBUS STOCK PLAN 
 INCORPORATING AMENDMENTS 
 EFFECTIVE ON OR 
 BEFORE FEBRUARY 24, 2005 

 TABLE OF CONTENTS 

 

					
	SECTION 1 - BACKGROUND, PURPOSE AND DURATION	  	5
	1.1	  	Purpose of the Plan	  	5
		
	SECTION 2 - DEFINITIONS	  	5
	2.1	  	“1934 Act”	  	5
	2.2	  	“Affiliate”	  	5
	2.3	  	“Award”	  	5
	2.4	  	“Award Agreement”	  	5
	2.5	  	“Board”	  	5
	2.6	  	“Code”	  	5
	2.7	  	“Committee”	  	5
	2.8	  	“Company”	  	5
	2.9	  	“Consultant”	  	5
	2.10	  	“Director”	  	5
	2.11	  	“Disability”	  	5
	2.12	  	“EBIT”	  	6
	2.13	  	“EBITDA”	  	6
	2.14	  	“Earnings Per Share”	  	6
	2.15	  	“Employee”	  	6
	2.16	  	“Exercise Price”	  	6
	2.17	  	“Fair Market Value”	  	6
	2.18	  	“Fiscal Year”	  	6
	2.19	  	“Grant Date”	  	6
	2.20	  	“Incentive Stock Option”	  	6
	2.21	  	“Net Income”	  	6
	2.22	  	“Non-employee Director”	  	6
	2.23	  	“Non-qualified Stock Option”	  	6
	2.24	  	“Operating Cash Flow”	  	6
	2.25	  	“Option”	  	6
	2.26	  	“Participant”	  	6
	2.27	  	“Performance Goals”	  	6
	2.28	  	“Performance Period”	  	7
	2.29	  	“Performance Share”	  	7
	2.30	  	“Performance Unit”	  	7
	2.31	  	“Period of Restriction”	  	7
	2.32	  	“Plan”	  	7
	2.33	  	“Restricted Stock”	  	7
	2.34	  	“Retirement”	  	7
	2.35	  	“Return on Assets”	  	7
	2.36	  	“Return on Equity”	  	7
	2.37	  	“Return on Sales”	  	7
	2.38	  	“Revenue”	  	7
	2.39	  	“Rule 16b-3”	  	7
	2.40	  	“Section 16 Person”	  	8
	2.41	  	“Shareholder Return”	  	8
	2.42	  	“Shares”	  	8
	2.43	  	“Stock Appreciation Right”	  	8
	2.44	  	“Subsidiary”	  	8
	2.45	  	“Termination of Service”	  	8
	2.46	  	“VAI”	  	8
		
	SECTION 3 - ADMINISTRATION	  	8
	3.1	  	The Committee	  	8

  
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	 3.2
	  	Authority of the Committee	  	8
	3.3	  	Delegation by the Committee	  	8
	3.4	  	Non-employee Directors	  	9
	3.5	  	Decisions Binding	  	9
		
	SECTION 4 - SHARES SUBJECT TO THE PLAN	  	9
	4.1	  	Number of Shares	  	9
	4.2	  	Lapsed Awards	  	9
	4.3	  	Adjustments in Awards and Authorized Shares	  	9
		
	SECTION 5 - STOCK OPTIONS	  	9
	5.1	  	Grant of Options	  	9
	5.2	  	Award Agreement	  	9
	5.3	  	Exercise Price	  	10
	5.4	  	Expiration of Options	  	10
	5.5	  	Exercisability of Options	  	11
	5.6	  	Payment	  	11
	5.7	  	Restrictions on Share Transferability	  	11
	5.8	  	Certain Additional Provisions for Incentive Stock Options	  	11
	5.9	  	Grant of Reload Options	  	11
		
	SECTION 6 - STOCK APPRECIATION RIGHTS	  	12
	6.1	  	Grant of SARs	  	12
	6.2	  	Exercise Price and Other Terms	  	12
	6.3	  	SAR Agreement	  	12
	6.4	  	Expiration of SARS	  	12
	6.5	  	Payment of SAR Amount	  	12
	6.6	  	Payment Upon Exercise of SAR	  	12
		
	SECTION 7 - RESTRICTED STOCK	  	12
	7.1	  	Grant of Restricted Stock	  	12
	7.2	  	Restricted Stock Agreement	  	12
	7.3	  	Transferability	  	12
	7.4	  	Other Restrictions	  	13
	7.5	  	Removal of Restrictions	  	13
	7.6	  	Voting Rights	  	13
	7.7	  	Dividends and Other Distributions	  	13
	7.8	  	Return on Restricted Stock to Company	  	13
		
	SECTION 8 - PERFORMANCE UNITS AND PERFORMANCE SHARES	  	13
	8.1	  	Grant of Performance Units and Shares	  	13
	8.2	  	Initial Value	  	14
	8.3	  	Performance Objectives and Other Terms	  	14
	8.4	  	Earning of Performance Units and Performance Shares	  	14
	8.5	  	Form and Timing of Payment	  	14
	8.6	  	Cancellation	  	14
		
	SECTION 9 - NON-EMPLOYEE DIRECTORS	  	14
	9.1	  	Granting of Options to Non-Employee Directors	  	14
	9.2	  	Terms of Options	  	15
	9.3	  	Substitute Options	  	15
		
	SECTION 10 - MISCELLANEOUS	  	15
	10.1	  	No Effect on Employment or Service	  	15
	10.2	  	Participation	  	15
	10.3	  	Indemnification	  	15

  
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	10.4	  	Successors	  	16
	10.5	  	Beneficiary Designations	  	16
	10.6	  	Nontransferability of Awards	  	16
	10.7	  	No Rights as Stockholder	  	16
	10.8	  	Withholding Requirements	  	16
	10.9	  	Withholding Arrangements	  	16
	10.10	  	Deferrals	  	16
		
	SECTION 11 - AMENDMENT, TERMINATION AND DURATION	  	17
	11.1	  	Amendment, Suspension or Termination	  	17
	11.2	  	Duration of the Plan	  	17
		
	SECTION 12 - LEGAL CONSTRUCTION	  	17
	12.1	  	Gender and Number	  	17
	12.2	  	Severability	  	17
	12.3	  	Requirements of Law	  	17
	12.4	  	Governing Law	  	17
	12.5	  	Captions	  	17

  
 4 

 VARIAN SEMICONDUCTOR EQUIPMENT ASSOCIATES, INC. 

AMENDED AND RESTATED OMNIBUS STOCK PLAN 
 SECTION 1 
 BACKGROUND, PURPOSE AND DURATION 

1.1 Purpose of the Plan. The Plan is intended to increase incentives and to encourage Share ownership on the part of
(1) employees of the Company and its Affiliates, (2) consultants who provide significant services to the Company and its Affiliates, and (3) directors of the Company who are employees of neither the Company nor any Affiliate. The Plan
also is intended to further the growth and profitability of the Company. The Plan is intended to permit the grant of Awards that qualify as performance-based compensation under section 162(m) of the Code. 

SECTION 2 

DEFINITIONS 
 The following words and phrases shall have the following meanings unless a different meaning is plainly required by the context: 
 2.1 “1934 Act” means the Securities Exchange Act of 1934, as amended. Reference to a specific section of the 1934 Act or regulation thereunder shall include such section or regulation,
any valid regulation promulgated under such section, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation. 

2.2 “Affiliate” means any corporation or any other entity (including, but not limited to, partnerships and joint
ventures) controlling, controlled by, or under common control with the Company. 
 2.3 “Award” means,
individually or collectively, a grant under the Plan of Non-qualified Stock Options, Incentive Stock Options, SARs, Restricted Stock, Performance Units or Performance Shares. 
 2.4 “Award Agreement” means the written agreement setting forth the terms and provisions applicable to each Award granted under the Plan. 

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

2.6 “Code” means the Internal Revenue Code of 1986, as amended. Reference to a specific section of the Code or
regulation thereunder shall include such section or regulation, any valid regulation promulgated thereunder, and any comparable provision of any future legislation or regulation amending, supplementing or superseding such section or regulation.

 2.7 “Committee” means the committee appointed by the Board (pursuant to Section 3.1) to administer the
Plan. 
 2.8 “Company” means Varian Semiconductor Equipment Associates, Inc., a Delaware corporation, or any
successor thereto. 
 2.9 “Consultant” means any consultant, independent contractor, or other person who
provides significant services to the Company or its Affiliates, but who is neither an Employee nor a Director. 
 2.10
“Director” means any individual who is a member of the Board. 
 2.11 “Disability” means a
permanent and total disability within the meaning of section 22(e)(3) of the Code, provided that in the case of Awards other than Incentive Stock Options, the Committee in its discretion may determine whether a permanent and total disability exists
in accordance with uniform and non-discriminatory standards adopted by the Committee from time to time. 

  
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 2.12 “EBIT” means as to any Performance Period, the Company’s or a
business unit’s income before reductions for interest and taxes, determined in accordance with generally accepted accounting principles. 
 2.13 “EBITDA” means as to any Performance Period. the Company’s or a business unit’s income before reductions for interest, taxes, depreciation and amortization, determined in
accordance with generally accepted accounting principles. 
 2.14 “Earnings Per Share” means as to any
Performance Period, the Company’s or a business unit’s Net Income, divided by a weighted average number of common shares outstanding and dilutive common equivalent shares deemed outstanding, determined in accordance with generally accepted
accounting principles. 
 2.15 “Employee” means any employee of the Company or of an Affiliate, whether such
employee is so employed at the time the Plan is adopted or becomes so employed subsequent to the adoption of the Plan. 
 2.16
“Exercise Price” means the price at which a Share may be purchased by a Participant pursuant to the exercise of an Option. 
 2.17 “Fair Market Value” means the last quoted per share selling price for Shares on the relevant date, or if there were no sales on such date, the arithmetic mean of the highest and
lowest quoted selling prices on the nearest day before and the nearest day after the relevant date, as determined by the Committee. Notwithstanding the preceding, for federal, state and local income tax reporting purposes, fair market value shall be
determined by the Committee in accordance with uniform and nondiscriminatory standards adopted by it from time to time. 
 2.18
“Fiscal Year” means the fiscal year of the Company. 
 2.19 “Grant Date” means, with respect
to an Award, the date that the Award was granted. 
 2.20 “Incentive Stock Option” means an Option to purchase
Shares which is designated as an Incentive Stock Option and is intended to meet the requirements of section 422 of the Code. 

2.21 “Net Income” means as to any Performance Period, the Company’s or a business unit’s income after taxes,
determined in accordance with generally accepted accounting principles. 
 2.22 “Non-employee Director” means a
Director who is an employee of neither the Company nor of any Affiliate. 
 2.23 “Non-qualified Stock Option”
means an option to purchase Shares which is not intended to be an Incentive Stock Option. 
 2.24 “Operating Cash
Flow” means as to any Performance Period, the Company’s or a business unit’s sum of Net Income plus depreciation and amortization less capital expenditures plus changes in working capital comprised of accounts receivable,
inventories, other current assets, trade accounts payable, accrued expenses, product warranty, advance payments from customers and long-term accrued expenses, determined in accordance with generally acceptable accounting principles. 

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

2.26 “Participant” means an Employee, Consultant, or Non-employee Director who has an outstanding Award. 

2.27 “Performance Goals” means the goal(s) determined by the Committee, in its sole discretion, to be applicable to a
Participant eligible for an Award and which may be selected from, but not limited to, (a) earnings per share, (b) return on average equity in relation to a peer group (the “Peer Group”) of companies designated by the Committee,
(c) return on average assets in relation to the Peer Group, or (d) such other performance goals as may be established by the Committee which may be based on earnings, earnings growth, earnings before interest, taxes, depreciation and
amortization (EBITDA), operating income, operating margins, revenues, expenses, stock price, market share, charge-offs, reductions in non-performing assets, regulatory compliance, satisfactory internal or

  
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external audits, improvement of financial ratings, achievement of balance sheet or income statement objectives, net cash provided from continuing operations, stock price appreciation, total
shareholder return, cost control, strategic initiatives, market share, pre-tax or after-tax income, or any other objective goals established by the Committee, and may be absolute in their terms or measured against or in relationship to other
companies comparably, similarly or otherwise situated. Such performance goals may be particular to a Participant or the division, department, branch, line of business, Subsidiary or other unit in which the Participant works, or may be based on the
performance of the Corporation generally, and may cover such period as may be specified by the Committee. Such Performance Goals may be applied by excluding the impact of charges for restructurings, discontinued operations, extraordinary items, and
other unusual or non-recurring items, and the cumulative effects of accounting changes, each as defined by generally accepted accounting principles. The Performance Goals may differ from Participant to Participant and from Award to Award. Prior to
the Determination Date, the Committee shall determine whether any significant element(s) shall be included in or excluded from the calculation of any Performance Goal with respect to any Participant. “Determination Date” means the latest
possible date that will not jeopardize an Award’s qualification as performance-based compensation under section 162(m) of the Code. Notwithstanding the previous sentence, for Awards not intended to qualify as performance-based compensation,
“Determination Date” shall mean such date as the Committee may determine in its discretion. 
 2.28
“Performance Period” means any fiscal period not to exceed three consecutive Fiscal Years, as determined by the Committee in its sole discretion. 
 2.29 “Performance Share” means a Performance Share granted to a Participant pursuant to Section 8. 
 2.30 “Performance Unit” means a Performance Unit granted to a Participant pursuant to Section 8. 
 2.31 “Period of Restriction” means the period during which Shares of Restricted Stock are subject to forfeiture and/or restrictions on transferability, which shall begin on the Grant Date
and shall end at such times, and be subject to such restrictions and conditions, as the Committee shall determine in its sole discretion. 
 2.32 “Plan” means the Varian Semiconductor Equipment Associates, Inc. Omnibus Stock Plan, as set forth in this instrument and as hereafter amended from time to time. 

2.33 “Restricted Stock” means an Award granted to a Participant pursuant to Section 7. 

2.34 “Retirement” means, in the case of an Employee or a Non-employee Director, “Retirement” as defined
pursuant to the Company’s or the Board’s Retirement Policies, as they may be established from time to time. With respect to a Consultant, no Termination of Service shall be deemed to be on account of “Retirement.” 

2.35 “Return on Assets” means as to any Performance Period, the percentage equal to the Company’s or a business
unit’s EBIT before incentive compensation, divided by average net Company or business unit, as applicable, assets, determined in accordance with generally accepted accounting principles. 

2.36 “Return on Equity” means as to any Performance Period, the percentage equal to the Company’s Net Income
divided by average stockholder’s equity, determined in accordance with generally accepted accounting principles. 
 2.37
“Return on Sales” means as to any Performance Period, the percentage equal to the Company’s or a business unit’s EBIT before incentive compensation, divided by the Company’s or the business unit’s, as applicable,
Revenue, determined in accordance with generally accepted accounting principles. 
 2.38 “Revenue” means as to
any Performance Period, the Company’s or a business unit’s net sales, determined in accordance with generally accepted accounting principles. 
 2.39 “Rule 16b-3” means Rule 16b-3 promulgated under the 1934 Act, as amended, and any future regulation amending, supplementing or superseding such regulation. 

  
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 2.40 “Section 16 Person” means a person who, with respect to the Shares, is
subject to section 16 of the 1934 Act. 
 2.41 “Shareholder Return” means as to any Performance Period, the
total return (change in share price plus reinvestment of any dividends) of a Share. 
 2.42 “Shares” means
shares of the Company’s common stock, $.01 par value. 
 2.43 “Stock Appreciation Right” or
“SAR” means an Award, granted alone, in connection or in tandem with a related Option, that pursuant to Section 6 is designated as a SAR. 
 2.44 “Subsidiary” means any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain
then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain. 
 2.45 “Termination of Service” means (a) in the case of an Employee, a cessation of the employee-employer relationship between an Employee and the Company or an Affiliate for any
reason, including, but not by way of limitation, a termination by resignation, discharge, death, Disability, Retirement, or the disaffiliation of an Affiliate, but excluding any such termination where there is a simultaneous reemployment by the
Company or an Affiliate; (b) in the case of a Consultant, a cessation of the service relationship between a Consultant and the Company or an Affiliate for any reason, including, but not by way of limitation, a termination by resignation,
discharge, death, Disability, or the disaffiliation of an Affiliate, but excluding any such termination where there is a simultaneous re-engagement of the consultant by the Company or an Affiliate; and (c) in the case of a Non-employee
Director, a cessation of the Non-employee Director’s service on the Board for any reason. 
 2.46 “VAI”
means Varian Associates, Inc., a Delaware corporation. 
 SECTION 3 

ADMINISTRATION 
 3.1 The Committee. The Plan shall be administered by the Committee. The Committee shall consist of not less than two (2) Directors. The members of the Committee shall be appointed from time to
time by, and serve at the pleasure of, the Board. Each member of the Committee shall qualify as (a) a “non-employee director” under Rule 16b-3, and (b) an “outside director” under section 162(m) of the Code. If it is
later determined that one or more members of the Committee do not so qualify, actions taken by the Committee prior to such determination shall be valid despite such failure to qualify. 

3.2 Authority of the Committee. It shall be the duty of the Committee to administer the Plan in accordance with the Plan’s
provisions. The Committee shall have all powers and discretion necessary or appropriate to administer the Plan and to control its operation, including, but not limited to, the power to (a) determine which Employees and Consultants shall be
granted Awards, (b) prescribe the terms and conditions of the Awards (other than the Options granted to Non-employee Directors pursuant to Section 9), (c) interpret the Plan and the Awards, (d) adopt such procedures and subplans
as are necessary or appropriate to permit participation in the Plan by Employees, Consultants and Directors who are foreign nationals or employed outside of the United States, (e) adopt rules for the administration, interpretation and
application of the Plan as are consistent therewith, and (f) interpret, amend or revoke any such rules. Notwithstanding any contrary provision of the Plan, the Committee may reduce the amount payable under any Award (other than an Option) after
the grant of such Award. 
 3.3 Delegation by the Committee. The Committee, in its sole discretion and on such terms and
conditions as it may provide, may delegate all or any part of its authority and powers under the Plan to one or more directors and/or officers of the Company; provided, however, that the Committee may not delegate its authority and powers
(a) with respect to Section 16 Persons, (b) in any way which would jeopardize the Plan’s qualification under Rule 16b-3, or (c) with respect to awards which are intended to qualify as performance-based compensation under
section 162(m) of the Code. 

  
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 3.4 Non-employee Directors. Notwithstanding any contrary provision of this
Section 3, the Board shall administer Section 9 of the Plan, and the Committee shall exercise no discretion with respect to Section 9. In the Board’s administration of Section 9 and the Options and any Shares granted to
Non-employee Directors, the Board shall have all of the authority and discretion otherwise granted to the Committee with respect to the administration of the Plan. 
 3.5 Decisions Binding. All determinations and decisions made by the Committee, the Board, and any delegate of the Committee pursuant to the provisions of the Plan shall be final, conclusive, and
binding on all persons, and shall be given the maximum deference permitted by law. 
 SECTION 4 

SHARES SUBJECT TO THE PLAN 
 4.1 Number of Shares. Subject to adjustment as provided in Section 4.3, the total number of Shares available for grant under the Plan shall not exceed 9,700,000, plus such number of Shares as
are granted pursuant to substitute Options under Sections 5.3.3 and 9.3 in connection with the distribution of Shares to the stockholders of VAI. Shares granted under the Plan may be either authorized but unissued Shares or treasury Shares.

 4.2 Lapsed Awards. If an Award terminates, expires, or lapses for any reason, any Shares subject to such Award again
shall be available to be the subject of an Award. In addition, any Shares issued pursuant to Awards assumed or granted in substitution of other awards in connection with the acquisition of the Company of an unrelated entity shall not reduce the
maximum number of Shares issuable under Section 4.1. However, the following Shares shall not be added back to the maximum number of Shares issuable under Section 4.1 and shall not be available again to be the subject of an Award
(i) the number of Shares tendered to the Company (whether by physical delivery or attestation) as full or partial payment for the Exercise Price of an Option or to satisfy a Participant’s tax withholding obligations in connection with any
Award and (ii) the number of Shares withheld to pay the Exercise Price of an Option or withheld from any Award to satisfy a Participant’s tax withholding obligations. In addition, any Shares that are granted pursuant to a Reload Option (as
defined in Section 5.9 below) shall be deemed delivered for purposes of determining the maximum number of Shares that may be delivered under Section 4.1 and shall not be available again to be the subject of an Award. 

4.3 Adjustments in Awards and Authorized Shares. In the event of any merger, reorganization, consolidation, recapitalization,
separation, liquidation, stock dividend, split-up, Share combination, or other change in the corporate structure of the Company affecting the Shares, the Committee shall adjust the number and class of Shares which may be delivered under the Plan,
the number, class, and price of Shares subject to outstanding Awards, and the numerical limit of Section 5.1 in such manner as the Committee (in its sole discretion) shall determine to be appropriate to prevent the dilution or diminution of
such Awards. In the case of Options granted to Non-employee Directors pursuant to Section 9, the foregoing adjustments shall be made by the Board, and any such adjustments also shall apply to the future grants provided by Section 9.
Notwithstanding the preceding, the number of Shares subject to any Award always shall be a whole number. 
 SECTION 5

 STOCK OPTIONS 
 5.1 Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted to Employees and Consultants at any time and from time to time as determined by the Committee in its
sole discretion. The Committee, in its sole discretion, shall determine the number of Shares subject to each Option, provided that during any Fiscal Year, no Participant shall be granted Options covering more than 1,000,000 Shares. The Committee may
grant Incentive Stock Options, Non-qualified Stock Options, or a combination thereof. 
 5.2 Award Agreement. Each Option
shall be evidenced by an Award Agreement that shall specify the Exercise Price, the expiration date of the Option, the number of Shares to which the Option pertains, any conditions to exercise of the Option, and such other terms and conditions as
the Committee, in its discretion, shall determine. 

  
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 The Award Agreement shall specify whether the Option is intended to be an Incentive Stock Option or a
Non-qualified Stock Option. 
 5.3 Exercise Price. Subject to the provisions of this Section 5.3, the Exercise Price
for each Option shall be determined by the Committee in its sole discretion. 
 5.3.1 Non-qualified Stock Options. In the
case of a Non-qualified Stock Option, the Exercise Price shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant Date. 
 5.3.2 Incentive Stock Options. In the case of an Incentive Stock Option, the Exercise Price shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant
Date; provided, however, that if on the Grant Date, the Employee (together with persons whose stock ownership is attributed to the Employee pursuant to section 424(d) of the Code) owns stock possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or any of its Subsidiaries, the Exercise Price shall be not less than one hundred and ten percent (110%) of the Fair Market Value of a Share on the Grant Date. 

5.3.3 Substitute Options. Notwithstanding, the provisions of Sections 5.3.1 and 5.3.2, in the event that the Company or an
Affiliate consummates a transaction described in section 424(a) of the Code (e.g., the acquisition of property or stock from an unrelated corporation), persons who become Employees or Consultants on account of such transaction may be granted Options
in substitution for options granted by their former employer. If such substitute Options are granted, the Committee, in its sole discretion and consistent with section 424(a) of the Code, shall determine the exercise price of such substitute
Options. 
 5.4 Expiration of Options. 
 5.4.1 Expiration Dates. Each Option shall terminate no later than the first to occur of the following events: 
 (a) The expiration of eight (8) years from the Grant Date; or 
 (b) The
expiration of three (3) months, or such longer period not longer than the period described in Section 5.4.1(a) as determined by the Committee in its discretion, from the date of the Participant’s Termination of Service for a reason
other than the Participant’s death, Disability or Retirement; or 
 (c) The expiration of one (1) year from the date
of the Participant’s Termination of Service by reason of Disability; or 
 (d) The expiration of eight (8) years from
the Grant Date in the case of the Participant’s Retirement (subject to Section 5.8.2 regarding Incentive Stock Options); or 
 (e) The date of the Participant’s Termination of Service by the Company for cause (as determined by the Company); or 
 (f) The date for termination of the Option determined by the Committee in its sole discretion and set forth in the written Award Agreement. 

5.4.2 Death of Participant. Notwithstanding Section 5.4.1, if a Participant who is an Employee dies prior to the expiration
of his or her Options, his or her Options shall be exercisable until the expiration of three (3) years after the date of death. If a Participant who is a Consultant dies prior to the expiration of his or her Options, the Committee, in its
discretion, may provide that his or her Options shall be exercisable for up to three (3) years after the date of death. 

5.4.3 Committee Discretion. Subject to the limits of Sections 5.4.1 and 5.4.2, the Committee, in its sole discretion,
(a) shall provide in each Award Agreement when each Option expires and becomes unexercisable, and (b) may, after an Option is granted and before such Option expires, extend the maximum term of the Option (subject to Section 5.8.4
regarding Incentive Stock Options). 

  
 10 

 5.5 Exercisability of Options. Options granted under the Plan shall be exercisable at
such times and be subject to such restrictions and conditions as the Committee shall determine in its sole discretion. After an Option is granted, the Committee, in its sole discretion, may accelerate the exercisability of the Option. With respect
to Options granted on or after November 17, 2000, if a Participant who is an Employee dies, incurs a Disability or terminates service by reason of his or her Retirement, the exercisability of his or her Options shall be fully accelerated to the
date of Termination of Service. With respect to Options granted prior to November 17, 2000, if a Participant dies while an Employee, the exercisability of his or her Options shall be fully accelerated to the date of Termination of Service.

 5.6 Payment. Options shall be exercised by the Participant’s delivery of a written notice of exercise to the
Secretary of the Company (or its designee), setting forth the number of Shares with respect to which the Option is to be exercised, accompanied by full payment for the Shares. 
 Upon the exercise of any Option, the Exercise Price shall be payable to the Company in full in cash or its equivalent. The Committee, in its sole discretion, also may permit exercise (a) by tendering
previously acquired Shares having an aggregate Fair Market Value at the time of exercise equal to the total Exercise Price, or (b) by any other means which the Committee, in its sole discretion, determines to both provide legal consideration
for the Shares, and to be consistent with the purposes of the Plan. 
 As soon as practicable after receipt of a written
notification of exercise and full payment for the Shares purchased, the Company shall deliver to the Participant (or the Participant’s designated broker), Share certificates (which may be in book entry form) representing such Shares.

 5.7 Restrictions on Share Transferability. The Committee may impose such restrictions on any Shares acquired pursuant
to the exercise of an Option as it may deem advisable, including, but not limited to, restrictions related to applicable Federal securities laws, the requirements of any national securities exchange or system upon which Shares are then listed or
traded, or any blue sky or state securities laws. 
 5.8 Certain Additional Provisions for Incentive Stock Options.

 5.8.1. Exercisability. The aggregate Fair Market Value (determined on the Grant Date(s)) of the Shares with respect to
which Incentive Stock Options are exercisable for the first time by any Employee during any calendar year (under all plans of the Company and its Subsidiaries) shall not exceed $100,000. 

5.8.2 Termination of Service. If any portion of an Incentive Stock Option is exercised more than three (3) months after the
Participant’s Termination of Service for any reason other than Disability or death (unless (a) the Participant dies during such three-month period, and (b) the Award Agreement or the Committee permits later exercise), the portion so
exercised shall be deemed a Non-qualified Stock Option. 
 5.8.3 Company and Subsidiaries Only. Incentive Stock Options
may be granted only to persons who are employees of the Company or a Subsidiary on the Grant Date. 
 5.8.4 Expiration.
No Incentive Stock Option may be exercised after the expiration of ten (10) years from the Grant Date; provided, however, that if the Option is granted to an Employee who, together with persons whose stock ownership is attributed to the
Employee pursuant to section 424(d) of the Code, owns stock possessing more than ten percent (10%) of the total combined voting power of all classes of the stock of the Company or any of its Subsidiaries, the Option may not be exercised after
the expiration of five (5) years from the Grant Date. 
 5.9 Grant of Reload Options. The Committee may provide in
an Award Agreement that a Participant who exercises all or part of an Option by payment of the Exercise Price with already-owned Shares, shall be granted an additional option (a “Reload Option”) for a number of shares of stock equal to the
number of Shares tendered to exercise the previously granted Option plus, if the Committee so determines, any Shares withheld or delivered in satisfaction of any tax withholding requirements, subject to Section 4.2. As determined by the
Committee, each Reload Option shall (a) have a Grant Date which is the date as of which the previously granted Option is exercised, and (b) be exercisable on the same terms and conditions as the previously granted Option, except that the
Exercise Price shall be determined as of the Grant Date. 

  
 11 

 SECTION 6 
 STOCK APPRECIATION RIGHTS 
 6.1 Grant of SARs. Subject to the terms
and conditions of the Plan, SARs may be granted to Employees and Consultants at any time and from time to time as shall be determined by the Committee, in its sole discretion, provided that the aggregate number of Shares to be granted pursuant to
Sections 6, 7 and 8 of the Plan shall not exceed 400,000 Shares. The Committee shall have complete discretion to determine the number of SARs granted to any Participant, provided that during any Fiscal Year, no Participant shall be granted SARs
covering more than 100,000 Shares. 
 6.2 Exercise Price and Other Terms. The Committee, subject to the provisions of the
Plan, shall have complete discretion to determine the terms and conditions of SARs granted under the Plan. However, the exercise price of an SAR shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant
Date. 
 6.3 SAR Agreement. Each SAR grant shall be evidenced by an Award Agreement that shall specify the exercise
price, the term of the SAR, the conditions of exercise, and such other terms and conditions as the Committee, in its sole discretion, shall determine. 
 6.4 Expiration of SARS. A SAR granted under the Plan shall expire upon the date determined by the Committee, in its sole discretion, and set forth in the Award Agreement. Notwithstanding the
foregoing, the rules of Section 5.4 also shall apply to SARs. 
 6.5 Payment of SAR Amount. Upon exercise of a SAR,
a Participant shall be entitled to receive payment from the Company in an amount determined by multiplying: 
 (a) The
difference between the Fair Market Value of a Share on the date of exercise over the exercise price; times 
 (b) The number of
Shares with respect to which the SAR is exercised. 
 6.6 Payment Upon Exercise of SAR. Any payment by the Company in
respect of such right may be made in cash, Shares, other property, or any combination thereof, as the Committee, in its sole discretion, shall determine. 
 SECTION 7 
 RESTRICTED STOCK 

7.1 Grant of Restricted Stock. Subject to the terms and provisions of the Plan, the Committee, at any time and from time to time,
may grant Shares of Restricted Stock to Employees and Consultants in such amounts as the Committee, in its sole discretion, shall determine, provided that the aggregate number of Shares to be granted pursuant to Sections 6, 7 and 8 of the Plan shall
not exceed 400,000 Shares. The Committee, in its sole discretion, shall determine the number of Shares to be granted to each Participant, provided that during any Fiscal Year, no Participant shall be granted more than 100,000 Shares of Restricted
Stock. 
 7.2 Restricted Stock Agreement. Each Award of Restricted Stock shall be evidenced by an Award Agreement that
shall specify the Period of Restriction, the number of Shares granted, any price to be paid for the Shares, and such other terms and conditions as the Committee, in its sole discretion, shall determine. Unless the Committee determines otherwise,
Shares of Restricted Stock shall be held by the Company as escrow agent until the restrictions on such Shares have lapsed. 

7.3 Transferability. Shares of Restricted Stock may not be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated until the end of the applicable Period of Restriction. 

  
 12 

 7.4 Other Restrictions. The Committee, in its sole discretion, may impose such other
restrictions on Shares of Restricted Stock as it may deem advisable or appropriate, in accordance with this Section 7.4. 

7.4.1 General Restrictions. The Committee may set restrictions based upon the achievement of specific performance objectives
(Company-wide, business unit or individual), applicable federal or state securities laws, or any other basis determined by the Committee in its discretion. 
 7.4.2 Section 162(m) Performance Restrictions. For purposes of qualifying grants of Restricted Stock as “performance-based compensation” under section 162(m) of the Code, the
Committee, in its discretion, may set restrictions based upon the achievement of Performance Goals. The Performance Goals shall be set by the Committee on or before the latest date permissible to enable the Restricted Stock to qualify as
“performance-based compensation” under section 162(m) of the Code. In granting Restricted Stock which is intended to qualify under section 162(m) of the Code, the Committee shall follow any procedures determined by it from time to time to
be necessary or appropriate to ensure qualification of the Restricted Stock under section 162(m) of the Code (e.g., in determining the Performance Goals). 
 7.4.3 Legend on Certificates. The Committee, in its discretion, may legend the certificates representing Restricted Stock to give appropriate notice of such restrictions. For example, the Committee
may determine that some or all certificates representing Shares of Restricted Stock shall bear the following legend: 
 “The
sale or other transfer of the shares of stock represented by this certificate, whether voluntary, involuntary, or by operation of law, is subject to certain restrictions on transfer as set forth in the Varian Semiconductor Equipment Associates, Inc.
Omnibus Stock Plan, and in a Restricted Stock Agreement. A copy of the Plan and such Restricted Stock Agreement may be obtained from the Secretary of Varian Semiconductor Equipment Associates, Inc.” 

7.5 Removal of Restrictions. Shares of Restricted Stock covered by each Restricted Stock grant made under the Plan shall be released from
escrow as soon as practicable after the last day of the Period of Restriction. The Committee, in its discretion, may accelerate the time at which any restrictions shall lapse, and remove any restrictions. After the restrictions have lapsed, the
Participant shall be entitled to have any legend or legends under Section 7.4 removed from his or her Share certificate, and the Shares shall be freely transferable by the Participant. 

7.6 Voting Rights. During the Period of Restriction, Participants holding Shares of Restricted Stock granted hereunder may exercise full
voting rights with respect to those Shares, unless otherwise provided in the Award Agreement. 
 7.7 Dividends and Other
Distributions. During the Period of Restriction, Participants holding Shares of Restricted Stock shall be entitled to receive all dividends and other distributions paid with respect to such Shares unless otherwise provided in the Award
Agreement. If any such dividends or distributions are paid in Shares, the Shares shall be subject to the same restrictions on transferability and forfeitability as the Shares of Restricted Stock with respect to which they were paid. 

7.8 Return of Restricted Stock to Company. On the date set forth in the Award Agreement, the Restricted Stock for which
restrictions have not lapsed shall revert to the Company and again shall become available for grant under the Plan. 
 SECTION
8 
 PERFORMANCE UNITS AND PERFORMANCE SHARES 
 8.1 Grant of Performance Units and Shares. Performance Units and Performance Shares may be granted to Employees and Consultants at any time and from time to time, as shall be determined by the
Committee, in its sole discretion, provided that the aggregate number of Shares to be granted pursuant to Sections 6, 7 and 8 of the Plan shall not exceed 400,000 Shares. The Committee shall have complete discretion in determining the number of
Performance Units and Performance Shares granted to any Participant, provided that during any Fiscal Year no more than 100,000 Performance Units or Performance Shares may be granted to any Participant. 

  
 13 

 8.2 Initial Value. Each Performance Unit shall have an initial value that is
established by the Committee on or before the Grant Date, provided that such value shall not exceed the Fair Market Value of a Share on the Grant Date. Each Performance Share shall have an initial value equal to the Fair Market Value of a Share on
the Grant Date. 
 8.3 Performance Objectives and Other Terms. The Committee shall set performance objectives in its
discretion which, depending on the extent to which they are met, will determine the number or value of Performance Units or Shares that will be paid out to the Participants. The Committee may set performance objectives based upon the achievement of
Company-wide, business unit, or individual goals, or any other basis determined by the Committee in its discretion. The time period during which the performance objectives must be met shall be called the “Performance Period.” Each Award of
Performance Units or Shares shall be evidenced by an Award Agreement that shall specify the Performance Period, and such other terms and conditions as the Committee, in its sole discretion, shall determine. 

8.3.1 General Performance Objectives. The Committee may set performance objectives based upon the achievement of Company-wide,
business unit or individual goals, or any other basis determined by the Committee in its discretion. 
 8.3.2
Section 162(m) Performance Objectives. For purposes of qualifying grants of Performance Units or Shares as “performance-based compensation” under section 162(m) of the Code, the Committee, in its discretion, may determine that
the performance objectives applicable to Performance Units or Shares shall be based on the achievement of Performance Goals. The Performance Goals shall be set by the Committee on or before the latest date permissible to enable the Performance Units
or Shares to qualify as “performance-based compensation” under section 162(m) of the Code. In granting Performance Units or Shares which are intended to qualify under section 162(m) of the Code, the Committee shall follow any procedures
determined by it from time to time to be necessary or appropriate to ensure qualification of the Performance Units or Shares under section 162(m) of the Code (e.g., in determining the Performance Goals). 

8.4 Earning of Performance Units and Performance Shares. After the applicable Performance Period has ended, the Participant shall
be entitled to receive a payout of the number of Performance Units or Shares earned during the Performance Period, depending upon the extent to which the applicable performance objectives have been achieved. After the grant of a Performance Unit or
Share, the Committee, in its sole discretion, may reduce or waive any performance objectives for Award. 
 8.5 Form and
Timing of Payment. Payment of earned Performance Units or Performance Shares shall be made as soon as practicable after the expiration of the applicable Performance Period. The Committee, in its sole discretion, may pay such earned Awards in
cash, Shares or a combination thereof. 
 8.6 Cancellation. On the date set forth in the Award Agreement, all unearned or
unvested Performance Units or Performance Shares shall be forfeited to the Company, and again shall be available for grant under the Plan. 
 SECTION 9 
 NON-EMPLOYEE DIRECTORS 

9.1 Granting of Options to Non-Employee Directors 
 Each Non-employee Director shall be granted an Option to purchase 12,000 Shares (an “Initial Grant”) on the later of the Effective Date of the Plan or the date of the Non-employee
Director’s appointment or initial election as a Non-employee Director. Beginning on the first business day after the first Annual Meeting of Stockholders following the Non-employee Director’s appointment or initial election, and on the
first business day after each Annual Meeting of Stockholders thereafter, for so long as the Non-employee Director serves as such, he or she annually shall be granted an Option for an additional 6,000 Shares (each a “Subsequent Grant”), but
only if the Non-employee Director has continuously served as such through the Grant Date. 

  
 14 

 9.2 Terms of Options.  

9.2.1 Option Agreement. Each Option granted pursuant to this Section 9 shall be evidenced by a written stock option agreement
which shall be executed by the Non-employee Director and the Company. 
 9.2.2 Exercise Price. The Exercise Price for the
Shares subject to each Option granted pursuant to this Section 9 shall be one hundred percent (100%) of the Fair Market Value of such Shares on the Grant Date. 
 9.2.3 Exercisability. Each Option granted pursuant to this Section 9 shall be fully exercisable on the Grant Date. 
 9.2.4 Expiration of Options. Each Option shall terminate upon the first to occur of the following events: 
 (a) The expiration of eight (8) years from the Grant Date; or 
 (b) The
expiration of three (3) months from the date of the Non-employee Director’s Termination of Service for a reason other than death, Disability, resignation or Retirement; or 

(c) The expiration of eight (8) years from the Grant Date in the case of the Non-employee Director’s Termination of Service by
reason of completion of the Participant’s term as a Director, Disability, Retirement or death; or 
 (d) The expiration of
one (1) month from the date of the Non-employee Director’s Termination of Service by reason of resignation. 
 9.2.5
Non Incentive Stock Options. Options granted pursuant to this Section 9 shall not be designated as Incentive Stock Options. 
 9.2.6 Other Terms. All provisions of the Plan not inconsistent with this Section 9 shall apply to Options granted to Non-employee Directors; provided, however, that Section 5.1 (relating
to the Committee’s discretion to set the terms and conditions of Options) shall be inapplicable with respect to Non-employee Directors. 
 9.3 Substitute Options. Notwithstanding the provisions of Section 9.2.2, in the event that the Company or an Affiliate consummates a transaction described in section 424(a) of the Code (e.g.,
the acquisition of property or stock from an unrelated corporation), persons who become Non-employee Directors on account of such transaction may be granted Options in substitution for options granted by their former employer. If such substitute
Options are granted, the Committee, in its sole discretion and consistent with section 424(a) of the Code, shall determine the exercise price of such substitute Options. 
 SECTION 10 
 MISCELLANEOUS 

10.1 No Effect on Employment or Service. Nothing in the Plan shall interfere with or limit in any way the right of the Company to
terminate any Participant’s employment or service at any time, with or without cause. For purposes of the Plan, transfer of employment of a Participant between the Company and any one of its Affiliates (or between Affiliates) shall not be
deemed a Termination of Service. Employment with the Company and its Affiliates is on an at-will basis only. 
 10.2
Participation. No Employee or Consultant shall have the right to be selected to receive an Award under this Plan, or, having been so selected, to be selected to receive a future Award. 

10.3 Indemnification. Each person who is or shall have been a member of the Committee, or of the Board, shall be indemnified and
held harmless by the Company against and from (a) any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action,

  
 15 

 
suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan or any Award Agreement, and
(b) from any and all amounts paid by him or her in settlement thereof, with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such claim, action, suit, or proceeding against him or her, provided he or she
shall give 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. The foregoing right of indemnification shall not be exclusive of any other rights
of indemnification to which such persons may be entitled under the Company’s Certificate of Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or under any power that the Company may have to indemnify them or hold them
harmless. 
 10.4 Successors. All obligations of the Company under the Plan, with respect to Awards granted hereunder,
shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation or otherwise, of all or substantially all of the business or assets of the Company.

 10.5 Beneficiary Designations. If permitted by the Committee, a Participant under the Plan may name a beneficiary or
beneficiaries to whom any vested but unpaid Award shall be paid in the event of the Participant’s death. Each such designation shall revoke all prior designations by the Participant and shall be effective only if given in a form and manner
acceptable to the Committee. In the absence of any such designation, any vested benefits remaining unpaid at the Participant’s death shall be paid to the Participant’s estate and, subject to the terms of the Plan and of the applicable
Award Agreement, any unexercised vested Award may be exercised by the administrator or executor of the Participant’s estate. 
 10.6 Nontransferability of Awards. No Award granted under the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will, by the laws of descent
and distribution, or to the limited extent provided in Section 10.5. All rights with respect to an Award granted to a Participant shall be available during his or her lifetime only to the Participant. 

10.7 No Rights as Stockholder. Except to the limited extent provided in Sections 7.6 and 7.7, no Participant (nor any beneficiary)
shall have any of the rights or privileges of a stockholder of the Company with respect to any Shares issuable pursuant to an Award (or exercise thereof), unless and until certificates representing such Shares shall have been issued, recorded on the
records of the Company or its transfer agents or registrars, and delivered to the Participant (or beneficiary). 
 10.8
Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to an Award (or exercise thereof), the Company shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an
amount sufficient to satisfy federal, state, local and foreign taxes (including the Participant’s FICA obligation) required to be withheld with respect to such Award (or exercise thereof). Notwithstanding any contrary provision of the Plan, if
a Participant fails to remit to the Company such withholding amount within the time period specified by the Committee (in its discretion), the Participant’s Award may, in the Committee’s discretion, be forfeited and in such case the
Participant shall not receive any of the Shares subject to such Award. 
 10.9 Withholding Arrangements. The Committee,
in its sole discretion and pursuant to such procedures as it may specify from time to time, may permit or require a Participant to satisfy all or part of the tax withholding obligations in connection with an Award by (a) having the Company
withhold otherwise deliverable Shares, or (b) delivering to the Company already-owned Shares having a Fair Market Value equal to the amount required to be withheld. The amount of the withholding requirement shall be deemed to include any amount
which the Committee determines, not to exceed the amount determined by using the maximum federal, state, local or foreign jurisdiction marginal income tax rates applicable to the Participant with respect to the Award on the date that the amount of
tax to be withheld is to be determined. The Fair Market Value of the Shares to be withheld or delivered shall be determined as of the date that the taxes are required to be withheld. 

10.10 Deferrals. The Committee, in its sole discretion, may permit a Participant to defer receipt of the payment of cash or the
delivery of Shares that would otherwise be delivered to a Participant under the Plan. Any such deferral elections shall be subject to such rules and procedures as shall be determined by the Committee in its sole discretion. 

  
 16 

 SECTION 11 
 AMENDMENT, TERMINATION AND DURATION 
 11.1 Amendment, Suspension or
Termination. The Board, in its sole discretion, may amend or terminate the Plan, or any part thereof, at any time and for any reason. The amendment, suspension or termination of the Plan shall not, without the consent of the Participant, alter
or impair any rights or obligations under any Award theretofore granted to such Participant. No Award may be granted during any period of suspension or after termination of the Plan. 

11.2 Duration of the Plan. The Plan shall commence on the date specified herein, and subject to Section 11.1 (regarding the
Board’s right to amend or terminate the Plan), shall remain in effect thereafter. However, without further stockholder approval, no Incentive Stock Option may be granted under the Plan after ten (10) years from the Effective Date.

 SECTION 12 
 LEGAL CONSTRUCTION 
 12.1 Gender and Number. Except where otherwise
indicated by the context, any masculine term used herein also shall include the feminine; the plural shall include the singular and the singular shall include the plural. 
 12.2 Severability. In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and the
Plan shall be construed and enforced as if the illegal or invalid provision had not been included. 
 12.3 Requirements of
Law. The granting of Awards and the issuance of Shares under the Plan shall be subject to all applicable laws, rules and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required. The
Award Agreements for any Awards subject to section 409A of the Code and the regulations thereunder shall incorporate the necessary provisions so that such Awards shall comply with section 409A of the Code and the regulations thereunder to the extent
that the Committee, in its discretion, shall determine. 
 12.4 Governing Law. The Plan and all Award Agreements shall be
construed in accordance with and governed by the laws of the State of Delaware, but without regard to its conflict of law provisions. 
 12.5 Captions. Captions are provided herein for convenience only, and shall not serve as a basis for interpretation or construction of the Plan. 

EXECUTION 

IN WITNESS WHEREOF, Varian Semiconductor Equipment Associates, Inc., by its duly authorized officer, has executed the Plan on the date
indicated below. 
  

							
		 		 	 VARIAN SEMICONDUCTOR EQUIPMENT
 ASSOCIATES, INC.

				
	Dated: December 16, 2004	 		 	By:	 	 /s/    GARY L. LOSER

		 		 	Name:	 	Gary L. Loser
		 		 	Title:	 	Vice President and General Counsel

  
 17Employment Agreement

 Exhibit 10.1 
 CONFIDENTIAL 
 EMPLOYMENT AGREEMENT 

THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made and entered into as of December 1, 2011, by and between
Exar Corporation, a Delaware corporation (the “Company”), and Louis DiNardo, an individual (the “Executive”). 
 RECITALS 
 A. The Company desires that the Executive be employed by
the Company as its Chief Executive Officer and President to carry out the duties and responsibilities described below, all on the terms and conditions hereinafter set forth, effective as of January 3, 2012 (the “Effective
Date”). 
 B. The Executive desires to accept such employment on such terms and conditions. 

C. This Agreement shall govern the employment relationship between the Executive and the Company from and after the Effective Date
and supersedes and negates all previous agreements with respect to such relationship. 
 D. The Compensation Committee
and the Board of Directors of the Company have approved this Agreement. 
 NOW, THEREFORE, in consideration of the above
recitals incorporated herein and the mutual covenants and promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby expressly acknowledged, the parties agree as follows: 

1. Retention and Duties. 
 1.1 Retention. As of the Effective Date, the Company does hereby hire, engage and employ the Executive for the Period of Employment (as defined in Section 2) on the terms and conditions
expressly set forth in this Agreement. As of the Effective Date, the Executive does hereby accept and agree to such hiring, engagement and employment, on the terms and conditions expressly set forth in this Agreement. 

1.2 Duties. During the Period of Employment, the Executive shall serve the Company as its President and Chief Executive
Officer and shall have the powers, duties and obligations of management usually vested in the offices of president and chief executive officer of a corporation, subject to the directives of the Company’s Board of Directors (the
“Board”). The Executive shall comply with the corporate policies of the Company as they are in effect from time to time throughout the Period of Employment (including, without limitation, the Company’s employee handbook,
personnel policies, and business conduct and ethics policies, as they may change from time to time). The Executive will be appointed to the Board as of the Effective Date, and the Company agrees that so long as the Executive is serving as the
Company’s Chief Executive Officer he will be nominated for election to the Board at each annual meeting of stockholders. The Executive may serve as an officer and/or member of the board of directors of one or more of the Company’s
subsidiaries or affiliates (and this Agreement shall provide the 

  
 1 

 CONFIDENTIAL 

 

 
exclusive compensation for all such services). During the Period of Employment, the Executive shall report solely to the Board. In connection with any termination of the Executive’s
employment, unless otherwise requested by the Board, the Executive shall concurrently resign from the Board and from the Board (or other similar body) of any other members of the Company Group (as defined below) on which he then serves. 

1.3 No Other Employment; Minimum Time Commitment. During the Period of Employment, the Executive shall both (i) devote
substantially all of the Executive’s business time, energy and skill to the performance of the Executive’s duties for the Company, and (ii) hold no other employment. The Executive’s service on the boards of directors (or similar
body) of other business entities, or the provision of other services thereto, is subject to the prior written approval of the Board, which may not be unreasonably withheld. The Board acknowledges and agrees that the Executive may continue to serve
on the board of directors of the companies identified in Exhibit A hereto, but shall resign from the board of directors of any other company for which he serves as a director prior to the Effective Date. The Company shall have the right to
require the Executive to resign from any board or similar body on which he may then serve if the Board determines that the Executive’s service on such board or body interferes with the effective discharge of the Executive’s duties and
responsibilities to the Company or that any business related to such service is then in competition with any business of the Company or any of its affiliates, successors or assigns. Nothing in this Section 1.3 shall be construed as preventing
the Executive from engaging in the investment of his personal assets. In addition, the Executive shall avoid all activities and other actions that might conflict with, or that might reasonably appear to conflict with, the interests of the Company.

 1.4 No Breach of Contract. The Executive hereby represents to the Company that: (i) the execution and
delivery of this Agreement by the Executive and the Company and the performance by the Executive of the Executive’s duties hereunder shall not constitute a breach of, or otherwise contravene, the terms of any other agreement or policy to which
the Executive is a party or otherwise bound; (ii) the Executive has no information (including, without limitation, confidential information and trade secrets) relating to any other person or entity which would prevent, or be violated by, the
Executive entering into this Agreement or carrying out his duties hereunder; and (iii) that, except as set forth on Exhibit B hereto, the Executive is not bound by any confidentiality, trade secret or similar agreement with any other
person or entity. 
 1.5 Location. The Executive acknowledges that the Company’s principal executive offices
are currently located in Fremont, California. The Executive’s principal place of employment shall be the Company’s principal executive offices. The Executive agrees that he will be regularly present at the Company’s principal
executive offices. The Executive acknowledges that he may be required to travel from time to time in the course of performing his duties for the Company. 
 1.6 Indemnification Agreement. The Company and the Executive have executed and delivered the Indemnification Agreement attached hereto as Exhibit C (the “Indemnification
Agreement”). 
 2. Period of Employment. The “Period of Employment” shall be a period of four
(4) years commencing on the Effective Date and ending at the close of business on the four-year anniversary of the Effective Date, subject to earlier termination in accordance with the provisions of Section 5 below (the
“Termination Date”). 

  
 2 

 CONFIDENTIAL 

 

 3. Compensation. 
 3.1 Base Salary. The Executive’s base salary (the “Base Salary”) shall be paid in accordance with the Company’s regular payroll practices in effect from time to
time, but not less frequently than in monthly installments. The Executive’s Base Salary for the first twelve (12) months of the Period of Employment shall be at an annualized rate of Five Hundred Thousand Dollars ($500,000). The
Compensation Committee (as defined below) will review the Executive’s Base Salary at least annually and may in its sole discretion adjust the Executive’s Base Salary from the rate then in effect based on such review; provided that the
Executive’s Base Salary shall not be less than the Base Salary set forth herein without the Executive’s consent. 

3.2 Incentive Bonus. During the Period of Employment commencing with the Company’s fiscal year 2013, the Executive
shall be eligible to receive an annual incentive bonus (“Incentive Bonus”). The Executive will not be entitled to any Incentive Bonus with respect to the Company’s fiscal year 2012. The Executive’s target Incentive Bonus
amount for the fiscal years during the Period of Employment commencing with the Company’s 2013 fiscal year shall be 100% of the Executive’s Base Salary, unless the Board or the Compensation Committee of the Board (the “Compensation
Committee”) sets a higher target Incentive Bonus for those years. The Executive’s Incentive Bonus for the Company’s 2013 fiscal year shall be payable in the form of an award of restricted stock units (“RSUs”) to
be granted on the first day of the Company’s 2013 fiscal year, with the target number of RSUs subject to such award (the “Target RSUs”) to be determined by dividing (i) $500,000 by (ii) the closing price of a share of
the Company’s common stock on the grant date. Twenty-five percent (25%) of the Target RSUs shall vest on the date that is six (6) months after the commencement of the 2013 fiscal year, subject to the Executive’s continued
employment with the Company through the vesting date. An additional twenty-five (25%) of such Target RSUs shall vest on the last day of the Company’s 2013 fiscal year) (the “Anniversary Date”), subject to the
Executive’s continued employment with the Company through the Anniversary Date. The remaining fifty percent (50%) of the Target RSUs shall be eligible to vest on the date that the Compensation Committee determines the vesting of RSU awards
granted to the Company’s senior executives generally under the Company’s Fiscal Year 2013 Executive Incentive Compensation Program (the “Determination Date”) in accordance with the Company’s Fiscal Year 2013 Executive
Incentive Compensation Program (subject to the Executive’s continued employment with the Company through the Determination Date) such that if the Compensation Committee determines that awards granted under the program shall vest based on
Company performance as to a percentage of the target number of units subject to such awards that is greater than fifty percent (50%) (the “Incentive Plan Vesting Percentage”), the Executive shall vest in additional amount of
Target RSUs on the Determination Date so that the total number of the Executive’s vested RSUs under the award (including the first and second installments comprising 50% of the Target RSUs previously paid to the Executive that vests as
described above) shall equal the Target RSUs multiplied by the Incentive Plan Vesting Percentage. In payment of each RSU that vests pursuant to the foregoing provisions, the Executive shall be entitled to receive one share of the Company’s
common stock (such payment to be made promptly and in all events within sixty (60) days after the applicable vesting date). If the Incentive Plan Vesting Percentage is 50% or less, the Executive will not be entitled to vest in

  
 3 

 CONFIDENTIAL 

 

 
any further Target RSUs under the Company’s Fiscal Year 2013 Executive Incentive Compensation Program. Any Target RSUs that are outstanding on the Determination Date and not vested after
giving effect to the foregoing provisions shall terminate on the Determination Date. For each fiscal year during the Period of Employment after the 2013 fiscal year, the Executive’s Incentive Bonus shall be in an amount determined by the
Compensation Committee in its sole discretion. The Executive may participate in recommending his individual performance goals and any corporate goals upon which his Incentive Bonus is based for each fiscal year, provided that the Compensation
Committee shall ultimately set such goals. Except as otherwise provided in any annual incentive program adopted by the Compensation Committee in which the Executive participates, any Incentive Bonus shall be paid, subject to applicable withholdings
and authorized deductions, as soon as practicable after the end of such fiscal year (and in all events within the applicable period prescribed for the payment of “short-term deferrals” as provided in Treasury Regulation
Section 1.409A-1(b)(4)). 
 If the Company is required to prepare an accounting restatement due to its material
noncompliance, as a result of misconduct (whether or not by the Executive), with any financial reporting requirement under the U.S. securities laws, the Executive shall reimburse the Company for any bonus or other incentive-based or equity-based
compensation received by the Executive from the Company during the 12-month period following the first public issuance or filing with the U.S. Securities and Exchange Commission (whichever first occurs) of the financial document embodying such
financial reporting requirement and any profits realized from the sale of securities of the Company during that 12-month period by the Executive. The provision in the immediately preceding sentence is intended to follow Section 304 of the
Sarbanes-Oxley Act of 2002, and to the extent such Section 304 is hereafter amended or modified (whether by legislative, judicial or administrative action) to provide for reduced obligations of the Executive thereunder, the immediately
preceding sentence shall be automatically similarly amended or modified, without the need of a written amendment hereof. In addition to the foregoing, any incentive compensation paid to the Executive shall be subject to the terms of any recoupment,
clawback or similar policy adopted by the Company as it may be in effect from time to time, as well as any similar provisions of applicable law. 
 3.3 Equity Awards.  
 (a) Stock Option. Subject to this
Section 3.3(a), the Company will grant to the Executive an option (the “Option”) to purchase 1,200,000 shares of the Company’s Common Stock, effective on the Effective Date. The exercise price per share for the Option will
be equal to the closing price of a share of the Common Stock on the Effective Date. The Option will be granted pursuant to the “inducement grant” exception provided in Nasdaq Rule 5635(c) and will not be intended to qualify as an
“incentive stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”). Except as expressly set forth herein, the Option will vest as follows: 

 

	 	(i)	with respect to 720,000 of the shares subject to the Option, the Option will vest as to 180,000 of such shares on the first anniversary of the Effective Date, and as to
1/36th of the remaining 540,000 shares underlying the Option each month thereafter on the same day of the month as the Effective Date, subject in each case to the Executive’s active and continuous service to the Company through the applicable
vesting date, such that the Executive shall be fully vested in such portion of the Option shares after four years of active and continuous service to the Company from the Effective Date, and 

  
 4 

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	 	(ii)	with respect to 480,000 of the shares subject to the Option, the Option will be eligible to vest as to 120,000 of such shares on the last day of each of the
Company’s 2013, 2014, 2015 and 2016 fiscal years, provided that the closing price of a share of the Company’s common stock (in regular trading) equals or exceeds the applicable Stock Price Threshold for a period of at least forty-five
(45) consecutive trading days during such fiscal year (the “Stock Price Threshold Objective”), subject to the Executive’s active and continuous service with the Company through the last day of such fiscal year. Except with
respect to the 2016 fiscal year, in the event that the Stock Price Threshold Objective is not achieved in a particular fiscal year, the Executive shall be eligible to vest in the portion of the Option applicable to such fiscal year (i.e. 120,000
shares) if the Stock Price Threshold Objective is achieved in the immediately following fiscal year (the “Roll-Over Fiscal Year”) and the Executive remains actively and continuously employed through the last day of the Roll-Over
Fiscal Year. If the Stock Price Threshold Objective is not achieved in the Roll-Over Fiscal Year, the portion of the Option applicable to the prior fiscal year shall terminate as of the last day of theRoll-Over Fiscal Year. (By way of example, if
the Stock Price Threshold Objective for the 2013 fiscal year is not achieved in that fiscal year, the Executive would be eligible to vest in 240,000 shares underlying the Option (i.e. 120,000 shares applicable to each of the 2013 and 2014 fiscal
years) if the Stock Price Threshold Objective set forth below for the 2014 fiscal year is achieved; if the Stock Price Threshold Objective for the 2014 fiscal year is not achieved in the 2014 fiscal year, 120,000 shares underlying the Option (the
portion of the Option applicable to the 2013 fiscal year) will terminate as of the last day of the 2014 fiscal year, but the Executive would be eligible to vest in 240,000 shares underlying the Option if the Stock Price Threshold Objective for the
2015 fiscal year is achieve during the 2015 fiscal year.) If the Stock Price Threshold for the 2016 fiscal year is not achieved in the 2016 fiscal year, the portion of the Option that remains unvested as of the end of the 2016 fiscal year shall
terminate as of the last day of that fiscal year unless the Agreement is extended by a written agreement signed by the parties in which case the portion of the Option that remains unvested as of the end of the 2016 fiscal year shall vest if the
Stock Price Threshold Objective is achieved for the 2017 fiscal year (as may be mutually agreed upon by the parties if this Agreement is extended) or will terminate if the Stock Price Threshold Objective is not achieved for the 2017 fiscal year. For
these purposes, the “Stock Price Threshold” for a particular fiscal year shall be as follows: 

  

					
	 Fiscal Year
	  	Stock Price Threshold	 
	 2013
	  	$	7.50	  
	 2014
	  	$	9.00	  
	 2015
	  	$	12.00	  
	 2016
	  	$	15.00	  

  
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 The maximum term of the Option will be seven (7) years from the date of grant of
the Option. The Option may be granted as one or more separate grants as determined by the Compensation Committee, each such grant to be on the same terms (except as expressly set forth herein) as option grants made generally under the Company’s
2006 Equity Incentive Plan (the “Plan”), a copy of which is publicly available. Each such grant shall be subject to such further terms and conditions as set forth in a written stock option agreement to be entered into by the Company
and the Executive to evidence the Option, such agreement(s) to be in the form(s) provided to the Executive prior to the execution of this Agreement. Each such agreement and any award agreement for any future option grant by the Company shall provide
that, in the event that Executive’s employment is terminated by the Company without Cause or by Executive for Good Reason and subject to the terms of Sections 5.3(b) and 5.4 below, Executive shall have up to twelve (12) months following
his Separation from Service (defined below) to exercise any vested stock options then held by Executive. 
 (b)
Performance-RSU Award. At the first regular meeting of the Compensation Committee following the Effective Date, the Company will grant the Executive an award of 300,000 performance RSUs (the “RSU Award”). The RSU Award shall
consist of three equal tranches of 100,000 RSUs (each, a “Tranche”), and will vest over three (3) years in each case as follows: 
 (i) with respect to the first Tranche, the Executive must be actively and continuously employed through the end of the 2015 fiscal year in order to vest one hundred percent (100%) (hence
33.3% per year) and the Company’s Earnings Before Interest and Taxes determined on a non-GAAP basis as the Company has historically reported such amounts to investors during earnings calls (“EBIT”) for each of the
four (4) fiscal quarters during the 2013 fiscal year must exceed the EBIT level for the immediately preceding fiscal quarter; 
 (ii) with respect to the second Tranche, the Executive must be actively and continuously employed through the end of the 2016 fiscal year in order to vest one hundred percent (100%) (hence
33.3% per year) and (A) the Company’s EBIT for the 2014 fiscal year must be positive and equal to or greater than five percent (5%) of the Company’s AOP Revenues for the 2014 fiscal year: and (B) the
Company’s revenue as determined in accordance with GAAP and as reported in the Company’s financial statements (“Revenue”) for the 2014 fiscal year must be equal to or greater than fiscal year 2013; 

(iii) with respect to the third Tranche, Executive must be actively and continuously employed through the end of the 2017 fiscal year in
order to vest one hundred percent (100%) (hence 33.3% per year) and (A) the Company’s EBIT for the 2015 fiscal year must be positive and equal to or greater than ten percent (10%) of the Company’s AOP Revenue for the
2015 fiscal year; and (B) the Company’s Revenue for the 2015 fiscal year must be equal to or greater than fiscal year 2014. 
 In each case, the Company’s EBIT level, Revenue level and the vesting of any Tranche shall be determined by the Compensation Committee. If the performance goals for a particular fiscal year set forth
above are not achieved, the Tranche of RSUs applicable to that fiscal year shall terminate as of the last day of that fiscal year. The RSU Award shall be granted under the Plan and shall be subject to such further terms and conditions as set forth
in a written award agreement to be entered into by the Company and the Executive to evidence the award. 

  
 6 

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 3.4 Director Compensation. During the Period of Employment, the Executive
shall not be entitled to receive cash or equity compensation paid to outside directors of the Company and, instead, the Executive shall be compensated exclusively in accordance with the terms of this Agreement. 

3.5 Relocation Expenses. The Executive agrees that (a) no later than four weeks following the Effective Date, he will
lease temporary housing within eight (8) miles of the Company’s principal executive offices (the “Corporate Residence”), (b) during calendar 2012, he will reside in the Corporate Residence during the workweek (Monday
through Friday) in order to devote substantially all of his time, energy and skill to the performance of his duties for the Company and avoid travel time from his principal residence in San Francisco, California; and (c) no later than four
weeks following the Effective Date, he will provide documentation to the Company demonstrating that he has leased a Corporate Residence that complies with this Section 3.5. The Company shall pay or reimburse the Executive for his reasonable
costs incurred in calendar 2012 in connection with leasing, moving into and living in the Corporate Residence and expenses incurred for use of his automobile for business purposes; provided that in no event shall the Company’s obligation with
respect to such payments or reimbursements exceed $5,000 per month in 2012. 
 3.6 Sign-On Bonus. Upon his
entering into this Agreement, the Executive shall be entitled to receive a sign-on bonus of $150,000, payable on or within thirty (30) days after the Effective Date (the “Sign-On Bonus”); provided, however, that in the event
that, at any time within 12 months after the Effective Date, the Executive’s employment is terminated by the Company for Cause or by the Executive other than for Good Reason, the Executive shall immediately repay the amount of the Sign-On Bonus
to the Company in full. 
 4. Benefits. 
 4.1 Retirement, Welfare and Fringe Benefits. During the Period of Employment, the Executive shall be entitled to participate in all employee pension and welfare benefit plans and programs,
and fringe benefit plans and programs, made available by the Company to the Company’s employees generally, in accordance with the eligibility and participation provisions of such plans and as such plans or programs may be in effect from time to
time; provided, however, that the Executive shall not be entitled to a duplication of benefits or payments provided to the Executive pursuant to this Agreement. 
 4.2 Reimbursement of Business Expenses. The Company shall reimburse the Executive for all reasonable business expenses that the Executive incurs during the Period of Employment in connection
with carrying out the Executive’s duties for the Company, subject to the Company’s expense reimbursement policies (including submission of any documentation of such expenses required by such policies) in effect from time to time and
provided that in all events any such reimbursement shall be made not later than the end of the calendar year following the year in which the related expense was incurred. 

  
 7 

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 4.3 Vacation and Other Leave. During the Period of Employment, the
Executive shall accrue and be entitled to take paid vacation in accordance with the Company’s vacation policies in effect from time to time, including the Company’s policies regarding vacation accruals; provided that the Executive’s
rate of vacation accrual during the Period of Employment shall be no less than three (3) weeks per year. The Executive shall also be entitled to all other holiday and leave pay generally available to other executives of the Company. 

5. Termination. 

5.1 Termination by the Company. The Executive’s employment by the Company, and the Period of Employment, may be
terminated at any time by the Company: (i) with Cause (as defined in Section 5.5), or (ii) with no less than thirty (30) days advance notice to the Executive, without Cause, or (iii) in the event of the Executive’s
death (which shall occur automatically upon such death), or (iv) in the event that the Board determines in good faith that the Executive has a Disability (as defined in Section 5.5). 

5.2 Termination by the Executive. The Executive’s employment by the Company, and the Period of Employment, may be
terminated by the Executive with no less than sixty (60) days advance notice to the Company; provided, however, that in the case of a termination for Good Reason, the Executive may provide immediate written notice upon the Company failing to
cure the event that constitutes Good Reason after the Executive has provided the Company written notice of the event constituting Good Reason and at least a thirty (30)-day period to cure. 

5.3 Benefits Upon Termination. If the Executive’s employment by the Company is terminated during the Period of
Employment for any reason by the Company or by the Executive, or upon or following the expiration of the Period of Employment (in any case, the date that the Executive’s employment by the Company terminates is referred to herein as the
“Severance Date”), the Company shall have no further obligation to make or provide to the Executive, and the Executive shall have no further right to receive or obtain from the Company, any payments or benefits except as follows:

 (a) The Company shall pay the Executive (or, in the event of his death, the Executive’s estate) any Accrued
Obligations (as defined in Section 5.5); 
 (b) If, during the Period of Employment, the Executive’s employment
with the Company terminates as a result of an Involuntary Termination (as defined in Section 5.5), and subject to the Executive signing, delivering and not revoking a general release as set forth in Section 5.4, the Company shall provide
the following severance benefits to the Executive: 
 (i) The Company shall pay the Executive (in addition to the Accrued
Obligations) an amount equal to 100% of the Executive’s Base Salary at the annual rate in effect on the Severance Date. Subject to Section 24.2, the Company shall pay such amount to the Executive in twelve (12) equal monthly
installments, less tax withholdings and other authorized deductions, over a period of twelve (12) consecutive months, with the first installment payable in the month following the month in which the Executive’s Separation from Service (as
such term is defined in Section 5.5) occurs. 
 (ii) The Company shall pay to Executive a pro rata portion of the
Incentive Bonus that Executive would have been entitled to receive had he remained employed through the end of the 

  
 8 

 CONFIDENTIAL 

 

 
fiscal year in which he was terminated in accordance with the terms of Section 3.2 above (the “Pro Rata Bonus”). The Pro Rata Bonus will be calculated in the same manner and
paid at the same time that the Incentive Bonus would have been paid in accordance with Section 3.2 above, provided, however, that the Pro Rata Bonus shall be determined by multiplying the Incentive Bonus that would have been paid to the
Executive by a fraction in which the numerator is the number of days that Executive was actively employed by the Company during the applicable fiscal year and the denominator is 365. 

(iii) The Company shall pay the cost of the Executive’s premiums charged to continue medical coverage pursuant to the
Consolidated Omnibus Budget Reconciliation Act (“COBRA”), at the same or reasonably equivalent medical coverage for Executive (and, if applicable, Executive’s eligible dependents) as in effect immediately prior to the Severance
Date, for a period commencing on the Severance Date and ending on the earlier to occur of (A) the date the Executive becomes eligible for medical coverage with another employer and (B) the 12-month anniversary of the Severance Date. To the
extent that the payment of any COBRA premiums pursuant to this Section 5.3(b)(ii) are taxable to Executive, any payment due to Executive pursuant to this section shall be paid to the Executive on or before the last day of the Executive’s
taxable year following the taxable year in which the related expense was incurred. The Executive’s right to payment of such premiums is not subject to liquidation or exchange for another benefit and the amount of such benefits that the
Executive receives in one taxable year shall not affect the amount of such benefits that the Executive receives in any other taxable year. 
 (iv) As to each then-outstanding equity award then held by the Executive that vests based solely on the Executive’s continued service with the Company, the Executive shall vest in any portion
of such award in which the Executive would have vested thereunder if the Executive’s employment with the Company had continued for twelve (12) months after the date of such termination. As to each then-outstanding equity award held by the
Executive that is subject to performance-based vesting requirements, the vesting of such award will continue to be governed by its terms, provided that for purposes of any service-based vesting requirement under such award, the Executive’s
employment with the Company will be deemed to have continued for twelve (12) months after the date of such termination. 

(v) In the event that Executive’s employment with the Company terminates as a result of an Involuntary Termination within
twelve (12) months following a Change of Control, the Company shall, in addition to the amounts in (i) and (ii) of this Section 5.3(b), (A) pay the Executive an amount equal to a pro-rated portion of the Executive’s
target Incentive Bonus for the fiscal year in which the termination occurs (such payment to be made, subject to Section 24.2 and less tax withholdings and other authorized deductions, in a lump sum in the month following the month in which the
Executive’s Separation from Service occurs); and (B) the Executive shall fully vest in any unvested shares subject to any option, restricted stock, restricted stock unit or any other form of equity award granted by the Company to the
Executive (and all future awards shall include vesting acceleration provisions consistent with this Section 5.3(b)(iv)). 

For purposes of clarity, in the event the Executive’s employment terminates upon the expiration of the Period of Employment, the
Executive’s outstanding options shall continue to be governed in accordance with their terms (including, without limitation, the terms applicable to a termination of the Executive’s employment). 

  
 9 

 CONFIDENTIAL 

 

 Notwithstanding the foregoing provisions of this Section 5.3, if the Executive
breaches his obligations under the Confidentiality Agreement and/or Section 7 or 8 of this Agreement at any time, from and after the date of such breach, (x) the Executive will no longer be entitled to, and the Company will no longer be
obligated to pay, any remaining unpaid portion of any benefits provided in Section 5.3(b), and (y) the Executive will no longer be entitled to, and the Company will no longer be obligated to make available to the Executive or the
Executive’s spouse or dependents any group health, life or other similar insurance plans or any payment in respect of such plans; provided, however, that if the Executive provides the release contemplated by Section 5.4, the Executive
shall only be entitled to $5,000, which amount the parties agree is good and adequate consideration, in and of itself, for the Executive’s release contemplated by Section 5.4. 

The foregoing provisions of this Section 5.3 shall not affect: (i) the Executive’s receipt of benefits otherwise due
terminated employees under group insurance coverage consistent with the terms of the applicable Company welfare benefit plan; (ii) the Executive’s rights under COBRA to continue participation in medical, dental, hospitalization and life
insurance coverage; or (iii) the Executive’s receipt of benefits otherwise due in accordance with the terms of the Company’s 401(k) plan (if any). In no event shall the Company’s obligations to the Executive exceed the sum of the
Accrued Obligations, the benefits provided in Section 5.3(b), if applicable, and the benefits contemplated by this paragraph, regardless of the manner of the Executive’s termination. 

5.4 Release; Exclusive Remedy. 
 (a) This Section 5.4 shall apply notwithstanding anything else contained in this Agreement or any stock option, restricted stock or other equity-based award agreement to the contrary. As a
condition precedent to any Company obligation to the Executive pursuant to Section 5.3(b) or any obligation to accelerate vesting of any equity-based award in connection with the termination of the Executive’s employment (including with
respect to the Option), the Executive shall, upon or within twenty-one (21) days following his last day of employment with the Company, provide the Company with a valid, executed general release agreement in a form attached hereto as Exhibit
C (with such changes as may be reasonably required to such form to help ensure its enforceability in light of any changes in applicable law) , and such release agreement shall have not been revoked by the Executive pursuant to any revocation
rights afforded by applicable law. The Company shall have no obligation to make any payment to the Executive pursuant to Section 5.3(b) (or otherwise accelerate the vesting of any equity-based award in the circumstances as otherwise
contemplated by the applicable award agreement) unless and until the release agreement contemplated by this Section 5.4 becomes irrevocable by the Executive in accordance with all applicable laws, rules and regulations. 

(b) The Executive agrees that the general release agreement described in Section 5.4(a) will require that the Executive
acknowledge, as a condition to the payment of any benefits under Section 5.3(b), as applicable, that the payments contemplated by Section 5.3 (and any applicable acceleration of vesting of an equity-based award in accordance with the terms
of such award in 

  
 10 

 CONFIDENTIAL 

 

 
connection with the termination of the Executive’s employment) shall constitute the exclusive and sole remedy for any termination of his employment, and the Executive will be required to
covenant, as a condition to receiving any such payment (and any such accelerated vesting), not to assert or pursue any other remedies, at law or in equity, with respect to his employment or the termination of his employment. The Company and
Executive acknowledge and agree that there is no duty of the Executive to mitigate damages under this Agreement. All amounts paid to the Executive pursuant to Section 5.3 shall be paid without regard to whether the Executive has taken or takes
actions to mitigate damages. 
 5.5 Certain Defined Terms. 

(a) As used herein, “Accrued Obligations” means: 

(i) any Base Salary that had accrued but had not been paid (including accrued and unpaid vacation time) on or before the Severance
Date; and 
 (ii) any reimbursement due to the Executive pursuant to Section 4.2 for expenses incurred by the
Executive on or before the Severance Date. 
 (b) As used herein, “Cause” shall mean, as reasonably
determined by the Board (excluding the Executive, if he is then a member of the Board), (i) any act of personal dishonesty taken by the Executive in connection with his responsibilities as an employee or director of the Company which is
intended to result in substantial personal enrichment of the Executive or is reasonably likely to result in material harm to the Company, (ii) the Executive’s conviction of a felony or any other crime which the Board reasonably believes
has had or will have a material detrimental effect on the Company’s reputation or business, (iii) a willful act by the Executive which constitutes misconduct and is materially injurious to the Company, (iv) Executive’s
unsatisfactory performance of his duties hereunder after receiving written notice from the Board and an opportunity to cure such performance deficiencies within 30 days of receiving such notice, or (v) continued willful violations by the
Executive of the Executive’s obligations to the Company after there has been delivered to the Executive a written demand for performance from the Company which describes the basis for the Company’s belief that the Executive has willfully
violated his obligations to the Company and at least thirty (30) days following delivery of such notice to cure any such violations if such violation is reasonably susceptible of cure. 

(c) As used herein, “Change of Control” shall mean (i) any merger or consolidation of the Company in which
the stockholders of the Company immediately prior to the transaction do not own more than fifty percent (50%) of the outstanding voting power of the Company (or its successor) immediately after such transaction, (ii) the sale of all or
substantially all of the assets of the Company, or (iii) any person or related group of persons (other than the Company or a person that directly or indirectly controls, is controlled by, or is under common control with, the Company) directly
or indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 of the Securities Exchange Act of 1934, as amended) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company’s
outstanding securities pursuant to a tender or exchange offer made directly to the Company’s stockholders. 
 (d) As
used herein, “Disability” shall mean a physical or mental impairment which, as determined in good faith by the Board, renders the Executive unable to perform the essential functions of his employment with the Company, taking into
consideration any reasonable 

  
 11 

 CONFIDENTIAL 

 

 
accommodation that does not impose an undue hardship on the Company, for more than 120 days in any twelve (12)-month period, unless a longer period is required by federal or state law, in which
case that longer period would apply. 
 (e) As used herein, “Good Reason” shall mean the occurrence of,
without Executive’s express written consent, a material reduction of the Executive’s duties, position or responsibilities relative to the Executive’s duties, position or responsibilities in effect immediately prior to such reduction
or a material breach of this Agreement by the Company. 
 (f) As used herein, “Involuntary Termination”
shall mean a termination of the Executive’s employment by the Company without Cause or a resignation by the Executive for Good Reason within sixty (60) days of the occurrence of the event constituting Good Reason (and after giving effect
to the notice and cure periods provided under Section 5.2). 
 (g) As used herein, a “Separation from
Service” occurs when the Executive dies, retires, or otherwise has a termination of employment with the Company that constitutes a “separation from service” within the meaning of Treasury Regulation Section 1.409A-1(h)(1),
without regard to the optional alternative definitions available thereunder. 
 5.6 Notice of Termination. Any
termination of the Executive’s employment under this Agreement shall be communicated by written notice of termination from the terminating party to the other party. The notice of termination shall indicate the specific provision(s) of this
Agreement relied upon in effecting the termination. 
 5.7 Limitation on Benefits. 

(a) Notwithstanding anything contained in this Agreement to the contrary, to the extent that the payments and benefits provided
under this Agreement and benefits provided to, or for the benefit of, the Executive under any other Company plan or agreement (such payments or benefits are collectively referred to as the “Benefits”) would be subject to the excise
tax (the “Excise Tax”) imposed under Section 4999 of the Code, the Benefits shall be reduced (but not below zero) if and to the extent that a reduction in the Benefits would result in the Executive retaining a larger amount, on
an after-tax basis (taking into account federal, state and local income taxes and the Excise Tax), than if the Executive received all of the Benefits (such reduced amount if referred to hereinafter as the “Limited Benefit Amount”).
Unless the Executive shall have given prior written notice (to the extent such a notice does not result in any tax liability under Section 409A of the Code) specifying a different order to the Company to effectuate the Limited Benefit Amount,
the Company shall reduce or eliminate the Benefits by first reducing or eliminating those payments or benefits which are not payable in cash and then by reducing or eliminating cash payments, in each case in reverse order beginning with payments or
benefits which are to be paid the farthest in time from the Determination (as hereinafter defined). Any notice given by the Executive pursuant to the preceding sentence shall take precedence over the provisions of any other plan, arrangement or
agreement governing the Executive’s rights and entitlements to any benefits or compensation. 
 (b) A determination
as to whether the Benefits shall be reduced to the Limited Benefit Amount pursuant to this Agreement and the amount of such Limited Benefit Amount shall be made by the Company’s independent public accountants or another certified public
accounting 

  
 12 

 CONFIDENTIAL 

 

 
firm of national reputation designated by the Company (the “Accounting Firm”) at the Company’s expense. The Accounting Firm shall provide its determination (the
“Determination”), together with detailed supporting calculations and documentation to the Company and the Executive within five (5) days of the date of termination of the Executive’s employment, if applicable, or such
other time as requested by the Company or the Executive (provided the Executive reasonably believes that any of the Benefits may be subject to the Excise Tax), and if the Accounting Firm determines that no Excise Tax is payable by the Executive with
respect to any Benefits, it shall furnish the Executive with an opinion reasonably acceptable to the Executive that no Excise Tax will be imposed with respect to any such Benefits. Unless the Executive provides written notice to the Company within
ten (10) days of the delivery of the Determination to the Executive that he disputes such Determination, the Determination shall be binding, final and conclusive upon the Company and the Executive. 

6. Proprietary Information and Confidentiality Agreement. The Executive has executed and delivered the Proprietary Information and
Confidentiality Agreement attached hereto as Exhibit E (the “Confidentiality Agreement”), and shall comply with its terms. 
 7. Confidentiality. The Executive shall not at any time (whether during or after the Executive’s employment with the Company), directly or indirectly, other than in the course of the
Executive’s duties hereunder, disclose or make available to any person, firm, corporation, association or other entity for any reason or purpose whatsoever, any Confidential Information (as defined in the Confidentiality Agreement). The
Executive agrees that, upon termination of the Executive’s employment with the Company, all Confidential Information in the Executive’s possession that is in written, digital or in other tangible form (together with all copies or
duplicates thereof, including any computer or electronically stored files, including but not limited to emails, power point presentations, pdf documents, excel spread sheets and other documents) shall be returned to the Company and shall not be
retained by the Executive or furnished to any third party, in any form; provided, however, that the Executive shall not be obligated to treat as confidential, or return to the Company copies of any Confidential Information that (a) was publicly
known at the time of disclosure to the Executive, (b) becomes publicly known or available thereafter other than by any means in violation of this Agreement or any other duty owed to the Company by any person or entity, or (c) is lawfully
disclosed to the Executive by a third party. 
 8. Anti-Solicitation. 

8.1 Business Relationships. During the Period of Employment and for a period of one (1) year thereafter, the Executive
shall not, directly or indirectly, individually or as a consultant to, or as an employee, officer, stockholder, director or other owner or participant in any business, use or disclose the Company’s confidential or proprietary information to
influence or attempt to influence customers, vendors, suppliers, joint venturers, associates, consultants, agents, or partners of the Company or any of its affiliates (collectively, the “Company Group”), to divert their business
away from the Company Group, to any individual, partnership, firm, corporation or other entity then in competition with the business of any entity within the Company Group, and he will not otherwise use or disclose the Company’s confidential or
proprietary information to materially interfere with any business relationship of any entity within the Company Group. 

  
 13 

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 8.2 Employees and Consultants. During the Period of Employment and for a
period of one (1) year thereafter, the Executive shall not, directly or indirectly, individually or as a consultant to, or as an employee, officer, stockholder, director or other owner of or participant in any business, solicit (or assist in
soliciting) any person who is then, or at any time within six (6) months prior thereto, an employee or consultant of an entity within the Company Group who earned annually $25,000 or more as an employee or consultant of such entity during the
last six (6) months of his or her own employment to work for (as an employee, consultant or otherwise) any business, individual, partnership, firm, corporation, or other entity whether or not engaged in competitive business with any entity in
the Company Group. 
 9. Withholding Taxes. Notwithstanding anything else herein to the contrary, the Company may withhold (or
cause there to be withheld, as the case may be) from any amounts otherwise due or payable under or pursuant to this Agreement such federal, state and local income, employment, or other taxes as may be required to be withheld pursuant to any
applicable law or regulation. 
 10. Litigation/Audit Cooperation. Following the termination of the Executive’s employment
with the Company for any reason, the Executive shall reasonably cooperate with the Company in connection with (a) any internal or governmental investigation or administrative, regulatory, arbitral or judicial proceeding involving any member of
the Company Group with respect to matters relating to the Executive’s employment with or service as a member of the board of directors of any member of the Company Group (collectively, “Litigation”) or (b) any audit of the
financial statements of any member of the Company Group with respect to the period of Executive’s employment with the Company (“Audit”). The Executive acknowledges that such cooperation may include, but shall not be limited to,
the Executive making himself available to the Company Group (or their respective attorneys or auditors) upon reasonable notice for: (i) interviews, factual investigations, and providing declarations or affidavits that provide truthful
information in connection with any Litigation or Audit; (ii) appearing at the request of any member of the Company Group to give testimony without requiring service of a subpoena or other legal process; (iii) volunteering to any member of
the Company Group pertinent information related to any Litigation or Audit; (iv) providing information and legal representations to the auditors of any member of the Company Group in a form and within a timeframe requested by the Board, with
respect to the financial statements for the period in which the Executive was employed by the Company; and (v) turning over to the Company Group any documents relevant to any Litigation or Audit that are or may come into the Executive’s
possession. The Company Group shall reimburse the Executive for reasonable travel expenses incurred in connection with providing the services under this Section 10, including lodging and meals, upon the Executive’s submission of receipts.

 11. Assignment. This Agreement is personal in its nature and neither of the parties hereto shall, without the consent of the
other, assign or transfer this Agreement or any rights or obligations hereunder; provided, however, that in the event of a merger, consolidation, or transfer or sale of all or substantially all of the assets of the Company with or to any other
individual(s) or entity, this Agreement shall, subject to the provisions hereof, be binding upon and inure to the benefit of such successor and such successor shall discharge and perform all the promises, covenants, duties, and obligations of the
Company hereunder. 

  
 14 

 CONFIDENTIAL 

 

 12. Number and Gender. Where the context requires, the singular shall include the plural,
the plural shall include the singular, and any gender shall include all other genders. 
 13. Section Headings. The section
headings of, and titles of paragraphs and subparagraphs contained in, this Agreement are for the purpose of convenience only, and they neither form a part of this Agreement nor are they to be used in the construction or interpretation thereof.

 14. Governing Law. This Agreement, and all questions relating to its validity, interpretation, performance and enforcement, as
well as the legal relations hereby created between the parties hereto, shall be governed by and construed under, and interpreted and enforced in accordance with, the laws of the State of California, notwithstanding any California or other conflict
of law provision to the contrary. 
 15. Severability. If any provision of this Agreement or the application thereof is held
invalid, the invalidity shall not affect other provisions or applications of this Agreement which can be given effect without the invalid provisions or applications and to this end the provisions of this Agreement are declared to be severable.

 16. Entire Agreement. This Agreement, together with the Confidentiality Agreement, the Indemnification Agreement and all award
agreements related to equity awards granted to the Executive by the Company, embodies the entire agreement of the parties hereto respecting the matters within its scope. This Agreement supersedes all prior and contemporaneous agreements of the
parties hereto that directly or indirectly bears upon the subject matter hereof from and after the Effective Date. Any prior negotiations, correspondence, agreements, proposals or understandings relating to the subject matter hereof shall be deemed
to have been merged into this Agreement, and to the extent inconsistent herewith, such negotiations, correspondence, agreements, proposals, or understandings shall be deemed to be of no force or effect. There are no representations, warranties, or
agreements, whether express or implied, or oral or written, with respect to the subject matter hereof, except as expressly set forth herein. 

17. Modifications. This Agreement may not be amended, modified or changed (in whole or in part), except by a formal, definitive written
agreement expressly referring to this Agreement, which agreement is executed by both of the parties hereto. 
 18. Waiver. Neither
the failure nor any delay on the part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any
other or further exercise of the same or of any right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with
respect to any other occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver. 
 19. Arbitration. Any controversy arising out of or relating to the Executive’s employment (whether or not before or after the expiration of the Period of Employment), any termination of
the Executive’s employment, this Agreement, the Confidentiality Agreement, any currently in effect equity award agreements between Executive and the Company, the Indemnification Agreement, the enforcement or interpretation of any of such
agreements, or because of an alleged breach, default, or misrepresentation in connection with any of the provisions of any such 

  
 15 

 CONFIDENTIAL 

 

 
agreement, including (without limitation) any state or federal statutory claims, shall be submitted to arbitration in Alameda County, California, before a sole arbitrator selected from Judicial
Arbitration and Mediation Services, Inc. or its successor (“JAMS”), or if JAMS is no longer able to supply the arbitrator, such arbitrator shall be selected from the American Arbitration Association; provided, however, that
provisional injunctive relief may, but need not, be sought in a court of law while arbitration proceedings are pending, and any provisional injunctive relief granted by such court shall remain effective until the matter is finally determined by the
arbitrator. The arbitration shall be administered by JAMS pursuant to its Comprehensive Arbitration Rules and Procedures. Judgment on the award may be entered in any court having jurisdiction. 

The parties acknowledge and agree that they are hereby waiving any rights to trial by jury in any action, proceeding or counterclaim
brought by either of the parties against the other in connection with any matter whatsoever arising out of or in any way connected with any of the matters referenced in the first sentence of the first paragraph of this Section 19. 

The parties agree that the Company shall be responsible for payment of the forum costs of any arbitration hereunder, including the
arbitrator’s fee. The parties further agree that in any proceeding with respect to such matters, the prevailing party will be entitled to recover its reasonable attorney’s fees and costs from the non-prevailing party (other than forum
costs associated with the arbitration which in any event shall be paid by the Company). 
 Without limiting the remedies
available to the parties and notwithstanding the foregoing provisions of this Section 19, the Executive and the Company acknowledge that any breach of any of the covenants or provisions contained in Section 7 or 8 of this Agreement or in
the Confidentiality Agreement could result in irreparable injury to either of the parties hereto for which there might be no adequate remedy at law, and that, in the event of such a breach or threat thereof, the non-breaching party shall be entitled
to obtain a temporary restraining order and/or a preliminary injunction and a permanent injunction restraining the other party hereto from engaging in any activities prohibited by any covenant or provision in Section 7 or 8 of this Agreement or
in the Confidentiality Agreement or such other equitable relief as may be required to enforce specifically any of such covenants or provisions. 

20. Insurance. The Company shall have the right at its own cost and expense to apply for and to secure in its own name, or otherwise, life,
health or accident insurance or any or all of them covering the Executive, and the Executive agrees to submit to any usual and customary medical examination and otherwise cooperate with the Company in connection with the procurement of any such
insurance and any claims thereunder. 

  
 16 

 CONFIDENTIAL 

 

 21. Notices. 
 21.1 All notices, requests, demands, consents and other communications required or permitted under this Agreement shall be in writing and shall be deemed to have been duly given and made if
(i) delivered by hand, (ii) otherwise delivered against receipt therefor, or (iii) sent by registered or certified mail, postage prepaid, return receipt requested. Any such notice, request, demand, consent or other communication by
the Board shall be made based on a resolution duly adopted by the Board (or an authorized committee thereof) and made to the Executive by the then serving Chairman of the Board or any other person authorized by the Board (or such committee) to make
such communication. Any notice shall be duly addressed to the parties as follows: 
 (a) if to the Company: 

Exar Corporation 

48720 Kato Road 

Fremont, CA 94538 

Attn: Board of Directors 
 with a copy to: 
 Exar Corporation 

48720 Kato Road 

Fremont, CA 94538 

Attn: Law Department 
 (b) if to the Executive, to the address most recently on file in the payroll records of the Company. 
 21.2 Any party may alter the address to which communications or copies are to be sent by giving notice of such change of address in conformity with the provisions of this Section 21 for the
giving of notice. Any communication shall be effective when delivered by hand, when otherwise delivered against receipt therefor, or five (5) business days after being mailed in accordance with the foregoing. 

22. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original as against any
party whose signature appears thereon, and all of which together shall constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof, individually or taken together, shall bear the signatures of all
of the parties reflected hereon as the signatories. Photographic copies of such signed counterparts may be used in lieu of the originals for any purpose. 
 23. Legal Counsel; Mutual Drafting. Each party recognizes that this is a legally binding contract and acknowledges and agrees that they have had the opportunity to consult with legal counsel
of their choice. Each party has cooperated in the drafting, negotiation and preparation of this Agreement. Hence, in any construction to be made of this Agreement, the same shall not be construed against either party on the basis of that party being
the drafter of such language. The Executive agrees and acknowledges that he has read and understands this Agreement, is entering into it freely and voluntarily, and has been advised to seek counsel prior to entering into this Agreement and has had
ample opportunity to do so. The parties agree and acknowledge that O’Melveny & Myers LLP represents the Company (and not the Executive) in connection with this Agreement. 
 24. Code Section 409A. 
 24.1 It is intended that any
amounts payable under this Agreement and the Company’s and the Executive’s exercise of authority or discretion hereunder shall comply with Section 409A of the Code (including the Treasury regulations and other published guidance
relating thereto) (“Code Section 409A”) so as not to subject the Executive to payment of any interest or additional 

  
 17 

 CONFIDENTIAL 

 

 
tax imposed under Code Section 409A. To the extent that any amount payable under this Agreement would trigger the additional tax imposed by Code Section 409A, the Agreement shall be
construed and interpreted in a manner to avoid such additional tax yet preserve (to the nearest extent reasonably possible) the intended benefit payable to the Executive. 
 24.2 Notwithstanding any provision of this Agreement to the contrary, if the Executive is a “specified employee” within the meaning of Treasury Regulation Section 1.409A-1(i) as of
the date of the Executive’s Separation from Service, to the extent any payment under Section 5.3(b) is deemed to be deferred compensation within the meaning of Section 409A of the Code that is payable as a result of a Separation from
Service, then the Executive shall not be entitled to any payment or benefit pursuant to Section 5.3(b) until the earlier of (i) the date which is six (6) months after Executive’s Separation from Service for any reason other than
death, or (ii) the date of the Executive’s death. Any amounts otherwise payable to the Executive upon or in the six (6) month period following the Executive’s Separation from Service that are not so paid by reason of this
Section 24.2 shall be paid (without interest) as soon as practicable (and in all events within thirty (30) days) after the date that is six (6) months after the Executive’s Separation from Service (or, if earlier, as soon as
practicable, and in all events within thirty (30) days, after the date of the Executive’s death). The provisions of this Section 24.2 shall only apply if, and to the extent, required to avoid the imputation of any tax, penalty or
interest pursuant to Section 409A of the Code. 
 24.3 To the extent that any benefits pursuant to
Section 5.3(b)(ii) or reimbursements pursuant to Section 3.6 or Section 4.2 are taxable to the Executive, any reimbursement payment due to the Executive pursuant to any such provision shall be paid to the Executive on or before the
last day of the Executive’s taxable year following the taxable year in which the related expense was incurred. The benefits and reimbursements pursuant to such provisions are not subject to liquidation or exchange for another benefit and the
amount of such benefits and reimbursements that the Executive receives in one taxable year shall not affect the amount of such benefits or reimbursements that the Executive receives in any other taxable year. 

[Signature Page Follows] 

  
 18 

 CONFIDENTIAL 

 

 IN WITNESS WHEREOF, the Company and the Executive have executed
this Agreement as of the date first written above. 
  

			
	“COMPANY”
	
	 Exar Corporation,

a Delaware corporation

		
	 By:
	 	 /s/ Richard L. Leza

	 Name:
	 	Richard L. Leza
	 Title:
	 	Chairman of the Board
	
	“EXECUTIVE”
	
	 /s/ Louis DiNardo

	 Louis DiNardo

 CONFIDENTIAL 

 

 EXHIBIT A 
 SynapSense Corporation 
 SoloPower Corporation 

 CONFIDENTIAL 

 

 EXHIBIT B 
 [IDENTIFY OTHER CONFIDENTIALITY AGREEMENTS 
 TO WHICH EXECUTIVE IS A PARTY]

 CONFIDENTIAL 

 

 EXHIBIT C 
 [Indemnification Agreement] 

 CONFIDENTIAL 

 

 EXHIBIT D 
 [Form of Release Agreement] 

 CONFIDENTIAL 

 

 EXHIBIT E 
 [Confidentiality Agreement]

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