Document:

Exhibit 10.2

 

GUARANTEE

 

Guarantee,
dated as of January 6, 2006 (this “Guarantee”), by Zodiac S.A. (the
“Guarantor”), in favor of Water Pik Technologies, Inc. (the “Guaranteed
Party”).

 

1.             GUARANTEE.  To induce the Guaranteed Party to
enter into an Agreement and Plan of Merger, dated as of January 6, 2006
(as amended, amended and restated, supplemented or otherwise modified from time
to time, the “Merger Agreement”), among Coast Acquisition Corporation, a
Delaware corporation in which the Guarantor proposes to invest (“Parent”),
Coast Merger Corporation, a Delaware corporation (“Merger Sub”), and the
Guaranteed Party, pursuant to which Merger Sub will merge with and into the
Guaranteed Party, the Guarantor hereby absolutely, unconditionally and
irrevocably guarantees to the Guaranteed Party (the “Guaranty”), as
primary obligor and not merely as surety, the due and punctual payment and
performance in full of all Guarantied Obligations (as defined below) when the
same become due, whether at stated maturity, by acceleration, demand or
otherwise (including amounts that would become due but for the operation of the
automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C.
§ 362(a)).  The term “Guarantied
Obligations” includes (x) twenty percent (20%) of each and every obligation
under Section 7.3(b)(ii) of the Merger Agreement; and (y) the
Guaranteed Party’s reasonable costs and expenses (including reasonable
attorneys’ fees and expenses) in connection with a claim against the Guarantor
that results in a judgment against the Guarantor for such portion of the
amounts set forth in Section 7.3(b)(ii) of the Merger Agreement as
Guarantor guarantees hereunder, together with interest on the amounts set forth
in Section 7.3(b)(ii) of the Merger Agreement for such portion of the
amounts set forth in Section 7.3(b)(ii) of the Merger Agreement as
Guarantor guarantees hereunder, at the prime rate of Citibank, N.A. in effect
on the date such payment was required to be made.  In no event shall Guarantor’s liability under
this Guarantee exceed $2 million plus, any amounts guaranteed by
Guarantor pursuant to clause (y) of the definition of Guarantied Obligations
above (the “Cap”).

 

The Guarantor
agrees that its obligations are irrevocable, absolute, independent and unconditional,
may not be assigned, whether by operation of law or otherwise, without the
prior written consent of the Company and will not be affected by any
circumstance that constitutes a legal or equitable discharge of a guarantor or
surety other than payment and performance in full of the Guarantied
Obligations.  This Guaranty is a guaranty
of payment and performance when due and not of collectibility.  To the fullest extent permitted by law, the
Guarantor hereby waives any defenses or benefits that may be derived from or
afforded by law which limit the liability of or exonerate guarantors or
sureties (other than fraud or willful misconduct by the Guaranteed Party or any
of its “Subsidiaries” (as defined in the Merger Agreement)), or which may
conflict with the terms of this Guaranty. 
Without limiting the foregoing, the Guarantor’s responsibility hereunder
shall not be discharged, released, diminished,or impaired in whole or in part
by (a) any setoff, counterclaim, defense, act or occurrence that the
Guarantor may have against the Company as a result of or arising out of this or
any other transaction, or (b) the renewal, extension, modification, waiver
or alteration of this Merger Agreement, The Guarantor waives notice of (1) acceptance
of this obligation, (2) the creation, renewal, extension, modification,
waiver or alteration of this Agreement, (3) any breach of or default in
the performance of Parent of Merger Sub of their obligations under the Merger
Agreement and (4) all other matters of 

 

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notice of which the Guarantor might otherwise
be entitled to receive (except for notices to be provided to Parent and Latham &
Watkins LLP in accordance with Section 8.2 of the Merger Agreement).  The Company may enforce the Guarantor’s
obligations without first (A) suing Parent or Merger Sub, (B) joining
Parent or Merger Sub in any suit against the Guarantor, (C) enforcing any
rights and remedies against Parent or Merger Sub or (D) otherwise pursuing
or asserting any claims or rights against Parent or Merger Sub or any of their
respective property.

 

2.             REPRESENTATIONS AND WARRANTIES.  The
Guarantor hereby represents and warrants that:

 

(a)           the
execution, delivery and performance of this Guarantee have been duly authorized
by all necessary action and do not contravene any provision of the Guarantor’s
charter, partnership agreement, operating agreement or similar organizational
documents or any law, regulation, rule, decree, order, judgment or contractual
restriction binding on the Guarantor or its assets;

 

(b)           all
consents, approvals, authorizations, permits of, filings with and notifications
to, any governmental authority necessary for the due execution, delivery and
performance of this Guarantee by the Guarantor have been obtained or made and
all conditions thereof have been duly complied with, and no other action by,
and no notice to or filing with, any governmental authority or regulatory body
is required in connection with the execution, delivery or performance of this Guarantee;

 

(c)           this
Guarantee constitutes a legal, valid and binding obligation of the Guarantor
enforceable against the Guarantor in accordance with its terms, subject to (i) the
effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium
or other similar laws affecting creditors’ rights generally, and (ii) general
equitable principles (whether considered in a proceeding in equity or at law);
and

 

(d)           the
Guarantor has the financial capacity to pay and perform its obligations under this
Guarantee, and all funds necessary for the Guarantor to fulfill its Guarantied
Obligations under this Guarantee shall be available to the Guarantor for so
long as this Guarantee shall remain in effect in accordance with Section 5
hereof.

 

3.             NO ASSIGNMENT.  Neither the Guarantor nor the
Guaranteed Party may assign its rights, interests or obligations hereunder to
any other person (except by operation of law) without the prior written consent
of the Guaranteed Party or the Guarantor, as the case may be.

 

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4.             NOTICES.  All notices and other
communications hereunder shall be in writing in the English language and shall
be given (a) on the date of delivery if delivered personally, (b) on
the first business day following the date of dispatch if delivered by a
nationally recognized next-day courier service, (c) on the fifth business
day following the date of mailing if delivered by registered or certified mail
(postage prepaid, return receipt requested) or (d) if sent by facsimile
transmission, when transmitted and receipt is confirmed.  All notices to the Guarantor hereunder shall
be delivered as set forth below or to such other address or facsimile number as
the Guarantor shall have notified the Guaranteed Party in a written notice
delivered to the Guaranteed Party in accordance with the Merger Agreement:

 

Zodiac S.A.

2 rue Maurice Mallet 

92130 Issy les Moulineaux 

Facsimile: 01 41 23 24 36 

Attention: Jean-Marc Daillance

 

with a copy to:

 

Latham & Watkins LLP

555 Eleventh Street, N.W.

Tenth Floor

Washington, DC 20004

Facsimile:  (202) 637-2201

Attention:  David S. Dantzic

 

5.             CONTINUING GUARANTEE.  This
Guarantee shall remain in full force and effect and
shall be binding on the Guarantor, its successors and assigns until all of the
Guarantied Obligations and all amounts payable under this Guarantee have been
indefeasibly paid, observed, performed or satisfied in full.  Notwithstanding the foregoing, this Guarantee
shall terminate and the Guarantor shall have no further obligations under this
Guarantee as of the earlier of (i) the Effective Time (as defined in the
Merger Agreement), (ii) the termination of the Merger Agreement, other
than pursuant to Section 7.1(e) and (iii) the one year
anniversary of the date hereof, unless Guaranteed Party has commenced an action
with respect to this Guarantee in a court of competent jurisdiction, in which
case this Guarantee shall remain in full force and effect until final
resolution of such action.

 

6.             GOVERNING LAW.  This Guarantee shall be governed
by, and construed in accordance with, the laws of the State of Delaware
applicable to contracts executed in and to be performed in that State.  All claims, suits, actions or proceedings arising
out of or relating to this Guarantee shall be heard and determined exclusively
in the Court of Chancery or other courts of the State of Delaware.  The parties hereto hereby (a) submit to
the exclusive jurisdiction of the Court of Chancery or other courts of the
State of Delaware for the purpose of any Action arising out of or relating to
this Guarantee brought by any party hereto, and (b) irrevocably waive, and
agree not to assert by way of motion, defense, or otherwise, in any such
Action, any claim that it is not subject personally to the jurisdiction of the
Court of Chancery or other courts of the State of Delaware, that its property
is exempt or immune from attachment or execution, that the Action is brought in
an inconvenient forum, that the venue of the Action is improper, or that this Guarantee
or the transactions contemplated hereby may not be enforced in or by any of the
above-named courts.

 

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7.             WAIVER OF JURY TRIAL.  EACH OF
THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY
LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH
THIS GUARANTEE OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY.

 

8.             COUNTERPARTS.  This Guarantee may be executed
and delivered (including by facsimile transmission) in one or more
counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which
taken together shall constitute one and the same instrument.

 

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IN WITNESS
WHEREOF, the Guarantor has caused this Guarantee to be executed and delivered
as of the date first written above by its officer thereunto duly authorized.

 

 

	
   

  	
  ZODIAC S.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jean-Marc Daillance

  	
   

  
	
   

  	
   

  	
  Name: Jean-Marc Daillance

  
	
   

  	
   

  	
  Title: CEO Marine Segment

  

 

 

	
   

  	
  ACKNOWLEDGED AND AGREED:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  WATER PIK TECHNOLOGIES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Michael P. Hoopis

  	
   

  
	
   

  	
   

  	
  Name: Michael P. Hoopis

  
	
   

  	
   

  	
  Title:   Chief Executive
  OfficerEXHIBIT 10.60

 

MICRON TECHNOLOGY, INC.

2004
EQUITY INCENTIVE PLAN

 

ARTICLE 1

PURPOSE

 

1.1.                              GENERAL.  The purpose of the Micron Technology, Inc.
2004 Equity Incentive Plan (the “Plan”) is to promote the success, and enhance
the value, of Micron Technology, Inc. (the “Company”), by linking the personal
interests of employees, officers, directors and consultants of the Company or
any Affiliate (as defined below) to those of Company stockholders and by
providing such persons with an incentive for outstanding performance.  The Plan is further intended to provide
flexibility to the Company in its ability to motivate, attract, and retain the
services of employees, officers, directors and consultants upon whose judgment,
interest, and special effort the successful conduct of the Company’s operation
is largely dependent.  Accordingly, the
Plan permits the grant of incentive awards from time to time to selected
employees, officers, directors and consultants of the Company and its
Affiliates.

 

ARTICLE 2

DEFINITIONS

 

2.1.                              DEFINITIONS.  When a word or phrase appears in this Plan
with the initial letter capitalized, and the word or phrase does not commence a
sentence, the word or phrase shall generally be given the meaning ascribed to
it in this Section or in Section 1.1 unless a clearly different meaning is
required by the context.  The following
words and phrases shall have the following meanings:

 

(a)                                  “Affiliate”
means (i) any Subsidiary or Parent, or (ii) an entity that directly or through
one or more intermediaries controls, is controlled by or is under common
control with, the Company, as determined by the Committee.

 

(b)                                 “Award”
means any Option, Stock Appreciation Right, Restricted Stock Award, Restricted
Stock Unit Award, Deferred Stock Unit Award, Performance Share, Dividend
Equivalent Award, or Other Stock-Based Award granted to a Participant under the
Plan.

 

(c)                                  “Award
Certificate” means a written document, in such form as the Committee prescribes
from time to time, setting forth the terms and conditions of an Award.  Award Certificates may be in the form of
individual award agreements or certificates or a program document describing
the terms and provisions of an Awards or series of Awards under the Plan.

 

(d)                                 “Board”
means the Board of Directors of the Company.

 

(e)                                  “Change
in Control” means and includes the occurrence of any one of the following
events:

 

(i)                                     individuals
who, on the Effective Date, constitute the Board of Directors of the Company
(the “Incumbent Directors”) cease for any reason to constitute at least a
majority of such Board, provided that any person becoming a director after the
Effective Date and whose election or nomination for election was approved by a
vote of at least a majority of the Incumbent Directors then on the Board shall
be an Incumbent Director; provided, however, that no individual
initially elected or nominated as a director of the Company as a result of an
actual or threatened election contest with respect to the election or removal
of directors (“Election Contest”) or other actual or threatened solicitation of
proxies or consents by or on behalf of any Person other than the Board (“Proxy
Contest”), including by reason of any agreement intended to avoid or settle any
Election Contest or Proxy Contest, shall be deemed an Incumbent Director; or

 

(ii)                                  any
person is or becomes a “beneficial owner” (as defined in Rule 13d-3 under the
1934 Act), directly or indirectly, of either (A) 35% or more of the
then-outstanding shares of common stock of the Company (“Company Common Stock”)
or (B) securities of the Company representing 35% or more of the combined
voting power of the Company’s then outstanding securities eligible to vote for
the election of directors (the “Company Voting Securities”); 

 

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provided,
however, that for purposes of this subsection (ii), the following
acquisitions shall not constitute a Change in Control: (w) an acquisition
directly from the Company, (x) an acquisition by the Company or a Subsidiary of
the Company, (y) an acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Company or any Subsidiary of the Company, or (z)
an acquisition pursuant to a Non-Qualifying Transaction (as defined in
subsection (iii) below); or

 

(iii)                               the
consummation of a reorganization, merger, consolidation, statutory share
exchange or similar form of corporate transaction involving the Company or a
Subsidiary (a “Reorganization”), or the sale or other disposition of all or
substantially all of the Company’s assets (a “Sale”) or the acquisition of
assets or stock of another corporation (an “Acquisition”), unless immediately
following such Reorganization, Sale or Acquisition: (A) all or substantially
all of the individuals and entities who were the beneficial owners,
respectively, of the outstanding Company Common Stock and outstanding Company
Voting Securities immediately prior to such Reorganization, Sale or Acquisition
beneficially own, directly or indirectly, more than 50% of, respectively, the
then outstanding shares of common stock and the combined voting power of the
then outstanding voting securities entitled to vote generally in the election
of directors, as the case may be, of the corporation resulting from such
Reorganization, Sale or Acquisition (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company’s assets or stock either directly or through
one or more subsidiaries, the “Surviving Corporation”) in substantially the same
proportions as their ownership, immediately prior to such Reorganization, Sale
or Acquisition, of the outstanding Company Common Stock and the outstanding
Company Voting Securities, as the case may be, and (B) no person (other than
(x) the Company or any Subsidiary of the Company, (y) the Surviving Corporation
or its ultimate parent corporation, or (z) any employee benefit plan or related
trust) sponsored or maintained by any of the foregoing is the beneficial owner,
directly or indirectly, of 35% or more of the total common stock or 35% or more
of the total voting power of the outstanding voting securities eligible to
elect directors of the Surviving Corporation, and (C) at least a majority of
the members of the board of directors of the Surviving Corporation were
Incumbent Directors at the time of the Board’s approval of the execution of the
initial agreement providing for such Reorganization, Sale or Acquisition (any
Reorganization, Sale or Acquisition which satisfies all of the criteria
specified in (A), (B) and (C) above shall be deemed to be a “Non-Qualifying
Transaction”); or

 

(iv)                              approval
by the stockholders of the Company of a complete liquidation or dissolution of
the Company.

 

(f)                                    “Code”
means the Internal Revenue Code of 1986, as amended from time to time, and
includes a reference to the underlying final regulations.

 

(g)                                 “Committee”
means the committee of the Board described in Article 4.

 

(h)                                 “Company”
means Micron Technology, Inc., a Delaware corporation, or any successor
corporation.

 

(i)                                     “Continuous
Status as a Participant” means the absence of any interruption or termination
of service as an employee, officer, consultant or director of the Company or
any Affiliate, as applicable; provided, however, that for purposes of an
Incentive Stock Option, or a Stock Appreciation Right issued in tandem with an
Incentive Stock Option, “Continuous Status as a Participant” means the absence
of any interruption or termination of service as an employee of the Company or
any Parent or Subsidiary, as applicable, pursuant to applicable tax
regulations.  Continuous Status as a
Participant shall continue to the extent provided in a written severance or
employment agreement during any period for which severance compensation payments
are made to an employee, officer, consultant or director and shall not be
considered interrupted in the case of any leave of absence authorized in
writing by the Company prior to its commencement; provided, however, that for
purposes of Incentive Stock Options, no such leave may 

 

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exceed 90 days,
unless reemployment upon expiration of such leave is guaranteed by statute or
contract.  If reemployment upon
expiration of a leave of absence approved by the Company is not so guaranteed,
on the 91st day of such leave any Incentive Stock Option held by the
Participant shall cease to be treated as an Incentive Stock Option and shall be
treated for tax purposes as a Nonstatutory Stock Option.

 

(j)                                     “Covered
Employee” means a covered employee as defined in Code Section 162(m)(3).

 

(k)                                  “Disability”
or “Disabled” has the same meaning as provided in the long-term disability plan
or policy maintained by the Company or if applicable, most recently maintained,
by the Company or if applicable, an Affiliate, for the Participant, whether or
not such Participant actually receives disability benefits under such plan or
policy.  If no long-term disability plan
or policy was ever maintained on behalf of Participant or if the determination
of Disability relates to an Incentive Stock Option, or a Stock Appreciation
Right issued in tandem with an Incentive Stock Option, Disability means
Permanent and Total Disability as defined in Section 22(e)(3) of the Code.  In the event of a dispute, the determination
whether a Participant is Disabled will be made by the Committee and may be
supported by the advice of a physician competent in the area to which such
Disability relates.

 

(l)                                     “Deferred
Stock Unit” means a right granted to a Participant under Article 11.

 

(m)                               “Dividend
Equivalent” means a right granted to a Participant under Article 12.

 

(n)                                 “Effective
Date” has the meaning assigned such term in Section 3.1.

 

(o)                                 “Eligible
Participant” means an employee, officer, consultant or director of the Company
or any Affiliate.

 

(p)                                 “Exchange”
means the New York Stock Exchange or any other national securities exchange or
national market system on which the Stock may from time to time be listed or
traded.

 

(q)                                 “Fair
Market Value” of the Stock, on any date, means: (i) if the Stock is listed or
traded on any Exchange, the average closing price for such Stock (or the
closing bid, if no sales were reported) as quoted on such Exchange (or the
Exchange with the greatest volume of trading in the Stock) for the last market
trading day prior to the day of determination, as reported by Bloomberg L.P. or such other source as the
Committee deems reliable; (ii) if the Stock is quoted on the over-the-counter
market or is regularly quoted by a recognized securities dealer, but selling
prices are not reported, the Fair Market Value of the Stock shall be the mean
between the high bid and low asked prices for the Stock on the last market
trading day prior to the day of determination, as reported by Bloomberg L.P. or such other source as the
Committee deems reliable, or (iii) in the absence of an established market for
the Stock, the Fair Market Value shall be determined in good faith by the
Committee.

 

(r)                                    “Full
Value Award” means an Award other than in the
form of an Option or SAR, and which is settled by the issuance of Stock.

 

(s)                                  “Grant
Date” of an Award means the first date on which all necessary corporate action
has been taken to approve the grant of the Award as provided in the Plan, or
such later date as is determined and specified as part of that authorization
process.  Notice of the grant shall be
provided to the grantee within a reasonable time after the Grant Date.

 

(t)                                    “Incentive
Stock Option” means an Option that is intended to be an incentive stock option
and meets the requirements of Section 422 of the Code or any successor
provision thereto.

 

(u)                                 “Non-Employee
Director” means a director of the Company who is not a common law employee of
the Company or an Affiliate.

 

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(v)                                 “Nonstatutory
Stock Option” means an Option that is not an Incentive Stock Option.

 

(w)                               “Option”
means a right granted to a Participant under Article 7 of the Plan to purchase
Stock at a specified price during specified time periods.  An Option may be either an Incentive Stock
Option or a Nonstatutory Stock Option.

 

(x)                                   “Other
Stock-Based Award” means a right, granted to a Participant under Article 13
that relates to or is valued by reference to Stock or other Awards relating to
Stock.

 

(y)                                 “Parent”
means a corporation, limited liability company, partnership or other entity
which owns or beneficially owns a majority of the outstanding voting stock or
voting power of the Company. Notwithstanding the above, with respect to an
Incentive Stock Option, Parent shall have the meaning set forth in Section
424(e) of the Code.

 

(z)                                   “Participant”
means a person who, as an employee, officer, director or consultant of the
Company or any Affiliate, has been granted an Award under the Plan; provided
that in the case of the death of a Participant, the term “Participant” refers
to a beneficiary designated pursuant to Section 14.5 or the legal guardian or
other legal representative acting in a fiduciary capacity on behalf of the
Participant under applicable state law and court supervision.

 

(aa)                            “Performance
Share” means any right granted to a Participant under Article 9 to a unit to be
valued by reference to a designated number of Shares to be paid upon
achievement of such performance goals as the Committee establishes with regard
to such Performance Share.

 

(bb)                          “Person”
means any individual, entity or group, within the meaning of Section 3(a)(9) of
the 1934 Act and as used in Section 13(d)(3) or 14(d)(2) of the 1934 Act.

 

(cc)                            “Plan”
means the Micron Technology, Inc. 2004 Equity Incentive Plan, as amended from
time to time.

 

(dd)                          “Public
Offering” shall occur on closing date of a public offering of any class or
series of the Company’s equity securities pursuant to a registration statement
filed by the Company under the 1933 Act.

 

(ee)                            “Qualified
Performance-Based Award” means an Award that is either (i) intended to qualify
for the Section 162(m) Exemption and is made subject to performance goals based
on Qualified Business Criteria as set forth in Section 14.10(b), or (ii) an
Option or SAR.

 

(ff)                                “Qualified
Business Criteria” means one or more of the Business Criteria listed in Section
14.10(b) upon which performance goals for certain Qualified Performance-Based
Awards may be established by the Committee.

 

(gg)                          “Restricted
Stock Award” means Stock granted to a Participant under Article 10 that is
subject to certain restrictions and to risk of forfeiture.

 

(hh)                          “Restricted
Stock Unit Award” means the right granted to a Participant under Article 10 to
receive shares of Stock (or the equivalent value in cash or other property if
the Committee so provides) in the future, which right is subject to certain
restrictions and to risk of forfeiture.

 

(ii)                                  “Section
162(m) Exemption” means the exemption from the limitation on deductibility
imposed by Section 162(m) of the Code that is set forth in Section 162(m)(4)(C)
of the Code or any successor provision thereto.

 

(jj)                                  “Shares”
means shares of the Company’s Stock.  If
there has been an adjustment or 

 

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substitution
pursuant to Section 15.1, the term “Shares” shall also include any shares of
stock or other securities that are substituted for Shares or into which Shares
are adjusted pursuant to Section 15.1.

 

(kk)                            “Stock”
means the $.10 par value common stock of the Company and such other securities
of the Company as may be substituted for Stock pursuant to Article 15.

 

(ll)                                  “Stock
Appreciation Right” or “SAR” means a right granted to a Participant under
Article 8 to receive a payment equal to the difference between the Fair Market
Value of a Share as of the date of exercise of the SAR over the base price of
the SAR, all as determined pursuant to Article 8.

 

(mm)                      “Subsidiary”
means any corporation, limited liability company, partnership or other entity
of which a majority of the outstanding voting stock or voting power is
beneficially owned directly or indirectly by the Company. Notwithstanding the
above, with respect to an Incentive Stock Option, Subsidiary shall have the
meaning set forth in Section 424(f) of the Code.

 

(nn)                          “1933
Act” means the Securities Act of 1933, as amended from time to time.

 

(oo)                          “1934
Act” means the Securities Exchange Act of 1934, as amended from time to time.

 

ARTICLE 3

EFFECTIVE TERM OF PLAN

 

3.1.                              EFFECTIVE
DATE.  The Plan shall be effective as
of the date it is approved by both the Board and the stockholders of the
Company (the “Effective Date”).

 

3.2.                              TERMINATION
OF PLAN.  The Plan shall terminate on
the tenth anniversary of the Effective Date unless earlier terminated as
provided herein.  The termination of the Plan on such date shall not affect the validity
of any Award outstanding on the date of termination.

 

ARTICLE 4

ADMINISTRATION

 

4.1.                              COMMITTEE.  The Plan shall be administered by a Committee
appointed by the Board (which Committee shall consist of at least two
directors) or, at the discretion of the Board from time to time, the Plan may
be administered by the Board.  It is
intended that at least two of the directors appointed to serve on the Committee
shall be “non-employee directors” (within the meaning of Rule 16b-3 promulgated
under the 1934 Act) and “outside directors” (within the meaning of Code Section
162(m)) and that any such members of the Committee who do not so qualify shall
abstain from participating in any decision to make or administer Awards that
are made to Eligible Participants who at the time of consideration for such
Award (i) are persons subject to the short-swing profit rules of Section 16 of
the 1934 Act, or (ii) are reasonably anticipated to become Covered Employees
during the term of the Award.  However,
the mere fact that a Committee member shall fail to qualify under either of the
foregoing requirements or shall fail to abstain from such action shall not
invalidate any Award made by the Committee which Award is otherwise validly
made under the Plan.  The members of the
Committee shall be appointed by, and may be changed at any time and from time
to time in the discretion of, the Board. 
The Board may reserve to itself any or all of the authority and
responsibility of the Committee under the Plan or may act as administrator of
the Plan for any and all purposes.  To
the extent the Board has reserved any authority and responsibility or during
any time that the Board is acting as administrator of the Plan, it shall have
all the powers of the Committee hereunder, and any reference herein to the
Committee (other than in this Section 4.1) shall include the Board.  To the extent any action of the Board under
the Plan conflicts with actions taken by the Committee, the actions of the
Board shall control.

 

4.2.                              ACTION
AND INTERPRETATIONS BY THE COMMITTEE. 
For purposes of administering the Plan, the Committee may from time to
time adopt rules, regulations, guidelines and procedures for carrying out the
provisions and purposes of the Plan and make such other determinations, not
inconsistent with the Plan, as the Committee may deem appropriate.  The Committee’s interpretation of the Plan,
any Awards granted under the Plan, any Award Certificate and all decisions and
determinations by the Committee with respect to the Plan are final,

 

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binding, and conclusive on all parties. 
Each member of the Committee is entitled to, in good faith, rely or act
upon any report or other information furnished to that member by any officer or
other employee of the Company or any Affiliate, the Company’s or an Affiliate’s
independent certified public accountants, Company counsel or any executive
compensation consultant or other professional retained by the Company to assist
in the administration of the Plan.

 

4.3.                              AUTHORITY
OF COMMITTEE.  Except as provided
below, the Committee has the exclusive power, authority and discretion to:

 

(a)                                  Grant
Awards;

 

(b)                                 Designate
Participants;

 

(c)                                  Determine
the type or types of Awards to be granted to each Participant;

 

(d)                                 Determine
the number of Awards to be granted and the number of Shares or dollar amount to
which an Award will relate;

 

(e)                                  Determine
the terms and conditions of any Award granted under the Plan, including but not
limited to, the exercise price, base price, or purchase price, any restrictions
or limitations on the Award, any schedule for lapse of forfeiture restrictions
or restrictions on the exercisability of an Award, and accelerations or waivers
thereof, based in each case on such considerations as the Committee in its sole
discretion determines;

 

(f)                                    Accelerate
the vesting, exercisability or lapse of restrictions of any outstanding Award,
in accordance with Article 14, based in each case on such considerations as the
Committee in its sole discretion determines;

 

(g)                                 Determine
whether, to what extent, and under what circumstances an Award may be settled
in, or the exercise price of an Award may be paid in, cash, Stock, other
Awards, or other property, or an Award may be canceled, forfeited, or
surrendered;

 

(h)                                 Prescribe
the form of each Award Certificate, which need not be identical for each
Participant;

 

(i)                                     Decide
all other matters that must be determined in connection with an Award;

 

(j)                                     Establish,
adopt or revise any rules, regulations, guidelines or procedures as it may deem
necessary or advisable to administer the Plan;

 

(k)                                  Make
all other decisions and determinations that may be required under the Plan or
as the Committee deems necessary or advisable to administer the Plan;

 

(l)                                     Amend
the Plan or any Award Certificate as provided herein; and

 

(m)                               Adopt
such modifications, procedures, and subplans as may be necessary or desirable
to comply with provisions of the laws of non-U.S. jurisdictions in which the
Company or any Affiliate may operate, in order to assure the viability of the
benefits of Awards granted to participants located in such other jurisdictions
and to meet the objectives of the Plan.

 

Notwithstanding the
foregoing, grants of Awards to Non-Employee Directors hereunder shall be made
only in accordance with the terms, conditions and parameters of a plan, program
or policy for the compensation of Non-Employee Directors as in effect from time
to time, and the Committee may not make discretionary grants hereunder to
Non-Employee Directors.

 

Notwithstanding the
above, the Board or the Committee may, by resolution, expressly delegate to a
special 

 

6

 

committee, consisting of one or more directors who are also officers of
the Company, the authority, within specified parameters, to (i) designate
officers, employees and/or consultants of the Company or any of its Affiliates
to be recipients of Awards under the Plan, and (ii) to determine the number of
such Awards to be received by any such Participants; provided, however, that
such delegation of duties and responsibilities to an officer of the Company may
not be made with respect to the grant of Awards to eligible participants (a)
who are subject to Section 16(a) of the 1934 Act at the Grant Date, or (b) who
as of the Grant Date are reasonably anticipated to be become Covered Employees
during the term of the Award.  The acts
of such delegates shall be treated hereunder as acts of the Board and such
delegates shall report regularly to the Board and the Compensation Committee
regarding the delegated duties and responsibilities and any Awards so granted.

 

4.4.                              AWARD
CERTIFICATES.  Each Award shall be
evidenced by an Award Certificate.  Each
Award Certificate shall include such provisions, not inconsistent with the
Plan, as may be specified by the Committee.

 

ARTICLE 5

SHARES SUBJECT TO THE PLAN

 

5.1.                              NUMBER
OF SHARES.  Subject to adjustment as
provided in Sections 5.2 and 15.1, the aggregate number of Shares reserved and
available for issuance pursuant to Awards granted under the Plan shall be
26,000,000; provided, however, that each Share issued under the Plan pursuant
to a Full Value Award shall reduce the number of available Shares by two (2)
shares.  The maximum number of Shares
that may be issued upon exercise of Incentive Stock Options granted under the
Plan shall be 2,000,000.

 

5.2.                              SHARE
COUNTING.

 

(a)          To the extent that an
Award is canceled, terminates, expires, is forfeited or lapses for any reason,
any unissued Shares subject to the Award will again be available for issuance
pursuant to Awards granted under the Plan.

 

(b)         Shares subject to Awards
settled in cash will again be available for issuance pursuant to Awards granted
under the Plan.

 

(c)          If the exercise price of
an Option is satisfied by delivering Shares to the Company (by either actual
delivery or attestation), only the number of Shares issued in excess of the
delivery or attestation (less any shares delivered by the optionee to satisfy
an applicable tax withholding obligation) shall be considered for purposes of
determining the number of Shares remaining available for issuance pursuant to
Awards granted under the Plan.

 

(d)         To the extent that the
full number of Shares subject to an Option is not issued upon exercise of the
Option for any reason, only the number of Shares issued and delivered upon
exercise of the Option shall be considered for purposes of determining the
number of Shares remaining available for issuance pursuant to Awards granted
under the Plan.  Nothing in this
subsection shall imply that any particular type of cashless exercise of an
Option is permitted under the Plan, that decision being reserved to the
Committee or other provisions of the Plan.

 

5.3.                              STOCK
DISTRIBUTED.  Any Stock distributed
pursuant to an Award may consist, in whole or in part, of authorized and
unissued Stock, treasury Stock or Stock purchased on the open market.

 

5.4.                              LIMITATION
ON AWARDS.  Notwithstanding any
provision in the Plan to the contrary (but subject to adjustment as provided in
Section 15.1), the maximum number of Shares with respect to one or more Options
and/or SARs that may be granted during any one calendar year under the Plan to
any one Participant shall be 2,000,000. 
The maximum aggregate grant with respect to Awards of Restricted Stock, Restricted Stock Units, Deferred Stock
Units, Performance Shares or other Stock-Based Awards (other than Options or
SARs) granted in any one calendar year to any one Participant shall be
2,000,000.

 

7

 

ARTICLE 6

ELIGIBILITY

 

6.1.                              GENERAL.  Awards may be granted only to Eligible
Participants; except that Incentive Stock Options may be granted to only to
Eligible Participants who are employees of the Company or a Parent or
Subsidiary as defined in Section 424(e) and (f) of the Code.

 

ARTICLE 7

STOCK OPTIONS

 

7.1.                              GENERAL.  The Committee is authorized to grant Options
to Participants on the following terms and conditions:

 

(a)                                  EXERCISE
PRICE.  The exercise price per Share
under an Option shall be determined by the Committee; provided that the
exercise price for any Option shall not be less than the Fair Market Value as
of the Grant Date.

 

(b)                                 TIME
AND CONDITIONS OF EXERCISE.  The
Committee shall determine the time or times at which an Option may be exercised
in whole or in part, subject to Section 7.1(d). 
The Committee shall also determine the performance or other conditions,
if any, that must be satisfied before all or part of an Option may be exercised
or vested.  The Committee may waive any
exercise or vesting provisions at any time in whole or in part based upon
factors as the Committee may determine in its sole discretion so that the
Option becomes exercisable or vested at an earlier date.  The Committee may permit an arrangement
whereby receipt of Stock upon exercise of an Option is delayed until a
specified future date.

 

(c)                                  PAYMENT.  The Committee shall determine the methods by
which the exercise price of an Option may be paid, the form of payment, including,
without limitation, cash, Shares, or other property (including “cashless
exercise” arrangements), and the methods by which Shares shall be delivered or
deemed to be delivered to Participants; provided, however, that if Shares are
used to pay the exercise price of an Option, such Shares must have been held by
the Participant for at least such period of time, if any, as necessary to avoid
the recognition of an expense under generally accepted accounting principles as
a result of the exercise of the Option.

 

(d)                                 EXERCISE
TERM.  In no event may any Option be
exercisable for more than ten years from the Grant Date.

(e)                                  SUSPENSION.  Any Participant who is also
a participant in the Retirement at Micron (“RAM”) Section 401(k) Plan and
who requests and receives a hardship distribution from the RAM Plan, is
prohibited from making, and must suspend, his or her employee elective
contributions and employee contributions including, without limitation on the
foregoing, the exercise of any Option granted from the date of receipt by that
employee of the RAM hardship distribution.

 

7.2.                              INCENTIVE
STOCK OPTIONS.  The terms of any
Incentive Stock Options granted under the Plan must comply with the following
additional rules:

 

(a)                                  EXERCISE
PRICE.  The exercise price of an Incentive
Stock Option shall not be less than the Fair Market Value as of the Grant Date.

 

(b)                                 LAPSE
OF OPTION.  Subject to any earlier
termination provision contained in the Award Certificate, an Incentive Stock
Option shall lapse upon the earliest of the following circumstances; provided,
however, that the Committee may, prior to the lapse of the Incentive Stock
Option under the circumstances described in subsections (3), (4) or (5) below,
provide in writing that the Option will extend until a later date, but if an
Option is so extended and is exercised after the dates specified in subsections
(3) and (4) below, it will automatically become a Nonstatutory Stock Option:

 

8

 

(1)                                  The
expiration date set forth in the Award Certificate.

 

(2)                                  The
tenth anniversary of the Grant Date.

 

(3)                                  Three
months after termination of the Participant’s Continuous Status as a
Participant for any reason other than the Participant’s Disability or death.

 

(4)                                  One
year after the Participant’s Continuous Status as a Participant by reason of
the Participant’s Disability.

 

(5)                                  One
year after the termination of the Participant’s death if the Participant dies
while employed, or during the three-month period described in paragraph (3) or
during the one-year period described in paragraph (4) and before the Option
otherwise lapses.

 

Unless
the exercisability of the Incentive Stock Option is accelerated as provided in
Article 14, if a Participant exercises an Option after termination of
employment, the Option may be exercised only with respect to the Shares that
were otherwise vested on the Participant’s termination of employment.  Upon the Participant’s death, any exercisable
Incentive Stock Options may be exercised by the Participant’s beneficiary,
determined in accordance with Section 14.5.

 

(c)                                  INDIVIDUAL
DOLLAR LIMITATION.  The aggregate
Fair Market Value (determined as of the Grant Date) of all Shares with respect
to which Incentive Stock Options are first exercisable by a Participant in any calendar
year may not exceed $100,000.00.

 

(d)                                 TEN
PERCENT OWNERS.  No Incentive Stock
Option shall be granted to any individual who, at the Grant Date, owns stock
possessing more than ten percent of the total combined voting power of all
classes of stock of the Company or any Parent or Subsidiary unless the exercise
price per share of such Option is at least 110% of the Fair Market Value per
Share at the Grant Date and the Option expires no later than five years after
the Grant Date.

 

(e)                                  EXPIRATION
OF AUTHORITY TO GRANT INCENTIVE STOCK OPTIONS.  No Incentive Stock Option may be granted
pursuant to the Plan after the day immediately prior to the tenth anniversary
of the date the Plan was adopted by the Board, or the termination of the Plan,
if earlier.

 

(f)                                    RIGHT
TO EXERCISE.  During a Participant’s
lifetime, an Incentive Stock Option may be exercised only by the Participant
or, in the case of the Participant’s Disability, by the Participant’s guardian
or legal representative.

 

(g)                                 ELIGIBLE
GRANTEES.  The Committee may not
grant an Incentive Stock Option to a person who is not at the Grant Date an
employee of the Company or a Parent or Subsidiary.

 

ARTICLE 8

STOCK APPRECIATION RIGHTS

 

8.1.                              GRANT
OF STOCK APPRECIATION RIGHTS.  The
Committee is authorized to grant Stock Appreciation Rights to Participants on
the following terms and conditions:

 

(a)                                  RIGHT
TO PAYMENT.  Upon the exercise of a
Stock Appreciation Right, the Participant to whom it is granted has the right
to receive the excess, if any, of:

 

(1)                                  The
Fair Market Value of one Share on the date of exercise; over

 

(2)                                  The
base price of the Stock Appreciation Right as determined by the Committee,
which shall not be less than the Fair Market Value of one Share on the Grant
Date.

 

(b)                                 OTHER
TERMS.  All awards of Stock
Appreciation Rights shall be evidenced by an 

 

9

 

Award Certificate.  The terms, methods of exercise, methods of
settlement, form of consideration payable in settlement, and any other terms
and conditions of any Stock Appreciation Right shall be determined by the
Committee at the time of the grant of the Award and shall be reflected in the
Award Certificate.

 

ARTICLE 9

PERFORMANCE SHARES

 

9.1.                              GRANT
OF PERFORMANCE SHARES.  The Committee
is authorized to grant Performance Shares to Participants on such terms and
conditions as may be selected by the Committee. 
The Committee shall have the complete discretion to determine the number
of Performance Shares granted to each Participant, subject to Section 5.4, and
to designate the provisions of such Performance Shares as provided in Section
4.3.  All Performance Shares shall be
evidenced by an Award Certificate or a written program established by the
Committee, pursuant to which Performance Shares are awarded under the Plan
under uniform terms, conditions and restrictions set forth in such written
program.

 

9.2.                              PERFORMANCE
GOALS.  The Committee may establish
performance goals for Performance Shares which may be based on any criteria
selected by the Committee.  Such
performance goals may be described in terms of Company-wide objectives or in
terms of objectives that relate to the performance of the Participant, an
Affiliate or a division, region, department or function within the Company or
an Affiliate.  If the Committee
determines that a change in the business, operations, corporate structure or
capital structure of the Company or the manner in which the Company or an
Affiliate conducts its business, or other events or circumstances render
performance goals to be unsuitable, the Committee may modify such performance
goals in whole or in part, as the Committee deems appropriate.  If a Participant is promoted, demoted or
transferred to a different business unit or function during a performance
period, the Committee may determine that the performance goals or performance
period are no longer appropriate and may (i) adjust, change or eliminate the
performance goals or the applicable performance period as it deems appropriate
to make such goals and period comparable to the initial goals and period, or
(ii) make a cash payment to the participant in amount determined by the
Committee.  The foregoing two sentences
shall not apply with respect to an Award of Performance Shares that is intended
to be a Qualified Performance-Based Award.

 

9.3.                              RIGHT
TO PAYMENT.  The grant of a
Performance Share to a Participant will entitle the Participant to receive at a
specified later time a specified number of Shares, or the equivalent value in
cash or other property, if the performance goals established by the Committee
are achieved and the other terms and conditions thereof are satisfied.  The Committee shall set performance goals and
other terms or conditions to payment of the Performance Shares in its
discretion which, depending on the extent to which they are met, will determine
the number of the Performance Shares that will be earned by the Participant.

 

9.4.                              OTHER
TERMS.  Performance Shares may be
payable in cash, Stock, or other property, and have such other terms and
conditions as determined by the Committee and reflected in the Award
Certificate.

 

ARTICLE 10

RESTRICTED
STOCK AND RESTRICTED STOCK UNIT AWARDS

 

10.1.                        GRANT OF RESTRICTED STOCK
AND RESTRICTED STOCK UNITS.  Subject
to the terms and conditions of this Article 10, the Committee is authorized to
make Awards of Restricted Stock or Restricted Stock Units to Participants in
such amounts and subject to such terms and conditions as may be selected by the
Committee.  An Award of Restricted Stock
or Restricted Stock Units shall be evidenced by an Award Certificate setting
forth the terms, conditions, and restrictions applicable to the Award.

 

10.2.                        ISSUANCE AND RESTRICTIONS.  Restricted Stock or Restricted Stock Units
shall be subject to such restrictions on transferability and other restrictions
as the Committee may impose (including, without limitation, limitations on the
right to vote Restricted Stock or the right to receive dividends on the
Restricted Stock); provided, however, at a minimum, all Restricted Stock and
Restricted Stock Units shall be subject to the restrictions set forth in
Section 14.4 for a period of no less than (a) one year from the date of award
with respect to Restricted Stock or Restricted Stock Units subject to
restrictions that lapse based upon satisfaction of performance goals, and (b)
three years from the date of award with respect to Restricted Stock or
Restricted Stock Units subject to time-

 

10

 

based restrictions that lapse based upon one’s Continuous Status as a
Participant.  For avoidance of doubt,
nothing in the foregoing shall preclude any applicable restriction, including
those set forth in Section 14.4 hereof, from lapsing ratably, including, but
not limited to, roughly annual increments over three years, with respect to the
Restricted Stock or Restricted Stock Units referred to in Section 10.2(b).  Moreover, nothing in the foregoing shall
preclude or be interpreted to preclude Awards to Non-employee Directors from
containing a period of restriction shorter than that set forth above.  Finally, nothing in this Section 10.2 shall
be deemed or interpreted to preclude the waiver, lapse or the acceleration of
lapse, of any restrictions with respect to Restricted Stock or Restricted Stock
Units in accordance with or as permitted by Sections 14.7 through Section 14.9,
respectively, Article 15 or any other provision of the Plan.  Subject to the remaining terms and conditions
of the Plan, these restrictions may lapse separately or in combination at such
times, under such circumstances, in such installments, upon the satisfaction of
performance goals or otherwise, as the Committee determines at the time of the
grant of the Award or thereafter.  Except
as otherwise provided in an Award Certificate or any special Plan document
governing an Award, the Participant shall have all of the rights of a
stockholder with respect to the Restricted Stock, and the Participant shall
have none of the rights of a stockholder with respect to Restricted Stock Units
until such time as Shares of Stock are paid in settlement of the Restricted
Stock Units.

 

10.3.                        FORFEITURE.  Except as otherwise determined by the
Committee at the time of the grant of the Award or thereafter, upon termination
of Continuous Status as a Participant during the applicable restriction period
or upon failure to satisfy a performance goal during the applicable restriction
period, Restricted Stock or Restricted Stock Units that are at that time
subject to restrictions shall be forfeited; provided, however, that the
Committee may provide in any Award Certificate, subject to the terms and
conditions of the Plan, that restrictions or forfeiture conditions relating to
Restricted Stock or Restricted Stock Units will be waived in whole or in part
in the event of terminations resulting from specified causes, including, but
not limited to, death, Disability, or for the convenience or in the best
interests of the Company.

 

10.4.                        DELIVERY OF RESTRICTED STOCK.  Shares of Restricted Stock shall be delivered
to the Participant at the time of grant either by book-entry registration or by
delivering to the Participant, or a custodian or escrow agent (including,
without limitation, the Company or one or more of its employees) designated by
the Committee, a stock certificate or certificates registered in the name of
the Participant.  If physical
certificates representing shares of Restricted Stock are registered in the name
of the Participant, such certificates must bear an appropriate legend referring
to the terms, conditions, and restrictions applicable to such Restricted Stock.

 

ARTICLE 11

DEFERRED STOCK UNITS

 

11.1.                        GRANT OF DEFERRED STOCK
UNITS.  The Committee is authorized
to grant Deferred Stock Units to Participants subject to such terms and
conditions as may be selected by the Committee. 
Deferred Stock Units shall entitle the Participant to receive Shares of
Stock (or the equivalent value in cash or other property if so determined by
the Committee) at a future time as determined by the Committee, or as
determined by the Participant within guidelines established by the Committee in
the case of voluntary deferral elections. 
An Award of Deferred Stock Units shall be evidenced by an Award
Certificate setting forth the terms and conditions applicable to the Award.

 

ARTICLE 12

DIVIDEND EQUIVALENTS

 

12.1.                        GRANT OF DIVIDEND
EQUIVALENTS.  The Committee is
authorized to grant Dividend Equivalents to Participants subject to such terms
and conditions as may be selected by the Committee.  Dividend Equivalents shall entitle the
Participant to receive payments equal to dividends with respect to all or a
portion of the number of Shares subject to an Award, as determined by the
Committee.  The Committee may provide
that Dividend Equivalents be paid or distributed when accrued or be deemed to
have been reinvested in additional Shares, or otherwise reinvested.

 

11

 

ARTICLE 13

STOCK OR OTHER STOCK-BASED AWARDS

 

13.1.                        GRANT OF STOCK OR OTHER
STOCK-BASED AWARDS.  The Committee is
authorized, subject to limitations under applicable law, to grant to
Participants such other Awards that are payable in, valued in whole or in part
by reference to, or otherwise based on or related to Shares, as deemed by the
Committee to be consistent with the purposes of the Plan, including without
limitation Shares awarded purely as a “bonus” and not subject to any
restrictions or conditions, convertible or exchangeable debt securities, other
rights convertible or exchangeable into Shares, and Awards valued by reference
to book value of Shares or the value of securities of or the performance of
specified Parents or Subsidiaries.  The
Committee shall determine the terms and conditions of such Awards.

 

ARTICLE 14

PROVISIONS APPLICABLE TO AWARDS

 

14.1.                        STAND-ALONE AND TANDEM
AWARDS.  Awards granted under the
Plan may, in the discretion of the Committee, be granted either alone or in
addition to, in tandem with, any other Award granted under the Plan.  Subject to Section 16.2, awards granted in
addition to or in tandem with other Awards may be granted either at the same
time as or at a different time from the grant of such other Awards.

 

14.2.                        TERM OF AWARD.  The term of each Award shall be for the
period as determined by the Committee, provided that in no event shall the term
of any Incentive Stock Option or a Stock Appreciation Right granted in tandem
with the Incentive Stock Option exceed a period of ten years from its Grant
Date (or, if Section 7.2(d) applies, five years from its Grant Date).

 

14.3.                        FORM OF PAYMENT FOR AWARDS.  Subject to the terms of the Plan and any
applicable law or Award Certificate, payments or transfers to be made by the
Company or an Affiliate on the grant or exercise of an Award may be made in
such form as the Committee determines at or after the Grant Date, including
without limitation, cash, Stock, other Awards, or other property, or any
combination, and may be made in a single payment or transfer, in installments,
or on a deferred basis, in each case determined in accordance with rules
adopted by, and at the discretion of, the Committee.

 

14.4.                        LIMITS ON TRANSFER.  No right or interest of a Participant in any
unexercised or restricted Award may be pledged, encumbered, or hypothecated to
or in favor of any party other than the Company or an Affiliate, or shall be
subject to any lien, obligation, or liability of such Participant to any other
party other than the Company or an Affiliate. 
No unexercised or restricted Award shall be assignable or transferable
by a Participant other than by will or the laws of descent and distribution or,
except in the case of an Incentive Stock Option, pursuant to a domestic
relations order that would satisfy Section 414(p)(1)(A) of the Code if such
Section applied to an Award under the Plan; provided, however, that the
Committee may (but need not) permit other transfers where the Committee
concludes that such transferability (i) does not result in accelerated
taxation, (ii) does not cause any Option intended to be an Incentive Stock
Option to fail to be described in Code Section 422(b), and (iii) is otherwise
appropriate and desirable, taking into account any factors deemed relevant,
including without limitation, state or federal tax or securities laws
applicable to transferable Awards.

 

14.5.                        BENEFICIARIES.  Notwithstanding Section 14.4, a Participant
may, in the manner determined by the Committee, designate a beneficiary to
exercise the rights of the Participant and to receive any distribution with
respect to any Award upon the Participant’s death.  A beneficiary, legal guardian, legal
representative, or other person claiming any rights under the Plan is subject
to all terms and conditions of the Plan and any Award Certificate applicable to
the Participant, except to the extent the Plan and Award Certificate otherwise
provide, and to any additional restrictions deemed necessary or appropriate by
the Committee.  If no beneficiary has
been designated or survives the Participant, payment shall be made to the
Participant’s estate.  Subject to the
foregoing, a beneficiary designation may be changed or revoked by a Participant
at any time provided the change or revocation is filed with the Committee.

 

14.6.                        STOCK CERTIFICATES.  All Stock issuable under the Plan is subject
to any stop-transfer orders 

 

12

 

and other restrictions as the Committee deems necessary or advisable to
comply with federal or state securities laws, rules and regulations and the
rules of any national securities exchange or automated quotation system on
which the Stock is listed, quoted, or traded. 
The Committee may place legends on any Stock certificate or issue
instructions to the transfer agent to reference restrictions applicable to the
Stock.

 

14.7.                        ACCELERATION UPON A CHANGE
IN CONTROL.  Except as otherwise
provided in the Award Certificate or any special Plan document governing an
Award, upon the occurrence of a Change in Control, all outstanding Options,
SARs, and other Awards in the nature of rights that may be exercised shall
become fully exercisable, and all time-based vesting restrictions on
outstanding Awards shall lapse.  Except
as otherwise provided in the Award Certificate or any special Plan document
governing an Award, upon the occurrence of a Change in Control, the target
payout opportunities attainable under all outstanding performance-based Awards
shall be deemed to have been fully earned as of the effective date of the
Change in Control based upon an assumed achievement of all relevant performance
goals at the “target” level and there
shall be prorata payout to Participants within thirty (30) days following the
effective date of the Change in Control based upon
the length of time within the performance period that has elapsed prior
to the Change in Control.

 

14.8                           ACCELERATION
UPON DEATH OR DISABILITY.  Except as
otherwise provided in the Award Certificate or any special Plan document
governing an Award, upon the Participant’s death or Disability during his or
her Continuous Status as a Participant, (i) all of such Participant’s
outstanding Options, SARs, and other Awards in the nature of rights that may be
exercised shall become fully exercisable, (ii) all time-based vesting
restrictions on the Participant’s outstanding Awards shall lapse, and (iii) the
target payout opportunities attainable under all of such Participant’s
outstanding performance-based Awards shall be deemed to have been fully earned
as of the date of termination based upon an assumed achievement of all relevant
performance goals at the “target” level and there shall be a prorata payout to
the Participant or his or her estate within thirty (30) days following the date
of termination based upon the length of time within the performance period that
has elapsed prior to the date of termination. 
Any Awards shall thereafter continue or lapse in accordance with the
other provisions of the Plan and the Awards Certificate.  To the extent that this provision causes
Incentive Stock Options to exceed the dollar limitation set forth in Section
7.2(c), the excess Options shall be deemed to be Nonstatutory Stock Options.

 

14.9.                        ACCELERATION FOR ANY OTHER
REASON.  Regardless of whether an
event has occurred as described in Section 14.7 or 14.8 above, and subject to
Section 14.11 as to Qualified Performance-Based Awards, the Committee may in
its sole discretion at any time determine that all or a portion of a
Participant’s Options, SARs, and other Awards in the nature of rights that may
be exercised shall become fully or partially exercisable, that all or a part of
the time-based vesting restrictions on all or a portion of the outstanding
Awards shall lapse, and/or that any performance-based criteria with respect to
any Awards shall be deemed to be wholly or partially satisfied, in each case,
as of such date as the Committee may, in its sole discretion, declare;
provided, however, the Committee shall not exercise such discretion with
respect to Full Value Awards comprised of Shares of Restricted Stock or
Restricted Stock Units which, in the aggregate, exceed five percent (5%) of the
aggregate number of Shares reserved and available for issuance pursuant to
Awards granted under the Plan; provided, further, that when calculating whether
the five percent (5%) maximum has been reached, the Committee shall not count
or consider any Shares of Restricted Stock or Restricted Stock Units granted to
Non-Employee Directors or regarding which the Committee accelerated vesting
rights, waived restrictions or determined performance-based criteria had been
satisfied resulting from an event described in Section 14.7, 24.8. Article 15,
a Participant’s termination of employment or separation from service resulting
from death, Disability or for the convenience or in the bests interests of the
Company.  The Committee may discriminate
among Participants and among Awards granted to a Participant in exercising its
discretion pursuant to this Section 14.9.

 

14.10.                  EFFECT OF ACCELERATION.  If an Award is accelerated under Section
14.7, Section 14.8 or Section 14.9, the Committee may, in its sole discretion,
provide (i) that the Award will expire after a designated period of time after
such acceleration to the extent not then exercised, (ii) that the Award will be
settled in cash rather than Stock, (iii) that the Award will be assumed by
another party to a transaction giving rise to the acceleration or otherwise be
equitably converted or substituted in connection with such transaction, (iv)
that the Award may be settled by payment in cash or cash equivalents equal to
the excess of the Fair Market Value of the underlying Stock, as of a specified
date associated with the transaction, over the exercise price of the Award, or
(v) any combination of the foregoing. 
The Committee’s determination need not be uniform and may be different
for different Participants whether or not such Participants are similarly
situated.  To the extent that such
acceleration 

 

13

 

causes Incentive Stock Options to exceed the dollar limitation set
forth in Section 7.2(c), the excess Options shall be deemed to be Nonstatutory Stock
Options.

 

14.11.                QUALIFIED PERFORMANCE-BASED AWARDS.

 

(a)                                  The
provisions of the Plan are intended to ensure that all Options and Stock
Appreciation Rights granted hereunder to any Covered Employee shall qualify for
the Section 162(m) Exemption; provided that the exercise or base price of such
Award is not less than the Fair Market Value of the Shares on the Grant Date.

 

(b)                                 When
granting any other Award, the Committee may designate such Award as a Qualified
Performance-Based Award, based upon a determination that the recipient is or
may be a Covered Employee with respect to such Award, and the Committee wishes
such Award to qualify for the Section 162(m) Exemption.  If an Award is so designated, the Committee
shall establish performance goals for such Award within the time period
prescribed by Section 162(m) of the Code based on one or more of the following
Qualified Business Criteria, which may be expressed in terms of Company-wide
objectives or in terms of objectives that relate to the performance of an
Affiliate or a unit, division, region, department or function within the
Company or an Affiliate:

 

•                                          Gross
and/or net revenue (including whether in the aggregate or attributable to
specific products)

•                                          Cost
of Goods Sold and Gross Margin

•                                          Costs
and expenses, including Research & Development and Selling, General &
Administrative

•                                          Income
(gross, operating, net, etc.)

•                                          Earnings,
including before interest, taxes, depreciation and amortization (whether in the
aggregate or on a per share basis

•                                          Cash
flows and share price

•                                          Return
on investment, capital, equity

•                                          Manufacturing
efficiency (including yield enhancement and cycle time reductions), quality
improvements and customer satisfaction

•                                          Product
life cycle management (including product and technology design, development,
transfer, manufacturing introduction, and sales price optimization and
management)

•                                          Economic
profit or loss

•                                          Market
share

•                                          Employee
retention, compensation, training and development, including succession
planning

•                                          Objective
goals consistent with the Participant’s specific officer duties and
responsibilities, designed to further the financial, operational and other
business interests of the Company, including goals and objectives with respect
to regulatory compliance matters.

 

Performance goals with respect to the foregoing Qualified Business
Criteria may be specified in absolute terms (including completion of
pre-established projects, such as the introduction of specified products), in
percentages, or in terms of growth from period to period or growth rates over
time as well as measured relative to an established or specially-created
performance index of Company competitors, peers or other members of high tech
industries.  Any member of an index that
disappears during a measurement period shall be disregarded for the entire
measurement period.  Performance Goals
need not be based upon an increase or positive result under a business
criterion and could include, for example, the maintenance of the status quo or
the limitation of economic losses (measured, in each case, by reference to a
specific business criterion).

 

(c)                                  Each
Qualified Performance-Based Award (other than an Option or SAR) shall be
earned, vested and payable (as applicable) only upon the achievement of
performance goals established by the Committee based upon one or more of the
Qualified Business Criteria, together with the satisfaction of any other
conditions, including the condition as to continued employment as set forth in
subsection (g) 

 

14

 

below, as the Committee may determine to be
appropriate; provided, however, that the Committee may provide, in its sole and
absolute discretion, either in connection with the grant thereof or by
amendment thereafter, that achievement of such performance goals will be waived
upon the death or Disability of the Participant, or upon a Change in Control.
Performance periods established by the Committee for any such Qualified
Performance-Based Award may be as short as ninety (90) days and may be any
longer period.

 

(d)                                 The Committee may provide in any Qualified
Performance-Based Award that any evaluation of performance may include
or exclude any of the following events that occurs during a performance period:
(a) asset write-downs or impairment charges; (b) litigation or claim judgments
or settlements; (c) the effect of changes in tax laws, accounting principles or
other laws or provisions affecting reported results; (d) accruals for
reorganization and restructuring programs; (e) extraordinary nonrecurring items
as described in Accounting Principles Board Opinion No. 30 and/or in management’s
discussion and analysis of financial condition and results of operations
appearing in the Company’s annual report to stockholders for the applicable
year; (f) acquisitions or divestitures; and (g) foreign exchange gains and
losses. To the extent such inclusions or exclusions affect Awards to Covered
Employees, they shall be prescribed in a form and at a time that meets the
requirements of Code Section 162(m) for deductibility.

 

(e)                                  Any
payment of a Qualified Performance-Based Award granted with performance goals
pursuant to subsection (c) above shall be conditioned on the written
certification of the Committee in each case that the performance goals and any
other material conditions were satisfied. Written certification may take the
form of a Committee resolution passed by a majority of the Committee at a
properly convened meeting or through unanimous action by the Committee via
action by written consent.  The
certification requirement also may be satisfied by a separate writing executed
by the Chairman of the Committee, acting in his capacity as such, following the
foregoing Committee action or by the Chairman executing approved minutes of the
Committee in which such determinations were made.  Except as specifically provided in subsection
(c), no Qualified Performance-Based Award held by a Covered Employee or an
employee who in the reasonable judgment of the Committee may be a Covered
Employee on the date of payment, may be amended, nor may the Committee exercise
any discretionary authority it may otherwise have under the Plan with respect
to a Qualified Performance-Based Award under the Plan, in any manner to waive
the achievement of the applicable performance goal based on Qualified Business
Criteria or to increase the amount payable pursuant thereto or the value
thereof, or otherwise in a manner that would cause the Qualified
Performance-Based Award to cease to qualify for the Section 162(m) Exemption.

 

(f)                                    Section
5.4 sets forth the maximum number of Shares or dollar value that may be granted
in any one-year period to a Participant in designated forms of Qualified
Performance-Based Awards.

 

(g)                                 With
respect to a Participant who is an officer of the Company, any payment of a
Qualified Performance-Based Award granted with performance goals pursuant to
subsection (c) above shall be conditioned on the officer having remained
continuously employed by the Company or an Affiliate for the entire performance
or measurement period, including, as well, through the date of determination
and certification of the payment of any such Award pursuant to subsection (e)
above (the “Certification Date”).  For
purposes of the Plan, with respect to any given performance or measurement
period, an officer of the Company who (i) terminates employment (regardless of
cause) or who otherwise ceases to be an officer, prior to the Certification
Date and (ii) who, pursuant to a separate contractual arrangement with the
Company is entitled to receive payments from the Company thereunder extending
to or beyond such Certification Date as a result of such termination or
cessation in officer status, shall be deemed to have been employed by the
Company as an officer through the Certification Date for purposes of payment
eligibility.

 

14.12.                  TERMINATION OF EMPLOYMENT.  Whether military, government or other service
or other leave of absence shall constitute a termination of employment shall be
determined in each case by the Committee at its discretion, and any
determination by the Committee shall be final and conclusive.  A Participant’s Continuous Status as a
Participant shall not be deemed to terminate (i) in a circumstance in which a
Participant transfers from the Company to an Affiliate, transfers from an
Affiliate to the Company, or transfers from one Affiliate to another Affiliate,
or (ii) in the discretion of the Committee as specified at or prior to such
occurrence, in the case of a spin-off, sale or disposition of the Participant’s
employer from the Company or any Affiliate. 
To the extent that this provision causes Incentive Stock Options to
extend beyond three months from the date a Participant is deemed to be 

 

15

 

an employee of the Company, a Parent or Subsidiary for purposes of
Sections 424(e) and 424(f) of the Code, the Options held by such Participant
shall be deemed to be Nonstatutory Stock Options.

 

14.13.                  DEFERRAL.  Subject to applicable law, the Committee may
permit or require a Participant to defer such Participant’s receipt of the payment of cash or the delivery of
Shares that would otherwise be  due to
such Participant by virtue of the exercise of an Option or SAR, the lapse
or waiver of restrictions with respect to Restricted Stock or Restricted Stock
Units, or the satisfaction of any requirements or goals with respect to
Performance Shares, and Other Stock-Based
Awards. If any such deferral election is required or permitted, the
Board shall, in its sole discretion, establish rules and procedures for such
payment deferrals.

 

14.14.                  FORFEITURE
EVENTS.  The Committee may specify in an Award Certificate  that the Participant’s rights, payments and
benefits with respect to an Award shall be subject to reduction,
cancellation, forfeiture or recoupment upon the occurrence of certain specified
events, in addition to any otherwise applicable vesting or performance
conditions of an Award. Such events shall include, but shall not be limited to,
termination of employment for cause, violation of material Company or Affiliate
policies, breach of noncompetition, confidentiality or other restrictive covenants that may apply to the Participant, or
other conduct by the Participant that is detrimental to the business or
reputation of the Company or any Affiliate.

 

14.15.                  SUBSTITUTE
AWARDS.  The Committee may grant
Awards under the Plan in substitution for stock and stock-based awards held by
employees of another entity who become employees of the Company or an Affiliate
as a result of a merger or consolidation of the former employing entity with
the Company or an Affiliate or the acquisition by the Company or an Affiliate
of property or stock of the former employing corporation.  The Committee may direct that the substitute
awards be granted on such terms and conditions as the Committee considers
appropriate in the circumstances.

 

ARTICLE 15

CHANGES IN CAPITAL STRUCTURE

 

15.1.                        GENERAL.  In the
event of a corporate event or transaction involving the Company (including,
without limitation, any stock dividend, stock split, extraordinary cash
dividend, recapitalization, reorganization, merger, consolidation, split-up,
spin-off, combination or exchange of shares), the authorization limits
under Section 5.1 and 5.4 shall be adjusted proportionately, and the Committee may adjust the Plan and Awards to
preserve the benefits or potential benefits of the Awards.  Action by the Committee may include: (i)
adjustment of the number and kind of shares which may be delivered under the
Plan; (ii) adjustment of the number and kind of shares subject to outstanding
Awards; (iii) adjustment of the exercise price of outstanding Awards or the
measure to be used to determine the amount of the benefit payable on an Award;
and (iv) any other adjustments that the Committee determines to be equitable.  In addition, the Committee may, in its
sole discretion, provide (i) that Awards will be settled in cash or other
property rather than Stock, (ii) that Awards will become immediately vested and
exercisable and will expire after a designated period of time to the extent not
then exercised, (iii) that Awards will be assumed by another party to a
transaction or otherwise be equitably converted or substituted in connection
with such transaction, (iv) that outstanding Awards may be settled by payment in
cash or cash equivalents equal to the excess of the Fair Market Value of the
underlying Stock, as of a specified date associated with the transaction, over
the exercise price of the Award, (v) that applicable performance targets and
performance periods for Awards will be modified, consistent with Code Section
162(m) where applicable, or (vi) any combination of the foregoing.  The Committee’s determination need not be
uniform and may be different for different Participants whether or not such
Participants are similarly situated.  Without limiting the foregoing, in the
event of a subdivision of the outstanding Stock (stock-split), a declaration of
a dividend payable in Shares, or a combination or consolidation of the
outstanding Stock into a lesser number of Shares, the authorization limits
under Section 5.1 and 5.4 shall automatically be adjusted proportionately, and
the Shares then subject to each Award shall automatically be adjusted
proportionately without any change in the aggregate purchase price therefor.  To the extent that any adjustments made
pursuant to this Article 15 cause Incentive Stock Options to cease to qualify
as Incentive Stock Options, such Options shall be deemed to be Nonstatutory
Stock Options.

 

16

 

ARTICLE 16

AMENDMENT, MODIFICATION AND
TERMINATION

 

16.1.                        AMENDMENT, MODIFICATION AND
TERMINATION.  The Board or the
Committee may, at any time and from time to time, amend, modify or terminate
the Plan without stockholder approval; provided,
however, that if an amendment to the Plan would, in the reasonable opinion of
the Board or the Committee, either (i) materially increase the number of Shares
available under the Plan, (ii) expand the types of awards under the Plan, (iii)
materially expand the class of participants eligible to participate in the
Plan, (iv) materially extend the term of the Plan, or (v) otherwise constitute
a material change requiring stockholder approval under applicable laws,
policies or regulations or the applicable listing or other requirements of an
Exchange, then such amendment shall be
subject to stockholder approval; and provided, further, that the Board
or Committee may condition any other amendment or modification on the approval
of stockholders of the Company for any reason, including by reason of such
approval being necessary or deemed advisable to (i) permit Awards made
hereunder to be exempt from liability under Section 16(b) of the 1934 Act, (ii)
to comply with the listing or other requirements of an Exchange, or (iii) to
satisfy any other tax, securities or other applicable laws, policies or
regulations.

 

16.2.                        AWARDS PREVIOUSLY GRANTED.  At any time and from time to time, the
Committee may amend, modify or terminate any outstanding Award without approval
of the Participant; provided, however:

 

(a)                                  Subject
to the terms of the applicable Award Certificate, such amendment, modification
or termination shall not, without the Participant’s consent, reduce or diminish
the value of such Award determined as if the Award had been exercised, vested,
cashed in or otherwise settled on the date of such amendment or termination
(with the per-share value of an Option or Stock Appreciation Right for this
purpose being calculated as the excess, if any, of the Fair Market Value as of
the date of such amendment or termination over the exercise or base price of
such Award);

 

(b)                                 The
original term of an Option may not be extended without the prior approval of
the stockholders of the Company;

 

(c)                                  Except
as otherwise provided in Article 15, the exercise price of an Option may not be
reduced, directly or indirectly, without the prior approval of the stockholders
of the Company; and

 

(d)                                 No
termination, amendment, or modification of the Plan shall adversely affect any
Award previously granted under the Plan, without the written consent of the
Participant affected thereby.  An
outstanding Award shall not be deemed to be “adversely affected” by a Plan
amendment if such amendment would not reduce or diminish the value of such
Award determined as if the Award had been exercised, vested, cashed in or
otherwise settled on the date of such amendment (with the per-share value of an
Option or Stock Appreciation Right for this purpose being calculated as the
excess, if any, of the Fair Market Value as of the date of such amendment over
the exercise or base price of such Award).

 

ARTICLE 17

GENERAL PROVISIONS

 

17.1.                        NO RIGHTS TO AWARDS;
NON-UNIFORM DETERMINATIONS.  No
Participant or any Eligible Participant shall have any claim to be granted any
Award under the Plan.  Neither the
Company, its Affiliates nor the Committee is obligated to treat Participants or
Eligible Participants uniformly, and determinations made under the Plan may be
made by the Committee selectively among Eligible Participants who receive, or
are eligible to receive, Awards (whether or not such Eligible Participants are
similarly situated).

 

17.2.                        NO STOCKHOLDER RIGHTS.  No Award gives a Participant any of the
rights of a stockholder of the Company unless and until Shares are in fact
issued to such person in connection with such Award.

 

17.3.                        WITHHOLDING.  The Company or any Affiliate shall have the
authority and the right to deduct 

 

17

 

or withhold, or require a Participant to remit to the Company, an
amount sufficient to satisfy federal, state, and local taxes (including the
Participant’s FICA obligation) required by law to be withheld with respect to
any exercise, lapse of restriction or other taxable event arising as a result
of the Plan.  If Shares are surrendered to the Company to satisfy withholding
obligations in excess of the minimum withholding obligation, such Shares must
have been held by the Participant as fully vested shares for such period of
time, if any, as necessary to avoid the recognition of an expense under
generally accepted accounting principles. 
The Company shall have the authority to require a Participant to remit
cash to the Company in lieu of the surrender of Shares for tax withholding
obligations if the surrender of Shares in satisfaction of such withholding
obligations would result in the Company’s recognition of expense under
generally accepted accounting principles. 
With respect to withholding required upon any taxable event under the
Plan, the Committee may, at the time the Award is granted or thereafter,
require or permit that any such withholding requirement be satisfied, in whole
or in part, by withholding from the Award Shares having a Fair Market Value on
the date of withholding equal to the minimum amount (and not any greater
amount) required to be withheld for tax purposes, all in accordance with such
procedures as the Committee establishes.

 

17.4.                        NO RIGHT TO CONTINUED
SERVICE.  Nothing in the Plan, any
Award Certificate or any other document or statement made with respect to the
Plan, shall interfere with or limit in any way the right of the Company or any
Affiliate to terminate any Participant’s employment or status as an officer,
director or consultant at any time, nor confer upon any Participant any right
to continue as an employee, officer, director or consultant of the Company or
any Affiliate, whether for the duration of a Participant’s Award or otherwise.

 

17.5.                        UNFUNDED STATUS OF AWARDS.  The Plan is intended to be an “unfunded” plan
for incentive and deferred compensation. 
With respect to any payments not yet made to a Participant pursuant to
an Award, nothing contained in the Plan or any Award Certificate shall give the
Participant any rights that are greater than those of a general creditor of the
Company or any Affiliate.  This Plan is
not intended to be subject to ERISA.

 

17.6.                        RELATIONSHIP TO OTHER
BENEFITS.  No payment under the Plan
shall be taken into account in determining any benefits under any pension,
retirement, savings, profit sharing, group insurance, welfare or benefit plan
of the Company or any Affiliate unless provided otherwise in such other plan.

 

17.7.                        EXPENSES.  The expenses of administering the Plan shall
be borne by the Company and its Affiliates.

 

17.8.                        TITLES AND HEADINGS.  The titles and headings of the Sections in
the Plan are for convenience of reference only, and in the event of any
conflict, the text of the Plan, rather than such titles or headings, shall
control.

 

17.9.                        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.

 

17.10.                  FRACTIONAL SHARES.  No fractional Shares shall be issued and the
Committee shall determine, in its discretion, whether cash shall be given in
lieu of fractional Shares or whether such fractional Shares shall be eliminated
by rounding up or down.

 

17.11.                  GOVERNMENT AND OTHER REGULATIONS.

 

(a)                                  Notwithstanding
any other provision of the Plan, no Participant who acquires Shares pursuant to
the Plan may, during any period of time that such Participant is an affiliate
of the Company (within the meaning of the rules and regulations of the
Securities and Exchange Commission under the 1933 Act), sell such Shares,
unless such offer and sale is made (i) pursuant to an effective registration
statement under the 1933 Act, which is current and includes the Shares to be
sold, or (ii) pursuant to an appropriate exemption from the registration
requirement of the 1933 Act, such as that set forth in Rule 144 promulgated
under the 1933 Act.

 

(b)                                 Notwithstanding
any other provision of the Plan, if at any time the Committee shall determine
that the registration, listing or qualification of the Shares covered by an
Award upon any 

 

18

 

Exchange or under any
foreign, federal, state or local law or practice, or the consent or approval of
any governmental regulatory body, is necessary or desirable as a condition of,
or in connection with, the granting of such Award or the purchase or receipt of
Shares thereunder, no Shares may be purchased, delivered or received pursuant
to such Award unless and until such registration, listing, qualification,
consent or approval shall have been effected or obtained free of any condition
not acceptable to the Committee.  Any
Participant receiving or purchasing Shares pursuant to an Award shall make such
representations and agreements and furnish such information as the Committee
may request to assure compliance with the foregoing or any other applicable
legal requirements.  The Company shall
not be required to issue or deliver any certificate or certificates for Shares
under the Plan prior to the Committee’s determination that all related requirements
have been fulfilled.  The Company shall
in no event be obligated to register any securities pursuant to the 1933 Act or
applicable state or foreign law or to take any other action in order to cause
the issuance and delivery of such certificates to comply with any such law,
regulation or requirement.

 

17.12.                  GOVERNING LAW.  To the extent not governed by federal law,
the Plan and all Award Certificates shall be construed in accordance with and
governed by the laws of the State of Delaware.

 

17.13.                  ADDITIONAL PROVISIONS.  Each Award Certificate may contain such other
terms and conditions as the Committee may determine; provided that such other
terms and conditions are not inconsistent with the provisions of the Plan.

 

17.14.                  NO LIMITATIONS ON RIGHTS OF
COMPANY.  The grant of any Award
shall not in any way affect the right or power of the Company to make
adjustments, reclassification or changes in its capital or business structure
or to merge, consolidate, dissolve, liquidate, sell or transfer all or any part
of its business or assets.  The Plan
shall not restrict the authority of the Company, for proper corporate purposes,
to draft or assume awards, other than under the Plan, to or with respect to any
person.  If the Committee so directs, the
Company may issue or transfer Shares to an Affiliate, for such lawful
consideration as the Committee may specify, upon the condition or understanding
that the Affiliate will transfer such Shares to a Participant in accordance
with the terms of an Award granted to such Participant and specified by the
Committee pursuant to the provisions of the Plan.

 

17.15.                  INDEMNIFICATION.  Each person who is or shall have been a member of
the Committee, or of the Board, or an officer of the Company to whom
authority was delegated in accordance with Article 4 shall be indemnified
and held harmless by the Company against and from 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, 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 and against and 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 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, unless such loss, cost, liability, or
expense is a result of his or her own willful misconduct or except as expressly
provided by statute.  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, as a matter of law, or otherwise,
or any power that the Company may have to indemnify them or hold them harmless.

 

19

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