Document:

exv10w2

Exhibit
10.2

FINANCIAL ENGINES, INC.

AMENDED AND RESTATED

2009 STOCK INCENTIVE PLAN

(Approved by Shareholders February 24, 2010)

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

Table of Contents

	 	 	 	 	 	 	 
	 	 	 	 	Page
	 
	SECTION 1.

	 	ESTABLISHMENT AND PURPOSE
	 	 	1	 
	SECTION 2.

	 	DEFINITIONS
	 	 	1	 
	(a)

	 	“Affiliate”
	 	 	1	 
	(b)

	 	“Award”
	 	 	1	 
	(c)

	 	“Board of Directors”
	 	 	1	 
	(d)

	 	“Change in Control”
	 	 	1	 
	(e)

	 	“Code”
	 	 	2	 
	(f)

	 	“Committee”
	 	 	3	 
	(g)

	 	“Company”
	 	 	3	 
	(h)

	 	“Consultant”
	 	 	3	 
	(i)

	 	“Employee”
	 	 	3	 
	(j)

	 	“Exchange Act”
	 	 	3	 
	(k)

	 	“Exercise Price”
	 	 	3	 
	(l)

	 	“Fair Market Value”
	 	 	3	 
	(m)

	 	“ISO”
	 	 	3	 
	(n)

	 	“Nonstatutory Option” or “NSO”
	 	 	4	 
	(o)

	 	“Offeree”
	 	 	4	 
	(p)

	 	“Option”
	 	 	4	 
	(q)

	 	“Optionee”
	 	 	4	 
	(r)

	 	“Outside Director”
	 	 	4	 
	(s)

	 	“Parent”
	 	 	4	 
	(t)

	 	“Participant”
	 	 	4	 
	(u)

	 	“Plan”
	 	 	4	 
	(v)

	 	“Purchase Price”
	 	 	4	 
	(w)

	 	“Restricted Share”
	 	 	4	 
	(x)

	 	“Restricted Share Agreement”
	 	 	4	 
	(y)

	 	“SAR”
	 	 	4	 
	(z)

	 	“SAR Agreement”
	 	 	4	 
	(aa)

	 	“Service”
	 	 	4	 
	(bb)

	 	“Share”
	 	 	5	 
	(cc)

	 	“Stock”
	 	 	5	 
	(dd)

	 	“Stock Option Agreement”
	 	 	5	 
	(ee)

	 	“Stock Unit”
	 	 	5	 

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

-i-

 

 

	 	 	 	 	 	 	 
	 	 	 	 	Page
	 
	(ff)

	 	“Stock Unit Agreement”
	 	 	5	 
	(gg)

	 	“Subsidiary”
	 	 	5	 
	(hh)

	 	“Total and Permanent Disability”
	 	 	5	 
	SECTION 3.

	 	ADMINISTRATION
	 	 	5	 
	(a)

	 	Committee Composition
	 	 	5	 
	(b)

	 	Committee for Non-Officer Grants
	 	 	5	 
	(c)

	 	Committee Procedures
	 	 	6	 
	(d)

	 	Committee Responsibilities
	 	 	6	 
	SECTION 4.

	 	ELIGIBILITY
	 	 	7	 
	(a)

	 	General Rule
	 	 	7	 
	(b)

	 	Automatic Grants to Outside Directors
	 	 	7	 
	(c)

	 	Ten-Percent Stockholders
	 	 	8	 
	(d)

	 	Attribution Rules
	 	 	9	 
	(e)

	 	Outstanding Stock
	 	 	9	 
	SECTION 5.

	 	STOCK SUBJECT TO PLAN
	 	 	9	 
	(a)

	 	Basic Limitation
	 	 	9	 
	(b)

	 	Section 162(m) Award Limitation
	 	 	9	 
	(c)

	 	Additional Shares
	 	 	9	 
	SECTION 6.

	 	RESTRICTED SHARES
	 	 	10	 
	(a)

	 	Restricted Stock Agreement
	 	 	10	 
	(b)

	 	Payment for Awards
	 	 	10	 
	(c)

	 	Vesting
	 	 	10	 
	(d)

	 	Voting and Dividend Rights
	 	 	10	 
	(e)

	 	Restrictions on Transfer of Shares
	 	 	10	 
	SECTION 7.

	 	TERMS AND CONDITIONS OF OPTIONS
	 	 	10	 
	(a)

	 	Stock Option Agreement
	 	 	10	 
	(b)

	 	Number of Shares
	 	 	11	 
	(c)

	 	Exercise Price
	 	 	11	 
	(d)

	 	Withholding Taxes
	 	 	11	 
	(e)

	 	Exercisability and Term
	 	 	11	 
	(f)

	 	Exercise of Options
	 	 	11	 
	(g)

	 	Effect of Change in Control
	 	 	11	 
	(h)

	 	No Rights as a Stockholder
	 	 	12	 
	(i)

	 	Modification, Extension and Renewal of Options
	 	 	12	 
	(j)

	 	Restrictions on Transfer of Shares
	 	 	12	 
	(k)

	 	Buyout Provisions
	 	 	12	 
	SECTION 8.

	 	PAYMENT FOR SHARES
	 	 	12	 

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

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	 	 	 	 	Page
	 
	(a)

	 	General Rule
	 	 	12	 
	(b)

	 	Surrender of Stock
	 	 	12	 
	(c)

	 	Services Rendered
	 	 	12	 
	(d)

	 	Cashless Exercise
	 	 	12	 
	(e)

	 	Exercise/Pledge
	 	 	13	 
	(f)

	 	Promissory Note
	 	 	13	 
	(g)

	 	Other Forms of Payment
	 	 	13	 
	(h)

	 	Limitations under Applicable Law
	 	 	13	 
	SECTION 9.

	 	STOCK APPRECIATION RIGHTS
	 	 	13	 
	(a)

	 	SAR Agreement
	 	 	13	 
	(b)

	 	Number of Shares
	 	 	13	 
	(c)

	 	Exercise Price
	 	 	13	 
	(d)

	 	Exercisability and Term
	 	 	13	 
	(e)

	 	Effect of Change in Control
	 	 	14	 
	(f)

	 	Exercise of SARs
	 	 	14	 
	(g)

	 	Modification or Assumption of SARs
	 	 	14	 
	(h)

	 	Buyout Provisions
	 	 	14	 
	SECTION 10.

	 	STOCK UNITS
	 	 	14	 
	(a)

	 	Stock Unit Agreement
	 	 	14	 
	(b)

	 	Payment for Awards
	 	 	14	 
	(c)

	 	Vesting Conditions
	 	 	14	 
	(d)

	 	Voting and Dividend Rights
	 	 	14	 
	(e)

	 	Form and Time of Settlement of Stock Units
	 	 	15	 
	(f)

	 	Death of Recipient
	 	 	15	 
	(g)

	 	Creditors’ Rights
	 	 	15	 
	SECTION 11.

	 	ADJUSTMENT OF SHARES
	 	 	15	 
	(a)

	 	Adjustments
	 	 	15	 
	(b)

	 	Dissolution or Liquidation
	 	 	16	 
	(c)

	 	Reorganizations
	 	 	16	 
	(d)

	 	Reservation of Rights
	 	 	16	 
	SECTION 12.

	 	DEFERRAL OF AWARDS
	 	 	17	 
	(a)

	 	Committee Powers
	 	 	17	 
	(b)

	 	General Rules
	 	 	17	 
	SECTION 13.

	 	AWARDS UNDER OTHER PLANS
	 	 	17	 
	SECTION 14.

	 	PAYMENT OF DIRECTOR’S FEES IN SECURITIES
	 	 	17	 
	(a)

	 	Effective Date
	 	 	17	 
	(b)

	 	Elections to Receive NSOs, Restricted Shares or Stock Units
	 	 	17	 

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

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	 	 	 	 	Page
	 
	(c)

	 	Number and Terms of NSOs, Restricted Shares or Stock Units
	 	 	18	 
	SECTION 15.

	 	LEGAL AND REGULATORY REQUIREMENTS
	 	 	18	 
	SECTION 16.

	 	WITHHOLDING TAXES
	 	 	18	 
	(a)

	 	General
	 	 	18	 
	(b)

	 	Share Withholding
	 	 	18	 
	SECTION 17.

	 	OTHER PROVISIONS APPLICABLE TO AWARDS
	 	 	18	 
	(a)

	 	Transferability
	 	 	18	 
	(b)

	 	Substitution and Assumption of Awards
	 	 	19	 
	(c)

	 	Qualifying Performance Criteria
	 	 	19	 
	SECTION 18.

	 	NO EMPLOYMENT RIGHTS
	 	 	20	 
	SECTION 19.

	 	DURATION AND AMENDMENTS
	 	 	20	 
	(a)

	 	Term of the Plan
	 	 	20	 
	(b)

	 	Right to Amend or Terminate the Plan
	 	 	20	 
	(c)

	 	Effect of Termination
	 	 	20	 
	SECTION 20.

	 	EXECUTION
	 	 	21	 

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

-iv-

 

 

FINANCIAL ENGINES, INC.

AMENDED AND RESTATED

2009 STOCK INCENTIVE PLAN

SECTION 1. ESTABLISHMENT AND PURPOSE.

     The Plan was adopted by the Board of Directors on November 18, 2009, and became effective on
March 16, 2010, immediately prior to the closing of the initial offering of Stock to the public
pursuant to a registration statement filed by the Company with the Securities and Exchange
Commission (the “Effective Date”). The Plan was amended and restated effective December 31, 2010 to
amend the vesting provisions for grants to Outside Directors under Section 4(b). The purpose of the
Plan is to promote the long-term success of the Company and the creation of stockholder value by
(a) encouraging Employees, Outside Directors and Consultants to focus on critical long-range
objectives, (b) encouraging the attraction and retention of Employees, Outside Directors and
Consultants with exceptional qualifications and (c) linking Employees, Outside Directors and
Consultants directly to stockholder interests through increased stock ownership. The Plan seeks to
achieve this purpose by providing for Awards in the form of restricted shares, stock units, options
(which may constitute incentive stock options or nonstatutory stock options) or stock appreciation
rights.

SECTION 2. DEFINITIONS.

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

     (b) “Award” shall mean any award of an Option, a SAR, a Restricted Share or a Stock Unit under
the Plan.

     (c) “Board of Directors” shall mean the Board of Directors of the Company, as constituted from
time to time.

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

	 	(i)	 	A change in the composition of the Board of Directors occurs,
as a result of which fewer than one-half of the incumbent directors are
directors who either:

          (A) Had been directors of the Company on the “look-back date” (as defined
below) (the “original directors”); or

          (B) Were elected, or nominated for election, to the Board of Directors with the
affirmative votes of at least a majority of the aggregate of the original directors
who were still in office at the time of the election or nomination and the directors
whose election or nomination was previously so approved (the “continuing
directors”); or

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

	 	(ii)	 	Any “person” (as defined below) who by the acquisition or
aggregation of securities, is or becomes the “beneficial owner” (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of
the Company representing 50% or more of the combined voting power of the
Company’s then outstanding securities ordinarily (and apart from rights
accruing under special circumstances) having the right to vote at elections of
directors (the “Base Capital Stock”); except that any change in the relative
beneficial ownership of the Company’s securities by any person resulting solely
from a reduction in the aggregate number of outstanding shares of Base Capital
Stock, and any decrease thereafter in such person’s ownership of securities,
shall be disregarded until such person increases in any manner, directly or
indirectly, such person’s beneficial ownership of any securities of the
Company; or
	 
	 	(iii)	 	The consummation of a merger or consolidation of the Company
with or into another entity or any other corporate reorganization, if persons
who were not stockholders of the Company immediately prior to such merger,
consolidation or other reorganization own immediately after such merger,
consolidation or other reorganization 50% or more of the voting power of the
outstanding securities of each of (A) the continuing or surviving entity and
(B) any direct or indirect parent corporation of such continuing or surviving
entity; or
	 
	 	(iv)	 	The sale, transfer or other disposition of all or substantially
all of the Company’s assets.

     For purposes of subsection (d)(i) above, the term “look-back” date shall mean the later of (1)
the Effective Date or (2) the date 24 months prior to the date of the event that may constitute a
Change in Control.

     For purposes of subsection (d)(ii)) above, the term “person” shall have the same meaning as
when used in Sections 13(d) and 14(d) of the Exchange Act but shall exclude (1) a trustee or other
fiduciary holding securities under an employee benefit plan maintained by the Company or
a Parent or Subsidiary and (2) a corporation owned directly or indirectly by the stockholders
of the Company in substantially the same proportions as their ownership of the Stock.

     Any other provision of this Section 2(d) notwithstanding, a transaction shall not constitute a
Change in Control if its sole purpose is to change the state of the Company’s incorporation or to
create a holding company that will be owned in substantially the same proportions by the persons
who held the Company’s securities immediately before such transaction, and a Change in Control
shall not be deemed to occur if the Company files a registration statement with the United States
Securities and Exchange Commission for the initial offering of Stock to the public.

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

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

     (f) “Committee” shall mean the Compensation Committee as designated by the Board of Directors,
which is authorized to administer the Plan, as described in Section 3 hereof.

     (g) “Company” shall mean Financial Engines, Inc., a Delaware corporation.

     (h) “Consultant” shall mean a consultant or advisor who provides bona fide services to the
Company, a Parent, a Subsidiary or an Affiliate as an independent contractor (not including service
as a member of the Board of Directors) or a member of the board of directors of a Parent or a
Subsidiary, in each case who is not an Employee.

     (i) “Employee” shall mean any individual who is a common-law employee of the Company, a
Parent, a Subsidiary or an Affiliate.

     (j) “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

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

     (l) “Fair Market Value”
with respect to a Share, shall mean the market price of one Share, determined by the Committee
as follows:

	 	(i)	 	If the Stock was traded over-the-counter on the date in
question, then the Fair Market Value shall be equal to the last transaction
price quoted for such date by the OTC Bulletin Board or, if not so quoted,
shall be equal to the mean between the last reported representative bid and
asked prices quoted for such date by the principal automated inter-dealer
quotation system on which the Stock is quoted or, if the Stock is not quoted on
any such system, by the Pink Quote system;
	 
	 	(ii)	 	If the Stock was traded on any established stock exchange (such
as the New York Stock Exchange, The Nasdaq Global Market or The Nasdaq Global
Select Market) or national market system on the date in question, then the Fair
Market Value shall be equal to the closing price reported for such date by the
applicable exchange or system; and
	 
	 	(iii)	 	If none of the foregoing provisions is applicable, then the
Fair Market Value shall be determined by the Committee in good faith on such
basis as it deems appropriate.

In all cases, the determination of Fair Market Value by the Committee shall be conclusive and
binding on all persons.

     (m) “ISO” shall mean an employee incentive stock option described in Section 422 of the Code.

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

     (n) “Nonstatutory Option” or “NSO” shall mean an employee stock option that is not an ISO.

     (o) “Offeree” shall mean an individual to whom the Committee has offered the right to acquire
Shares under the Plan (other than upon exercise of an Option).

     (p) “Option” shall mean an ISO or Nonstatutory Option granted under the Plan and entitling the
holder to purchase Shares.

     (q) “Optionee” shall mean an individual or estate who holds an Option or SAR.

     (r) “Outside Director”
shall mean a member of the Board of Directors who is not a common-law employee of, or paid
consultant to, the Company, a Parent or a Subsidiary.

     (s) “Parent” shall mean any corporation (other than the Company) in an unbroken chain of
corporations ending with the Company, if each of the corporations other than the Company owns stock
possessing 50% or more of the total combined voting power of all classes of stock in one of the
other corporations in such chain. A corporation that attains the status of a Parent on a date after
the adoption of the Plan shall be a Parent commencing as of such date.

     (t) “Participant” shall mean an individual or estate who holds an Award.

     (u) “Plan” shall mean this 2009 Stock Incentive Plan of Financial Engines, Inc., as amended
from time to time.

     (v) “Purchase Price” shall mean the consideration for which one Share may be acquired under
the Plan (other than upon exercise of an Option), as specified by the Committee.

     (w) “Restricted Share” shall mean a Share awarded under the Plan.

     (x) “Restricted Share Agreement” shall mean the agreement between the Company and the
recipient of a Restricted Share which contains the terms, conditions and restrictions pertaining to
such Restricted Shares.

     (y) “SAR” shall mean a stock appreciation right granted under the Plan.

     (z) “SAR Agreement” shall mean the agreement between the Company and an Optionee which
contains the terms, conditions and restrictions pertaining to his or her SAR.

     (aa) “Service” shall mean service as an Employee, Consultant or Outside Director, subject to
such further limitations as may be set forth in the Plan or the applicable Stock Option Agreement,
SAR Agreement, Restricted Share Agreement or Stock Unit Agreement. Service does not terminate when
an Employee goes on a bona fide leave of absence, that was approved by the
Company in writing, if the terms of the leave provide for continued Service crediting, or when
continued Service crediting is required by applicable law. However, for purposes of determining
whether an Option is entitled to ISO status, an Employee’s employment will be treated as
terminating 90 days after such Employee went on leave, unless such Employee’s right to return to
active work is guaranteed by law or by a contract. Service terminates in any event

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

when the
approved leave ends, unless such Employee immediately returns to active work. The Company
determines which leaves of absence count toward Service, and when Service terminates for all
purposes under the Plan.

     (bb) “Share” shall mean one share of Stock, as adjusted in accordance with Section 11 (if
applicable).

     (cc) “Stock” shall mean the Common Stock of the Company.

     (dd) “Stock Option Agreement” shall mean the agreement between the Company and an Optionee
that contains the terms, conditions and restrictions pertaining to such Option.

     (ee) “Stock Unit” shall mean a bookkeeping entry representing the Company’s obligation to
deliver one Share (or distribute cash) on a future date in accordance with the provisions of a
Stock Unit Agreement.

     (ff) “Stock Unit Agreement” shall mean the agreement between the Company and the recipient of
a Stock Unit which contains the terms, conditions and restrictions pertaining to such Stock Unit.

     (gg) “Subsidiary” shall mean any corporation, if the Company and/or one or more other
Subsidiaries own not less than 50% of the total combined voting power of all classes of outstanding
stock of such corporation. A corporation that attains the status of a Subsidiary on a date after
the adoption of the Plan shall be considered a Subsidiary commencing as of such date.

     (hh) “Total and Permanent Disability” shall mean any permanent and total disability as defined
by section 22(e)(3) of the Code.

SECTION 3. ADMINISTRATION.

     (a) Committee Composition. The Plan shall be administered by the Board or a Committee appointed by the Board. The
Committee shall consist of two or more directors of the Company. In addition, to the extent
required by the Board, the composition of the Committee shall satisfy (i) such requirements as the
Securities and Exchange Commission may establish for administrators acting under plans intended to
qualify for exemption under Rule 16b-3 (or its successor) under the Exchange Act; and (ii) such
requirements as the Internal Revenue Service may establish for outside directors acting under plans
intended to qualify for exemption under Section 162(m)(4)(C) of the Code.

     (b) Committee for Non-Officer Grants. The Board may also appoint one or more separate
committees of the Board, each composed of one or more directors of the Company who need not satisfy
the requirements of Section 3(a), who may administer the Plan with respect to Employees who are not
considered officers or directors of the Company under Section 16 of the Exchange Act, may grant
Awards under the Plan to such Employees and may determine all terms of such grants. Within the
limitations of the preceding sentence, any reference in the Plan to the Committee shall include
such committee or committees appointed pursuant to the preceding sentence. To the extent permitted
by applicable laws, the Board of Directors may also authorize one or more officers of the Company
to designate Employees, other than officers under Section

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

16 of the Exchange Act, to receive Awards
and/or to determine the number of such Awards to be received by such persons; provided, however,
that the Board of Directors shall specify the total number of Awards that such officers may so
award.

     (c) Committee Procedures. The Board of Directors shall designate one of the members of the
Committee as chairman. The Committee may hold meetings at such times and places as it shall
determine. The acts of a majority of the Committee members present at meetings at which a quorum
exists, or acts reduced to or approved in writing (including via email) by all Committee members,
shall be valid acts of the Committee.

     (d) Committee Responsibilities. Subject to the provisions of the Plan, the Committee shall
have full authority and discretion to take the following actions:

	 	(i)	 	To interpret the Plan and to apply its provisions;
	 
	 	(ii)	 	To adopt, amend or rescind rules, procedures and forms relating
to the Plan;
	 
	 	(iii)	 	To adopt, amend or terminate sub-plans established for the
purpose of satisfying applicable foreign laws including qualifying for
preferred tax treatment under applicable foreign tax laws;
	 
	 	(iv)	 	To authorize any person to execute, on behalf of the Company,
any instrument required to carry out the purposes of the Plan;
	 
	 	(v)	 	To determine when Awards are to be granted under the Plan;
	 
	 	(vi)	 	To select the Offerees and Optionees;
	 
	 	(vii)	 	To determine the number of Shares to be made subject to each
Award;
	 
	 	(viii)	 	To prescribe the terms and conditions of each Award, including (without
limitation) the Exercise Price and Purchase Price, and the vesting or duration
of the Award (including accelerating the vesting of Awards, either at the time
of the Award or thereafter, without the consent of the Participant), to
determine whether an Option is to be classified as an ISO or as a Nonstatutory
Option, and to specify the provisions of the agreement relating to such Award;
	 
	 	(ix)	 	To amend any outstanding Award agreement, subject to applicable
legal restrictions and to the consent of the Participant if the Participant’s
rights or obligations would be materially impaired;
	 
	 	(x)	 	To prescribe the consideration for the grant of each Award or
other right under the Plan and to determine the sufficiency of such
consideration;
	 
	 	(xi)	 	To determine the disposition of each Award or other right under
the Plan in the event of a Participant’s divorce or dissolution of marriage;

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

	 	(xii)	 	To determine whether Awards under the Plan will be granted in
replacement of other grants under an incentive or other compensation plan of an
acquired business;
	 
	 	(xiii)	 	To correct any defect, supply any omission, or reconcile any inconsistency in
the Plan or any Award agreement;
	 
	 	(xiv)	 	To establish or verify the extent of satisfaction of any
performance goals or other conditions applicable to the grant, issuance,
exercisability, vesting and/or ability to retain any Award; and
	 
	 	(xv)	 	To take any other actions deemed necessary or advisable for the
administration of the Plan.

Subject to the requirements of applicable law, the Committee may designate persons other than
members of the Committee to carry out its responsibilities and may prescribe such conditions and
limitations as it may deem appropriate, except that the Committee may not delegate its authority
with regard to the selection for participation of or the granting of Options or other rights under
the Plan to persons subject to Section 16 of the Exchange Act. All decisions, interpretations and
other actions of the Committee shall be final and binding on all Offerees, all Optionees, and all
persons deriving their rights from an Offeree or Optionee. No member of the Committee shall be
liable for any action that he has taken or has failed to take in good faith with respect to the
Plan, any Option, or any right to acquire Shares under the Plan.

SECTION 4. ELIGIBILITY.

     (a) General Rule. Only common-law employees of the Company, a Parent or a Subsidiary shall be
eligible for the grant of ISOs. Only Employees, Consultants and Outside Directors shall be eligible
for the grant of Restricted Shares, Stock Units, Nonstatutory Options or SARs.

     (b) Automatic Grants to Outside Directors.

	 	(i)	 	Each Outside Director who first joins the Board of Directors on
or after the Effective Date, and who was not previously an Employee, shall
receive a Nonstatutory Option, subject to approval of the Plan by the Company’s
stockholders, to purchase 50,000 Shares (subject to adjustment under Section
11) on the date of his or her election to the Board of Directors. The Shares
subject to each Option granted under this Section 4(b)(i) shall vest and become
exercisable on substantially the same terms and conditions as Options granted
to employees at the time of grant under this Section 4(b)(i), subject to the
Committee’s discretion. As of the time of the December 31, 2010 amendment of
this Plan, that vesting is as follows: Twenty-five percent (25%) of the Shares
subject to each Option granted under this Section 4(b)(i) shall vest and become
exercisable on the first anniversary of the date of grant. The balance of the
Shares subject to such Option (i.e. the remaining seventy-five percent (75%))
shall vest and become exercisable monthly over a 3-year period beginning on the
day

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

	 	 	 	which is one month after the first anniversary of the date of grant, at a
monthly rate of 2.0833% of the total number of Shares subject to such Option.
Notwithstanding the foregoing, each such Option shall become vested if a Change
in Control occurs with respect to the Company during the Optionee’s Service.
	 
	 	(ii)	 	On the first business day following the conclusion of each
regular annual meeting of the Company’s stockholders, commencing with the
annual meeting occurring after the Effective Date, each Outside Director who
was not elected to the Board for the first time at such meeting and who will
continue serving as a member of the Board of Directors thereafter shall receive
an Option to purchase 10,000 Shares (subject to adjustment under Section 11),
provided that such Outside Director has served on the Board of Directors for at
least six months. The Shares subject to each Option granted under this Section
4(b)(ii) shall vest and become exercisable on substantially the same terms and
conditions as Options granted to employees at the time of grant under this
Section 4(b)(ii), subject to the Committee’s discretion. As of the time of the
December 31, 2010 amendment of this Plan, that vesting is as follows:
Twenty-five percent (25%) of the Shares subject to each Option granted under
this Section
4(b)(ii) shall vest and become exercisable on the first anniversary of the
date of grant. The balance of the Shares subject to such Option (i.e. the
remaining seventy-five percent (75%)) shall vest and become exercisable
monthly over a 3-year period beginning on the day which is one month after
the first anniversary of the date of grant, at a monthly rate of 2.0833% of
the total number of Shares subject to such Option. Notwithstanding the
foregoing, each Option granted under this Section 4(b)(ii) shall become
vested if a Change in Control occurs with respect to the Company during the
Optionee’s Service.
	 
	 	(iii)	 	The Exercise Price of all Nonstatutory Options granted to an
Outside Director under this Section 4(b) shall be equal to 100% of the Fair
Market Value of a Share on the date of grant, payable in one of the forms
described in Section 8(a), (b) or (d).
	 
	 	(iv)	 	All Nonstatutory Options granted to an Outside Director under
this Section 4(b) shall terminate on the earlier of (A) the day before the
tenth anniversary of the date of grant of such Options or (B) the date twelve
months after the termination of such Outside Director’s Service for any reason;
provided, however, that any such Options that are not vested upon the
termination of the Outside Director’s Service as a member of the Board of
Directors for any reason shall terminate immediately and may not be exercised.

     (c) Ten-Percent Stockholders. An Employee who owns more than 10% of the total combined voting
power of all classes of outstanding stock of the Company, a Parent or

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Subsidiary shall not be
eligible for the grant of an ISO unless such grant satisfies the requirements of Section 422(c)(5)
of the Code.

     (d) Attribution Rules. For purposes of Section 4(c) above, in determining stock ownership, an
Employee shall be deemed to own the stock owned, directly or indirectly, by or for such Employee’s
brothers, sisters, spouse, ancestors and lineal descendants. Stock owned, directly or indirectly,
by or for a corporation, partnership, estate or trust shall be deemed to be owned proportionately
by or for its stockholders, partners or beneficiaries.

     (e) Outstanding Stock. For purposes of Section 4(c) above, “outstanding stock” shall include
all stock actually issued and outstanding immediately after the grant. “Outstanding stock” shall
not include shares authorized for issuance under outstanding options held by the Employee or by any
other person.

SECTION 5. STOCK SUBJECT TO PLAN.

     (a) Basic Limitation.
Shares offered under the Plan shall be authorized but unissued Shares or treasury Shares.
The aggregate number of Shares authorized for issuance as Awards under the Plan shall not exceed
2,000,000 Shares, plus (x) any Shares subject to outstanding options under the Company’s 1998 Stock
Plan (the “Predecessor Plan”) on the effective date of this Plan that are subsequently forfeited or
terminated for any reason before being exercised, such number of additional Shares not to exceed an
aggregate of 2,000,000 Shares, and (y) an annual increase on the first day of each fiscal year
beginning in 2010 and ending in 2019, in an amount equal to the lesser of (i) 2,000,000 Shares,
(ii) 4% of the outstanding Shares on the last day of the immediately preceding year or (iii) an
amount determined by the Board. The limitations of this Section 5(a) shall be subject to adjustment
pursuant to Section 11. The number of Shares that are subject to Options or other Awards
outstanding at any time under the Plan shall not exceed the number of Shares which then remain
available for issuance under the Plan. The Company, during the term of the Plan, shall at all times
reserve and keep available sufficient Shares to satisfy the requirements of the Plan.

     (b) Section 162(m) Award Limitation. Notwithstanding any contrary provisions of the Plan, and
subject to the provisions of Section 11, no Participant may receive Options, SARs, Restricted
Shares or Stock Units under the Plan in any calendar year that relate to an aggregate of more than
500,000 Shares, and no more than two times this amount in the first year of employment, and the
maximum aggregate amount of cash that may be paid to any Participant during any calendar year with
respect to Awards payable in cash shall be $1,000,000.

     (c) Additional Shares. If Restricted Shares or Shares issued upon the exercise of Options are
forfeited, then such Shares shall again become available for Awards under the Plan. If Stock Units,
Options or SARs are forfeited or terminate for any reason before being exercised or settled, or an
Award is settled in cash without the delivery of Shares to the holder, then any Shares subject to
the Award shall again become available for Awards under the Plan. Only the number of Shares (if
any) actually issued in settlement of Awards shall reduce the number available in Section 5(a) and
the balance shall again become available for Awards under the Plan. Any Shares tendered or
withheld to satisfy the grant or exercise price or tax withholding obligation pursuant to any Award
shall again become available for Awards under the Plan.

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Notwithstanding the foregoing and, subject
to adjustment as provided in Section 11, the maximum number of Shares that may be issued upon the
exercise of ISOs will equal the aggregate Share number stated in Section 5(a), plus, to the extent
allowable under Section 422 of the Code and the Treasury Regulations promulgated thereunder, any
Shares that become available for issuance under the Plan pursuant this Section 5(c).

SECTION 6. RESTRICTED SHARES.

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

     (b) Payment for Awards. Restricted Shares may be sold or awarded under the Plan for such
consideration as the Committee may determine, including (without limitation) cash, cash
equivalents, full-recourse promissory notes, past services and future services.

     (c) Vesting. Each Award of Restricted Shares may or may not be subject to vesting. Vesting
shall occur, in full or in installments, upon satisfaction of the conditions specified in the
Restricted Stock Agreement. A Restricted Stock Agreement may provide for accelerated vesting in the
event of the Participant’s death, disability or retirement or other events. The Committee may
determine, at the time of granting Restricted Shares of thereafter, that all or part of such
Restricted Shares shall become vested in the event that a Change in Control occurs with respect to
the Company.

     (d) Voting and Dividend Rights. The holders of Restricted Shares awarded under the Plan shall
have the same voting, dividend and other rights as the Company’s other stockholders. A Restricted
Stock Agreement, however, may require that the holders of Restricted Shares invest any cash
dividends received in additional Restricted Shares. Such additional Restricted Shares shall be
subject to the same conditions and restrictions as the Award with respect to which the dividends
were paid.

     (e) Restrictions on Transfer of Shares. Restricted Shares shall be subject to such rights of
repurchase, rights of first refusal or other restrictions as the Committee may determine. Such
restrictions shall be set forth in the applicable Restricted Stock Agreement and shall apply in
addition to any general restrictions that may apply to all holders of Shares.

SECTION 7. TERMS AND CONDITIONS OF OPTIONS.

     (a) Stock Option Agreement. Each grant of an Option under the Plan shall be evidenced by a
Stock Option Agreement between the Optionee and the Company. Such Option shall be subject to all
applicable terms and conditions of the Plan and may be subject to any other terms and conditions
which are not inconsistent with the Plan and which the Committee deems appropriate for inclusion in
a Stock Option Agreement. The Stock Option Agreement shall specify whether the Option is an ISO or
an NSO. The provisions of the various Stock Option Agreements entered into under the Plan need not
be identical.

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     (b)Number of Shares. Each Stock Option Agreement shall specify the number of Shares that are subject to the
Option and shall provide for the adjustment of such number in accordance with Section 11.

     (c) Exercise Price. Each Stock Option Agreement shall specify the Exercise Price. The Exercise
Price of an ISO shall not be less than 100% of the Fair Market Value of a Share on the date of
grant, except as otherwise provided in 4(c), and the Exercise Price of an NSO shall not be less
100% of the Fair Market Value of a Share on the date of grant. Notwithstanding the foregoing,
Options may be granted with an Exercise Price of less than 100% of the Fair Market Value per Share
on the date of grant pursuant to a transaction described in, and in a manner consistent with,
Section 424(a) of the Code. Subject to the foregoing in this Section 7(c), the Exercise Price
under any Option shall be determined by the Committee in its sole discretion. The Exercise Price
shall be payable in one of the forms described in Section 8.

     (d) Withholding Taxes. As a condition to the exercise of an Option, the Optionee shall make
such arrangements as the Committee may require for the satisfaction of any federal, state, local or
foreign withholding tax obligations that may arise in connection with such exercise. The Optionee
shall also make such arrangements as the Committee may require for the satisfaction of any federal,
state, local or foreign withholding tax obligations that may arise in connection with the
disposition of Shares acquired by exercising an Option.

     (e) Exercisability and Term. Each Stock Option Agreement shall specify the date when all or
any installment of the Option is to become exercisable. The Stock Option Agreement shall also
specify the term of the Option; provided that the term of an ISO shall in no event exceed 10 years
from the date of grant (five years for ISOs granted to Employees described in Section 4(c)). A
Stock Option Agreement may provide for accelerated exercisability in the event of the Optionee’s
death, disability, or retirement or other events and may provide for expiration prior to the end of
its term in the event of the termination of the Optionee’s Service. Options may be awarded in
combination with SARs, and such an Award may provide that the Options will not be exercisable
unless the related SARs are forfeited. Subject to the foregoing in this Section 7(e), the Committee
at its sole discretion shall determine when all or any installment of an Option is to become
exercisable and when an Option is to expire.

     (f) Exercise of Options. Each Stock Option Agreement shall set forth the extent to which the
Optionee shall have the right to exercise the Option following termination of the Optionee’s
Service with the Company and its Subsidiaries, and the right to exercise the Option of any
executors or administrators of the Optionee’s estate or any person who has acquired such Option(s)
directly from the Optionee by bequest or inheritance. Such provisions shall be determined in the
sole discretion of the Committee, need not be uniform among all Options issued pursuant to the
Plan, and may reflect distinctions based on the reasons for termination of Service.

     (g) Effect of Change in Control. The Committee may determine, at the time of granting an
Option or thereafter, that such Option shall become exercisable as to all or part of the Shares
subject to such Option in the event that a Change in Control occurs with respect to the Company.

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     (h) No Rights as a Stockholder. An Optionee, or a transferee of an Optionee, shall have no
rights as a stockholder with respect to any Shares covered by his Option until the date of the
issuance of a stock certificate for such Shares. No adjustments shall be made, except as provided
in Section 11.

     (i) Modification, Extension and Renewal of Options. Within the limitations of the Plan, the
Committee may modify, extend or renew outstanding options or may accept the cancellation of
outstanding options (to the extent not previously exercised), whether or not granted hereunder, in
return for the grant of new Options for the same or a different number of Shares and at the same or
a different Exercise Price, or in return for the grant of the same or a different number of Shares.
The foregoing notwithstanding, no modification of an Option shall, without the consent of the
Optionee, materially impair his or her rights or obligations under such Option.

     (j) Restrictions on Transfer of Shares. Any Shares issued upon exercise of an Option shall be
subject to such special forfeiture conditions, rights of repurchase, rights of first refusal and
other transfer restrictions as the Committee may determine. Such restrictions shall be set forth in
the applicable Stock Option Agreement and shall apply in addition to any general restrictions that
may apply to all holders of Shares.

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

SECTION 8. PAYMENT FOR SHARES.

     (a) General Rule. The entire Exercise Price or Purchase Price of Shares issued under the Plan
shall be payable in lawful money of the United States of America at the time when such Shares are
purchased, except as provided in Section 8(b) through Section 8(g) below.

     (b) Surrender of Stock.
To the extent that a Stock Option Agreement so provides, payment may be made all or in part
by surrendering, or attesting to the ownership of, Shares which have already been owned by the
Optionee or his representative. Such Shares shall be valued at their Fair Market Value on the date
when the new Shares are purchased under the Plan. The Optionee shall not surrender, or attest to
the ownership of, Shares in payment of the Exercise Price if such action would cause the Company to
recognize compensation expense (or additional compensation expense) with respect to the Option for
financial reporting purposes.

     (c) Services Rendered. At the discretion of the Committee, Shares may be awarded under the
Plan in consideration of services rendered to the Company or a Subsidiary. If Shares are awarded
without the payment of a Purchase Price in cash, the Committee shall make a determination (at the
time of the Award) of the value of the services rendered by the Offeree and the sufficiency of the
consideration to meet the requirements of Section 6(b).

     (d) Cashless Exercise. To the extent that a Stock Option Agreement so provides, payment may be
made all or in part by delivery (on a form prescribed by the Committee) of an

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irrevocable direction
to a securities broker to sell Shares and to deliver all or part of the sale proceeds to the
Company in payment of the aggregate Exercise Price.

     (e) Exercise/Pledge. To the extent that a Stock Option Agreement so provides, payment may be
made all or in part by delivery (on a form prescribed by the Committee) of an irrevocable direction
to a securities broker or lender to pledge Shares, as security for a loan, and to deliver all or
part of the loan proceeds to the Company in payment of the aggregate Exercise Price.

     (f) Promissory Note. To the extent that a Stock Option Agreement or Restricted Stock Agreement
so provides, payment may be made all or in part by delivering (on a form prescribed by the Company)
a full-recourse promissory note.

     (g) Other Forms of Payment. To the extent that a Stock Option Agreement or Restricted Stock
Agreement so provides, payment may be made in any other form that is consistent with applicable
laws, regulations and rules.

     (h) Limitations under Applicable Law. Notwithstanding anything herein or in a Stock Option
Agreement or Restricted Stock Agreement to the contrary, payment may not be made in any form that
is unlawful, as determined by the Committee in its sole discretion.

SECTION 9. STOCK APPRECIATION RIGHTS.

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

     (b) Number of Shares. Each SAR Agreement shall specify the number of Shares to which the SAR
pertains and shall provide for the adjustment of such number in accordance with Section 11.

     (c) Exercise Price. Each SAR Agreement shall specify the Exercise Price. The Exercise Price
of a SAR shall not be less than 100% of the Fair Market Value of a Share on the date of grant.
Notwithstanding the foregoing, SARs may be granted with an Exercise Price of less than 100% of the
Fair Market Value per Share on the date of grant pursuant to a transaction described in, and in a
manner consistent with, Section 424(a) of the Code. Subject to the foregoing in this Section 9(c),
the Exercise Price under any SAR shall be determined by the Committee in its sole discretion.

     (d) Exercisability and Term. Each SAR Agreement shall specify the date when all or any
installment of the SAR is to become exercisable. The SAR Agreement shall also specify the term of
the SAR. A SAR Agreement may provide for accelerated exercisability in the event of the Optionee’s
death, disability or retirement or other events and may provide for expiration prior to the end of
its term in the event of the termination of the Optionee’s service. SARs may be awarded in
combination with Options, and such an Award may provide that the SARs will not be exercisable
unless the related Options are forfeited. A SAR may be included in an ISO only at the time of grant
but may be included in an NSO at the time of grant or thereafter. A SAR

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granted under the Plan may
provide that it will be exercisable only in the event of a Change in Control.

     (e) Effect of Change in Control. The Committee may determine, at the time of granting a SAR or
thereafter, that such SAR shall become fully exercisable as to all Common Shares subject to such
SAR in the event that a Change in Control occurs with respect to the Company.

     (f) Exercise of SARs. Upon exercise of a SAR, the Optionee (or any person having the right to
exercise the SAR after his or her death) shall receive from the Company (a) Shares, (b) cash or (c)
a combination of Shares and cash, as the Committee shall determine. The amount of cash and/or the
Fair Market Value of Shares received upon exercise of SARs shall, in the aggregate, be equal
to the amount by which the Fair Market Value (on the date of surrender) of the Shares subject
to the SARs exceeds the Exercise Price.

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

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

SECTION 10. STOCK UNITS.

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

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

     (c) Vesting Conditions. Each Award of Stock Units may or may not be subject to vesting.
Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in
the Stock Unit Agreement. A Stock Unit Agreement may provide for accelerated vesting in the event
of the Participant’s death, disability or retirement or other events. The Committee may determine,
at the time of granting Stock Units or thereafter, that all or part of such Stock Units shall
become vested in the event that a Change in Control occurs with respect to the Company.

     (d) Voting and Dividend Rights. The holders of Stock Units shall have no voting rights. Prior
to settlement or forfeiture, any Stock Unit awarded under the Plan may, at the

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Committee’s
discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be
credited with an amount equal to all
cash dividends paid on one Share while the Stock Unit is outstanding. Dividend equivalents may
be converted into additional Stock Units. Settlement of dividend equivalents may be made in the
form of cash, in the form of Shares, or in a combination of both. Prior to distribution, any
dividend equivalents which are not paid shall be subject to the same conditions and restrictions
(including without limitation, any forfeiture conditions) as the Stock Units to which they attach.

     (e) Form and Time of Settlement of Stock Units. Settlement of vested Stock Units may be made
in the form of (a) cash, (b) Shares or (c) any combination of both, as determined by the Committee.
The actual number of Stock Units eligible for settlement may be larger or smaller than the number
included in the original Award, based on predetermined performance factors. Methods of converting
Stock Units into cash may include (without limitation) a method based on the average Fair Market
Value of Shares over a series of trading days. A Stock Unit Agreement may provide that vested Stock
Units may be settled in a lump sum or in installments. A Stock Unit Agreement may provide that the
distribution may occur or commence when all vesting conditions applicable to the Stock Units have
been satisfied or have lapsed, or it may be deferred to any later date. The amount of a deferred
distribution may be increased by an interest factor or by dividend equivalents. Until an Award of
Stock Units is settled, the number of such Stock Units shall be subject to adjustment pursuant to
Section 11.

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

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

SECTION 11. ADJUSTMENT OF SHARES.

     (a) Adjustments. In the event of a subdivision of the outstanding Stock, a declaration of a
dividend payable in Shares, a declaration of a dividend payable in a form other than Shares in an
amount that has a material effect on the price of Shares, a combination or consolidation of the
outstanding Stock (by reclassification or otherwise) into a lesser number of Shares, a
recapitalization, a spin-off or a similar occurrence, the Committee shall make appropriate and
equitable adjustments in:

	 	(i)	 	The number of Options, SARs, Restricted Shares and Stock Units
available for future Awards under Section 5;
	 
	 	(ii)	 	The limitations set forth in Sections 5(a) and (b);

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	 	(iii)	 	The number of NSOs to be granted to Outside Directors under
Section 4(b);
	 
	 	(iv)	 	The number of Shares covered by each outstanding Option and
SAR;
	 
	 	(v)	 	The Exercise Price under each outstanding Option and SAR; and
	 
	 	(vi)	 	The number of Stock Units included in any prior Award which has
not yet been settled.

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

     (c) Reorganizations. In the event that the Company is a party to a merger or other
reorganization, outstanding Awards shall be subject to the agreement of merger or reorganization.
Subject to compliance with Section 409A of the Code, such agreement shall provide for:

	 	(i)	 	The continuation of the outstanding Awards by the Company, if
the Company is a surviving corporation;
	 
	 	(ii)	 	The assumption of the outstanding Awards by the surviving
corporation or its parent or subsidiary;
	 
	 	(iii)	 	The substitution by the surviving corporation or its parent or
subsidiary of its own awards for the outstanding Awards;
	 
	 	(iv)	 	Full exercisability or vesting and accelerated expiration of
the outstanding Awards; or
	 
	 	(v)	 	Settlement of the intrinsic value of the outstanding Awards in
cash or cash equivalents followed by cancellation of such Awards.

     (d) Reservation of Rights. Except as provided in this Section 11, a Participant shall have no
rights by reason of any subdivision or consolidation of shares of stock of any class, the payment
of any dividend or any other increase or decrease in the number of shares of stock of any class.
Any issue by the Company of shares of stock of any class, or securities convertible into shares of
stock of any class, shall not affect, and no adjustment by reason thereof shall be made with
respect to, the number or Exercise Price of Shares subject to an Award. The grant of an Award
pursuant to the
Plan shall not affect in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business structure, to merge or
consolidate or to dissolve, liquidate, sell or transfer all or any part of its business or assets.
In the event of any change affecting the Shares or the Exercise Price of Shares subject to an
Award, including a merger or other reorganization, for reasons of administrative convenience, the
Company in its sole discretion may refuse to permit the exercise of any Award during a period of up
to thirty (30) days prior to the occurrence of such event.

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SECTION 12. DEFERRAL OF AWARDS.

     (a) Committee Powers. Subject to compliance with Section 409A of the Code, the Committee (in
its sole discretion) may permit or require a Participant to:

	 	(i)	 	Have cash that otherwise would be paid to such Participant as a
result of the exercise of a SAR or the settlement of Stock Units credited to a
deferred compensation account established for such Participant by the Committee
as an entry on the Company’s books;
	 
	 	(ii)	 	Have Shares that otherwise would be delivered to such
Participant as a result of the exercise of an Option or SAR converted into an
equal number of Stock Units; or
	 
	 	(iii)	 	Have Shares that otherwise would be delivered to such
Participant as a result of the exercise of an Option or SAR or the settlement
of Stock Units converted into amounts credited to a deferred compensation
account established for such Participant by the Committee as an entry on the
Company’s books. Such amounts shall be determined by reference to the Fair
Market Value of such Shares as of the date when they otherwise would have been
delivered to such Participant.

     (b) General Rules. A deferred compensation account established under this Section 12 may be
credited with interest or other forms of investment return, as determined by the Committee. A
Participant for whom such an account is established shall have no rights other than those of a
general creditor of the Company. Such an account shall represent an unfunded and unsecured
obligation of the Company and shall be subject to the terms and conditions of the applicable
agreement between such Participant and the Company. If the deferral or conversion of Awards is
permitted or required, the Committee (in its sole discretion) may establish rules, procedures and
forms pertaining to such Awards, including (without limitation) the settlement of deferred
compensation accounts established under this Section 12.

SECTION 13. AWARDS UNDER OTHER PLANS.

     The Company may grant awards under other plans or programs. Such awards may be settled in the
form of Shares issued under this Plan. Such Shares shall be treated for all purposes
under the Plan like Shares issued in settlement of Stock Units and shall, when issued, reduce
the number of Shares available under Section 5.

SECTION 14. PAYMENT OF DIRECTOR’S FEES IN SECURITIES.

     (a) Effective Date. No provision of this Section 14 shall be effective unless and until the
Board has determined to implement such provision.

     (b) Elections to Receive NSOs, Restricted Shares or Stock Units. An Outside Director may elect
to receive his or her annual retainer payments and/or meeting fees from the Company in the form of
cash, NSOs, Restricted Shares or Stock Units, or a combination thereof, as determined by the Board.
Such NSOs, Restricted Shares and Stock Units shall be issued under

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the Plan. An election under this
Section 14 shall be filed with the Company on the prescribed form.

     (c) Number and Terms of NSOs, Restricted Shares or Stock Units. The number of NSOs, Restricted
Shares or Stock Units to be granted to Outside Directors in lieu of annual retainers and meeting
fees that would otherwise be paid in cash shall be calculated in a manner determined by the Board.
The terms of such NSOs, Restricted Shares or Stock Units shall also be determined by the Board.

SECTION 15. LEGAL AND REGULATORY REQUIREMENTS.

     Shares shall not be issued under the Plan unless the issuance and delivery of such Shares
complies with (or is exempt from) all applicable requirements of law, including (without
limitation) the Securities Act of 1933, as amended, the rules and regulations promulgated
thereunder, state securities laws and regulations and the regulations of any stock exchange on
which the Company’s securities may then be listed, and the Company has obtained the approval or
favorable ruling from any governmental agency which the Company determines is necessary or
advisable. The Company shall not be liable to a Participant or other persons as to: (a) the
non-issuance or sale of Shares as to which the Company has not obtained from any regulatory body
having jurisdiction the authority deemed by the Company’s counsel to be necessary to the lawful
issuance and sale of any Shares under the Plan; and (b) any tax consequences expected, but not
realized, by any Participant or other person due to the receipt, exercise or settlement of any
Award granted under the Plan.

SECTION 16. WITHHOLDING TAXES.

     (a) General. To the extent required by applicable federal, state, local or foreign law, a
Participant or his or her successor shall make arrangements satisfactory to the Company for the
satisfaction of any withholding tax obligations that arise in connection with the Plan. The Company
shall not be
required to issue any Shares or make any cash payment under the Plan until such obligations
are satisfied.

     (b) Share Withholding. The Committee may permit a Participant to satisfy all or part of his or
her withholding or income tax obligations by having the Company withhold all or a portion of any
Shares that otherwise would be issued to him or her or by surrendering all or a portion of any
Shares that he or she previously acquired. Such Shares shall be valued at their Fair Market Value
on the date when taxes otherwise would be withheld in cash. In no event may a Participant have
Shares withheld that would otherwise be issued to him or her in excess of the number necessary to
satisfy the minimum legally required tax withholding.

SECTION 17. OTHER PROVISIONS APPLICABLE TO AWARDS.

     (a) Transferability. Unless the agreement evidencing an Award (or an amendment
thereto authorized by the Committee) expressly provides otherwise, no Award granted under this
Plan, nor any interest in such Award, may be sold, assigned, conveyed, gifted, pledged,
hypothecated or otherwise transferred in any manner (prior to the vesting and lapse of any and all
restrictions applicable to Shares issued under such Award), other than by will or the laws of
descent and distribution; provided, however, that an ISO may be transferred or assigned only to

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

the
extent consistent with Section 422 of the Code. Any purported assignment, transfer or encumbrance
in violation of this Section 17(a) shall be void and unenforceable against the Company.

     (b) Substitution and Assumption of Awards. The Committee may make Awards under the Plan by
assumption, substitution or replacement of stock options, stock appreciation rights, stock units or
similar awards granted by another entity (including a Parent or Subsidiary), if such assumption,
substitution or replacement is in connection with an asset acquisition, stock acquisition, merger,
consolidation or similar transaction involving the Company (and/or its Parent or Subsidiary) and
such other entity (and/or its affiliate). Notwithstanding any provision of the Plan (other than
the maximum number of Shares that may be issued under the Plan), the terms of such assumed,
substituted or replaced Awards shall be as the Committee, in its discretion, determines is
appropriate.

     (c) Qualifying Performance Criteria. The number of Shares or other benefits granted, issued,
retainable and/or vested under an Award may be made subject to the attainment of performance goals.
The Committee may utilize any performance criteria selected by it in its sole discretion to
establish performance goals; provided, however, that where any Award is intended to qualify for
exemption from the deduction limitation of Section 162(m) of the Code as “qualified
performance-based compensation,” the following conditions shall apply:

     (i) The amount potentially available under an Award shall be subject to the attainment
of pre-established, objective performance goals relating to a specified period
of service based on one or more of the following performance criteria: (a) cash flow,
(b) earnings per share, (c) earnings before interest, taxes and amortization, (d) return on
equity, (e) total stockholder return, (f) share price performance, (g) return on capital,
(h) return on assets or net assets, (i) revenue, (j) income or net income, (k) operating
income or net operating income, (l) operating profit or net operating profit, (m) operating
margin or profit margin, (n) return on operating revenue, (o) return on invested capital,
(p) market segment shares, (q) costs, (r) expenses, (s) regulatory body approval for
commercialization of a product, or (t) implementation or completion of critical projects
(“Qualifying Performance Criteria”), any of which may be measured either individually,
alternatively or in any combination, applied to either the Company as a whole or to a
business unit or Subsidiary, either individually, alternatively or in any combination, and
measured either annually or cumulatively over a period of years, on an absolute basis or
relative to a pre-established target, to previous years’ results or to a designated
comparison group or index, in each case as specified by the Committee in the Award;

     (ii) The Committee may appropriately adjust any evaluation of performance under a
Qualifying Performance Criteria to exclude any of the following events that occurs during a
performance period: (i) asset write-downs, (ii) litigation or claim judgments or
settlements, (iii) the effect of changes in tax law, accounting principles or other such
laws or provisions affecting reported results, (iv) accruals for reorganization and
restructuring programs and (v) any extraordinary nonrecurring items as described in
Accounting Principles Board Opinion No. 30 and/or in managements’ discussion and analysis of
financial condition and results of operations appearing in the Company’s

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

annual report to
stockholders for the applicable year, in each case within the time prescribed by, and
otherwise in compliance with, Section 162(m) of the Code;

     (iii) The Committee shall establish the applicable performance goals in writing and an
objective method for determining the Award earned by a Participant if the goals are
attained, while the outcome is substantially uncertain and not later than the
90th day of the performance period (but in no event after 25% of the period of
service with respect to which the performance goals relate has elapsed), and shall determine
and certify in writing, for each Participant, the extent to which the performance goals have
been met prior to payment or vesting of the Award; and

     (iv) The Committee may not in any event increase the amount of compensation payable
under the Plan upon the attainment of the pre-established performance goals to a Participant
who is a “covered employee” within the meaning of Section 162(m) of the Code.

SECTION 18. NO EMPLOYMENT RIGHTS.

     No provision of the Plan, nor any Award granted under the Plan, shall be construed to give any
person any right to become, to be treated as, or to remain an Employee or Consultant. The Company
and its Subsidiaries reserve the right to terminate any person’s Service at any time and for any
reason, with or without notice.

SECTION 19. DURATION AND AMENDMENTS.

     (a) Term of the Plan. The Plan, as set forth herein, shall terminate automatically on November
18, 2019 and may be terminated on any earlier date pursuant to Subsection (b) below.

     (b) Right to Amend or Terminate the Plan. The Board of Directors may amend or terminate the
Plan at any time and from time to time. Rights and obligations under any Award granted before
amendment of the Plan shall not be materially impaired by such amendment, except with consent of
the Participant. An amendment of the Plan shall be subject to the approval of the Company’s
stockholders only to the extent required by applicable laws, regulations or rules.

     (c) Effect of Termination. No Awards shall be granted under the Plan after the termination
thereof. The termination of the Plan shall not affect Awards previously granted under the Plan.

[Remainder of this page intentionally left blank]

Financial Engines, Inc.

Amended and Restated 2009 Stock Incentive Plan

 

 

SECTION 20. EXECUTION.

     To record the adoption of the Amended and Restated Plan by the Board of Directors, the Company
has caused its authorized officer to execute the same.

	 	 	 	 	 
	 	FINANCIAL ENGINES, INC.

 	 
	 	By  	/s/ Raymond J. Sims
 	 
	 	 	Name              Raymond J. Sims 	 
	 	 	Title             Chief Financial Officer 	 
	 

FINANCIAL ENGINES, INC.

2009 STOCK INCENTIVE PLAN

-21-exv10w16

Exhibit 10.16

FORM OF

FINANCIAL ENGINES, INC.

2009 STOCK INCENTIVE PLAN

NOTICE OF STOCK OPTION GRANT

OUTSIDE DIRECTOR

     You have been granted the following Option to purchase Common Stock of FINANCIAL ENGINES, INC.
(the “Company”) under the Company’s Amended and Restated 2009 Stock Incentive Plan (the “Plan”):

	 	 	 

	Name of Optionee:
	 	 
	 
	Total Number of Option Shares Granted:
	 	 
	 
	Type of Option:
	 	 
	 
	Exercise Price Per Share:
	 	 
	 
	Grant Date:
	 	 
	 
	Vesting Commencement Date:
	 	 
	 
	Vesting Schedule:

	 	Twenty-five percent (25%) of the
Shares subject to this Option shall
vest and become exercisable on the
first anniversary of the date of
grant. The balance of the Shares
subject to this Option (i.e. the
remaining seventy-five percent
(75%)) shall vest and become
exercisable monthly over a 3-year
period beginning on the day which
is one month after the first
anniversary of the date of grant,
at a monthly rate of 2.0833% of the
total number of Shares subject to
such Option.
	 
	 	 
	 

	 	Notwithstanding the foregoing, the
Shares subject to this Option shall
become vested if a Change in
Control occurs with respect to the
Company during the Optionee’s
Service.
	 
	 	 
	Expiration Date:

	 	%%EXPIRE_DATE_PERIOD1%-%. This
Option expires earlier if your
Service terminates earlier, as
described in the Stock Option
Agreement.

     By your acceptance of this Stock Option Grant, you agree that this Option is granted under and
governed by the terms and conditions of the Plan and the Stock Option Agreement (the “Agreement”),
which are attached to and made a part of this document.

     By accepting this Stock Option Grant you further agree that the Company may deliver by e-mail
all documents relating to the Plan or this Award (including without limitation, prospectuses
required by the Securities and Exchange Commission) and all other documents that the Company is
required to deliver to its security holders (including without limitation, annual reports and proxy
statements). You also agree that the Company may deliver these documents by posting them on a
website maintained by the

Financial Engines, Inc.

Notice of Stock Option Grant

-1-

 

Company or by a third party under contract with the Company. If the Company posts these
documents on a website, it will notify you by e-mail.

	 	 	 	 	 	 
	FINANCIAL ENGINES, INC.	 	OPTIONEE	 
	 
	 	 	 	 
	/s/ Raymond J. Sims 

	 	
	 	 
	By:  	RAYMOND J SIMS
	 	By:  	 	 
	 	 	 
	 	 
	 	Title:  E.V.P. and Chief Financial Officer

	 		Title: 	 
	 

	 	 
	 	 

Financial Engines, Inc.

Notice of Stock Option Grant

-2-

 

FINANCIAL ENGINES, INC.

2009 STOCK INCENTIVE PLAN

STOCK OPTION AGREEMENT

	 	 	 

	Tax Treatment

	 	This Option is intended to be a non-qualified option, as provided in
the Notice of Stock Option Grant.
	 
	 	 
	Vesting

	 	This Option becomes exercisable in installments, as shown in the Notice
of Stock Option Grant. This Option will in no event become exercisable
for additional Shares after your Service as a Director has terminated
for any reason.
	 
	 	 
	Term

	 	This Option expires in any event at the close of business at Company
headquarters on the day before the 10th anniversary of the Grant Date,
as shown on the Notice of Stock Option Grant This Option may expire
earlier if your Service terminates, as described below.
	 
	 	 
	Termination

	 	If your Service terminates for any reason, then this Option will expire
at the close of business at Company headquarters on the date twelve
(12) months after the date your Service terminates (or, if earlier, the
Expiration Date). If your Service terminates because of death, your
estate or heirs may exercise the Option. The Company determines when
your Service terminates for this purpose and all purposes under the
Plan and its determinations are conclusive and binding on all persons.
	 
	 	 
	Restrictions on 

Exercise

	 	The Company will not permit you to exercise this Option if the issuance
of Shares at that time would violate any law or regulation. The
inability of the Company to obtain approval from any regulatory body
having authority deemed by the Company to be necessary to the lawful
issuance and sale of the Company stock pursuant to this Option shall
relieve the Company of any liability with respect to the non-issuance
or sale of the Company stock as to which such approval shall not have
been obtained.
	 
	 	 
	Notice of Exercise

	 	When you wish to exercise this Option you must provide a notice of
exercise form in accordance with such procedures as are established by
the Company and communicated to you from time to time. Any notice of
exercise must specify how many Shares you wish to purchase and how your
Shares should be registered. The notice of exercise will be effective
when it is received by the Company. If someone else wants to exercise
this Option after your death, that person must prove to the Company’s
satisfaction that he or she is entitled to do so.
	 
	 	 
	Form of Payment

	 	When you submit your notice of exercise, you must include payment of
the Option exercise price for the Shares you are purchasing. Payment
may be made in the following form(s):

	 	•	 	Your personal check, a cashier’s check or a money order.

Financial Engines, Inc.

Stock Option Agreement

-1-

 

	 	•	 	Certificates for Shares that you own, along with any forms
needed to effect a transfer of those Shares to the Company. The
value of the Shares, determined as of the effective date of the
Option exercise, will be applied to the Option exercise price.
Instead of surrendering Shares, you may attest to the ownership
of those Shares on a form provided by the Company and have the
same number of Shares subtracted from the Shares issued to you
upon exercise of the Option. However, you may not surrender or
attest to the ownership of Shares in payment of the exercise
price if your action would cause the Company to recognize a
compensation expense (or additional compensation expense) with
respect to this Option for financial reporting purposes.
	 
	 	•	 	By delivery on a form approved by the Company of an irrevocable
direction to a securities broker approved by the Company to sell
all or part of the Shares that are issued to you when you
exercise this Option and to deliver to the Company from the sale
proceeds an amount sufficient to pay the Option exercise price
and any withholding taxes. The balance of the sale proceeds, if
any, will be delivered to you. The directions must be given by
providing a notice of exercise form approved by the Company.
	 
	 	•	 	By delivery on a form approved by the Company of an irrevocable
direction to a securities broker or lender approved by the
Company to pledge Shares that are issued to you when you
exercise this Option as security for a loan and to deliver to
the Company from the loan proceeds an amount sufficient to pay
the Option exercise price and any withholding taxes. The
directions must be given by providing a notice of exercise form
approved by the Company.
	 
	 	•	 	Any other form permitted by the Committee in its sole discretion.
	 
	 	Notwithstanding the foregoing, payment may not be made in any form that is
unlawful, as determined by the Committee in its sole discretion.
	 
	Restrictions on Resale	You agree not to sell any Shares at a time when applicable laws, Company
policies or an agreement between the Company and its underwriters prohibit a
sale. This restriction will apply as long as your Service continues and for such
period of time after the termination of your Service as the Company may specify.

Financial Engines, Inc.

Stock Option Agreement

-2-

 

	 	 	 

	Transfer of Option

	 	In general, only you can exercise this
Option prior to your death. You may not
sell, transfer, assign, pledge or otherwise
dispose of this Option, other than as
designated by you by will or by the laws of
descent and distribution, except as provided
below. For instance, you may not use this
Option as security for a loan. If you
attempt to do any of these things, this
Option will immediately become invalid. You
may in any event dispose of this Option in
your will. Regardless of any marital
property settlement agreement, the Company
is not obligated to honor a notice of
exercise from your former spouse, nor is the
Company obligated to recognize your former
spouse’s interest in your Option in any
other way.
	 
	 	 
	Retention Rights

	 	Neither your Option nor this Agreement gives
you the right to continue as a Director, or
to become employed or retained by the
Company or a subsidiary of the Company in
any capacity. The Board of Directors, the
Company and its subsidiaries reserve the
right to terminate your Service at any time,
with or without cause.
	 
	 	 
	Stockholder Rights

	 	Your Options carry neither voting rights nor
rights to dividends. You, or your estate or
heirs, have no rights as a stockholder of
the Company unless and until you have
exercised this Option by giving the required
notice to the Company and paying the
exercise price. No adjustments will be made
for dividends or other rights if the
applicable record date occurs before you
exercise this Option, except as described in
the Plan.
	 
	 	 
	Adjustments

	 	In the event of a stock split, a stock
dividend or a similar change in Company
Shares, the number of Shares covered by this
Option and the exercise price per Share
shall be adjusted pursuant to the Plan.
	 
	 	 
	Successors and Assigns

	 	Except as otherwise provided in the Plan or
this Agreement, every term of this Agreement
shall be binding upon and inure to the
benefit of the parties hereto and their
respective heirs, legatees, legal
representatives, successors, transferees and
assigns.
	 
	 	 
	Notice

	 	Any notice required or permitted under this
Agreement shall be given in writing and
shall be deemed effectively given upon the
earliest of personal delivery, receipt or
the third full day following mailing with
postage and fees prepaid, addressed to the
other party hereto at the address last known
in the Company’s records or at such other
address as such party may designate by ten
(10) days’ advance written notice to the
other party hereto.
	 
	 	 
	Applicable Law

	 	This Agreement will be interpreted and
enforced under the laws of the State of
Delaware (without regard to their
choice-of-law provisions).
	 
	 	 
	The Plan and Other
Agreements

	 	The text of the Plan is incorporated in this
Agreement by reference. All capitalized
terms in the Agreement shall have the
meanings assigned to them in the Plan. This
Agreement and the Plan constitute the entire
understanding between you and the Company
regarding this Option. Any prior agreements,
commitments or negotiations concerning this
Option are

Financial Engines, Inc.

Stock Option Agreement

-3-

 

	 	 	 

	 

	 	superseded. This Agreement may be
amended by the Committee without your
consent; however, if any such amendment
would materially impair your rights or
obligations under the Agreement, this
Agreement may be amended only by another
written agreement, signed by you and the
Company.

BY ACCEPTING THIS AGREEMENT,

YOU AGREE TO ALL OF THE TERMS AND CONDITIONS

DESCRIBED ABOVE AND IN THE PLAN.

Financial Engines, Inc.

Stock Option Agreement

-4-

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