Document:

Exhibit
10.1

 

OMNICELL, INC.

 

2009
EQUITY INCENTIVE PLAN

 

ADOPTED
BY THE BOARD OF DIRECTORS: MARCH 5, 2009

APPROVED
BY THE STOCKHOLDERS:  MAY 19,  2009

TERMINATION
DATE:  MARCH 4, 2019

 

1.                                      GENERAL.

 

(a)           Successor
to and Continuation of Prior Plans.  The Plan is intended as the successor to and
continuation of the Omnicell, Inc. 1999 Equity Incentive Plan, the 2003
Equity Incentive Plan and the 2004 Equity Incentive Plan (together, the “Prior Plans”).  On and after the Effective Date, no
additional stock awards shall be granted under the Prior Plans.  All outstanding stock awards granted under
the Prior Plans shall remain subject to the terms of the Prior Plans; provided, however, that after December 31, 2008, any
shares subject to outstanding stock awards granted under the Prior Plans that
expire or terminate for any reason prior to exercise or settlement or are
forfeited because of the failure to meet a contingency or condition required to
vest such shares (the “Returning Shares”)
shall become available for issuance pursuant to Awards granted hereunder.  All Awards granted on or after the Effective
Date of this Plan shall be subject to the terms of this Plan.

 

(b)           Eligible Award Recipients. 
The persons eligible to receive Awards are Employees, Directors and Consultants.

 

(c)           Available Awards. 
The Plan provides for the grant of the following Awards: (i) Incentive
Stock Options, (ii) Nonstatutory Stock Options, (iii) Stock
Appreciation Rights, (iv) Restricted Stock Awards, (v) Restricted
Stock Unit Awards, (vi) Performance Stock Awards, (vii) Performance
Cash Awards, and (viii) Other Stock Awards.

 

(d)           Purpose. 
The Company, by means of the Plan, seeks to secure and retain the
services of the group of persons eligible to receive Awards as set forth in Section 1(b),
to provide incentives for such persons to exert maximum efforts for the success
of the Company and any Affiliate and to provide a means by which such eligible
recipients may be given an opportunity to benefit from increases in value of
the Common Stock through the granting of Stock Awards.

 

2.                                      ADMINISTRATION.

 

(a)           Administration by Board. 
The Board shall administer the Plan unless and until the Board delegates
administration of the Plan to a Committee or Committees, as provided in Section 2(c).

 

(b)           Powers of Board. 
The Board shall have the power, subject to, and within the limitations
of, the express provisions of the Plan:

 

 

(i)            To determine from time to time (A) which of the
persons eligible under the Plan shall be granted Awards; (B) when and how
each Award shall be granted; (C) what type or combination of types of
Award shall be granted; (D) the provisions of each Award granted (which
need not be identical), including the time or times when a person shall be
permitted to receive cash or Common Stock pursuant to a Stock Award; (E) the
number of shares of Common Stock with respect to which a Stock Award shall be
granted to each such person; and (F) the Fair Market Value applicable to a
Stock Award.

 

(ii)           To construe and interpret the Plan and Awards granted
under it, and to establish, amend and revoke rules and regulations for its
administration.  The Board, in the
exercise of this power, may correct any defect, omission or inconsistency in
the Plan or in any Stock Award Agreement or in the written terms of a
Performance Cash Award, in a manner and to the extent it shall deem necessary
or expedient to make the Plan or Award fully effective.

 

(iii)         To settle all controversies regarding the Plan and
Awards granted under it.

 

(iv)          To accelerate the time at which an Award may first be
exercised or the time during which an Award or any part thereof will vest in
accordance with the Plan, notwithstanding the provisions in the Award stating
the time at which it may first be exercised or the time during which it will
vest.

 

(v)            To suspend or terminate the Plan at any
time.  Suspension or termination of the
Plan shall not impair rights and obligations under any Award granted while the
Plan is in effect except with the written consent of the affected Participant.

 

(vi)          To amend the Plan in any respect the
Board deems necessary or advisable, including, without limitation, by adopting
amendments relating to Incentive Stock Options and certain nonqualified
deferred compensation under Section 409A of the Code and/or to bring the
Plan or Awards granted under the Plan into compliance therewith, subject to the
limitations, if any, of applicable law. However, except as provided in Section 9(a) relating
to Capitalization Adjustments, to the extent required by applicable law or
listing requirements, stockholder approval shall be required for any
amendment of the Plan that either (A) materially increases the number of
shares of Common Stock available for issuance under the Plan, (B) materially
expands the class of individuals eligible to receive Awards under the Plan, (C) materially
increases the benefits accruing to Participants under the Plan or materially
reduces the price at which shares of Common Stock may be issued or purchased
under the Plan, (D) materially extends the term of the Plan, or (E) expands
the types of Awards available for issuance under the Plan. Except as provided above, rights under
any Award granted before amendment of the Plan shall not be impaired by any
amendment of the Plan unless (1) the Company requests the consent of the
affected Participant, and (2) such Participant consents in writing.

 

(vii)         To submit any amendment to the Plan for
stockholder approval, including, but not limited to, amendments to the Plan
intended to satisfy the requirements of (A) Section 162(m) of
the Code regarding the exclusion of performance-based compensation from the
limit on corporate deductibility of compensation paid to Covered Employees, (B) Section 422
of the Code regarding “incentive stock options” or (C) Rule 16b-3.

 

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(viii)        To approve forms of Award Agreements for use under the
Plan and to amend the terms of any one or more Awards, including, but not
limited to, amendments to provide terms more favorable to the Participant than
previously provided in the Award Agreement, subject to any specified limits in
the Plan that are not subject to Board discretion; provided
however, that except with respect to amendments that disqualify or
impair the status of an Incentive Stock Option, a Participant’s rights under
any Award shall not be impaired by any such amendment unless (A) the
Company requests the consent of the affected Participant, and (B) such
Participant consents in writing. 
Notwithstanding the foregoing, subject to the limitations of applicable
law, if any, the Board may amend the terms of any one or more Awards without
the affected Participant’s consent if necessary to maintain the qualified
status of the Award as an Incentive Stock Option or to bring the Award into
compliance with Section 409A of the Code.

 

(ix)          Generally, to exercise such powers and to perform such
acts as the Board deems necessary or expedient to promote the best interests of
the Company and that are not in conflict with the provisions of the Plan or
Awards.

 

(x)           To adopt such procedures and sub-plans as are
necessary or appropriate to permit participation in the Plan by Employees,
Directors or Consultants who are foreign nationals or employed outside the
United States.

 

(c)           Delegation to Committee.

 

(i)            General. 
The Board may delegate some or all of the administration of the Plan to
a Committee or Committees.  If
administration of the Plan is delegated to a Committee, the Committee shall
have, in connection with the administration of the Plan, the powers theretofore
possessed by the Board that have been delegated to the Committee, including the
power to delegate to a subcommittee of the Committee any of the administrative
powers the Committee is authorized to exercise (and references in this Plan to
the Board shall thereafter be to the Committee or subcommittee), subject,
however, to such resolutions, not inconsistent with the provisions of the Plan,
as may be adopted from time to time by the Board.  The Board may retain the authority to
concurrently administer the Plan with the Committee and may, at any time,
revest in the Board some or all of the powers previously delegated.

 

(ii)           Section 162(m) and Rule 16b-3
Compliance.  The Committee may consist solely of two or
more Outside Directors, in accordance with Section 162(m) of the
Code, or solely of two or more Non-Employee Directors, in accordance with Rule 16b-3.

 

(d)           Effect of Board’s Decision. All determinations, interpretations and
constructions made by the Board in good faith shall not be subject to review by
any person and shall be final, binding and conclusive on all persons.

 

(e)           Cancellation and Re-Grant of Stock
Awards.  Neither the Board nor any Committee shall
have the authority to: (i) reduce the exercise price of any outstanding
Options or Stock Appreciation Rights under the Plan, or (ii) cancel any
outstanding Options or Stock Appreciation Rights that have an exercise price or
strike price greater than the current Fair Market Value of the Common Stock in
exchange for cash or other Stock Awards under the Plan, unless the stockholders
of the Company have approved such an action within twelve (12) months prior to
such an event.

 

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3.                                      SHARES SUBJECT TO THE PLAN.

 

(a)           Share Reserve.  Subject to Section 9(a) relating to
Capitalization Adjustments, the aggregate number of shares of Common Stock that
may be issued pursuant to Stock Awards from and after the Effective Date shall
not exceed 2,100,000 shares plus the
Returning Shares, if any, as such shares become available from time to time less  one
(1) share for each share of stock issued pursuant to an option or stock
appreciation right granted after December 31, 2008 under the Prior Plans
with respect to which the strike price is at least one hundred percent (100%)
of the Fair Market Value of the underlying Common Stock on the date of grant and 1.4 shares
for each share of stock issued pursuant to an award other than an option or
stock appreciation right granted after December 31, 2008 under the Prior
Plans (the “Share Reserve”).  For clarity, the Share Reserve in this Section 3(a) is
a limitation in the number of shares of the Common Stock that may be issued
pursuant to the Plan and does not limit the granting of Stock Awards except as
provided in Section 7(a).  Shares
may be issued in connection with a merger or acquisition as permitted by NASDAQ
Marketplace Rule 4350(i)(1)(A)(iii) or, if applicable, NYSE Listed
Company Manual Section 303A.08, or AMEX Company Guide Section 711 or
other applicable rule, and such issuance shall not reduce the number of shares
available for issuance under the Plan. 
Furthermore, if a Stock Award or any portion thereof (i) expires or
otherwise terminates without all of the shares covered by such Stock Award have
been issued or (ii) is settled in cash (i.e.,
the Participant receives cash rather than stock), such expiration, termination
or settlement shall not reduce (or otherwise offset) the number of shares of
Common Stock that may be available for issuance under the Plan.

 

(b)           Subject to subsection 3(c), the number of shares
available for issuance under the Plan shall be reduced by: (i) one (1) share
for each share of stock issued pursuant to (A) an Option granted under Section 5,
or (B) a Stock Appreciation Right granted under Section 5 with
respect to which the strike price is at least one hundred percent (100%) of the
Fair Market Value of the underlying Common Stock on the date of grant; and (ii) 1.4 shares for each share of Common
Stock issued pursuant to a Restricted Stock Award, Restricted Stock Unit Award,
Performance Stock Award or Other Stock Award.

 

(c)           Reversion of Shares to the Share
Reserve.

 

(i)            Shares Available For Subsequent
Issuance.  If any shares of common stock issued
pursuant to a Stock Award are forfeited back to the Company because of the
failure to meet a contingency or condition required to vest such shares in the
Participant, then the shares which are forfeited shall revert to and again
become available for issuance under the Plan. 
Notwithstanding the provisions of this Section 3(c)(i), any such
shares shall not be subsequently issued pursuant to the exercise of Incentive
Stock Options.  To the extent (A) there
is issued a share of Common Stock pursuant to a Stock Award that counted as  1.4
shares against the number of shares available for issuance under the
Plan pursuant to Section 3(b) or (B) any Returning Shares
granted under the Prior Plan pursuant to an award other than an option or stock
appreciation right, and such share of Common Stock becomes available for
issuance under the Plan pursuant to Section 1(a), Section 3(a) or
this Section 3(c), then the number of shares of Common Stock available for
issuance under the Plan shall increase by 1.4 shares.

 

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(ii)           Shares Not Available For
Subsequent Issuance.  If any shares subject to a Stock Award
are not delivered to a Participant because the Stock Award is exercised through
a reduction of shares subject to the Stock Award (i.e.,
“net exercised”), the number of shares that are not delivered to the
Participant shall not remain available for issuance under the Plan.  Also, any shares reacquired by the Company
pursuant to Section 8(g) or as consideration for the exercise of an
Option shall not again become available for issuance under the Plan.

 

(d)           Incentive Stock Option Limit.  Notwithstanding anything to the contrary in this Section 3,
subject to the provisions of Section 9(a) relating to Capitalization
Adjustments the aggregate maximum number of shares of Common Stock that may be
issued pursuant to the exercise of Incentive Stock Options shall be the number
of shares of Common Stock in the Share Reserve.

 

(e)           Source of Shares. 
The stock issuable under the Plan shall be shares of authorized but
unissued or reacquired Common Stock, including shares repurchased by the
Company on the open market or otherwise.

 

4.                                      ELIGIBILITY.

 

(a)           Eligibility
for Specific Stock Awards. 
Incentive Stock Options may be granted only to employees of the Company
or a “parent corporation” or “subsidiary corporation” thereof (as such terms
are defined in Sections 424(e) and (f) of the Code).  Stock Awards other than Incentive Stock
Options may be granted to Employees, Directors and Consultants; provided, however, Nonstatutory Stock Options
and SARs may not be granted to Employees, Directors, and Consultants who are
providing Continuous Services only to any “parent” of the Company, as such term
is defined in Rule 405 promulgated under the Securities Act, unless such
Stock Awards comply with the distribution requirements of Section 409A of
the Code.

 

(b)           Ten Percent Stockholders.  A
Ten Percent Stockholder shall not be granted an Incentive Stock Option unless
the exercise price of such Option is at least one hundred ten percent (110%) of
the Fair Market Value on the date of grant and the Option is not exercisable
after the expiration of five (5) years from the date of grant.

 

(c)           Section 162(m) Limitation
on Annual Grants.  Subject to the provisions of Section 9(a) relating
to Capitalization Adjustments, at such time as the Company may be subject to
the applicable provisions of Section 162(m) of the Code, no
Participant shall be eligible to be granted during any calendar year Options,
Stock Appreciation Rights and Other Stock Awards whose value is determined by
reference to an increase over an exercise or strike price of at least one
hundred percent (100%) of the Fair Market Value on the date the Stock Award is
granted covering more than 1,500,000  shares of
Common Stock.

 

5.                                      PROVISIONS RELATING TO OPTIONS
AND STOCK APPRECIATION RIGHTS.

 

Each Option or SAR shall be in such form and shall
contain such terms and conditions as the Board shall deem appropriate.  All Options shall be separately designated
Incentive Stock Options or Nonstatutory Stock Options at the time of grant,
and, if certificates are issued, a separate certificate or certificates shall
be issued for shares of Common Stock purchased on exercise of each type of
Option. If an Option is not specifically designated as an Incentive Stock Option,
then the Option shall be a Nonstatutory Stock Option. The provisions of
separate Options or SARs need not be identical; provided, however, that each Option Agreement or Stock
Appreciation Right Agreement shall conform to (through incorporation of
provisions hereof by reference in the applicable Award Agreement or otherwise)
the substance of each of the following provisions:

 

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(a)           Term. 
Subject to the provisions of Section 4(b) regarding Ten Percent
Stockholders, no Option or SAR shall be exercisable after the expiration of ten
(10) years from the date of its grant or such shorter period specified in
the Award Agreement.

 

(b)           Exercise Price. 
Subject to the provisions of Section 4(b) regarding Ten
Percent Stockholders, the exercise price (or strike price) of each Option or
SAR shall be not less than one hundred percent (100%) of the Fair Market Value
of the Common Stock subject to the Option or SAR on the date the Option or SAR
is granted.  Notwithstanding the
foregoing, an Option or SAR may be granted with an exercise price (or strike
price) lower than one hundred percent (100%) of the Fair Market Value of the
Common Stock subject to the Option or SAR if such Option or SAR is granted
pursuant to an assumption of or substitution for another option or stock
appreciation right pursuant to a Corporate Transaction and in a manner
consistent with the provisions of Sections 409A and 424(a) of the Code
(whether or not such awards are Incentive Stock Options).  Each SAR will be denominated in shares of
Common Stock equivalents.

 

(c)           Purchase Price for Options. 
The purchase price of Common Stock acquired pursuant to the exercise of
an Option shall be paid, to the extent permitted by applicable law and as determined
by the Board in its sole discretion, by any combination of the methods of
payment set forth below.  The Board shall
have the authority to grant Options that do not permit all of the following
methods of payment (or otherwise restrict the ability to use certain methods)
and to grant Options that require the consent of the Company to utilize a
particular method of payment.  The
permitted methods of payment are as follows:

 

(i)            by cash, check, bank draft or money order payable to
the Company;

 

(ii)           pursuant to a program developed under Regulation T as
promulgated by the Federal Reserve Board that, prior to the issuance of the
stock subject to the Option, results in either the receipt of cash (or check)
by the Company or the receipt of irrevocable instructions to pay the aggregate
exercise price to the Company from the sales proceeds;

 

(iii)         by delivery to the Company (either by actual delivery
or attestation) of shares of Common Stock;

 

(iv)          if the option is a Nonstatutory Stock Option, by a “net
exercise” arrangement pursuant to which the Company will reduce the number of
shares of Common Stock issuable upon exercise by the largest whole number of
shares with a Fair Market Value that does not exceed the aggregate exercise
price; provided, however, that the Company shall accept a
cash or other payment from the Participant to the extent of any remaining
balance of the aggregate exercise price not satisfied by such reduction in the
number of whole shares to be issued; provided,
further, that shares of Common Stock will no longer be subject to an
Option and will not be exercisable thereafter to the extent that (A) shares
issuable upon exercise are reduced to pay the exercise price pursuant to the “net
exercise,” (B) shares are delivered to the Participant as a result of such
exercise, and (C) shares are withheld to satisfy tax withholding
obligations; or

 

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(v)            in any other form of legal consideration that may be
acceptable to the Board.

 

(d)           Exercise and Payment of a SAR. 
To exercise any outstanding Stock Appreciation Right, the Participant
must provide written notice of exercise to the Company in compliance with the
provisions of the Stock Appreciation Right Agreement evidencing such Stock
Appreciation Right.  The appreciation
distribution payable on the exercise of a Stock Appreciation Right will be not
greater than an amount equal to the excess of (A) the aggregate Fair
Market Value (on the date of the exercise of the Stock Appreciation Right) of a
number of shares of Common Stock equal to the number of Common Stock
equivalents in which the Participant is vested under such Stock Appreciation
Right, and with respect to which the Participant is exercising the Stock
Appreciation Right on such date, over (B) the strike price that will be
determined by the Board at the time of grant of the Stock Appreciation
Right.  The appreciation distribution in
respect to a Stock Appreciation Right may be paid in Common Stock, in cash, in
any combination of the two or in any other form of consideration, as determined
by the Board and contained in the Stock Appreciation Right Agreement evidencing
such Stock Appreciation Right.

 

(e)           Transferability of Options and
SARs.  The Board may, in its sole discretion, impose
such limitations on the transferability of Options and SARs as the Board shall
determine.  In the absence of such a
determination by the Board to the contrary, the following restrictions on the
transferability of Options and SARs shall apply:

 

(i)            Restrictions on Transfer.  An Option or SAR shall not be transferable
except by will or by the laws of descent and distribution and shall be
exercisable during the lifetime of the Participant only by the Participant; provided, however, that the Board may, in its sole
discretion, permit transfer of the Option or SAR in a manner that is not
prohibited by applicable tax and securities laws upon the Participant’s
request.  Except as explicitly provided
herein, neither an Option nor a SAR may be transferred for consideration.

 

(ii)           Domestic Relations Orders. 
Notwithstanding the foregoing, an Option or SAR may be transferred
pursuant to a domestic relations order; provided, however,
that if an Option is an Incentive Stock Option, such Option may be deemed to be
a Nonstatutory Stock Option as a result of such transfer.

 

(iii)         Beneficiary Designation. 
Notwithstanding the foregoing, the Participant may, by delivering
written notice to the Company, in a form provided by or otherwise satisfactory
to the Company and any broker designated by the Company to effect Option
exercises, designate a third party who, in the event of the death of the
Participant, shall thereafter be entitled to exercise the Option or SAR and
receive the Common Stock or other consideration resulting from such exercise.  In the absence of such a designation, the
executor or administrator of the Participant’s estate shall be entitled to
exercise the Option or SAR and receive the Common Stock or other consideration
resulting from such exercise.

 

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(f)            Vesting Generally. 
The total number of shares of Common Stock subject to an Option or SAR
may vest and therefore become exercisable in periodic installments that may or
may not be equal.  The Option or SAR may
be subject to such other terms and conditions on the time or times when it may
or may not be exercised (which may be based on the satisfaction of Performance
Goals or other criteria) as the Board may deem appropriate.  The vesting provisions of individual Options
or SARs may vary.  The provisions of this
Section 5(f) are subject to any Option or SAR provisions governing
the minimum number of shares of Common Stock as to which an Option or SAR may
be exercised.

 

(g)           Termination of Continuous Service. 
Except as otherwise provided in the applicable Award Agreement or other
agreement between the Participant and the Company, in the event that a
Participant’s Continuous Service terminates (other than for Cause or upon the
Participant’s death or Disability), the Participant may exercise his or her
Option or SAR (to the extent that the Participant was entitled to exercise such
Award as of the date of termination of Continuous Service) but only within such
period of time ending on the earlier of (i) the date three (3) months
following the termination of the Participant’s Continuous Service (or such
longer or shorter period specified in the applicable Award Agreement), or (ii) the
expiration of the term of the Option or SAR as set forth in the Award
Agreement.  If, after termination of Continuous
Service, the Participant does not exercise his or her Option or SAR within the
time specified herein or in the Award Agreement (as applicable), the Option or
SAR shall terminate.

 

(h)           Extension of Termination Date.  
In the event that the exercise of an Option or SAR following the
termination of the Participant’s Continuous Service (other than for Cause or
upon the Participant’s death or Disability) would be prohibited at any time
solely because the issuance of shares of Common Stock would violate the
registration requirements under the Securities Act, then the Option or SAR
shall terminate on the earlier of (i) the expiration of a period of three (3) months
after the termination of the Participant’s Continuous Service during which the
exercise of the Option or SAR would not be in violation of such registration
requirements, or (ii) the expiration of the term of the Option or SAR as
set forth in the applicable Award Agreement. 
In addition, unless otherwise provided in a Participant’s Award
Agreement, if the sale of any Common Stock received upon exercise of an Option
or SAR following the termination of the Participant’s Continuous Service (other
than for Cause) would violate the Company’s insider trading policy, then the
Option or SAR shall terminate on the earlier of (i) the expiration of a
period equal to the applicable post-termination exercise period after the
termination of the Participant’s Continuous Service during which the exercise
of the Option or SAR would not be in violation of the Company’s insider trading
policy, or (ii) the expiration of the term of the Option or SAR as set
forth in the applicable Award Agreement.

 

(i)            Disability of Participant. 
Except as otherwise provided in the applicable Award Agreement or other
agreement between the Participant and the Company, in the event that a
Participant’s Continuous Service terminates as a result of the Participant’s
Disability, the Participant may exercise his or her Option or SAR (to the
extent that the Participant was entitled to exercise such Option or SAR as of
the date of termination of Continuous Service), but only within such period of
time ending on the earlier of (i) the date twelve (12) months following
such termination of Continuous Service (or such longer or shorter period
specified in the Award Agreement), or (ii) the expiration of the term of
the Option or SAR as set forth in the Award Agreement.  If, after termination of Continuous Service,
the Participant does not exercise his or her Option or SAR within the time
specified herein or in the Award Agreement (as applicable), the Option or SAR
(as applicable) shall terminate.

 

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(j)            Death of Participant. 
Except as otherwise provided in the applicable Award Agreement or other
agreement between the Participant and the Company, in the event that (i) a
Participant’s Continuous Service terminates as a result of the Participant’s
death, or (ii) the Participant dies within the period (if any) specified
in the Award Agreement after the termination of the Participant’s Continuous
Service for a reason other than death, then the Option or SAR may be exercised
(to the extent the Participant was entitled to exercise such Option or SAR as
of the date of death) by the Participant’s estate, by a person who acquired the
right to exercise the Option or SAR by bequest or inheritance or by a person
designated to exercise the Option or SAR upon the Participant’s death, but only
within the period ending on the earlier of (i) the date eighteen (18)
months following the date of death (or such longer or shorter period specified
in the Award Agreement), or (ii) the expiration of the term of such Option
or SAR as set forth in the Award Agreement. 
If, after the Participant’s death, the Option or SAR is not exercised
within the time specified herein or in the Award Agreement (as applicable), the
Option or SAR shall terminate.

 

(k)           Termination for Cause. 
Except as explicitly provided otherwise in a Participant’s Award
Agreement, if a Participant’s Continuous Service is terminated for Cause, the
Option or SAR shall terminate upon the date on which the event giving rise to
the termination occurred, and the Participant shall be prohibited from
exercising his or her Option or SAR from and after the time of such termination
of Continuous Service.

 

(l)            Non-Exempt Employees. 
No Option or SAR granted to an Employee who is a non-exempt employee for
purposes of the Fair Labor Standards Act of 1938, as amended shall be first
exercisable for any shares of Common Stock until at least six months following
the date of grant of the Option or SAR. Notwithstanding the foregoing,
consistent with the provisions of the Worker Economic Opportunity Act, (i) in the event of the Participant’s death or
Disability, (ii) upon a Corporate Transaction in which such Option or SAR
is not assumed, continued, or substituted, (iii) upon a Change in Control,
or (iv) upon the Participant’s retirement (as such term may be defined in
the Participant’s Award Agreement or in another applicable agreement or in accordance
with the Company’s then current employment policies and guidelines) any such
vested Options and SARs may be exercised earlier than six months
following the date of grant.  The
foregoing provision is intended to operate so that any income derived by a
non-exempt employee in connection with the exercise or vesting of an Option or
SAR will be exempt from his or her regular rate of pay.

 

6.                                      PROVISIONS OF STOCK AWARDS OTHER
THAN OPTIONS AND SARS.

 

(a)           Restricted Stock Awards. 
Each Restricted Stock Award Agreement shall be in such form and shall
contain such terms and conditions as the Board shall deem appropriate.  To the extent consistent with the Company’s
Bylaws, at the Board’s election, shares of Common Stock may be (x) held in
book entry form subject to the Company’s instructions until any restrictions
relating to the Restricted Stock Award lapse; or (y) evidenced by a
certificate, which certificate shall be held in such form and manner as
determined by the Board.  The terms and
conditions of Restricted Stock Award Agreements may change from time to time,
and the terms and conditions of separate Restricted Stock Award Agreements need
not be identical; provided, however,
that each Restricted Stock Award Agreement shall conform to (through
incorporation of the provisions hereof by reference in the agreement or
otherwise) the substance of each of the following provisions:

 

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(i)            Consideration.  A
Restricted Stock Award may be awarded in consideration for (A) cash,
check, bank draft or money order payable to the Company, (B) past services
to the Company or an Affiliate, or (C) any other form of legal
consideration (including future services) that may be acceptable to the Board
in its sole discretion and permissible under applicable law.

 

(ii)           Vesting.  Shares of Common Stock
awarded under the Restricted Stock Award Agreement may be subject to forfeiture
to the Company in accordance with a vesting schedule to be determined by the
Board.

 

(iii)         Termination of Participant’s Continuous Service. 
In the event a Participant’s Continuous Service terminates, the Company
may receive via a forfeiture condition or a repurchase right, any or all of the
shares of Common Stock held by the Participant which have not vested as of the
date of termination of Continuous Service under the terms of the Restricted
Stock Award Agreement.

 

(iv)          Transferability.  Rights to acquire shares of
Common Stock under the Restricted Stock Award Agreement shall be transferable
by the Participant only upon such terms and conditions as are set forth in the
Restricted Stock Award Agreement, as the Board shall determine in its sole
discretion, so long as Common Stock awarded under the Restricted Stock Award
Agreement remains subject to the terms of the Restricted Stock Award Agreement.

 

(b)           Restricted Stock Unit Awards.  Each Restricted Stock Unit Award Agreement shall be in
such form and shall contain such terms and conditions as the Board shall deem
appropriate.  The terms and conditions of
Restricted Stock Unit Award Agreements may change from time to time, and the
terms and conditions of separate Restricted Stock Unit Award Agreements need
not be identical; provided, however,  that
each Restricted Stock Unit Award Agreement shall conform to (through
incorporation of the provisions hereof by reference in the Agreement or
otherwise) the substance of each of the following provisions:

 

(i)            Consideration. 
At the time of grant of a Restricted Stock Unit Award, the Board will
determine the consideration, if any, to be paid by the Participant upon
delivery of each share of Common Stock subject to the Restricted Stock Unit
Award. The consideration to be paid (if any) by the Participant for each share
of Common Stock subject to a Restricted Stock Unit Award may be paid in any
form of legal consideration that may be acceptable to the Board in its sole
discretion and permissible under applicable law.

 

(ii)           Vesting.  At the time of the grant of a Restricted Stock Unit
Award, the Board may impose such restrictions on or conditions to the vesting
of the Restricted Stock Unit Award as it, in its sole discretion, deems
appropriate.

 

10

 

(iii)         Payment. 
A Restricted Stock Unit Award may be settled by the delivery of shares
of Common Stock, their cash equivalent, any combination thereof or in any other
form of consideration, as determined by the Board and contained in the
Restricted Stock Unit Award Agreement.

 

(iv)          Additional Restrictions.  At the time of the grant of a Restricted Stock Unit
Award, the Board, as it deems appropriate, may impose such restrictions or
conditions that delay the delivery of the shares of Common Stock (or their cash
equivalent) subject to a Restricted Stock Unit Award to a time after the vesting
of such Restricted Stock Unit Award.

 

(v)            Dividend Equivalents.  Dividend equivalents may be credited in respect of
shares of Common Stock covered by a Restricted Stock Unit Award, as determined
by the Board and contained in the Restricted Stock Unit Award Agreement.  At the sole discretion of the Board, such
dividend equivalents may be converted into additional shares of Common Stock
covered by the Restricted Stock Unit Award in such manner as determined by the
Board.  Any additional shares covered by
the Restricted Stock Unit Award credited by reason of such dividend equivalents
will be subject to all the terms and conditions of the underlying Restricted
Stock Unit Award Agreement to which they relate.

 

(vi)          Termination of Participant’s
Continuous Service.  Except as otherwise provided in the
applicable Restricted Stock Unit Award Agreement, such portion of the
Restricted Stock Unit Award that has not vested will be forfeited upon the
Participant’s termination of Continuous Service.

 

(c)           Performance Awards.

 

(i)            Performance Stock Awards. 
A Performance Stock Award is a Stock Award that may vest or may be
exercised contingent upon the attainment during a Performance Period of certain
Performance Goals.  A Performance Stock
Award may, but need not, require the completion of a specified period of
Continuous Service. The length of any Performance Period, the Performance Goals
to be achieved during the Performance Period, and the measure of whether and to
what degree such Performance Goals have been attained shall be conclusively
determined by the Committee in its sole discretion.  The maximum number of shares covered by an
Award that may be granted to any Participant in a calendar year attributable to
Stock Awards described in this Section 6(c)(i) (whether the grant,
vesting or exercise is contingent upon the attainment during a Performance
Period of the Performance Goals) shall not exceed 1,500,000 shares of Common
Stock.  In addition, to the extent
permitted by applicable law and the applicable Award Agreement, the Board may
determine that cash may be used in payment of Performance Stock Awards.

 

(ii)           Performance Cash Awards. 
A Performance Cash Award is a cash award that may be paid contingent
upon the attainment during a Performance Period of certain Performance
Goals.  A Performance Cash Award may also
require the completion of a specified period of Continuous Service.  The length of any Performance Period, the
Performance Goals to be achieved during the Performance Period, and the measure
of whether and to what degree such Performance Goals have been attained shall
be conclusively determined by the Committee in its sole discretion.  In any calendar year, the Committee may not
grant a Performance Cash Award

 

11

 

that  has a maximum value that may be paid to any
Participant in excess of $1,500,000.  The
Board may provide for or, subject to such terms and conditions as the Board may
specify, may permit a Participant to elect for, the payment of any Performance
Cash Award to be deferred to a specified date or event.  The Committee may specify the form of payment
of Performance Cash Awards, which may be cash or other property, or may provide
for a Participant to have the option for his or her Performance Cash Award, or
such portion thereof as the Board may specify, to be paid in whole or in part
in cash or other property.

 

(d)           Other Stock Awards. 
Other forms of Stock Awards valued in whole or in part by reference to,
or otherwise based on, Common Stock, including the appreciation in value
thereof (e.g., options or stock rights with an exercise price or strike price
less than 100% of the Fair Market Value of the Common Stock at the time of
grant) may be granted either alone or in addition to Stock Awards provided for under
Section 5 and the preceding provisions of this Section 6.  Subject to the provisions of the Plan, the
Board shall have sole and complete authority to determine the persons to whom
and the time or times at which such Other Stock Awards will be granted, the
number of shares of Common Stock (or the cash equivalent thereof) to be granted
pursuant to such Other Stock Awards and all other terms and conditions of such
Other Stock Awards.

 

7.                                      COVENANTS OF THE COMPANY.

 

(a)           Availability of Shares. 
During the terms of the Stock Awards, the Company shall keep available
at all times the number of shares of Common Stock reasonably required to
satisfy such Stock Awards.

 

(b)           Securities Law Compliance. 
The Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may be required to
grant Stock Awards and to issue and sell shares of Common Stock upon exercise
of the Stock Awards; provided, however,
that this undertaking shall not require the Company to register under the
Securities Act the Plan, any Stock Award or any Common Stock issued or issuable
pursuant to any such Stock Award.  If,
after reasonable efforts, the Company is unable to obtain from any such
regulatory commission or agency the authority that counsel for the Company
deems necessary for the lawful issuance and sale of Common Stock under the
Plan, the Company shall be relieved from any liability for failure to issue and
sell Common Stock upon exercise of such Stock Awards unless and until such
authority is obtained. A Participant shall not be eligible for the grant of a
Stock Award or the subsequent issuance of Common Stock pursuant to the Stock
Award if such grant or issuance would be in violation of any applicable
securities law.

 

(c)           No Obligation to Notify.  The Company shall have no duty or obligation to any
Participant to advise such holder as to the time or manner of exercising such
Stock Award.  Furthermore, the Company
shall have no duty or obligation to warn or otherwise advise such holder of a
pending termination or expiration of a Stock Award or a possible period in
which the Stock Award may not be exercised. 
The Company has no duty or obligation to minimize the tax consequences
of a Stock Award to the holder of such Stock Award.

 

12

 

8.                                      MISCELLANEOUS.

 

(a)           Use of Proceeds from Sales of Common
Stock.  Proceeds from the sale of shares of Common Stock
pursuant to Stock Awards shall constitute general funds of the Company.

 

(b)           Corporate Action Constituting Grant
of Stock Awards.  Corporate action constituting a grant by the
Company of a Stock Award to any Participant shall be deemed completed as of the
date of such corporate action, unless otherwise determined by the Board,
regardless of when the instrument, certificate, or letter evidencing the Stock
Award is communicated to, or actually received or accepted by, the Participant.

 

(c)           Stockholder Rights. 
No Participant shall be deemed to be the holder of, or to have any of
the rights of a holder with respect to, any shares of Common Stock subject to
such Stock Award unless and until (i) such Participant has satisfied all
requirements for exercise of the Stock Award pursuant to its terms, if
applicable, and (ii) the issuance of the Common Stock subject to such
Stock Award has been entered into the books and records of the Company.

 

(d)           No Employment or Other Service
Rights.  Nothing in the Plan, any Stock Award
Agreement or any other instrument executed thereunder or in connection with any
Award granted pursuant thereto shall confer upon any Participant any right to
continue to serve the Company or an Affiliate in the capacity in effect at the
time the Stock Award was granted or shall affect the right of the Company or an
Affiliate to terminate (i) the employment of an Employee with or without
notice and with or without cause, (ii) the service of a Consultant
pursuant to the terms of such Consultant’s agreement with the Company or an
Affiliate, or (iii) the service of a Director pursuant to the Bylaws of
the Company or an Affiliate, and any applicable provisions of the corporate law
of the state in which the Company or the Affiliate is incorporated, as the case
may be.

 

(e)           Incentive Stock Option $100,000
Limitation.  To the extent that the aggregate Fair Market
Value (determined at the time of grant) of Common Stock with respect to which
Incentive Stock Options are exercisable for the first time by any Optionholder
during any calendar year (under all plans of the Company and any Affiliates) exceeds
one hundred thousand dollars ($100,000), the Options or portions thereof that
exceed such limit (according to the order in which they were granted) shall be
treated as Nonstatutory Stock Options, notwithstanding any contrary provision
of the applicable Option Agreement(s).

 

(f)            Investment Assurances. 
The Company may require a Participant, as a condition of exercising or
acquiring Common Stock under any Stock Award, (i) to give written
assurances satisfactory to the Company as to the Participant’s knowledge and
experience in financial and business matters and/or to employ a purchaser
representative reasonably satisfactory to the Company who is knowledgeable and
experienced in financial and business matters and that he or she is capable of
evaluating, alone or together with the purchaser representative, the merits and
risks of exercising the Stock Award; and (ii) to give written assurances
satisfactory to the Company stating that the Participant is acquiring Common
Stock subject to the Stock Award for the Participant’s own account and not with
any present intention of selling or otherwise distributing the Common
Stock.  The foregoing requirements, and
any assurances given pursuant 

 

13

 

to such requirements,
shall be inoperative if (A) the issuance of the shares upon the exercise
or acquisition of Common Stock under the Stock Award has been registered under
a then currently effective registration statement under the Securities Act, or (B) as
to any particular requirement, a determination is made by counsel for the
Company that such requirement need not be met in the circumstances under the
then applicable securities laws.  The
Company may, upon advice of counsel to the Company, place legends on stock
certificates issued under the Plan as such counsel deems necessary or
appropriate in order to comply with applicable securities laws, including, but
not limited to, legends restricting the transfer of the Common Stock.

 

(g)           Withholding Obligations. 
Unless prohibited by the terms of a Stock Award Agreement, the Company
may, in its sole discretion, satisfy any federal, state or local tax
withholding obligation relating to an Award by any of the following means (in
addition to the Company’s right to withhold from any compensation paid to the
Participant by the Company) or by a combination of such means: (i) causing
the Participant to tender a cash payment; (ii)  withholding shares of
Common Stock from the shares of Common Stock issued or otherwise issuable to
the Participant in connection with the Award; provided,
however, that no shares of Common Stock are withheld with a value
exceeding the minimum amount of tax required to be withheld by law (or such
lower amount as may be necessary to avoid classification of the Stock Award as
a liability for financial accounting purposes); (iii) withholding cash
from an Award settled in cash; (iv) withholding payment from any amounts
otherwise payable to the Participant; or (v) by such other method as may
be set forth in the Award Agreement.

 

(h)           Electronic Delivery. 
Any reference herein to a “written” agreement or document shall include
any agreement or document delivered electronically or posted on the Company’s
intranet.

 

(i)            Deferrals. 
To the extent permitted by applicable law, the Board, in its sole
discretion, may determine that the delivery of Common Stock or the payment of
cash, upon the exercise, vesting or settlement of all or a portion of any Award
may be deferred and may establish programs and procedures for deferral elections
to be made by Participants.  Deferrals by
Participants will be made in accordance with Section 409A of the Code.
Consistent with Section 409A of the Code, the Board may provide for
distributions while a Participant is still an employee.  The Board is authorized to make deferrals of
Awards and determine when, and in what annual percentages, Participants may
receive payments, including lump sum payments, following the Participant’s
termination of employment or retirement, and implement such other terms and
conditions consistent with the provisions of the Plan and in accordance with
applicable law.

 

(j)            Compliance with Section 409A.  To the extent that the Board determines that any Award
granted hereunder is subject to Section 409A of the Code, the Award
Agreement evidencing such Award shall incorporate the terms and conditions necessary to
avoid the consequences specified in Section 409A(a)(1) of the Code. 
To the extent applicable, the Plan and Award Agreements shall be
interpreted in accordance with Section 409A of the Code, including without
limitation any applicable guidance that may be issued or amended after the
Effective Date.

 

14

 

9.                                      ADJUSTMENTS UPON CHANGES IN
COMMON STOCK; OTHER CORPORATE EVENTS.

 

(a)           Capitalization Adjustments. 
In the event of a Capitalization Adjustment, the Board shall
appropriately and proportionately adjust: (i) the class(es) and maximum
number of securities subject to the Plan pursuant to Section 3(a), (ii) the
class(es) and maximum number of securities that may be issued pursuant to the
exercise of Incentive Stock Options pursuant to Section 3(c), (iii) the
class(es) and maximum number of securities that may be awarded to any person
pursuant to Section 4(c) and 6(c)(i) , and (iv) the
class(es) and number of securities and price per share of stock subject to
outstanding Stock Awards.  The Board
shall make such adjustments, and its determination shall be final, binding and
conclusive.

 

(b)           Dissolution or Liquidation. 
Except as otherwise provided in the Stock Award Agreement, in the event
of a dissolution or liquidation of the Company, all outstanding Stock Awards
(other than Stock Awards consisting of vested and outstanding shares of Common
Stock not subject to a forfeiture condition or the Company’s right of
repurchase) shall terminate immediately prior to the completion of such
dissolution or liquidation, and the shares of Common Stock subject to the
Company’s repurchase rights or subject to a forfeiture condition may be repurchased
or reacquired by the Company notwithstanding the fact that the holder of such
Stock Award is providing Continuous Service, provided,
however, that the
Board may, in its sole discretion, cause some or all Stock Awards to become
fully vested, exercisable and/or no longer subject to repurchase or forfeiture
(to the extent such Stock Awards have not previously expired or terminated)
before the dissolution or liquidation is completed but contingent on its
completion.

 

(c)           Corporate Transaction.  The following provisions shall apply to Stock Awards
in the event of a Corporate Transaction unless otherwise provided in the
instrument evidencing the Stock Award or any other written agreement between
the Company or any Affiliate and the holder of the Stock Award or unless
otherwise expressly provided by the Board at the time of grant of a Stock
Award.

 

(i)            Stock Awards May Be Assumed. 
In the event of a Corporate Transaction, any surviving corporation or
acquiring corporation (or the surviving or acquiring corporation’s parent
company) may assume or continue any or all Stock Awards outstanding under the
Plan or may substitute similar stock awards for Stock Awards outstanding under
the Plan (including but not limited to, awards to acquire the same
consideration paid to the stockholders of the Company pursuant to the Corporate
Transaction), and any reacquisition or repurchase rights held by the Company in
respect of Common Stock issued pursuant to Stock Awards may be assigned by the
Company to the successor of the Company (or the successor’s parent company, if
any), in connection with such Corporate Transaction.  A surviving corporation or acquiring
corporation (or its parent) may choose to assume or continue only a portion of
a Stock Award or substitute a similar stock award for only a portion of a Stock
Award, or may choose to assume or continue the Stock Awards held by some, but
not all Participants.  The terms of any
assumption, continuation or substitution shall be set by the Board.

 

15

 

(ii)           Stock Awards Held by Current
Participants.  In the event of a Corporate Transaction in
which the surviving corporation or acquiring corporation (or its parent
company) does not assume or continue such outstanding Stock Awards or substitute
similar stock awards for such outstanding Stock Awards, then with respect to
Stock Awards that have not been assumed, continued or substituted and that are
held by Participants whose Continuous Service has not terminated prior to the
effective time of the Corporate Transaction (referred to as the “Current Participants”),
the vesting of such Stock Awards (and, with respect to Options and Stock
Appreciation Rights, the time when such Stock Awards may be exercised) shall be
accelerated in full to a date prior to the effective time of such Corporate
Transaction (contingent upon the effectiveness of the Corporate Transaction) as
the Board shall determine (or, if the Board shall not determine such a date, to
the date that is five (5) days prior to the effective time of the
Corporate Transaction), and such Stock Awards shall terminate if not exercised
(if applicable) at or prior to the effective time of the Corporate Transaction,
and any reacquisition or repurchase rights held by the Company with respect to
such Stock Awards shall lapse (contingent upon the effectiveness of the
Corporate Transaction).

 

(iii)         Stock Awards Held by Persons other
than Current Participants.  In the event
of a Corporate Transaction in which the surviving corporation or acquiring
corporation (or its parent company) does not assume or continue such
outstanding Stock Awards or substitute similar stock awards for such
outstanding Stock Awards, then with respect to Stock Awards that have not been
assumed, continued or substituted and that are held by persons other than
Current Participants, such Stock Awards shall terminate if not exercised (if
applicable) prior to the effective time of the Corporate Transaction; provided, however, that any reacquisition or repurchase rights held by the
Company with respect to such Stock Awards shall not terminate and may continue
to be exercised notwithstanding the Corporate Transaction.

 

(d)           Change in Control.  A
Stock Award may be subject to additional acceleration of vesting and
exercisability upon or after a Change in Control as may be provided in the
Stock Award Agreement for such Stock Award or as may be provided in any other
written agreement between the Company or any Affiliate and the Participant, but
in the absence of such provision, no such acceleration shall occur.

 

10.                               TERMINATION OR SUSPENSION OF THE
PLAN.

 

(a)           Plan Term. 
The Board may suspend or terminate the Plan at any time.  Unless terminated sooner by the Board
pursuant to Section 2(b)(v), the Plan shall automatically terminate on the
day before the tenth (10th) anniversary of the earlier of (i) the date the
Plan is adopted by the Board, or (ii) the date the Plan is approved by the
stockholders of the Company.  No Awards
may be granted under the Plan while the Plan is suspended or after it is
terminated.

 

(b)           No Impairment of Rights. 
Suspension or termination of the Plan shall not impair rights and
obligations under any Award granted while the Plan is in effect except with the
written consent of the affected Participant.

 

11.                               EFFECTIVE DATE OF PLAN.

 

This Plan shall become effective on the Effective
Date.

 

16

 

12.                               CHOICE OF LAW.

 

The law of the State of California shall govern all
questions concerning the construction, validity and interpretation of this
Plan, without regard to that state’s conflict of laws rules.

 

13.                               DEFINITIONS.   As used in the Plan, the following definitions shall
apply to the capitalized terms indicated below:

 

(a)           “Affiliate”
means, at the time of determination, any “parent” or “subsidiary” of the
Company as such terms are defined in Rule 405 of the Securities Act.  The Board shall have the authority to
determine the time or times at which “parent” or “subsidiary” status is
determined within the foregoing definition.

 

(b)           “Award”
means a Stock Award or a Performance Cash Award.

 

(c)           “Award Agreement”
means a written agreement between the Company and a Participant evidencing the
terms and conditions of an Award.

 

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

 

(e)           “Capitalization Adjustment”
means any change that is made in, or other events that occur with respect to,
the Common Stock subject to the Plan or subject to any Stock Award after the
Effective Date without the receipt of consideration by the Company (through
merger, consolidation, reorganization, recapitalization, reincorporation, stock
dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or similar transaction). 
Notwithstanding the foregoing, the conversion of any convertible
securities of the Company shall not be treated as a Capitalization Adjustment.

 

(f)            “Cause”  shall have the
meaning ascribed to such term in any written agreement between the Participant
and the Company defining such term and, in the absence of such agreement, such
term shall mean, with respect to
a Participant, the occurrence of any of the following events: (i) an
intentional action or intentional failure to act by the Participant that was
performed in bad faith; (ii) a Participant’s intentional refusal or
intentional failure to act in accordance with any lawful and proper direction
or order of his or her superiors;  (iii) a
Participant’s habitual neglect of the duties of employment, which may include a
failure to perform his or her job duties satisfactorily; (iv) a
Participant’s indictment, charge, or conviction of a felony or any crime
involving moral turpitude, or participation in any act of theft or dishonesty,
regardless of whether such act has had or could reasonably be expected to have
a material detrimental effect on the business of the Company or an Affiliate;
or  (v) a Participant’s violation of
any material provision of the Company’s Proprietary Information and Inventions
Agreement or violation of any material provision of any other written  policy or procedure of the Company or an
Affiliate.  The
determination that a termination of the Participant’s Continuous Service is
either for Cause or without Cause shall be made by the Company, in its sole
discretion.  Any determination by the
Company that the Continuous Service of a Participant was terminated with or
without Cause for the purposes of outstanding Awards held by such Participant shall
have no effect upon any determination of the rights or obligations of the
Company or such Participant for any other purpose.

 

17

 

(g)           “Change in Control”
means the occurrence, in a single transaction or in a series of related
transactions, of any one or more of the following events:

 

(i)            any Exchange Act Person becomes the Owner, directly or
indirectly, of securities of the Company representing more than fifty percent (50%) of the combined voting
power of the Company’s then outstanding securities other than by virtue of a
merger, consolidation or similar transaction. 
Notwithstanding the foregoing, a
Change in Control shall not be deemed to occur (A) on account of the
acquisition of securities of the Company directly from the Company, (B) on
account of the acquisition of securities of the Company by an investor, any
affiliate thereof or any other Exchange Act Person that acquires the Company’s
securities in a transaction or series of related transactions the primary
purpose of which is to obtain financing for the Company through the issuance of
equity securities, or (C) solely because the level of Ownership held by
any Exchange Act Person (the “Subject Person”) exceeds the designated percentage threshold of the outstanding voting
securities as a result of a repurchase or other acquisition of voting
securities by the Company reducing the number of shares outstanding, provided
that if a Change in Control would occur (but for the operation of this
sentence) as a result of the acquisition of voting securities by the Company,
and after such share acquisition, the Subject Person becomes the Owner of any
additional voting securities that, assuming the repurchase or other acquisition
had not occurred, increases the percentage of the then outstanding voting securities
Owned by the Subject Person over the designated percentage threshold, then a
Change in Control shall be deemed to occur;

 

(ii)           there is consummated a merger, consolidation or
similar transaction involving (directly or indirectly) the Company and,
immediately after the consummation of such merger, consolidation or similar
transaction, the stockholders of the Company immediately prior thereto do not
Own, directly or indirectly, either (A) outstanding voting securities
representing more than fifty percent
(50%) of the combined outstanding voting power of the surviving Entity
in such merger, consolidation or similar transaction or (B) more than
fifty percent (50%) of the
combined outstanding voting power of the parent of the surviving Entity in such
merger, consolidation or similar transaction, in each case in substantially the
same proportions as their Ownership of the outstanding voting securities of the
Company immediately prior to such transaction;

 

(iii)         the stockholders of the Company approve or the Board
approves a plan of complete dissolution or liquidation of the Company, or a
complete dissolution or liquidation of the Company shall otherwise occur,
except for a liquidation into a parent corporation; or

 

(iv)          there is consummated a sale, lease, exclusive license
or other disposition of all or substantially all of the consolidated assets of
the Company and its Subsidiaries, other than a sale, lease, license or other
disposition of all or substantially all of the consolidated assets of the Company
and its Subsidiaries to an Entity, more than fifty percent (50%) of the combined voting power of the voting
securities of which are Owned by stockholders of the Company in substantially
the same proportions as their Ownership of the outstanding voting securities of
the Company immediately prior to such sale, lease, license or other
disposition.

 

18

 

Notwithstanding the foregoing or any other provision
of this Plan, the term Change in Control shall not include a sale of assets,
merger or other transaction effected exclusively for the purpose of changing
the domicile of the Company.

 

(h)           “Code” means
the Internal Revenue Code of 1986, as amended, including any applicable
regulations and guidance thereunder.

 

(i)            “Committee”
means a committee of one or more Directors to whom authority has been delegated
by the Board in accordance with Section 2(c).

 

(j)            “Common Stock”
means the common stock of the Company.

 

(k)           “Company”
means Omnicell, Inc., a Delaware corporation.

 

(l)            “Consultant” means any person, including an advisor,
who is (i) engaged by the Company or an Affiliate to render consulting or
advisory services and is compensated for such services, or (ii) serving as
a member of the board of directors of an Affiliate and is compensated for such
services.  However, service solely as a
Director, or payment of a fee for such service, shall not cause a Director to
be considered a “Consultant” for purposes of the Plan.  Notwithstanding
the foregoing, a person is treated as a Consultant under this Plan only if a Form S-8
Registration Statement under the Securities Act is available to register the
sale of the Company’s securities to such person.

 

(m)          “Continuous Service”
means that the Participant’s service with the Company or an Affiliate, whether
as an Employee, Director or Consultant, is not interrupted or terminated.  A change in the capacity in which the Participant
renders service to the Company or an Affiliate as an Employee, Consultant or
Director or a change in the entity for which the Participant renders such
service, provided that there is no interruption or termination of the
Participant’s service with the Company or an Affiliate, shall not terminate a
Participant’s Continuous Service; provided, however, if
the Entity for which a Participant is rendering services ceases to qualify as
an Affiliate, as determined by the Board in its sole discretion, such Participant’s
Continuous Service shall be considered to have terminated on the date such
Entity ceases to qualify as an Affiliate. 
To the extent permitted by law, the Board or the chief executive officer
of the Company, in that party’s sole discretion, may determine whether
Continuous Service shall be considered interrupted in the case of (i) any
leave of absence approved by the Board or Chief Executive Officer, including
sick leave, military leave or any other personal leave, or (ii) transfers
between the Company, an Affiliate, or their successors.  Notwithstanding the foregoing, a leave of
absence shall be treated as Continuous Service for purposes of vesting in a
Stock Award only to such extent as may be provided in the Company’s leave of
absence policy, in the written terms of any leave of absence agreement or
policy applicable to the Participant, or as otherwise required by law.

 

(n)           “Corporate Transaction”
means the occurrence, in a single transaction or in a series of related
transactions, of any one or more of the following events:

 

(i)            the consummation of a sale  or
other disposition of all or substantially all, as determined by the Board in
its sole discretion, of the consolidated assets of the Company and its
Subsidiaries;

 

19

 

(ii)           the consummation of a sale or other disposition of at
least ninety percent (90%) of
the outstanding securities of the Company;

 

(iii)         the consummation of a merger, consolidation or similar
transaction following which the Company is not the surviving corporation; or

 

(iv)          the consummation of a merger, consolidation or similar
transaction following which the Company is the surviving corporation but the
shares of Common Stock outstanding immediately preceding the merger, consolidation
or similar transaction are converted or exchanged by virtue of the merger,
consolidation or similar transaction into other property, whether in the form
of securities, cash or otherwise.

 

(o)           “Covered Employee”
shall have the meaning provided in Section 162(m)(3) of the Code.

 

(p)           “Director”
means a member of the Board.

 

(q)           “Disability”
means, with respect to a Participant, 
the inability of such Participant to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment
which can be expected to result in death or which has lasted or can be expected
to last for a continuous period of not less than twelve (12) months, as
provided in Sections 22(e)(3) and 409A(a)(2)(c)(i) of the Code, and
shall be determined by the Board on the basis of such medical evidence as the
Board deems warranted under the circumstances.

 

(r)           “Effective
Date” means the effective date of this Plan document, which is
the date after the annual meeting of stockholders of the Company held in 2009
provided this Plan is approved by the Company’s stockholders at such meeting.

 

(s)           “Employee” means any person employed by the Company
or an Affiliate.  However, service solely
as a Director, or payment of a fee for such services, shall not cause a
Director to be considered an “Employee” for purposes of the Plan.

 

(t)            “Entity”
means a corporation, partnership, limited liability company or other entity.

 

(u)           “Exchange Act”
means the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.

 

(v)            “Exchange Act Person”  means any natural person, Entity or
“group” (within the meaning of Section 13(d) or 14(d) of the
Exchange Act), except that “Exchange Act Person” shall not include (i) the
Company or any Subsidiary of the Company, (ii) any employee benefit plan
of the Company or any Subsidiary of the Company or any trustee or other
fiduciary holding securities under an employee benefit plan of the Company or
any Subsidiary of the Company, (iii) an underwriter temporarily holding
securities pursuant to a registered public offering of such securities, (iv) an
Entity Owned, directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their Ownership of stock of the Company;
or (v) any natural person, Entity or “group” (within the meaning of Section 13(d) or
14(d) of the Exchange Act) that, as of the Effective Date, is the Owner,
directly or indirectly, of securities of the Company representing more than
fifty percent (50%) of the combined voting power of the Company’s then
outstanding securities.

 

20

 

(w)           “Fair Market Value”
means, as of any date, the value of the Common Stock determined as follows:

 

(i)            If the Common Stock is listed on any established stock
exchange or traded on any established market, the Fair Market Value of a share
of Common Stock shall be the closing sales price for such stock as quoted on
such exchange or market (or the exchange or market with the greatest volume of
trading in the Common Stock) on the date of determination, as reported in  a
source the Board deems reliable.

 

(ii)           Unless otherwise provided by the Board, if there is no
closing sales price for the Common Stock on the date of determination, then the
Fair Market Value shall be the closing selling price on the last preceding date
for which such quotation exists.

 

(iii)         In the absence of such markets for the Common Stock,
the Fair Market Value shall be determined by the Board in good faith and in a manner
that complies with Sections 409A and 422 of the Code.

 

(x)           “Incentive Stock Option”
means an option granted pursuant to Section 5 of the Plan that is intended
to be, and qualifies as, an “incentive stock option” within the meaning of Section 422
of the Code.

 

(y)           “Non-Employee Director”  means a Director who either (i) is not a current
employee or officer of the Company or an Affiliate, does not receive
compensation, either directly or indirectly, from the Company or an Affiliate
for services rendered as a consultant or in any capacity other than as a
Director (except for an amount as to which disclosure would not be required
under Item 404(a) of Regulation S-K promulgated pursuant to the Securities
Act (“Regulation S-K”)),
does not possess an interest in any other transaction for which disclosure
would be required under Item 404(a) of Regulation S-K, and is not engaged
in a business relationship for which disclosure would be required pursuant to
Item 404(b) of Regulation S-K; or (ii) is otherwise considered a
“non-employee director” for purposes of Rule 16b-3.

 

(z)           “Nonstatutory Stock Option”
means any option granted pursuant to Section 5 of the Plan that does not
qualify as an Incentive Stock Option.

 

(aa)         “Officer”
means a person who is an officer of the Company within the meaning of Section 16
of the Exchange Act.

 

(bb)         “Option”
means an Incentive Stock Option or a Nonstatutory Stock Option to purchase
shares of Common Stock granted pursuant to the Plan.

 

(cc)         “Option Agreement”
means a written agreement between the Company and an Optionholder evidencing
the terms and conditions of an Option grant. 
Each Option Agreement shall be subject to the terms and conditions of
the Plan.

 

21

 

(dd)         “Optionholder”
means a person to whom an Option is granted pursuant to the Plan or, if
applicable, such other person who holds an outstanding Option.

 

(ee)         “Other Stock Award” means an award based in whole or in part
by reference to the Common Stock which is granted pursuant to the terms and
conditions of Section 6(d).

 

(ff)           “Other Stock Award Agreement”  means a written agreement between the
Company and a holder of an Other Stock Award evidencing the terms and
conditions of an Other Stock Award grant. 
Each Other Stock Award Agreement shall be subject to the terms and
conditions of the Plan.

 

(gg)         “Outside Director”
means a Director who either (i) is not a current employee of the Company
or an “affiliated corporation” (within the meaning of Treasury Regulations
promulgated under Section 162(m) of the Code), is not a former
employee of the Company or an “affiliated corporation” who receives
compensation for prior services (other than benefits under a tax-qualified
retirement plan) during the taxable year, has not been an officer of the
Company or an “affiliated corporation,” and does not receive remuneration from
the Company or an “affiliated corporation,” either directly or indirectly, in
any capacity other than as a Director, or (ii) is otherwise considered an “outside
director” for purposes of Section 162(m) of the Code.

 

(hh)         “Own,”  “Owned,”  “Owner,”  “Ownership”  A person or Entity
shall be deemed to “Own,” to have “Owned,” to be the “Owner” of, or to have
acquired “Ownership” of securities if such person or Entity, directly or
indirectly, through any contract, arrangement, understanding, relationship or
otherwise, has or shares voting power, which includes the power to vote or to
direct the voting, with respect to such securities.

 

(ii)           “Participant”
means a person to whom an Award is granted pursuant to the Plan or, if
applicable, such other person who holds an outstanding Stock Award.

 

(jj)           “Performance Cash Award”
means an award of cash granted pursuant to the terms and conditions of Section 6(c)(ii).

 

(kk)        “Performance Criteria” means the one or more criteria that the
Board shall select for purposes of establishing the Performance Goals for a
Performance Period.  The Performance
Criteria that shall be used to establish such Performance Goals may be based on
any one of, or combination of, the following as determined by the Board: (i) earnings
(including earnings per share and net earnings); (ii) earnings before
interest, taxes and depreciation; (iii) earnings before interest, taxes,
depreciation and amortization; (iv) total stockholder return; (v) return
on equity or average stockholder’s equity; (vi) return on assets,
investment, or capital employed; (vii) stock price; (viii) margin
(including gross margin); (ix) income (before or after taxes); (x) operating
income; (xi) operating income after taxes; (xii) pre-tax profit; (xiii)
operating cash flow; (xiv) sales, backlog or revenue targets; (xv) increases in
revenue or product revenue; (xvi) expenses and cost reduction, or other
budgetary goals; (xvii) improvement in or attainment of working capital levels;
(xiii) economic value added (or an equivalent metric); (xix) market share; (xx)
cash flow; (xxi) cash flow per share; (xxii) share price performance; (xxiii)
debt reduction; (xxiv) implementation or completion of projects or processes;
(xxv) customer satisfaction, service, or 
personal visitations; (xxvi) stockholders’ equity; (xxvii) capital
expenditures; (xxiii) debt levels; 

 

22

 

(xxix)
operating profit or net operating profit; (xxx) workforce diversity; (xxxi)
growth of net income or operating income; (xxxii) billings; (xxxiii) completion
of strategic, business, development, financial, employee or integration plan
(or equivalent type of plan); (xxxiv) manufacturing, production, research and
development, product launch or product objective goals; (xxxvi) litigation,
arbitration or other conflict achievements or resolutions; (xxxvii) hiring or
reduction in headcount; (xxxviii) timely completion of internal and external
analysis, or audits; (xxxix) completion of Performance Goals by direct reports;
and (xl) to the extent that an Award is not intended to comply with Section 162(m) of
the Code, other measures of performance selected by the Board.

 

(ll)           “Performance Goals” means, for a Performance Period, the one
or more goals established by the Board for the Performance Period based upon
the Performance Criteria.  Performance
Goals may be based on a Company-wide basis, with respect to one or more
business units, divisions, Affiliates, or business segments, and in either
absolute terms or relative to the performance of one or more
comparable companies or the performance of one or more relevant indices.  Unless specified otherwise by the Board in
the Award Agreement at the time the Award is granted or other terms setting
forth the Performance Goals at the time the Performance Goals are established,
the Board shall appropriately make adjustments in the method of calculating the
attainment of Performance Goals for a Performance Period as follows: (i) to
exclude restructuring and/or other nonrecurring charges; (ii) to exclude
exchange rate effects, as applicable, for non-U.S. dollar denominated net sales and operating
earnings; (iii) to exclude the effects of changes to generally accepted
accounting principles; (iv) to exclude the effects of any statutory
adjustments to corporate tax rates; and (v) to exclude the effects of any “extraordinary
items” as determined under generally accepted accounting principles.  In addition, the Board retains the discretion
to reduce or eliminate the compensation or economic benefit due upon attainment
of Performance Goals and to define the manner of calculating the Performance
Criteria it selects to use for such Performance Period. Partial achievement of
the specified criteria may result in the payment or vesting corresponding to
the degree of achievement as specified in the Stock Award Agreement or the
written terms of a Performance Cash Award.

 

(mm)       “Performance Period” means the period of time selected by the
Board over which the attainment of one or more Performance Goals will be
measured for the purpose of determining a Participant’s right to and the
payment of a Stock Award or a Performance Cash Award.  Performance Periods may be of varying and
overlapping duration, at the sole discretion of the Board.

 

(nn)         “Performance Stock Award”
means a Stock Award granted under the terms and conditions of Section 6(c)(i).

 

(oo)         “Plan” means
this Omnicell, Inc. 2009 Equity Incentive Plan.

 

(pp)         “Restricted Stock Award” means an award of shares of Common Stock
which is granted pursuant to the terms and conditions of Section 0.

 

(qq)         “Restricted Stock Award Agreement” means a written agreement between the
Company and a holder of a Restricted Stock Award evidencing the terms and
conditions of a Restricted Stock Award grant. 
Each Restricted Stock Award Agreement shall be subject to the terms and
conditions of the Plan.

 

23

 

(rr)         “Restricted Stock Unit Award”  means a right to receive shares of Common
Stock which is granted pursuant to the terms and conditions of Section 6(b).

 

(ss)         “Restricted Stock Unit Award
Agreement”
means
a written agreement between the Company and a holder of a Restricted Stock Unit
Award evidencing the terms and conditions of a Restricted Stock Unit Award
grant.  Each Restricted Stock Unit Award
Agreement shall be subject to the terms and conditions of the Plan.

 

(tt)           “Rule 16b-3”
means Rule 16b-3 promulgated under the Exchange Act or any successor to Rule 16b-3,
as in effect from time to time.

 

(uu)         “Securities Act”
means the Securities Act of 1933, as amended.

 

(vv)          “Stock Appreciation Right” or “SAR”  means a right to receive the
appreciation on Common Stock that is granted pursuant to the terms and conditions
of Section 5.

 

(ww)        “Stock Appreciation Right Agreement” means a written agreement between the
Company and a holder of a Stock Appreciation Right evidencing the terms and
conditions of a Stock Appreciation Right grant. 
Each Stock Appreciation Right Agreement shall be subject to the terms
and conditions of the Plan.

 

(xx)         “Stock Award” means any right to receive Common Stock
granted under the Plan, including an Incentive Stock Option, a Nonstatutory
Stock Option, a Restricted Stock Award, a Restricted Stock Unit Award, a Stock
Appreciation Right, a Performance Stock Award or any Other Stock Award.

 

(yy)         “Stock Award Agreement” means a written agreement between the
Company and a Participant evidencing the terms and conditions of a Stock Award
grant.  Each Stock Award Agreement shall
be subject to the terms and conditions of the Plan.

 

(zz)         “Subsidiary”
means, with respect to the Company, (i) any corporation of which more than
fifty percent (50%) of the outstanding capital stock having ordinary voting
power to elect a majority of the board of directors of such corporation
(irrespective of whether, at the time, stock of any other class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time, directly or indirectly, Owned by
the Company, and (ii) any partnership, limited liability company
or other entity in
which the Company has a direct or indirect interest (whether in the form of
voting or participation in profits or capital contribution) of more than fifty
percent (50%).

 

(aaa)       “Ten Percent Stockholder”
means a person who Owns (or is deemed to Own pursuant to Section 424(d) of
the Code) stock possessing more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company or any Affiliate.

 

24EXHIBIT 10.1

 

AMENDMENT TO SEVERANCE AGREEMENT AND GENERAL
RELEASE

 

This is a an amendment to the Severance Agreement and
General Release  by and between Michael
A. Jessee (“Mr. Jessee”)  and
Federal Home Loan Bank of Boston (“FHLBB” or “the Employer”), dated December 31,
2008 (“the Agreement”), and is made pursuant to paragraph 14 of the
Agreement.  The Agreement and the
Amendment shall be referred to as “the Amended Agreement.”

 

As a result of an order issued by the Federal Housing
Finance Agency, James B. Lockhart III, Director, on April 28, 2009
regarding the amount of severance and benefits that FHLBB is permitted to pay Mr. Jessee,
the Agreement is hereby modified as set forth below.   All other terms of the Agreement remain in
full force and effect.

 

1.               Paragraph 8(c) is hereby amended as
follows:

 

During the twelve (12)
months from May 1, 2009 through April 30, 2010 (the “severance pay
period”), FHLBB shall provide Mr. Jessee with salary continuation at his
current base rate of pay.  The severance
payments shall be paid through FHLBB’s normal payroll, minus normal deductions
for taxes.  Should Mr. Jessee die
during the severance pay period, all unpaid amounts shall be paid to his
estate.  Mr. Jessee shall not accrue
any benefits during the severance pay period.

 

2.             Paragraph
8(e) is stricken from the Agreement. 
Mr. Jessee is not eligible for a 2008 bonus and was not paid a 2008
bonus.

 

3.             In accordance with paragraph 15 of
the Agreement, Mr. Jessee has up to 21 days to consider the Amended
Agreement before executing it, although he has the right to take less time
should he choose to do so.  Mr. Jessee
also has the right to revoke the Amended Agreement within seven (7) days
after executing this Amended Agreement, the Workers Compensation Statement
(attached as Exhibit B to the Agreement), and the General Release
(attached as Exhibit C to the Agreement). Any such revocation must be in
writing and written notice shall be provided to Ellen McLaughlin, Sr. Vice
President and General Counsel, Federal Home Loan 

 

 

Bank Boston.  The Amended Agreement, including the Workers
Compensation Statement and General Release, shall not become effective or
enforceable until the expiration of the revocation period, and no payments or
actions called for by FHLBB under the Amended Agreement shall be made until the
expiration of such revocation period.

 

4.             If any provision of this Amended
Agreement, or any portion thereof, is found to be invalid, illegal, or
unenforceable under any applicable statute, administrative order, or rule of
law, then such provision or portion therefore shall be deemed omitted, and the
validity, legality and enforceability of the remaining provisions of this
Amended Agreement shall not in any way be affected or impaired.

 

	
   

  	
   

  	
  Federal Home Loan Bank of
  Boston

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Michael A. Jessee

  	
   

  	
  /s/ Jan Miller

  
	
  Michael A. Jessee

  	
   

  	
  Jan Miller, Chairman of
  the Board

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Date: April 30, 2009

  	
   

  	
  Date: April 30, 2009

  

 

2

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