Document:

2007 New Employee Stock Incentive Plan

 Exhibit 10.1 
 BLUE COAT SYSTEMS, INC. 
 2007
NEW EMPLOYEE STOCK INCENTIVE PLAN 
 (AS
ADOPTED EFFECTIVE JUNE 12, 2007) 

 TABLE OF CONTENTS 
  

					
	 	  	 	  	Page
	 ARTICLE 1.
	  	 INTRODUCTION
	  	1
			
	 ARTICLE 2.
	  	ADMINISTRATION	  	1
	 2.1
	  	Committee Composition	  	1
	 2.2
	  	Committee Responsibilities	  	1
	 2.3
	  	Committee for Non-Officer Grants	  	2
			
	 ARTICLE 3.
	  	SHARES AVAILABLE FOR GRANTS	  	2
	 3.1
	  	Basic Limitation	  	2
	 3.2
	  	Shares Returned to Reserve	  	2
	 3.3
	  	Dividend Equivalents	  	2
			
	 ARTICLE 4.
	  	ELIGIBILITY	  	2
			
	 ARTICLE 5.
	  	OPTIONS	  	2
	 5.1
	  	Stock Option Agreement	  	2
	 5.2
	  	Number of Shares	  	3
	 5.3
	  	Exercise Price	  	3
	 5.4
	  	Exercisability and Term	  	3
	 5.5
	  	Modification or Assumption of Options	  	3
	 5.6
	  	Buyout Provisions	  	3
			
	 ARTICLE 6.
	  	PAYMENT FOR OPTION SHARES	  	3
	 6.1
	  	General Rule	  	3
	 6.2
	  	Surrender of Stock	  	3
	 6.3
	  	Net Exercise	  	3
	 6.4
	  	Exercise/Sale	  	4
	 6.5
	  	Other Forms of Payment	  	4
			
	 ARTICLE 7.
	  	RESTRICTED SHARES	  	4
	 7.1
	  	Restricted Stock Agreement	  	4
	 7.2
	  	Payment for Awards	  	4
	 7.3
	  	Vesting Conditions	  	4
	 7.4
	  	Voting and Dividend Rights	  	4
			
	 ARTICLE 8.
	  	STOCK UNITS	  	4
	 8.1
	  	Stock Unit Agreement	  	4
	 8.2
	  	Payment for Awards	  	5
	 8.3
	  	Vesting Conditions	  	5
	 8.4
	  	Voting and Dividend Rights	  	5
	 8.5
	  	Form and Time of Settlement of Stock Units	  	5
	 8.6
	  	Death of Recipient	  	5
	 8.7
	  	Creditors’ Rights	  	5

  

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	 ARTICLE 9.
	  	CHANGE IN CONTROL	  	6
	 9.1
	  	Effect of Change in Control	  	6
	 9.2
	  	Involuntary Termination	  	6
			
	 ARTICLE 10.
	  	PROTECTION AGAINST DILUTION	  	6
	 10.1
	  	Adjustments	  	6
	 10.2
	  	Dissolution or Liquidation	  	7
	 10.3
	  	Reorganizations	  	7
			
	 ARTICLE 11.
	  	AWARDS UNDER OTHER PLANS	  	7
			
	 ARTICLE 12.
	  	LIMITATION ON RIGHTS	  	7
	 12.1
	  	Retention Rights	  	7
	 12.2
	  	Stockholders’ Rights	  	7
	 12.3
	  	Regulatory Requirements	  	7
			
	 ARTICLE 13.
	  	WITHHOLDING TAXES	  	8
	 13.1
	  	General	  	8
	 13.2
	  	Share Withholding	  	8
			
	 ARTICLE 14.
	  	LIMITATION ON PAYMENTS	  	8
	 14.1
	  	Scope of Limitation	  	8
	 14.2
	  	Basic Rule	  	8
	 14.3
	  	Reduction of Payments	  	8
	 14.4
	  	Overpayments and Underpayments	  	9
	 14.5
	  	Related Corporations	  	9
			
	 ARTICLE 15.
	  	FUTURE OF THE PLAN	  	9
	 15.1
	  	Term of the Plan	  	9
	 15.2
	  	Amendment or Termination	  	9
	 15.3
	  	Stockholder Approval	  	10
			
	 ARTICLE 16.
	  	DEFINITIONS	  	10

  

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 BLUE COAT SYSTEMS, INC. 
 2007 NEW EMPLOYEE STOCK INCENTIVE PLAN 
 ARTICLE 1. INTRODUCTION. 
 The Plan
was adopted by the Board on June 12, 2007. The purpose of the Plan is to promote the long-term success of the Company and the creation of stockholder value by (a) encouraging Employees to focus on critical long-range objectives,
(b) encouraging the attraction and retention of Employees with exceptional qualifications and (c) linking Employees s directly to stockholder interests through increased stock ownership. The Plan seeks to achieve this purpose by providing
for Awards in the form of Restricted Shares, Stock Units, or Options (which shall be NSOs). 
 The Plan is designed to attract new employees
and is intended to satisfy the requirements of Nasdaq Marketplace Rule 4350. 
 The Plan shall be governed by, and construed in accordance
with, the laws of the State of Delaware (except their choice-of-law provisions). 
 ARTICLE 2. ADMINISTRATION. 
 2.1 Committee Composition. The Committee shall administer the Plan. The Committee shall consist exclusively of two or more directors of the
Company, who shall be appointed by the Board. In addition, each member of the Committee shall meet the following requirements: 
 (a) Any listing standards prescribed by the principal securities market on which the Company’s equity securities are traded; 
 (b) Such requirements as the Securities and Exchange Commission may establish for administrators acting under plans intended to qualify for exemption under Rule 16b-3 (or its successor) under the Exchange Act; and

 (c) Any other requirements imposed by applicable law, regulations or rules. 
 2.2 Committee Responsibilities. The Committee shall (a) select the Employees who are to receive Awards under the Plan, (b) determine the
type, number, vesting requirements and other features and conditions of such Awards, (c) interpret the Plan, (d) make all other decisions relating to the operation of the Plan and (e) carry out any other duties delegated to it by the
Board. The Committee may adopt such rules or guidelines as it deems appropriate to implement the Plan. The Committee’s determinations under the Plan shall be final and binding on all persons. 

 2.3 Committee for Non-Officer Grants. The Board may also appoint a secondary committee of the
Board, which shall be composed of one or more directors of the Company who need not satisfy the requirements of Section 2.1. Such secondary committee may administer the Plan with respect to Employees who are not considered executive officers of
the Company under section 16 of the Exchange Act, may grant Awards under the Plan to such Employees and may determine all features and conditions of such Awards. Within the limitations of this Section 2.3, any reference in the Plan to the
Committee shall include such secondary committee. 
 ARTICLE 3. SHARES AVAILABLE FOR GRANTS. 
 3.1 Basic Limitation. Common Shares issued pursuant to the Plan may be authorized but unissued shares or treasury shares. The aggregate number of
Common Shares issued under the Plan shall not exceed (a) 400,000 plus (b) the additional Common Shares described in Section 3.2. The number of Common Shares that are subject to Awards outstanding at any time under the Plan shall not
exceed the number of Common Shares that then remain available for issuance under the Plan. The limitations of this Section 3.1 shall be subject to adjustment pursuant to Article 10. 
 3.2 Shares Returned to Reserve. If Options or Stock Units are forfeited or terminate for any other reason before being exercised or settled, then
the Common Shares subject to such Options or Stock Units shall again become available for issuance under the Plan. If Stock Units are settled, then only the number of Common Shares (if any) actually issued in settlement of such Stock Units shall
reduce the number available under Section 3.1 and the balance shall again become available for issuance under the Plan. If Restricted Shares or Common Shares issued upon the exercise of Options are reacquired by the Company pursuant to a
forfeiture provision or for any other reason, then such Common Shares shall again become available for issuance under the Plan. 
 3.3
Dividend Equivalents. Any dividend equivalents paid or credited under the Plan shall not be applied against the number of Common Shares that may be issued under the Plan, whether or not such dividend equivalents are converted into Stock Units.

 ARTICLE 4. ELIGIBILITY. 
 Only Employees shall be eligible for the grant of Restricted Shares, Stock Units, or NSOs. 
 ARTICLE 5. OPTIONS. 

5.1 Stock Option Agreement. Each grant of an Option under the Plan shall be evidenced by a Stock Option Agreement between the Optionee and the
Company. Such Option shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The provisions of the various Stock Option Agreements entered into under the Plan need not be
identical. Options may be granted in consideration of a reduction in the Optionee’s other compensation. A Stock Option Agreement may provide that a new Option will be granted automatically to the Optionee when he or she exercises a prior Option
and pays the Exercise Price in the form described in Section 6.2. 
  

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 5.2 Number of Shares. Each Stock Option Agreement shall specify the number of Common Shares
subject to the Option and shall provide for the adjustment of such number in accordance with Article 10. 
 5.3 Exercise Price.
Each Stock Option Agreement shall specify the Exercise Price; provided that the Exercise Price shall in no event be less than 100% of the Fair Market Value of a Common Share on the date of grant. 
 5.4 Exercisability and Term. Each Stock Option Agreement shall specify the date or event when all or any installment of the Option is to become
exercisable. The Stock Option Agreement shall also specify the term of the Option. A Stock Option Agreement may provide for accelerated exercisability in the event of the Optionee’s death, disability or retirement or other events and may
provide for expiration prior to the end of its term in the event of the termination of the Optionee’s Service. 
 5.5 Modification or
Assumption of Options. Within the limitations of the Plan, the Committee may modify, reprice, extend or assume outstanding options or may accept the cancellation of outstanding options (whether granted by the Company or by another issuer) in
return for the grant of new options for the same or a different number of shares and at the same or a different exercise price. The foregoing notwithstanding, no modification of an Option shall, without the consent of the Optionee, alter or impair
his or her rights or obligations under such Option. 
 5.6 Buyout Provisions. The Committee may at any time (a) offer to buy out
for a payment in cash or cash equivalents an Option previously granted or (b) authorize an Optionee to elect to cash out an Option previously granted, in either case at such time and based upon such terms and conditions as the Committee shall
establish. 
 ARTICLE 6. PAYMENT FOR OPTION SHARES. 
 6.1 General Rule. The entire Exercise Price of Common Shares issued upon exercise of Options shall be payable in cash or cash equivalents at the time when such Common Shares are purchased, except that the
Committee at its sole discretion may accept payment of the Exercise Price in any other form(s) described in this Article 6. However, if the Optionee is an executive officer of the Company, he or she may pay the Exercise Price in a form other
than cash or cash equivalents only to the extent permitted by section 13(k) of the Exchange Act. 
 6.2 Surrender of Stock. With
the Committee’s consent, all or any part of the Exercise Price may be paid by surrendering, or attesting to the ownership of, Common Shares that are already owned by the Optionee. Such Common Shares shall be valued at their Fair Market Value on
the date when the new Common Shares are purchased under the Plan. 
 6.3 Net Exercise. With the Committee’s consent, all or any
part of the Exercise Price may be paid by requesting that the Company withhold Common Shares that otherwise would be issued in connection with the Option exercise. Such Common Shares shall be valued at their Fair Market Value on the date when the
Option is exercised. 
  

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 6.4 Exercise/Sale. With the Committee’s consent, all or any part of the Exercise Price and
any withholding taxes may be paid by delivering (on a form prescribed by the Company) an irrevocable direction to a securities broker approved by the Company to sell all or part of the Common Shares being purchased under the Plan and to deliver all
or part of the sales proceeds to the Company. 
 6.5 Other Forms of Payment. With the Committee’s consent, all or any part of the
Exercise Price and any withholding taxes may be paid in any other form that is consistent with applicable laws, regulations and rules. 
 ARTICLE 7. RESTRICTED SHARES. 
 7.1 Restricted Stock Agreement. Each grant of Restricted Shares under the Plan shall
be evidenced by a Restricted Stock Agreement between the recipient and the Company. Such Restricted Shares shall be subject to all applicable terms of the Plan and may be subject to any other terms that are not inconsistent with the Plan. The
provisions of the various Restricted Stock Agreements entered into under the Plan need not be identical. 
 7.2 Payment for Awards.
Restricted Shares may be sold or awarded under the Plan for such consideration as the Committee may determine, including (without limitation) cash, cash equivalents, property, full-recourse promissory notes, past services and future services. If the
Participant is an executive officer of the Company, he or she may pay for Restricted Shares with a promissory note only to the extent permitted by section 13(k) of the Exchange Act. Within the limitations of the Plan, the Committee may accept
the cancellation of outstanding options in return for the grant of Restricted Shares. 
 7.3 Vesting Conditions. Each Award of
Restricted Shares may or may not be subject to vesting. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Restricted Stock Agreement. A Restricted Stock Agreement may provide for accelerated
vesting in the event of the Participant’s death, disability or retirement or other events. 
 7.4 Voting and Dividend Rights. The
holders of Restricted Shares awarded under the Plan shall have the same voting, dividend and other rights as the Company’s other stockholders. A Restricted Stock Agreement, however, may require that the holders of Restricted Shares invest any
cash dividends received in additional Restricted Shares. Such additional Restricted Shares shall be subject to the same conditions and restrictions as the Award with respect to which the dividends were paid. 
 ARTICLE 8. STOCK UNITS. 
 8.1 Stock
Unit Agreement. Each grant of Stock Units under the Plan shall be evidenced by a Stock Unit Agreement between the recipient and the Company. Such Stock Units shall be subject to all applicable terms of the Plan and may be subject to any other
terms that are not inconsistent with the Plan. The provisions of the various Stock Unit Agreements entered into under the Plan need not be identical. Stock Units may be granted in consideration of a reduction in the recipient’s other
compensation. 
  

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 8.2 Payment for Awards. To the extent that an Award is granted in the form of Stock Units, no cash
consideration shall be required of the Award recipients. 
 8.3 Vesting Conditions. Each Award of Stock Units may or may not be
subject to vesting. Vesting shall occur, in full or in installments, upon satisfaction of the conditions specified in the Stock Unit Agreement. A Stock Unit Agreement may provide for accelerated vesting in the event of the Participant’s death,
disability or retirement or other events. 
 8.4 Voting and Dividend Rights. The holders of Stock Units shall have no voting rights.
Prior to settlement or forfeiture, any Stock Unit awarded under the Plan may, at the Committee’s discretion, carry with it a right to dividend equivalents. Such right entitles the holder to be credited with an amount equal to all cash dividends
paid on one Common Share while the Stock Unit is outstanding. Dividend equivalents may be converted into additional Stock Units. Settlement of dividend equivalents may be made in the form of cash, in the form of Common Shares, or in a combination of
both. Prior to distribution, any dividend equivalents that are not paid shall be subject to the same conditions and restrictions as the Stock Units to which they attach. 
 8.5 Form and Time of Settlement of Stock Units. Settlement of vested Stock Units may be made in the form of (a) cash, (b) Common Shares or (c) any combination of both, as determined by the
Committee. The actual number of Stock Units eligible for settlement may be larger or smaller than the number included in the original Award, based on predetermined performance factors. Methods of converting Stock Units into cash may include (without
limitation) a method based on the average Fair Market Value of Common Shares over a series of trading days. Vested Stock Units may be settled in a lump sum or in installments. The distribution may occur or commence when all vesting conditions
applicable to the Stock Units have been satisfied or have lapsed, or it may be deferred to any later date. The amount of a deferred distribution may be increased by an interest factor or by dividend equivalents. Until an Award of Stock Units is
settled, the number of such Stock Units shall be subject to adjustment pursuant to Article 10. 
 8.6 Death of Recipient. Any
Stock Units Award that becomes payable after the recipient’s death shall be distributed to the recipient’s beneficiary or beneficiaries. Each recipient of a Stock Units Award under the Plan shall designate one or more beneficiaries for
this purpose by filing the prescribed form with the Company. A beneficiary designation may be changed by filing the prescribed form with the Company at any time before the Award recipient’s death. If no beneficiary was designated or if no
designated beneficiary survives the Award recipient, then any Stock Units Award that becomes payable after the recipient’s death shall be distributed to the recipient’s estate. 
 8.7 Creditors’ Rights. A holder of Stock Units shall have no rights other than those of a general creditor of the Company. Stock Units
represent an unfunded and unsecured obligation of the Company, subject to the terms and conditions of the applicable Stock Unit Agreement. 
  

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 ARTICLE 9. CHANGE IN CONTROL 
 9.1 Effect of Change in Control. In the event of any Change in Control, each outstanding Award shall automatically accelerate so that each such
Award shall, immediately prior to the effective date of the Change in Control, become fully exercisable for all of the Common Shares at the time subject to such Award and may be exercised for any or all of those shares as fully-vested Common Shares.
However, an outstanding Award shall not so accelerate if and to the extent such Award is, in connection with the Change in Control, either to be assumed by the successor corporation (or parent thereof) or to be replaced with a comparable Award for
shares of the capital stock of the successor corporation (or parent thereof). The determination of Award comparability shall be made by the Board of Directors, and its determination shall be final, binding and conclusive. 
 9.2 Involuntary Termination. In addition, in the event that the Award is assumed by the successor corporation (or parent thereof) and the
Participant experiences an Involuntary Termination within eighteen months following a Change in Control, each outstanding Award shall automatically accelerate so that each such Award shall, immediately prior to the effective date of the Involuntary
Termination, become fully exercisable for all of the Common Shares at the time subject to such Award and may be exercised for any or all of those shares as fully-vested Common Shares. 
 ARTICLE 10. PROTECTION AGAINST DILUTION. 
 10.1 Adjustments. In the event of a subdivision of the outstanding Common Shares, a declaration of a dividend payable in Common Shares or a combination or consolidation of the outstanding Common Shares (by reclassification or
otherwise) into a lesser number of Common Shares, corresponding adjustments shall automatically be made in each of the following: 
 (a) The number of Options, Restricted Shares and Stock Units available for future Awards under Article 3; 
 (b)
The number of Common Shares covered by each outstanding Option; 
 (c) The Exercise Price under each outstanding Option; or

 (d) The number of Stock Units included in any prior Award that has not yet been settled. 
 In the event of a declaration of an extraordinary dividend payable in a form other than Common Shares in an amount that has a material effect on the price of Common
Shares, a recapitalization, a spin-off or a similar occurrence, the Committee shall make such adjustments as it, in its sole discretion, deems appropriate in one or more of the foregoing. Except as provided in this Article 10, a Participant
shall have no rights by reason of any issuance by the Company of stock of any class or securities convertible into stock of any class, any subdivision or consolidation of shares of stock of any class, the payment of any stock dividend or any other
increase or decrease in the number of shares of stock of any class. 
  

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 10.2 Dissolution or Liquidation. To the extent not previously exercised or settled, Options, and
Stock Units shall terminate immediately prior to the dissolution or liquidation of the Company. 
 10.3 Reorganizations. In the event
that the Company is a party to a merger or other reorganization, outstanding Awards shall be subject to the agreement of merger or reorganization. Such agreement shall provide for (a) the continuation of the outstanding Awards by the Company,
if the Company is a surviving corporation, (b) the assumption of the outstanding Awards by the surviving corporation or its parent or subsidiary, (c) the substitution by the surviving corporation or its parent or subsidiary of its own
awards for the outstanding Awards, (d) full exercisability or vesting and accelerated expiration of the outstanding Awards or (e) settlement of the full value of the outstanding Awards in cash or cash equivalents followed by cancellation
of such Awards. 
 ARTICLE 11. AWARDS UNDER OTHER PLANS. 
 The Company may grant awards under other plans or programs. Such awards may be settled in the form of Common Shares issued under this Plan. Such Common Shares shall be treated for all purposes under the Plan like
Common Shares issued in settlement of Stock Units and shall, when issued, reduce the number of Common Shares available under Article 3. 
 ARTICLE 12. LIMITATION ON RIGHTS. 
 12.1 Retention Rights. Neither the Plan nor any Award granted under the Plan shall
be deemed to give any individual a right to remain an Employee. The Company and its Parents, Subsidiaries and Affiliates reserve the right to terminate the Service of any Employee at any time, with or without cause, subject to applicable laws and a
written employment agreement (if any). 
 12.2 Stockholders’ Rights. A Participant shall have no dividend rights, voting rights
or other rights as a stockholder with respect to any Common Shares covered by his or her Award prior to the time when a stock certificate for such Common Shares is issued or, if applicable, the time when he or she becomes entitled to receive such
Common Shares by filing any required notice of exercise and paying any required Exercise Price. No adjustment shall be made for cash dividends or other rights for which the record date is prior to such time, except as expressly provided in the Plan.

 12.3 Regulatory Requirements. Any other provision of the Plan notwithstanding, the obligation of the Company to issue Common Shares
under the Plan shall be subject to all applicable laws, rules and regulations and such approval by any regulatory body as may be required. The Company reserves the right to restrict, in whole or in part, the delivery of Common Shares pursuant to any
Award prior to the satisfaction of all legal requirements relating to the issuance of such Common Shares, to their registration, qualification or listing or to an exemption from registration, qualification or listing. 
  

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 ARTICLE 13. WITHHOLDING TAXES. 
 13.1 General. To the extent required by applicable federal, state, local or foreign law, a Participant or his or her successor shall make
arrangements satisfactory to the Company for the satisfaction of any withholding tax obligations that arise in connection with the Plan. The Company shall not be required to issue any Common Shares or make any cash payment under the Plan until such
obligations are satisfied. 
 13.2 Share Withholding. To the extent that applicable law subjects a Participant to tax withholding
obligations, the Committee may permit such Participant to satisfy all or part of such obligations by having the Company withhold all or a portion of any Common Shares that otherwise would be issued to him or her or by surrendering all or a portion
of any Common Shares that he or she previously acquired. Such Common Shares shall be valued at their Fair Market Value on the date when they are withheld or surrendered. 
 ARTICLE 14. LIMITATION ON PAYMENTS. 
 14.1 Scope of Limitation. This Article 14 shall
apply to an Award only if: 
 (a) The independent auditors selected for this purpose by the Committee (the
“Auditors”) determine that the after-tax value of such Award to the Participant, taking into account the effect of all federal, state and local income taxes, employment taxes and excise taxes applicable to the Participant (including the
excise tax under section 4999 of the Code), will be greater after the application of this Article 14 than it was before the application of this Article 13; or 
 (b) The Committee, at the time of making an Award under the Plan or at any time thereafter, specifies in writing that such Award shall be
subject to this Article 14 (regardless of the after-tax value of such Award to the Participant). 
 If this Article 14 applies to an Award, it
shall supersede any contrary provision of the Plan or of any Award granted under the Plan. 
 14.2 Basic Rule. In the event that the
Auditors determine that any payment or transfer by the Company under the Plan to or for the benefit of a Participant (a “Payment”) would be nondeductible by the Company for federal income tax purposes because of the provisions concerning
“excess parachute payments” in section 280G of the Code, then the aggregate present value of all Payments shall be reduced (but not below zero) to the Reduced Amount. For purposes of this Article 14, the “Reduced
Amount” shall be the amount, expressed as a present value, which maximizes the aggregate present value of the Payments without causing any Payment to be nondeductible by the Company because of section 280G of the Code. 
 14.3 Reduction of Payments. If the Auditors determine that any Payment would be nondeductible by the Company because of section 280G of the
Code, then the Company shall promptly give the Participant notice to that effect and a copy of the detailed calculation thereof and of the Reduced Amount, and the Participant may then elect, in his or her 

  

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sole discretion, which and how much of the Payments shall be eliminated or reduced (as long as after such election the aggregate present value of the
Payments equals the Reduced Amount) and shall advise the Company in writing of his or her election within 10 days of receipt of notice. If no such election is made by the Participant within such 10-day period, then the Company may elect which
and how much of the Payments shall be eliminated or reduced (as long as after such election the aggregate present value of the Payments equals the Reduced Amount) and shall notify the Participant promptly of such election. For purposes of this
Article 16, present value shall be determined in accordance with section 280G(d)(4) of the Code. All determinations made by the Auditors under this Article 14 shall be binding upon the Company and the Participant and shall be made
within 60 days of the date when a Payment becomes payable or transferable. As promptly as practicable following such determination and the elections hereunder, the Company shall pay or transfer to or for the benefit of the Participant such
amounts as are then due to him or her under the Plan and shall promptly pay or transfer to or for the benefit of the Participant in the future such amounts as become due to him or her under the Plan. 
 14.4 Overpayments and Underpayments. As a result of uncertainty in the application of section 280G of the Code at the time of an initial
determination by the Auditors hereunder, it is possible that Payments will have been made by the Company which should not have been made (an “Overpayment”) or that additional Payments which will not have been made by the Company could have
been made (an “Underpayment”), consistent in each case with the calculation of the Reduced Amount hereunder. In the event that the Auditors, based upon the assertion of a deficiency by the Internal Revenue Service against the Company or
the Participant that the Auditors believe has a high probability of success, determine that an Overpayment has been made, such Overpayment shall be treated for all purposes as a loan to the Participant that he or she shall repay to the Company,
together with interest at the applicable federal rate provided in section 7872(f)(2) of the Code; provided, however, that no amount shall be payable by the Participant to the Company if and to the extent that such payment would not reduce the
amount that is subject to taxation under section 4999 of the Code. In the event that the Auditors determine that an Underpayment has occurred, such Underpayment shall promptly be paid or transferred by the Company to or for the benefit of the
Participant, together with interest at the applicable federal rate provided in section 7872(f)(2) of the Code. 
 14.5 Related
Corporations. For purposes of this Article 14, the term “Company” shall include affiliated corporations to the extent determined by the Auditors in accordance with section 280G(d)(5) of the Code. 
 ARTICLE 15. FUTURE OF THE PLAN. 
 15.1 Term of the Plan. The Plan, as set forth herein, shall become effective on the date of
adoption. The Plan shall remain in effect until the earlier of (a) the date the Plan is terminated under Section 15.2 or (b) the 10th anniversary of the date the Board adopted the Plan. 
 15.2 Amendment or Termination.
The Board may, at any time and for any reason, amend or terminate the Plan. No Awards shall be granted under the Plan after the termination thereof. The termination of the Plan, or any amendment thereof, shall not affect any Award previously granted
under the Plan. 
  

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 15.3 Stockholder Approval. Approval of the Company’s stockholders shall be required only to
the extent required by applicable laws, regulations or rules. 
 ARTICLE 16. DEFINITIONS. 
 16.1 “Affiliate” means any entity other than a Subsidiary, if the Company and/or one or more Subsidiaries own not less than 50% of
such entity. 
 16.2 “Award” means any award of an Option, a Restricted Share or a Stock Unit under the Plan.

 16.3 “Board” means the Company’s Board of Directors, as constituted from time to time. 
 16.4 “Change in Control” means: 
 (a) The consummation of a merger or consolidation of the Company with or into another entity or any other corporate reorganization, if persons who were not stockholders of the Company immediately prior to such merger,
consolidation or other reorganization own immediately after such merger, consolidation or other reorganization 50% or more of the voting power of the outstanding securities of each of (i) the continuing or surviving entity and (ii) any
direct or indirect parent corporation of such continuing or surviving entity; 
 (b) The sale, transfer or other disposition
of all or substantially all of the Company’s assets; 
 (c) A change in the composition of the Board, as a result of
which fewer than 50% of the incumbent directors are directors who either (i) had been directors of the Company on the date 24 months prior to the date of the event that may constitute a Change in Control (the “original directors”) or
(ii) were elected, or nominated for election, to the Board with the affirmative votes of at least a majority of the aggregate of the original directors who were still in office at the time of the election or nomination and the directors whose
election or nomination was previously so approved; or 
 (d) Any transaction as a result of which any person is the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing at least 50% of the total voting power represented by the Company’s then outstanding voting
securities. For purposes of this Paragraph (d), the term “person” shall have the same meaning as when used in sections 13(d) and 14(d) of the Exchange Act but shall exclude(i) a trustee or other fiduciary holding securities
under an employee benefit plan of the Company or of a Parent or Subsidiary and (ii) a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of the common stock of
the Company. 
  

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 A transaction shall not constitute a Change in Control if its sole purpose is to change the state of the Company’s
incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the Company’s securities immediately before such transaction. 
 16.5 “Code” means the Internal Revenue Code of 1986, as amended. 
 16.6 “Committee” means a committee of the Board, as described in Article 2. 
 16.7 “Common Share” means one share of the common stock of the Company. 
 16.8 “Company” means Blue Coat Systems, Inc., a Delaware corporation. 
 16.9 “Consultant” means a consultant or adviser who provides bona fide services to the Company, a Parent, a Subsidiary or an
Affiliate as an independent contractor. 
 16.10 “Employee” means a common-law employee of the Company, a Parent, a
Subsidiary or an Affiliate who is newly hired as a employee by the Company, or who is rehired following a bona fide period of interruption of employment, including persons who become new employees of the Company, a Parent, a Subsidiary or an
Affiliate in connection with a merger or acquisition. 
 16.11 “Exchange Act” means the Securities Exchange Act of
1934, as amended. 
 16.12 “Exercise Price,” in the case of an Option, means the amount for which one Common Share
may be purchased upon exercise of such Option, as specified in the applicable Stock Option Agreement. 
 16.13 “Fair Market
Value” means the market price of Common Shares, determined by the Committee in good faith on such basis as it deems appropriate. Such determination shall be conclusive and binding on all persons. 
 16.14 “Involuntary Termination” means the termination of the Service of any individual which occurs by reason of: 
 (a) such individual’s involuntary dismissal or discharge by the Company for reasons other than Misconduct, or 
 (b) such individual’s voluntary resignation following (A) a change in his or her position with the Company which materially
reduces his or her level of responsibility, (B) a reduction in his or her level of compensation (including base salary, fringe benefits and participation in bonus or incentive programs) or (C) a relocation of such individual’s place
of employment by more than fifty (50) miles, provided and only if such change, reduction or relocation is effected by the Company without the individual’s consent. 
  

 11 

 16.15 “Misconduct” means the commission of any act of fraud, embezzlement or
dishonesty by the Optionee or Participant, any unauthorized use or disclosure by such person of confidential information or trade secrets of the Company (or any Parent or Subsidiary), or any other intentional misconduct by such person adversely
affecting the business or affairs of the Company (or any Parent or Subsidiary) in a material manner. The foregoing definition shall not be deemed to be inclusive of all the acts or omissions which the Company (or any Parent or Subsidiary) may
consider as grounds for the dismissal or discharge of any Optionee or Participant or other person in the Service of the Company (or any Parent or Subsidiary). 
 16.16 “NSO” means a stock option not described in sections 422 or 423 of the Code. 
 16.17 “Option” means an NSO granted under the Plan and entitling the holder to purchase Common Shares. 
 16.18 “Optionee” means an individual or estate who holds an Option or SAR. 
 16.19
“Parent” means any corporation (other than the Company) in an unbroken chain of corporations ending with the Company, if each of the corporations other than the Company owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other corporations in such chain. A corporation that attains the status of a Parent on a date after the adoption of the Plan shall be considered a Parent commencing as of such date. 
 16.20 “Participant” means an individual or estate who holds an Award. 
 16.21 “Plan” means this Blue Coat Systems, Inc. 2007 New Employee Stock Incentive Plan, as amended from time to time. 

16.22 “Restricted Share” means a Common Share awarded under the Plan. 
 16.23 “Restricted Stock Agreement” means the agreement between the Company and the recipient of a Restricted Share that contains
the terms, conditions and restrictions pertaining to such Restricted Share. 
 16.24 “Service” means service as an
Employee or Consultant. 
 16.25 “Stock Option Agreement” means the agreement between the Company and an Optionee
that contains the terms, conditions and restrictions pertaining to his or her Option. 
 16.26 “Stock Unit” means a
bookkeeping entry representing the equivalent of one Common Share, as awarded under the Plan. 
 16.27 “Stock Unit
Agreement” means the agreement between the Company and the recipient of a Stock Unit that contains the terms, conditions and restrictions pertaining to such Stock Unit. 
  

 12 

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

 13Form of Stock Option Agreement

 Exhibit 10.2 
 BLUE COAT SYSTEMS, INC. 
 2007
NEW EMPLOYEE STOCK INCENTIVE PLAN 
 NOTICE
OF STOCK OPTION GRANT 
 You have been granted the following option to
purchase Common Stock of Blue Coat Systems, Inc. (the “Company”): 
  

			
	Name of Optionee:	  	«Name»
		
	Total Number of Shares Granted:	  	«TotalShares»
		
	Type of Option:	  	Nonstatutory Stock Option
		
	Exercise Price Per Share:	  	$«PricePerShare»
		
	Date of Grant:	  	«DateGrant»
		
	Vesting Commencement Date:	  	«VestDay»
		
	Vesting Schedule:	  	This option becomes exercisable with respect to the first     % of the Shares subject to this option when you complete 12 months of continuous Service from the Vesting
Commencement Date and with respect to an additional     % of the Shares subject to this option when you complete each          of continuous Service
thereafter.
		
	Expiration Date:	  	«ExpDate»

 You and the Company agree that this option is granted under and governed by the terms and conditions of the Stock
Option Agreement, which is attached to and made a part of this document, and the Company’s 2007 New Employee Stock Incentive Plan. 
 You further agree
that the Company may deliver by email all documents relating to the Plan or this option (including, without limitation, prospectuses required by the Securities and Exchange Commission) and all other documents that the Company is required to deliver
to its security holders (including, without limitation, annual reports and proxy statements). You also agree that the Company may deliver these documents by posting them on a web site maintained by the Company or by a third party under contract with
the Company. If the Company posts these documents on a web site, it will notify you by email. 
  

							
	OPTIONEE:	 		 	BLUE COAT SYSTEMS, INC.
				
	  
	 		 	By:	 	  

	  
	 		 	Title:	 	  

	Print Name	 		 		 	

 BLUE COAT SYSTEMS, INC. 
 2007 NEW EMPLOYEE STOCK INCENTIVE PLAN 
 STOCK OPTION AGREEMENT 
  

			
	Grant of Option	  	You have been granted an option as of the Grant Date to purchase up to the number of Shares of Company Common Stock specified in the Notice of Stock Option Grant.
		
	Tax Treatment	  	This option is intended to be a nonstatutory option, as provided in the Notice of Stock Option Grant.
		
	Vesting	  	This option becomes exercisable in installments, as shown in the Notice of Stock Option Grant. No additional shares become exercisable after your service as an employee, consultant or outside
director of the Company or a parent or subsidiary of the Company (“Service”) has terminated for any reason.
		
	Term	  	This option expires in any event on the day before the 10th
anniversary of the Date of Grant, as shown in the Notice of Stock Option Grant. (It will expire earlier if your Service terminates, as described below.)
		
	Regular Termination	  	If your Service terminates for any reason except death, Permanent Disability or Misconduct, then this option will expire on the date 3 months after your termination date. The Company determines
when your Service terminates for this purpose.
		
	Permanent Disability	  	 If your Service terminates because of your Permanent Disability, then this option will expire on the date 12 months after your termination date. The
Company determines when your Service terminates for this purpose.
  
 Permanent Disability
means that you are unable 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 12 months.

		
	Death	  	If you die while in Service, the option will expire on the date 12 months after the date of death.

  

 2 

			
	Misconduct	  	If your Service terminates for Misconduct, then this option will terminate immediately and cease to be outstanding. “Misconduct” includes fraud, embezzlement, dishonesty or any
unauthorized use or disclosure of confidential information or trade secrets of the Company or any parent or subsidiary or any other intentional misconduct adversely affecting the business or affairs of the Company or a parent or subsidiary of the
Company. The foregoing definition is not deemed to be inclusive of all the acts or omissions that the Company or any parent or subsidiary corporation may consider as grounds for your dismissal or discharge or the discharge of any other individual in
the Service of the Company or any parent or subsidiary corporation.
		
	Change in Control	  	 In the event of a Change in Control, then the vesting of this option will not automatically accelerate unless this option is, in connection with
the Change in Control, not to be assumed by the successor corporation (or its parent) or to be replaced with a comparable option for shares of the capital stock of the successor corporation (or its parent). The determination of option
comparability will be made by the Company’s Board of Directors, and its determination will be final, binding and conclusive.
  
 Change in Control is defined in the Company’s 2007 New Employee Stock Incentive Plan.

		
	Involuntary Termination	  	If the option is assumed by the successor corporation (or its parent) and you experience an Involuntary Termination within eighteen months following a Change in Control, the vesting of this
option will automatically accelerate so that this option will, immediately before the effective date of the Involuntary Termination, become fully exercisable for all of the shares of Common Stock at the time subject to this option and may be
exercised for any or all of those shares as fully-vested shares of Common Stock.
		
		  	An Involuntary Termination means the termination of your Service by reason of: (a) your involuntary dismissal or discharge by the Company for reasons other than Misconduct or
(b) your voluntary resignation following (1) a change in your position with the Company which materially reduces your level of responsibility, (2) a reduction in your level of compensation (including base salary, fringe benefits and
participation in bonus or incentive programs) or (3) a relocation of your place of employment by more than fifty (50) miles, provided and only if such change, reduction or relocation is effected by the Company without your
consent.
		
	Restrictions on Exercise	  	The Company will not permit you to exercise this option if the issuance of shares at that time would violate any law or regulation.

  

 3 

			
	Notice of Exercise	  	 When you wish to exercise this option, you must notify the Company by filing the proper “Notice of Exercise” form at the address given on
the form. Your notice must specify how many shares you wish to purchase. Your notice must also specify how your shares should be registered (in your name only or in your and your spouse’s names as community property or as joint tenants with
right of survivorship). The notice will be effective when it is received by the Company.
  
 If someone else wants to exercise this option after your death, that person must prove to the Company’s satisfaction that he or she is entitled to do so.

		
	Form of Payment	  	When you submit your notice of exercise, you must include payment of the option exercise price for the shares you are purchasing. To the extent permitted by applicable law, payment may be made
in one (or a combination of two or more) of the following forms:
		
		  	 •     Cash or check made payable to the Company.

		
		  	 •     Directions to the Company to withhold shares of Common Stock that otherwise would have been issued to you
as a result of the option exercise. The value of the shares, determined as of the effective date of the option exercise, will be applied to the option exercise price. This form of payment requires the Company’s consent.

		
		  	 •     Irrevocable directions to a securities broker approved by the Company to sell all or part of your option
shares and to deliver to the Company from the sale proceeds an amount sufficient to pay the option exercise price and any withholding taxes. (The balance of the sale proceeds, if any, will be delivered to you.) The directions must be given by
signing a special “Notice of Exercise” form provided by the Company.

		
	Withholding Taxes and Stock Withholding	  	You will not be allowed to exercise this option unless you make arrangements acceptable to the Company to pay any withholding taxes that may be due as a result of the option exercise. These
arrangements may include withholding shares of Common Stock that otherwise would be issued to you when you exercise this option. The value of these shares, determined as of the effective date of the option exercise, will be applied to the
withholding taxes.

  

 4 

			
	Restrictions on Resale	  	You agree not to sell any option shares at a time when applicable laws, Company policies or an agreement between the Company and its underwriters prohibit a sale. This restriction will apply as
long as your Service continues and for such period of time after the termination of your Service as the Company may specify.
		
	Transfer of Option	  	 Before your death, only you may exercise this option. You cannot transfer or assign this option. For instance, you may not sell this option or use it
as security for a loan. If you attempt to do any of these things, this option will immediately become invalid. You may, however, dispose of this option in your will or a beneficiary designation.
  
 Regardless of any marital property settlement agreement, the Company is not obligated to honor a
notice of exercise from your former spouse, nor is the Company obligated to recognize your former spouse’s interest in your option in any other way.

		
	Employment or Retention Rights	  	Your option or this Agreement do not give you the right to be retained by the Company or a parent or subsidiary of the Company in any capacity. The Company and its parents or subsidiaries
reserve the right to terminate your Service at any time, with or without cause.
		
	Stockholder
Rights	  	You, or your estate or heirs, have no rights as a stockholder of the Company until you have exercised this option by giving the required notice to the Company and paying the exercise price. No
adjustments are made for dividends or other rights if the applicable record date occurs before you exercise this option, except as described in the Company’s 2007 New Employee Stock Incentive Plan.
		
	Adjustments	  	In the event of a stock split, a stock dividend or a similar change in Common Stock, the number of shares covered by this option and the exercise price per share may be adjusted pursuant to the
Company’s 2007 New Employee Stock Incentive Plan.
		
	Applicable Law	  	This Agreement will be interpreted and enforced under the laws of the State of Delaware (without regard to their choice-of-law provisions).
		
	The Plan and Other Agreements	  	The text of the Company’s 2007 New Employee Stock Incentive Plan is incorporated in this Agreement by reference. A copy of the Plan is available on the Company’s intranet or by request
to the Company’s Finance Department.

  

 5 

			
		  	 This Agreement and the Company’s 2007 New Employee Stock Incentive Plan constitute the entire understanding between you and the Company regarding this option.
Any prior agreements, commitments or negotiations concerning this option are superseded. This Agreement may be amended only by another written agreement between the parties.

 YOU AGREE TO ALL OF
THE TERMS AND CONDITIONS DESCRIBED ABOVE AND IN THE 
 COMPANY’S 2007 NEW EMPLOYEE STOCK INCENTIVE PLAN. 
  

 6

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