Document:

exv10w1

 

Exhibit 10.1

     

    

 

    AMKOR
    TECHNOLOGY, INC.

    

 

    2007
    EXECUTIVE INCENTIVE BONUS PLAN

 

    1.  Purposes of the Plan.  The
    Plan is intended to increase stockholder value and the success
    of the Company by motivating key executives to: (1) perform
    to the best of their abilities, and (2) achieve the
    Company’s objectives. The Plan’s goals are to be
    achieved by providing such executives with incentive awards
    based on the achievement of goals relating to the performance of
    the Company or upon the achievement of objectively determinable
    individual performance goals. The Plan is intended to permit the
    payment of bonuses that may qualify as performance-based
    compensation under Code section 162(m).

 

    2.  Definitions.  

 

    (a) “Annual Revenue” means the
    Company’s or a business unit’s net sales for the
    Fiscal Year, determined in accordance with generally accepted
    accounting principles.

 

    (b) “Award” means, with respect to
    each Participant, the award determined pursuant to
    Section 8(a) below for a Performance Period. Each Award is
    determined by a Payout Formula for a Performance Period, subject
    to the Committee’s authority under Section 8(a) to
    eliminate or reduce the Award otherwise payable.

 

    (c) “Base Salary” means as to any
    Performance Period, the Participant’s annualized salary
    rate on the last day of the Performance Period. Such Base Salary
    shall be before both (i) deductions for taxes or benefits,
    and (ii) deferrals of compensation pursuant to
    Company-sponsored plans.

 

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

 

    (e) “Cash Position” means the
    Company’s or a business unit’s level of cash and cash
    equivalents.

 

    (f) “Code” means the Internal
    Revenue Code of 1986, as amended.

 

    (g) “Committee” means the
    Compensation Committee of the Board, or a sub-committee of the
    Compensation Committee, which shall, with respect to payments
    hereunder intended to qualify as performance-based compensation
    under Code Section 162(m), consist solely of two or more
    members of the Board who are not employees of the Company and
    who otherwise qualify as “outside directors” within
    the meaning of Section 162(m).

 

    (h) “Company” means Amkor
    Technology, Inc. or any of its subsidiaries (as such term is
    defined in Code Section 424(f)).

 

    (i) “Company Free Cash Flow” means
    as to any Fiscal Quarter or Fiscal Year, the Company’s or a
    business unit’s Net Cash Provided by Operations less
    payments for property, plant, and equipment determined in
    accordance with generally accepted accounting principles.

 

    (j) “Determination Date” means the
    latest possible date that will not jeopardize a Target Award or
    an Award’s qualification as Performance-Based Compensation.

 

    (k) “Earnings Per Share” means as
    to any Fiscal Quarter or Fiscal Year, the Company’s or a
    business unit’s Net Income, divided by a weighted average
    number of common shares outstanding and dilutive common
    equivalent shares deemed outstanding, determined in accordance
    with generally accepted accounting principles.

 

    (l) “EBITDA” means as to any Fiscal
    Quarter or Fiscal Year, the Company’s or a business
    unit’s earnings before interest, depreciation and
    amortization determined in accordance with generally accepted
    accounting principles.

 

    (m) “Fiscal Quarter” means a fiscal
    quarter of the Company.

 

    (n) “Fiscal Year” means a fiscal
    year of the Company.

 

    (o) “Gross Fixed Assets” means as
    to any Fiscal Quarter or Fiscal Year, the value of the
    Company’s assets intended for ongoing use in business
    operations, determined in accordance with generally accepted
    accounting principles.

    

    1

 

    (p) “Gross Margin” means as to any
    Fiscal Quarter or Fiscal Year, the Company’s or a business
    unit’s revenue less the cost of goods sold, determined in
    accordance with generally accepted accounting principles.

 

    (q) “Gross Profit Dollars” means as
    to any Fiscal Quarter or Fiscal Year, the Company’s or a
    business unit’s revenue less cost of goods sold, determined
    in accordance with generally accepted accounting principles.

 

    (r) “Maximum Award” means as to any
    Participant for any Performance Period, the lesser of
    (i) $3,000,000 or (ii) 200% of the Participant’s
    Base Salary.

 

    (s) “Net Cash Provided by
    Operations” means as to any Fiscal Quarter or
    Fiscal Year, the Company’s or a business unit’s Net
    Income plus adjustments to reconcile Net Income to Net Cash
    Provided by Operations, determined in accordance with generally
    accepted accounting principles.

 

    (t) “Net Income” means as to any
    Fiscal Quarter or Fiscal Year, the income after taxes of the
    Company or a business unit for the Fiscal Quarter or Fiscal Year
    determined in accordance with generally accepted accounting
    principles.

 

    (u) “Operating Cash Flow” means the
    Company’s or a business unit’s sum of Net Income plus
    depreciation and amortization less capital expenditures plus
    changes in working capital comprised of accounts receivable,
    inventories, other current assets, trade accounts payable,
    accrued expenses, product warranty, advance payments from
    customers and long-term accrued expenses, determined in
    accordance with generally acceptable accounting principles.

 

    (v) “Operating Expenses” means the
    sum of the Company’s or a business unit’s research and
    development expenses and selling and general and administrative
    expenses during a Fiscal Quarter or Fiscal Year.

 

    (w) “Operating Income” means the
    Company’s or a business unit’s income from operations
    determined in accordance with generally accepted accounting
    principles.

 

    (x) “Participant” means an
    executive officer or other key employee of the Company
    participating in the Plan for a Performance Period.

 

    (y) “Payout Formula” means as to
    any Performance Period, the formula or payout matrix established
    by the Committee pursuant to Section 7 in order to
    determine the Awards (if any) to be paid to Participants. The
    formula or matrix may differ from Participant to Participant.

 

    (z) “Performance-Based
    Compensation” means compensation that is intended
    to qualify as “performance-based compensation” within
    the meaning of Section 162(m).

 

    (aa) “Performance Goals” means the
    goal(s) (or combined goal(s)) determined by the Committee (in
    its discretion) to be applicable to a Participant with respect
    to an Award. As determined by the Committee, the Performance
    Goals applicable to an Award may provide for a targeted level or
    levels of achievement using one or more of the following
    measures: (i) Annual Revenue, (ii) Cash Position,
    (iii) Company Free Cash Flow, (iv) Earnings Per Share,
    (v) EBITDA, (vi) Gross Margin, (vii) Gross Profit
    Dollars, (viii) Net Cash Provided by Operations,
    (ix) Net Income, (x) Operating Cash Flow,
    (xi) Operating Expenses, (xii) Operating Income,
    (xiii) Profit Before Tax, (xiv) Return on Assets,
    (xv) Return on Equity, (xvi) Return on Gross Fixed
    Assets, (xvii) Return on Sales, (xviii) Revenue
    Growth, and (xix) Total Stockholder Return. The Performance
    Goals may differ from Participant to Participant and from Award
    to Award. Any criteria used may be (i) measured in absolute
    terms, (ii) compared to another company or companies,
    (iii) measured against the performance of the Company as a
    whole or a segment of the Company
    and/or
    (iv) measured on a pre-tax or post-tax basis (if
    applicable). Prior to the Determination Date, the Administrator
    will determine whether any significant element(s) will be
    included in or excluded from the calculation of any Performance
    Goal with respect to any Participant. Any Performance Goals may
    be used to measure the performance of the Company as a whole or
    a business unit of the Company and may be measured relative to a
    peer group or index. The Performance Goals may differ from
    Participant to Participant and from Award to Award. Prior to the
    Determination Date, the Administrator will determine whether any
    significant element(s) will be included in or excluded from the
    calculation of any Performance Goal with respect to any
    Participant. In all other respects, Performance Goals will be
    calculated in accordance with the Company’s financial
    statements, generally accepted accounting principles, or under a
    methodology established by the Administrator

    

    2

 

    prior to the issuance of an Award, which is consistently applied
    and identified in the financial statements, including footnotes,
    or the management discussion and analysis section of the
    Company’s annual report.

 

    (bb) “Performance Period” means any
    Fiscal Quarter or Fiscal Year, or such other longer period but
    not in excess of three Fiscal Years, as determined by the
    Committee in its sole discretion.

 

    (cc) “Plan” means this 2007
    Executive Incentive Bonus Plan.

 

    (dd) “Plan Year” means the
    Company’s fiscal year.

 

    (ee) “Profit Before Tax” means as
    to any Fiscal Quarter or Fiscal Year, the Company’s or a
    business unit’s net sales less all expenses (except for
    taxes, equity, and minority interest), determined in accordance
    with generally accepted accounting principles.

 

    (ff) “Return on Assets” means the
    percentage equal to the Company’s or a business unit’s
    Operating Income before incentive compensation, divided by
    average net Company or business unit, as applicable,
    assets, determined in accordance with generally accepted
    accounting principles.

 

    (gg) “Return on Equity” means the
    percentage equal to the Company’s or a business unit’s
    Net Income divided by average stockholder’s equity,
    determined in accordance with generally accepted accounting
    principles.

 

    (hh) “Return on Gross Fixed Assets”
    means as to any Fiscal Quarter or Fiscal Year, the
    Company’s or a business unit’s annualized EBITDA
    divided by the total Gross Fixed Assets determined in accordance
    with generally accepted accounting principles.

 

    (ii) “Return on Sales” means the
    percentage equal to the Company’s or a business unit’s
    Operating Income before incentive compensation, divided by the
    Company’s or the business unit’s, as applicable,
    revenue, determined in accordance with generally accepted
    accounting principles.

 

    (jj) “Revenue Growth” means the
    Company’s or a business unit’s net sales for the
    Fiscal Quarter or Fiscal Year, determined in accordance with
    generally accepted accounting principles, compared to the net
    sales of the immediately preceding quarter.

 

    (kk) “Section 162(m)” means
    Section 162(m) of the Code, or any successor to
    Section 162(m), as that Section may be interpreted from
    time to time by the Internal Revenue Service, whether by
    regulation, notice or otherwise.

 

    (ll) “Target Award” means the
    target award payable under the Plan to a Participant for the
    Performance Period, expressed as a percentage of his or her Base
    Salary or a specific dollar amount, as determined by the
    Committee in accordance with Section 6.

 

    (mm) “Total Stockholder Return”
    means the total return (change in share price plus reinvestment
    of any dividends) of a share of the Company’s common stock.

 

    3.  Plan Administration.  

 

    (a) The Committee shall be responsible for the general
    administration and interpretation of the Plan and for carrying
    out its provisions. Subject to the requirements for qualifying
    compensation as Performance-Based Compensation, the Committee
    may delegate specific administrative tasks to Company employees
    or others as appropriate for proper administration of the Plan.
    Subject to the limitations on Committee discretion imposed under
    Section 162(m), the Committee shall have such powers as may
    be necessary to discharge its duties hereunder, including, but
    not by way of limitation, the following powers and duties, but
    subject to the terms of the Plan:

 

    (i) discretionary authority to construe and interpret the
    terms of the Plan, and to determine eligibility, Awards and the
    amount, manner and time of payment of any Awards hereunder;

 

    (ii) to prescribe forms and procedures for purposes of Plan
    participation and distribution of Awards; and

 

    (iii) to adopt rules, regulations and bylaws and to take
    such actions as it deems necessary or desirable for the proper
    administration of the Plan.

 

    (b) Any rule or decision by the Committee that is not
    inconsistent with the provisions of the Plan shall be conclusive
    and binding on all persons, and shall be given the maximum
    deference permitted by law.

    

    3

 

    4.  Eligibility.  The
    employees eligible to participate in the Plan for a given
    Performance Period shall be the Chief Executive Officer and
    other select executives and employees of the Company who are
    designated by the Committee in its sole discretion. No person
    shall be automatically entitled to participate in the Plan.

 

    5.  Performance Goal
    Determination.  The Committee, in its sole
    discretion, shall establish the Performance Goals for each
    Participant for the Performance Period. Such Performance Goals
    shall be set forth in writing prior to the Determination Date.

 

    6.  Target Award
    Determination.  The Committee, in its sole
    discretion, shall establish a Target Award for each Participant.
    Each Participant’s Target Award shall be determined by the
    Committee in its sole discretion, and each Target Award shall be
    set forth in writing prior to the Determination Date.

 

    7.  Determination of Payout Formula or
    Formulae.  On or prior to the Determination
    Date, the Committee, in its sole discretion, shall establish a
    Payout Formula or Formulae for purposes of determining the Award
    (if any) payable to each Participant. Each Payout Formula shall
    (a) be set forth in writing prior to the Determination
    Date, (b) be based on a comparison of actual performance to
    the Performance Goals, (c) provide for the payment of a
    Participant’s Target Award if the Performance Goals for the
    Performance Period are achieved, and (d) provide for an
    Award greater than or less than the Participant’s Target
    Award, depending upon the extent to which actual performance
    exceeds or falls below the Performance Goals. Notwithstanding
    the preceding, in no event shall a Participant’s Award for
    any Performance Period exceed the Maximum Award.

 

    8.  Determination of Awards; Award
    Payment.  

 

    (a) Determination and
    Certification.  After the end of each
    Performance Period and after receipt of the audit report of the
    Company’s financial statements from the Company’s
    auditors, the Committee shall certify in writing (which may be
    by approval of the minutes in which the certification was made)
    the extent to which the Performance Goals applicable to each
    Participant for the Performance Period were achieved or
    exceeded. The Award for each Participant shall be determined by
    applying the Payout Formula to the level of actual performance
    that has been certified by the Committee. Notwithstanding any
    contrary provision of the Plan, the Committee, in its sole
    discretion, may eliminate or reduce the Award payable to any
    Participant below that which otherwise would be payable under
    the Payout Formula but shall not have the right to increase the
    Award above that which would otherwise be payable under the
    Payout Formula.

 

    (b) Right to Receive Payment.  Each
    Award under the Plan shall be paid solely from the general
    assets of the Company. Nothing in this Plan shall be construed
    to create a trust or to establish or evidence any
    Participant’s claim of any right to payment of an Award
    other than as an unsecured general creditor with respect to any
    payment to which he or she may be entitled. A Participant needs
    to be employed by the Company through the payment date in order
    to be eligible to receive an Award payout hereunder.

 

    (c) Form of Distributions.  The
    Company shall distribute all Awards to the Participant in cash.

 

    (d) Timing of
    Distributions.  Subject to Section 8(e)
    below, the Company shall distribute amounts payable to
    Participants as soon as is practicable following the
    determination and written certification of the Award for a
    Performance Period, but no later than the fifteenth day of the
    third month of the Fiscal Year following the determination and
    certification.

 

    (e) Deferral.  The Committee may
    defer payment of Awards, or any portion thereof, to Participants
    as the Committee, in its discretion, determines to be necessary
    or desirable to preserve the deductibility of such amounts under
    Section 162(m). In addition, the Committee, in its sole
    discretion, may permit a Participant to defer receipt of the
    payment of cash that would otherwise be delivered to a
    Participant under the Plan. Any such deferral elections shall be
    subject to such rules and procedures as shall be determined by
    the Committee in its sole discretion.

 

    9.  Term of Plan.  Subject to
    its approval at the 2007 annual meeting of the Company’s
    stockholders, the Plan shall first apply to the Company’s
    first Plan Year commencing following approval by the
    stockholders at the 2007 annual meeting. Once approved by the
    Company’s stockholders, the Plan shall continue for a term
    of five (5) years unless sooner terminated under
    Section 10 of the Plan.

    

    4

 

    10.  Amendment and Termination of the
    Plan.  The Committee may amend, modify,
    suspend or terminate the Plan, in whole or in part, at any time,
    including the adoption of amendments deemed necessary or
    desirable to correct any defect or to supply omitted data or to
    reconcile any inconsistency in the Plan or in any Award granted
    hereunder; provided, however, that no amendment, alteration,
    suspension or discontinuation shall be made which would
    (a) impair any payments to Participants made prior to such
    amendment, modification, suspension or termination, unless the
    Committee has made a determination that such amendment or
    modification is in the best interests of all persons to whom
    Awards have theretofore been granted; provided further, however,
    that in no event may such an amendment or modification result in
    an increase in the amount of compensation payable pursuant to
    such Award or (b) cause compensation that is, or may
    become, payable hereunder to fail to qualify as
    Performance-Based Compensation. To the extent necessary or
    advisable under applicable law, including Section 162(m),
    Plan amendments shall be subject to stockholder approval. At no
    time before the actual distribution of funds to Participants
    under the Plan shall any Participant accrue any vested interest
    or right whatsoever under the Plan except as otherwise stated in
    this Plan.

 

    11.  Withholding.  Distributions
    pursuant to this Plan shall be subject to all applicable federal
    and state tax and withholding requirements.

 

    12.  At-Will Employment.  No
    statement in this Plan should be construed to grant any employee
    an employment contract of fixed duration or any other
    contractual rights, nor should this Plan be interpreted as
    creating an implied or an expressed contract of employment or
    any other contractual rights between the Company and its
    employees. The employment relationship between the Company and
    its employees is terminable at-will. This means that an employee
    of the Company may terminate the employment relationship at any
    time and for any reason or no reason.

 

    13.  Successors.  All
    obligations of the Company under the Plan, with respect to
    awards granted hereunder, shall be binding on any successor to
    the Company, whether the existence of such successor is the
    result of a direct or indirect purchase, merger, consolidation,
    or otherwise, of all or substantially all of the business or
    assets of the Company.

 

    14.  Indemnification.  Each
    person who is or shall have been a member of the Committee, or
    of the Board, shall be indemnified and held harmless by the
    Company against and from (a) any loss, cost, liability, or
    expense that may be imposed upon or reasonably incurred by him
    or her in connection with or resulting from any claim, action,
    suit, or proceeding to which he or she may be a party or in
    which he or she may be involved by reason of any action taken or
    failure to act under the Plan or any award, and (b) from
    any and all amounts paid by him or her in settlement thereof,
    with the Company’s approval, or paid by him or her in
    satisfaction of any judgment in any such claim, action, suit, or
    proceeding against him or her, provided he or she shall give the
    Company an opportunity, at its own expense, to handle and defend
    the same before he or she undertakes to handle and defend it on
    his or her own behalf. The foregoing right of indemnification
    shall not be exclusive of any other rights of indemnification to
    which such persons may be entitled under the Company’s
    Certificate of Incorporation or Bylaws, by contract, as a matter
    of law, or otherwise, or under any power that the Company may
    have to indemnify them or hold them harmless.

 

    15.  Nonassignment.  The
    rights of a Participant under this Plan shall not be assignable
    or transferable by the Participant except by will or the laws of
    intestacy.

 

    16.  Governing Law.  The Plan
    shall be governed by the laws of the State of Arizona, without
    regard to conflicts of law provisions thereunder.

    

    5exv10w2

 

Exhibit 10.2

 

     

    

 

    AMKOR
    TECHNOLOGY, INC.

    

 

    2007
    EQUITY INCENTIVE PLAN

 

    1.  Purposes of the Plan.  The
    purposes of this Plan are:

 

			
	 	    • 
	
    to attract and retain the best available personnel for positions
    of substantial responsibility,

	 
	 	    • 
	
    to provide incentives to individuals who perform services to the
    Company, and

	 
	 	    • 
	
    to promote the success of the Company’s business.

 

    The Plan permits the grant of Incentive Stock Options,
    Nonstatutory Stock Options, Restricted Stock, Restricted Stock
    Units, Stock Appreciation Rights, Performance Units, Performance
    Shares and other stock or cash awards as the Administrator may
    determine.

 

    2.  Definitions.  As used
    herein, the following definitions will apply:

 

    (a) “Administrator” means the Board
    or any of its Committees as will be administering the Plan, in
    accordance with Section 4 of the Plan.

 

    (b) “Annual Revenue” means the
    Company’s or a business unit’s net sales for the
    Fiscal Year, determined in accordance with generally accepted
    accounting principles.

 

    (c) “Applicable Laws” means the
    requirements relating to the administration of equity-based
    awards under U.S. state corporate laws, U.S. federal
    and state securities laws, the Code, any stock exchange or
    quotation system on which the Common Stock is listed or quoted
    and the applicable laws of any foreign country or jurisdiction
    where Awards are, or will be, granted under the Plan.

 

    (d) “Award” means, individually or
    collectively, a grant under the Plan of Options, Restricted
    Stock, Restricted Stock Units, Stock Appreciation Rights,
    Performance Units, Performance Shares and other stock or cash
    awards as the Administrator may determine.

 

    (e) “Award Agreement” means the
    written or electronic agreement setting forth the terms and
    provisions applicable to each Award granted under the Plan. The
    Award Agreement is subject to the terms and conditions of the
    Plan.

 

    (f) “Award Transfer Program” means
    any program instituted by the Committee which would permit
    Participants the opportunity to transfer any outstanding Awards
    to a financial institution or other person or entity approved by
    the Committee.

 

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

 

    (h) “Cash Position” means the
    Company’s or a business unit’s level of cash and cash
    equivalents.

 

    (i) “Change in Control” means the
    occurrence of any of the following events:

 

    (i) Any “person” (as such term is used in
    Sections 13(d) and 14(d) of the Exchange Act) becomes the
    “beneficial owner” (as defined in
    Rule 13d-3
    of the Exchange Act), directly or indirectly, of securities of
    the Company representing fifty percent (50%) or more of the
    total voting power represented by the Company’s then
    outstanding voting securities;

 

    (ii) The consummation of the sale or disposition by the
    Company of all or substantially all of the Company’s assets;

 

    (iii) A change in the composition of the Board occurring
    within a twelve (12)-month period, as a result of which fewer
    than a majority of the directors are Incumbent Directors.
    “Incumbent Directors” means directors who either
    (A) are Directors as of the effective date of the Plan, or
    (B) are elected, or nominated for election, to the Board
    with the affirmative votes of at least a majority of the
    Incumbent Directors at the time of such election or nomination
    (but will not include an individual whose election or

    

    1

 

    nomination is in connection with an actual or threatened proxy
    contest relating to the election of directors to the
    Company); or

 

    (iv) The consummation of a merger or consolidation of the
    Company with any other corporation, other than a merger or
    consolidation which would result in the voting securities of the
    Company outstanding immediately prior thereto continuing to
    represent (either by remaining outstanding or by being converted
    into voting securities of the surviving entity or its parent) at
    least fifty percent (50%) of the total voting power represented
    by the voting securities of the Company or such surviving entity
    or its parent outstanding immediately after such merger or
    consolidation.

 

    (j) “Code” means the Internal
    Revenue Code of 1986, as amended. Any reference to a section of
    the Code herein will be a reference to any successor or amended
    section of the Code.

 

    (k) “Committee” means a committee
    of Directors or of other individuals satisfying Applicable Laws
    appointed by the Board in accordance with Section 4 hereof.

 

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

 

    (m) “Company” means Amkor
    Technology, Inc., a Delaware corporation, or any successor
    thereto.

 

    (n) “Company Free Cash Flow” means
    as to any Fiscal Quarter or Fiscal Year, the Company’s or a
    business unit’s Net Cash Provided by Operations less
    payments for property, plant, and equipment determined in
    accordance with generally accepted accounting principles.

 

    (o) “Consultant” means any person,
    including an advisor, engaged by the Company or a Parent or
    Subsidiary to render services to such entity.

 

    (p) “Determination Date” means the
    latest possible date that will not jeopardize the qualification
    of an Award granted under the Plan as “performance-based
    compensation” under Section 162(m) of the Code.

 

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

 

    (r) “Disability” means total and
    permanent disability as defined in Section 22(e)(3) of the
    Code, provided that in the case of Awards other than Incentive
    Stock Options, the Administrator in its discretion may determine
    whether a permanent and total disability exists in accordance
    with uniform and non-discriminatory standards adopted by the
    Administrator from time to time.

 

    (s) “Earnings Per Share” means as
    to any Fiscal Quarter or Fiscal Year, the Company’s or a
    business unit’s Net Income, divided by a weighted average
    number of common shares outstanding and dilutive common
    equivalent shares deemed outstanding, determined in accordance
    with generally accepted accounting principles.

 

    (t) “EBITDA” means as to any Fiscal
    Quarter or Fiscal Year, the Company’s or a business
    unit’s earnings before interest, depreciation and
    amortization determined in accordance with generally accepted
    accounting principles.

 

    (u) “Employee” means any person,
    including Officers and Directors, employed by the Company or any
    Parent or Subsidiary of the Company. Neither service as a
    Director nor payment of a director’s fee by the Company
    will be sufficient to constitute “employment” by the
    Company.

 

    (v) “Exchange Act” means the
    Securities Exchange Act of 1934, as amended.

 

    (w) “Exchange Program” means a
    program under which (i) outstanding Awards are surrendered
    or cancelled in exchange for Awards of the same type (which may
    have higher exercise prices and different terms), Awards of a
    different type,
    and/or cash,
    and/or
    (ii) the exercise price of an outstanding Award is
    increased. The Administrator will determine the terms and
    conditions of any Exchange Program in its sole discretion.

    

    2

 

    (x) “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 a national market system, including without
    limitation the Nasdaq Global Market, the Nasdaq Global Select
    Market or the Nasdaq Capital Market, its Fair Market Value shall
    be the closing sales price for such stock (or, if no closing
    sales price was reported on that date, as applicable, on the
    last trading date such closing sales price was reported) as
    quoted on such exchange or system on the day of determination,
    as reported in The Wall Street Journal or such other
    source as the Administrator deems reliable;

 

    (ii) If the Common Stock is regularly quoted by a
    recognized securities dealer but selling prices are not
    reported, its Fair Market Value shall be the mean between the
    high bid and low asked prices for the Common Stock on the day of
    determination (or, if no bids and asks were reported on that
    date, as applicable, on the last trading date such bids and asks
    were reported); or

 

    (iii) In the absence of an established market for the
    Common Stock, the Fair Market Value thereof shall be determined
    in good faith by the Administrator.

 

    (y) “Fiscal Quarter” means a fiscal
    quarter of the Company.

 

    (z) “Fiscal Year” means the fiscal
    year of the Company.

 

    (aa) “Gross Fixed Assets” means as
    to any Fiscal Quarter or Fiscal Year, the value of the
    Company’s assets intended for ongoing use in business
    operations, determined in accordance with generally accepted
    accounting principles.

 

    (bb) “Gross Margin” means as to any
    Fiscal Quarter or Fiscal Year, the Company’s or a business
    unit’s revenue less the cost of goods sold, determined in
    accordance with generally accepted accounting principles.

 

    (cc) “Gross Profit Dollars” means
    as to any Fiscal Quarter or Fiscal Year, the Company’s or a
    business unit’s revenue less cost of goods sold, determined
    in accordance with generally accepted accounting principles.

 

    (dd) “Incentive Stock Option” means
    an Option that by its terms qualifies and is otherwise intended
    to qualify as an incentive stock option within the meaning of
    Section 422 of the Code and the regulations promulgated
    thereunder.

 

    (ee) “Inside Director” means a
    Director who is an Employee.

 

    (ff) “Net Cash Provided by
    Operations” means as to any Fiscal Quarter or
    Fiscal Year, the Company’s or a business unit’s Net
    Income plus adjustments to reconcile Net Income to Net Cash
    Provided by Operations, determined in accordance with generally
    accepted accounting principles.

 

    (gg) “Net Income” means as to any
    Fiscal Quarter or Fiscal Year, the income after taxes of the
    Company or a business unit for the Fiscal Quarter or Fiscal Year
    determined in accordance with generally accepted accounting
    principles.

 

    (hh) “Nonstatutory Stock Option”
    means an Option that by its terms does not qualify or is not
    intended to qualify as an Incentive Stock Option.

 

    (ii) “Officer” means a person who
    is an officer of the Company within the meaning of
    Section 16 of the Exchange Act and the rules and
    regulations promulgated thereunder.

 

    (jj) “Operating Cash Flow” means
    the Company’s or a business unit’s sum of Net Income
    plus depreciation and amortization less capital expenditures
    plus changes in working capital comprised of accounts
    receivable, inventories, other current assets, trade accounts
    payable, accrued expenses, product warranty, advance payments
    from customers and long-term accrued expenses, determined in
    accordance with generally acceptable accounting principles.

 

    (kk) “Operating Expenses” means the
    sum of the Company’s or a business unit’s research and
    development expenses and selling and general and administrative
    expenses during a Fiscal Quarter or Fiscal Year.

    

    3

 

    (ll) “Operating Income” means the
    Company’s or a business unit’s income from operations
    determined in accordance with generally accepted accounting
    principles.

 

    (mm) “Option” means a stock option
    granted pursuant to the Plan.

 

    (nn) “Outside Director” means a
    Director who is not an Employee.

 

    (oo) “Parent” means a “parent
    corporation,” whether now or hereafter existing, as defined
    in Section 424(e) of the Code.

 

    (pp) “Participant” means the holder
    of an outstanding Award.

 

    (qq) “Performance Goals” will have
    the meaning set forth in Section 12 of the Plan.

 

    (rr) “Performance Period” means any
    Fiscal Year of the Company or such other period as determined by
    the Administrator in its sole discretion.

 

    (ss) “Performance Share” means an
    Award denominated in Shares which may be earned in whole or in
    part upon attainment of Performance Goals or other vesting
    criteria as the Administrator may determine pursuant to
    Section 10.

 

    (tt) “Performance Unit” means an
    Award which may be earned in whole or in part upon attainment of
    Performance Goals or other vesting criteria as the Administrator
    may determine and which may be settled for cash, Shares or other
    securities or a combination of the foregoing pursuant to
    Section 10.

 

    (uu) “Period of Restriction” means
    the period during which the transfer of Shares of Restricted
    Stock are subject to restrictions and therefore, the Shares are
    subject to a substantial risk of forfeiture. Such restrictions
    may be based on the passage of time, the achievement of target
    levels of performance, or the occurrence of other events as
    determined by the Administrator.

 

    (vv) “Plan” means this 2007 Equity
    Incentive Plan.

 

    (ww) “Profit Before Tax” means as
    to any Fiscal Quarter or Fiscal Year, the Company’s or a
    business unit’s net sales less all expenses (except for
    taxes, equity, and minority interest), determined in accordance
    with generally accepted accounting principles.

 

    (xx) “Restricted Stock” means
    Shares issued pursuant to a Restricted Stock award under
    Section 7 of the Plan, or issued pursuant to the early
    exercise of an Option.

 

    (yy) “Restricted Stock Unit” means
    a bookkeeping entry representing an amount equal to the Fair
    Market Value of one Share, granted pursuant to Section 8.
    Each Restricted Stock Unit represents an unfunded and unsecured
    obligation of the Company.

 

    (zz) “Retirement” means a
    Participant’s ceasing to be a Service Provider on or after
    the date when the sum in years of (i) the
    Participant’s age (rounded down to the nearest whole
    month), plus (ii) the number of years (rounded down to the
    nearest whole month) that the Participant has provided services
    to the Company equals or is greater than seventy-five (75).

 

    (aaa) “Return on Assets” means the
    percentage equal to the Company’s or a business unit’s
    Operating Income before incentive compensation, divided by
    average net Company or business unit, as applicable,
    assets, determined in accordance with generally accepted
    accounting principles.

 

    (bbb) “Return on Equity” means the
    percentage equal to the Company’s or a business unit’s
    Net Income divided by average stockholder’s equity,
    determined in accordance with generally accepted accounting
    principles.

 

    (ccc) “Return on Gross Fixed
    Assets” means as to any Fiscal Quarter or Fiscal
    Year, the Company’s or a business unit’s annualized
    EBITDA divided by the total Gross Fixed Assets determined in
    accordance with generally accepted accounting principles.

    

    4

 

    (ddd) “Return on Sales” means the
    percentage equal to the Company’s or a business unit’s
    Operating Income before incentive compensation, divided by the
    Company’s or the business unit’s, as applicable,
    revenue, determined in accordance with generally accepted
    accounting principles.

 

    (eee) “Revenue Growth” means the
    Company’s or a business unit’s net sales for the
    Fiscal Quarter or Fiscal Year, determined in accordance with
    generally accepted accounting principles, compared to the net
    sales of the immediately preceding quarter.

 

    (fff) “Rule 16b-3”
    means
    Rule 16b-3
    of the Exchange Act or any successor to
    Rule 16b-3,
    as in effect when discretion is being exercised with respect to
    the Plan.

 

    (ggg) “Section 16(b)” means
    Section 16(b) of the Exchange Act.

 

    (hhh) “Service Provider” means an
    Employee, Director, or Consultant.

 

    (iii) “Share” means a share of the
    Common Stock, as adjusted in accordance with Section 15 of
    the Plan.

 

    (jjj) “Stock Appreciation Right”
    means an Award, granted alone or in connection with an Option,
    that pursuant to Section 9 is designated as a Stock
    Appreciation Right.

 

    (kkk) “Subsidiary” means a
    “subsidiary corporation,” whether now or hereafter
    existing, as defined in Section 424(f) of the Code.

 

    (lll) “Total Stockholder Return”
    means the total return (change in share price plus reinvestment
    of any dividends) of a share of the Company’s common stock.

 

    3.  Stock Subject to the
    Plan.  

 

    (a) Subject to the provisions of Section 15 of the
    Plan, the maximum aggregate number of Shares that may be awarded
    and sold under the Plan is seventeen million (17,000,000)
    Shares. The Shares may be authorized, but unissued, or
    reacquired Common Stock.

 

    (b) Full Value Awards.  Any Shares
    subject to Restricted Stock, Restricted Stock Units, Performance
    Units, and Performance Shares will be counted against the
    numerical limits of this Section 3 as one and a half (1.5)
    Shares for every one (1) Share subject thereto. Further, if
    Shares acquired pursuant to any Restricted Stock, Restricted
    Stock Units, Performance Units, and Performance Shares are
    forfeited or repurchased by the Company and would otherwise
    return to the Plan pursuant to Section 3(c), one and a half
    (1.5) times the number of Shares so forfeited or repurchased
    will return to the Plan and will again become available for
    issuance.

 

    (c) Lapsed Awards.  If an Award
    expires or becomes unexercisable without having been exercised
    in full, is surrendered pursuant to an Exchange Program, or,
    with respect to Restricted Stock, Restricted Stock Units,
    Performance Units or Performance Shares, is forfeited to or
    repurchased by the Company due to failure to vest, the
    unpurchased Shares (or for Awards other than Options or Stock
    Appreciation Rights, the forfeited or repurchased Shares) which
    were subject thereto will become available for future grant or
    sale under the Plan (unless the Plan has terminated). With
    respect to Stock Appreciation Rights, only Shares actually
    issued pursuant to a Stock Appreciation Right will cease to be
    available under the Plan; all remaining Shares under Stock
    Appreciation Rights will remain available for future grant or
    sale under the Plan (unless the Plan has terminated). Shares
    that have actually been issued under the Plan under any Award
    will not be returned to the Plan and will not become available
    for future distribution under the Plan; provided, however, that
    if Shares issued pursuant to Awards of Restricted Stock,
    Restricted Stock Units, Performance Shares or Performance Units
    are repurchased by the Company or are forfeited to the Company,
    such Shares will become available for future grant under the
    Plan. Shares used to pay the exercise price of an Award or to
    satisfy the tax withholding obligations related to an Award will
    not become available for future grant or sale under the Plan. To
    the extent an Award under the Plan is paid out in cash rather
    than Shares, such cash payment will not result in reducing the
    number of Shares available for issuance under the Plan.
    Notwithstanding the foregoing and, subject to adjustment as
    provided in Section 15, the maximum number of Shares that
    may be issued upon the exercise of Incentive Stock Options will
    equal the aggregate Share number stated in Section 3(a),
    plus, to the extent allowable under Section 422 of the Code
    and the Treasury Regulations promulgated thereunder, any Shares
    that become available for issuance under the Plan pursuant to
    this Section 3(c).

    

    5

 

    (d) Share Reserve.  The Company,
    during the term of this Plan, will at all times reserve and keep
    available such number of Shares as will be sufficient to satisfy
    the requirements of the Plan.

 

    4.  Administration of the
    Plan.  

 

    (a) Procedure.

 

    (i) Multiple Administrative
    Bodies.  Different Committees with respect to
    different groups of Service Providers may administer the Plan.

 

    (ii) Section 162(m).  To the
    extent that the Administrator determines it to be desirable to
    qualify Awards granted hereunder as “performance-based
    compensation” within the meaning of Section 162(m) of
    the Code, the Plan will be administered by a Committee of two
    (2) or more “outside directors” within the
    meaning of Section 162(m) of the Code.

 

    (iii) Rule 16b-3.  To
    the extent desirable to qualify transactions hereunder as exempt
    under
    Rule 16b-3,
    the transactions contemplated hereunder will be structured to
    satisfy the requirements for exemption under
    Rule 16b-3.

 

    (iv) Other Administration.  Other
    than as provided above, the Plan will be administered by
    (A) the Board or (B) a Committee, which Committee will
    be constituted to satisfy Applicable Laws.

 

    (b) Powers of the
    Administrator.  Subject to the provisions of
    the Plan, and in the case of a Committee, subject to the
    specific duties delegated by the Board to such Committee, the
    Administrator will have the authority, in its discretion:

 

    (i) to determine the Fair Market Value;

 

    (ii) to select the Service Providers to whom Awards may be
    granted hereunder;

 

    (iii) to determine the number of Shares to be covered by
    each Award granted hereunder;

 

    (iv) to approve forms of Award Agreements for use under the
    Plan;

 

    (v) to determine the terms and conditions, not inconsistent
    with the terms of the Plan, of any Award granted hereunder. Such
    terms and conditions include, but are not limited to, the
    exercise price, the time or times when Awards may be exercised
    (which may be based on performance criteria), any vesting
    acceleration or waiver of forfeiture restrictions, and any
    restriction or limitation regarding any Award or the Shares
    relating thereto, based in each case on such factors as the
    Administrator will determine;

 

    (vi) to determine the terms and conditions of any, and to
    institute any Exchange Program;

 

    (vii) to determine the terms and conditions of any, and to
    institute any Award Transfer Program in accordance with
    Section 14(b).

 

    (viii) to construe and interpret the terms of the Plan and
    Awards granted pursuant to the Plan;

 

    (ix) to prescribe, amend and rescind rules and regulations
    relating to the Plan, including rules and regulations relating
    to sub-plans established for the purpose of satisfying
    applicable foreign laws;

 

    (x) to modify or amend each Award (subject to
    Section 20(c) of the Plan), including but not limited to
    the discretionary authority to extend the post-termination
    exercisability period of Awards and to extend the maximum term
    of an Option (subject to Section 6(b) regarding Incentive
    Stock Options). Notwithstanding the previous sentence, without
    stockholder approval, the Administrator may not (1) modify
    or amend an Option or Stock Appreciation Right to reduce the
    exercise price of such Option or Stock Appreciation Right after
    it has been granted (except for adjustments made pursuant to
    Section 15), (2) cancel any outstanding Option or
    Stock Appreciation Right and immediately replace it with a new
    Option or Stock Appreciation Right with a lower exercise price,
    (3) cancel any outstanding Option or Stock Appreciation
    Right and immediately replace it with a new Restricted Stock,
    Restricted Stock Unit, Performance Unit, or Performance Share,
    or (4) cancel any outstanding Option in exchange for cash;

    

    6

 

    (xi) to allow Participants to satisfy withholding tax
    obligations in such manner as prescribed in Section 16;

 

    (xii) to authorize any person to execute on behalf of the
    Company any instrument required to effect the grant of an Award
    previously granted by the Administrator;

 

    (xiii) to allow a Participant to defer the receipt of the
    payment of cash or the delivery of Shares that would otherwise
    be due to such Participant under an Award pursuant to such
    procedures as the Administrator may determine; and

 

    (xiv) to make all other determinations deemed necessary or
    advisable for administering the Plan.

 

    (c) Effect of Administrator’s
    Decision.  The Administrator’s decisions,
    determinations and interpretations will be final and binding on
    all Participants and any other holders of Awards.

 

    5.  Eligibility.  Nonstatutory
    Stock Options, Restricted Stock, Restricted Stock Units, Stock
    Appreciation Rights, Performance Units and Performance Shares,
    and such other cash or stock awards as the Administrator
    determines may be granted to Service Providers. Incentive Stock
    Options may be granted only to Employees.

 

    6.  Stock Options.  

 

    (a) Limitations.

 

    (i) Each Option will be designated in the Award Agreement
    as either an Incentive Stock Option or a Nonstatutory Stock
    Option. However, notwithstanding such designation, to the extent
    that the aggregate Fair Market Value of the Shares with respect
    to which Incentive Stock Options are exercisable for the first
    time by the Participant during any calendar year (under all
    plans of the Company and any Parent or Subsidiary) exceeds one
    hundred thousand dollars ($100,000), such Options will be
    treated as Nonstatutory Stock Options. For purposes of this
    Section 16(a), Incentive Stock Options will be taken into
    account in the order in which they were granted. The Fair Market
    Value of the Shares will be determined as of the time the Option
    with respect to such Shares is granted.

 

    (ii) The following limitations will apply to grants of
    Options:

 

    (1) No Participant will be granted, in any Fiscal Year,
    Options to purchase more than 2,000,000 Shares.

 

    (2) In connection with his or her initial service as an
    Employee, an Employee may be granted Options to purchase up to
    an additional 2,000,000 Shares, which will not count
    against the limit set forth in Section 6(a)(ii)(1) above.

 

    (3) The foregoing limitations will be adjusted
    proportionately in connection with any change in the
    Company’s capitalization as described in Section 15.

 

    (4) If an Option is cancelled in the same Fiscal Year in
    which it was granted (other than in connection with a
    transaction described in Section 15), the cancelled Option,
    as applicable, will be counted against the limits set forth in
    subsections (1) and (2) above.

 

    (b) Term of Option.  The
    Administrator will determine the term of each Option in its sole
    discretion; provided, however, that the term will be no more
    than ten (10) years from the date of grant thereof.
    Moreover, in the case of an Incentive Stock Option granted to a
    Participant who, at the time the Incentive Stock Option is
    granted, owns stock representing more than ten percent (10%) of
    the total combined voting power of all classes of stock of the
    Company or any Parent or Subsidiary, the term of the Incentive
    Stock Option will be five (5) years from the date of grant
    or such shorter term as may be provided in the Award Agreement.

 

    (c) Option Exercise Price and Consideration.

 

    (i) Exercise Price.  The per share
    exercise price for the Shares to be issued pursuant to exercise
    of an Option will be determined by the Administrator, but will
    be no less than one hundred percent (100%) of the Fair Market
    Value per Share on the date of grant. In addition, in the case
    of an Incentive Stock Option granted to an Employee who, at the
    time the Incentive Stock Option is granted, owns stock
    representing more than ten

    

    7

 

    percent (10%) of the voting power of all classes of stock of the
    Company or any Parent or Subsidiary, the per Share exercise
    price will be no less than one hundred ten percent (110%) of the
    Fair Market Value per Share on the date of grant.
    Notwithstanding the foregoing provisions of this
    Section 6(c), Options may be granted with a per Share
    exercise price of less than one hundred percent (100%) of the
    Fair Market Value per Share on the date of grant pursuant to a
    transaction described in, and in a manner consistent with,
    Section 424(a) of the Code.

 

    (ii) Waiting Period and Exercise
    Dates.  At the time an Option is granted, the
    Administrator will fix the period within which the Option may be
    exercised and will determine any conditions that must be
    satisfied before the Option may be exercised.

 

    (iii) Form of Consideration.  The
    Administrator will determine the acceptable form of
    consideration for exercising an Option, including the method of
    payment to the extent permitted by Applicable Laws.

 

    (d)  Exercise of Option.

 

    (i) Procedure for Exercise; Rights as a
    Stockholder.  Any Option granted hereunder
    will be exercisable according to the terms of the Plan and at
    such times and under such conditions as determined by the
    Administrator and set forth in the Award Agreement. An Option
    may not be exercised for a fraction of a Share.

 

    An Option will be deemed exercised when the Company receives:
    (i) notice of exercise (in such form as the Administrator
    specifies from time to time) from the person entitled to
    exercise the Option, and (ii) full payment for the Shares
    with respect to which the Option is exercised (together with any
    applicable withholding taxes). Full payment may consist of any
    consideration and method of payment authorized by the
    Administrator and permitted by the Award Agreement and the Plan.
    Shares issued upon exercise of an Option will be issued in the
    name of the Participant or, if requested by the Participant, in
    the name of the Participant and his or her spouse. Until the
    Shares are issued (as evidenced by the appropriate entry on the
    books of the Company or of a duly authorized transfer agent of
    the Company), no right to vote or receive dividends or any other
    rights as a stockholder will exist with respect to the Shares
    subject to an Option, notwithstanding the exercise of the
    Option. The Company will issue (or cause to be issued) such
    Shares promptly after the Option is exercised. No adjustment
    will be made for a dividend or other right for which the record
    date is prior to the date the Shares are issued, except as
    provided in Section 15 of the Plan.

 

    Exercising an Option in any manner will decrease the number of
    Shares thereafter available, both for purposes of the Plan and
    for sale under the Option, by the number of Shares as to which
    the Option is exercised.

 

    (ii) Termination of Relationship as a Service
    Provider.  If a Participant ceases to be a
    Service Provider, other than upon the Participant’s
    termination as the result of the Participant’s death or
    Disability, the Participant may exercise his or her Option
    within such period of time as is specified in the Award
    Agreement to the extent that the Option is vested on the date of
    termination (but in no event later than the expiration of the
    term of such Option as set forth in the Award Agreement). In the
    absence of a specified time in the Award Agreement, the Option
    will remain exercisable for three (3) months following the
    Participant’s termination. Unless otherwise provided by the
    Administrator, if on the date of termination the Participant is
    not vested as to his or her entire Option, the Shares covered by
    the unvested portion of the Option will revert to the Plan. If
    after termination the Participant does not exercise his or her
    Option within the time specified by the Administrator, the
    Option will terminate, and the Shares covered by such Option
    will revert to the Plan.

 

    (iii) Disability of
    Participant.  If a Participant ceases to be a
    Service Provider as a result of the Participant’s
    Disability, the Participant may exercise his or her Option
    within such period of time as is specified in the Award
    Agreement to the extent the Option is vested on the date of
    termination (but in no event later than the expiration of the
    term of such Option as set forth in the Award Agreement). In the
    absence of a specified time in the Award Agreement, the Option
    will remain exercisable for twelve (12) months following
    the Participant’s termination. Unless otherwise provided by
    the Administrator, if on the date of termination the Participant
    is not vested as to his or her entire Option, the Shares covered
    by the unvested portion of the Option will revert to the Plan.
    If after termination the Participant does not exercise his or
    her Option within the time specified herein, the Option will
    terminate, and the Shares covered by such Option will revert to
    the Plan.

    

    8

 

    (iv) Death of Participant.  If a
    Participant dies while a Service Provider, the Option may be
    exercised following the Participant’s death within such
    period of time as is specified in the Award Agreement to the
    extent that the Option is vested on the date of death (but in no
    event may the option be exercised later than the expiration of
    the term of such Option as set forth in the Award Agreement), by
    the Participant’s designated beneficiary, provided such
    beneficiary has been designated prior to Participant’s
    death in a form acceptable to the Administrator. If no such
    beneficiary has been designated by the Participant, then such
    Option may be exercised by the personal representative of the
    Participant’s estate or by the person(s) to whom the Option
    is transferred pursuant to the Participant’s will or in
    accordance with the laws of descent and distribution. In the
    absence of a specified time in the Award Agreement, the Option
    will remain exercisable for twelve (12) months following
    Participant’s death. Unless otherwise provided by the
    Administrator, if at the time of death Participant is not vested
    as to his or her entire Option, the Shares covered by the
    unvested portion of the Option will immediately revert to the
    Plan. If the Option is not so exercised within the time
    specified herein, the Option will terminate, and the Shares
    covered by such Option will revert to the Plan.

 

    (v) Retirement of Optionee.  If a
    Participant ceases to be a Service Provider as a result of the
    Participant’s Retirement, the Option will remain
    exercisable for twelve (12) months following
    Participant’s Retirement.

 

    (vi) Other Termination.  A
    Participant’s Award Agreement may also provide that if the
    exercise of an Option following the termination of
    Participant’s status as a Service Provider (other than upon
    the Participant’s death or Disability) would result in
    liability under Section 16(b), then the Option will
    terminate on the earlier of (A) the expiration of the term
    of the Option set forth in the Award Agreement, or (B) the
    10th day after the last date on which such exercise would
    result in such liability under Section 16(b). Finally, a
    Participant’s Award Agreement may also provide that if the
    exercise of the Option following the termination of the
    Participant’s status as a Service Provider (other than upon
    the Participant’s death or Disability) would be prohibited
    at any time solely because the issuance of Shares would violate
    the registration requirements under the Securities Act, then the
    Option will terminate on the earlier of (A) the expiration
    of the term of the Option, or (B) the expiration of a
    period of three (3) months after the termination of the
    Participant’s status as a Service Provider during which the
    exercise of the Option would not be in violation of such
    registration requirements.

 

    7.  Restricted Stock.

 

    (a) Grant of Restricted
    Stock.  Subject to the terms and provisions of
    the Plan, the Administrator, at any time and from time to time,
    may grant Shares of Restricted Stock to Service Providers in
    such amounts as the Administrator, in its sole discretion, will
    determine.

 

    (b) Restricted Stock
    Agreement.  Each Award of Restricted Stock
    will be evidenced by an Award Agreement that will specify the
    Period of Restriction, the number of Shares granted, and such
    other terms and conditions as the Administrator, in its sole
    discretion, will determine. Notwithstanding the foregoing
    sentence, Restricted Stock will vest over a minimum period of
    three (3) years from the date of grant, unless such
    Restricted Stock was granted based upon performance criteria in
    which case it will vest over a minimum of one (1) year from
    the date of grant. Notwithstanding the foregoing sentence,
    during any Fiscal Year no Participant will receive more than an
    aggregate of 1,000,000 Shares of Restricted Stock.
    Notwithstanding the foregoing limitation, in connection with his
    or her initial service as an Employee, an Employee may be
    granted an aggregate of up to an additional
    1,000,000 Shares of Restricted Stock. Unless the
    Administrator determines otherwise, the Company as escrow agent
    will hold Shares of Restricted Stock until the restrictions on
    such Shares have lapsed.

 

    (c) Transferability.  Except as
    provided in this Section 7, Shares of Restricted Stock may
    not be sold, transferred, pledged, assigned, or otherwise
    alienated or hypothecated until the end of the applicable Period
    of Restriction.

 

    (d) Other Restrictions.  The
    Administrator, in its sole discretion, may impose such other
    restrictions on Shares of Restricted Stock as it may deem
    advisable or appropriate.

 

    (e) Removal of
    Restrictions.  Except as otherwise provided in
    this Section 7, Shares of Restricted Stock covered by each
    Restricted Stock grant made under the Plan will be released from
    escrow as soon as practicable

    

    9

 

    after the last day of the Period of Restriction or at such other
    time as the Administrator may determine. The Administrator, in
    its discretion, may accelerate the time at which any
    restrictions will lapse or be removed.

 

    (f) Voting Rights.  During the
    Period of Restriction, Service Providers holding Shares of
    Restricted Stock granted hereunder may exercise full voting
    rights with respect to those Shares, unless the Administrator
    determines otherwise.

 

    (g) Dividends and Other
    Distributions.  During the Period of
    Restriction, Service Providers holding Shares of Restricted
    Stock will be entitled to receive all dividends and other
    distributions paid with respect to such Shares unless otherwise
    provided in the Award Agreement. If any such dividends or
    distributions are paid in Shares, the Shares will be subject to
    the same restrictions on transferability and forfeitability as
    the Shares of Restricted Stock with respect to which they were
    paid.

 

    (h) Return of Restricted Stock to
    Company.  On the date set forth in the Award
    Agreement, the Restricted Stock for which restrictions have not
    lapsed will revert to the Company and again will become
    available for grant under the Plan.

 

    (i) Section 162(m) Performance
    Restrictions.  For purposes of qualifying
    grants of Restricted Stock as “performance-based
    compensation” under Section 162(m) of the Code, the
    Administrator, in its discretion, may set restrictions based
    upon the achievement of Performance Goals. The Performance Goals
    will be set by the Administrator on or before the Determination
    Date. In granting Restricted Stock which is intended to qualify
    under Section 162(m) of the Code, the Administrator will
    follow any procedures determined by it from time to time to be
    necessary or appropriate to ensure qualification of the Award
    under Section 162(m) of the Code (e.g., in determining the
    Performance Goals).

 

    8.  Restricted Stock Units.  

 

    (a) Grant.  Restricted Stock Units
    may be granted at any time and from time to time as determined
    by the Administrator. Each Restricted Stock Unit grant will be
    evidenced by an Award Agreement that will specify such other
    terms and conditions as the Administrator, in its sole
    discretion, will determine, including all terms, conditions, and
    restrictions related to the grant, the number of Restricted
    Stock Units and the form of payout, which subject to
    Section 8(d), may be left to the discretion of the
    Administrator. Notwithstanding anything to the contrary in this
    Section 8(a), during any Fiscal Year of the Company, no
    Participant will receive more than an aggregate of 1,000,000
    Restricted Stock Units. Notwithstanding the limitation in the
    previous sentence, in connection with his or her initial service
    as an Employee, an Employee may be granted an aggregate of up to
    an additional 1,000,000 Restricted Stock Units.

 

    (b) Vesting Criteria and Other
    Terms.  The Administrator will set vesting
    criteria in its discretion, which, depending on the extent to
    which the criteria are met, will determine the number of
    Restricted Stock Units that will be paid out to the Participant.
    Notwithstanding the foregoing sentence, Restricted Stock Units
    will vest over a minimum period of three (3) years from the
    date of grant, unless such Restricted Stock Units were granted
    based upon performance criteria in which case they will vest
    over a minimum of one (1) year from the date of grant. The
    Administrator may set vesting criteria based upon the
    achievement of Company-wide, business unit, or individual goals
    (including, but not limited to, continued employment), or any
    other basis determined by the Administrator in its discretion.

 

    (c) Earning Restricted Stock
    Units.  Upon meeting the applicable vesting
    criteria, the Participant will be entitled to receive a payout
    as specified in the Award Agreement.

 

    (d) Form and Timing of
    Payment.  Payment of earned Restricted Stock
    Units will be made as soon as practicable after the date(s) set
    forth in the Award Agreement. The Administrator, in its sole
    discretion, may pay earned Restricted Stock Units in cash,
    Shares, or a combination thereof.

 

    (e) Cancellation.  On the date set
    forth in the Award Agreement, all unearned Restricted Stock
    Units will be forfeited to the Company.

 

    (f) Section 162(m) Performance
    Restrictions.  For purposes of qualifying
    grants of Restricted Stock Units as “performance-based
    compensation” under Section 162(m) of the Code, the
    Administrator, in its discretion, may set

    

    10

 

    restrictions based upon the achievement of Performance Goals. In
    granting Restricted Stock Units which are intended to qualify
    under Section 162(m) of the Code, the Administrator will
    follow any procedures determined by it from time to time to be
    necessary or appropriate to ensure qualification of the Award
    under Section 162(m) of the Code (e.g., in determining the
    Performance Goals). The Performance Goals will be set by the
    Administrator on or before the Determination Date.

 

    9.  Stock Appreciation
    Rights.  

 

    (a) Grant of Stock Appreciation
    Rights.  Subject to the terms and conditions
    of the Plan, a Stock Appreciation Right may be granted to
    Service Providers at any time and from time to time as will be
    determined by the Administrator, in its sole discretion.

 

    (b) Number of Shares.  The
    Administrator will have complete discretion to determine the
    number of Stock Appreciation Rights granted to any Participant,
    provided that during any Fiscal Year, no Participant will be
    granted Stock Appreciation Rights covering more than
    1,000,000 Shares. Notwithstanding the limitation in the
    previous sentence, in connection with his or her initial service
    as an Employee, an Employee may be granted Stock Appreciation
    Rights covering up to an additional 1,000,000 Shares.

 

    (c) Exercise Price and Other
    Terms.  The Administrator, subject to the
    provisions of the Plan, will have complete discretion to
    determine the terms and conditions of Stock Appreciation Rights
    granted under the Plan; provided, however, that the exercise
    price will be not less than one hundred percent (100%) of the
    Fair Market Value of a Share on the date of grant.

 

    (d) Stock Appreciation Right
    Agreement.  Each Stock Appreciation Right
    grant will be evidenced by an Award Agreement that will specify
    the exercise price, the term of the Stock Appreciation Right,
    the conditions of exercise, and such other terms and conditions
    as the Administrator, in its sole discretion, will determine.

 

    (e) Expiration of Stock Appreciation
    Rights.  A Stock Appreciation Right granted
    under the Plan will expire upon the date determined by the
    Administrator, in its sole discretion, and set forth in the
    Award Agreement; provided, however, that the term will be no
    more than ten (10) years from the date of grant thereof.
    Notwithstanding the foregoing, the rules of Section 6(d)
    also will apply to Stock Appreciation Rights.

 

    (f) Payment of Stock Appreciation Right
    Amount.  Upon exercise of a Stock Appreciation
    Right, a Participant will be entitled to receive payment from
    the Company in an amount determined by multiplying:

 

    (i) The difference between the Fair Market Value of a Share
    on the date of exercise over the exercise price; times

 

    (ii) The number of Shares with respect to which the Stock
    Appreciation Right is exercised.

 

    At the discretion of the Administrator, the payment upon Stock
    Appreciation Right exercise may be in cash, in Shares of
    equivalent value, or in some combination thereof.

 

    10.  Performance Units and Performance
    Shares.  

 

    (a) Grant of Performance
    Units/Shares.  Performance Units and
    Performance Shares may be granted to Service Providers at any
    time and from time to time, as will be determined by the
    Administrator, in its sole discretion. The Administrator will
    have complete discretion in determining the number of
    Performance Units and Performance Shares granted to each
    Participant, provided that during any Fiscal Year, (i) no
    Participant will receive Performance Units having an initial
    value greater than $5,000,000, and (ii) no Participant will
    receive more than 1,000,000 Performance Shares. Notwithstanding
    the foregoing limitation, in connection with his or her initial
    service, a Service Provider may be granted up to an additional
    1,000,000 Performance Shares.

 

    (b) Value of Performance
    Units/Shares.  Each Performance Unit will have
    an initial value that is established by the Administrator on or
    before the date of grant. Each Performance Share will have an
    initial value equal to the Fair Market Value of a Share on the
    date of grant.

 

    (c) Performance Objectives and Other
    Terms.  The Administrator will set performance
    objectives or other vesting provisions (including, without
    limitation, continued status as a Service Provider) in its
    discretion which, depending on the extent to which they are met,
    will determine the number or value of Performance Units/Shares
    that

    

    11

 

    will be paid out to the Service Providers. Notwithstanding the
    foregoing sentence, Performance Units/Shares will vest over a
    minimum period of three (3) years from the date of grant,
    unless such Performance Units/Shares were granted based upon
    performance criteria in which case they will vest over a minimum
    of one (1) year from the date of grant. Each Award of
    Performance Units/Shares will be evidenced by an Award Agreement
    that will specify the Performance Period, and such other terms
    and conditions as the Administrator, in its sole discretion,
    will determine. The Administrator may set performance objectives
    based upon the achievement of Company-wide, divisional, or
    individual goals, applicable federal or state securities laws,
    or any other basis determined by the Administrator in its
    discretion.

 

    (d) Earning of Performance
    Units/Shares.  After the applicable
    Performance Period has ended, the holder of Performance
    Units/Shares will be entitled to receive a payout of the number
    of Performance Units/Shares earned by the Participant over the
    Performance Period, to be determined as a function of the extent
    to which the corresponding performance objectives or other
    vesting provisions have been achieved. After the grant of a
    Performance Unit/Share, the Administrator, in its sole
    discretion, may reduce or waive any performance objectives or
    other vesting provisions for such Performance Unit/Share.

 

    (e) Form and Timing of Payment of Performance
    Units/Shares.  Payment of earned Performance
    Units/Shares will be made as soon as practicable after the
    expiration of the applicable Performance Period. The
    Administrator, in its sole discretion, may pay earned
    Performance Units/Shares in the form of cash, in Shares (which
    have an aggregate Fair Market Value equal to the value of the
    earned Performance Units/Shares at the close of the applicable
    Performance Period) or in a combination thereof.

 

    (f) Cancellation of Performance
    Units/Shares.  On the date set forth in the
    Award Agreement, all unearned or unvested Performance
    Units/Shares will be forfeited to the Company, and again will be
    available for grant under the Plan.

 

    (g) Section 162(m) Performance
    Restrictions.  For purposes of qualifying
    grants of Performance Units/Shares as “performance-based
    compensation” under Section 162(m) of the Code, the
    Administrator, in its discretion, may set restrictions based
    upon the achievement of Performance Goals. The Performance Goals
    will be set by the Administrator on or before the Determination
    Date. In granting Performance Units/Shares which are intended to
    qualify under Section 162(m) of the Code, the Administrator
    will follow any procedures determined by it from time to time to
    be necessary or appropriate to ensure qualification of the Award
    under Section 162(m) of the Code (e.g., in determining the
    Performance Goals).

 

    11.  Formula Option Grants to Outside
    Directors.  

 

    (a) General.  All grants of Options
    to Outside Directors pursuant to this Section 11 will be
    automatic and nondiscretionary, except as otherwise provided
    herein, and will be made in accordance with the following
    provisions:

 

    (b) Type of Option.  All Options
    granted pursuant to this Section will be Nonstatutory Stock
    Options and, except as otherwise provided herein, will be
    subject to the other terms and conditions of the Plan.

 

    (c) No Discretion.  No person will
    have any discretion to select which Outside Directors will be
    granted Options under this Section or to determine the number of
    Shares to be covered by such Options (except as provided in
    Sections 11(g) and 15).

 

    (d) Initial Option.  Each person
    who first becomes an Outside Director following the effective
    date of the Plan will be automatically granted an Option to
    purchase twenty thousand (20,000) Shares (the “Initial
    Option”) on or about the date on which such person
    first becomes an Outside Director, whether through election by
    the stockholders of the Company or appointment by the Board to
    fill a vacancy; provided, however, that an Inside Director who
    ceases to be an Inside Director, but who remains a Director,
    will not receive a First Option.

 

    (e) Annual Option.  Each Outside
    Director will be automatically granted an Option to purchase ten
    thousand (10,000) Shares (an “Annual Option”)
    on each date of the annual meeting of the stockholders of the
    Company beginning in 2008, if as of such date, he or she will
    have served on the Board for at least the preceding six
    (6) months.

    

    12

 

    (f) Terms.  The terms of each
    Option granted pursuant to this Section 11 will be as
    follows:

 

    (i) The term of the Option will be ten (10) years.

 

    (ii) The exercise price per Share will be one hundred
    percent (100%) of the Fair Market Value per Share on the date of
    grant of the Option.

 

    (iii) Subject to Section 15, the Option will vest and
    become exercisable as to one-third
    (1/3rd)
    of the Shares subject to the Option on each anniversary of its
    date of grant, provided that the Participant continues to serve
    as a Director through each such date.

 

    (g) Adjustments.  The Administrator
    in its discretion may change and otherwise revise the terms of
    Options granted under this Section 11, including, without
    limitation, the number of Shares and exercise prices thereof,
    for Options granted on or after the date the Administrator
    determines to make any such change or revision.

 

    (h) Other Awards.  Nothing in this
    Section 11 will limit the ability of the Administrator to
    grant all types of Awards under the Plan to Outside Directors in
    addition to the Options that are granted to them under this
    Section 11.

 

    12.  Performance Goals.  The
    granting
    and/or
    vesting of Awards of Restricted Stock, Restricted Stock Units,
    Performance Shares and Performance Units and other incentives
    under the Plan may be made subject to the attainment of
    performance goals relating to one or more business criteria
    within the meaning of Section 162(m) of the Code and may
    provide for a targeted level or levels of achievement
    (“Performance Goals”) including:
    (i) Annual Revenue, (ii) Cash Position,
    (iii) Company Free Cash Flow, (iv) Earnings Per Share,
    (v) EBITDA, (vi) Gross Margin, (vii) Gross Profit
    Dollars, (viii) Net Cash Provided by Operations,
    (ix) Net Income, (x) Operating Cash Flow,
    (xi) Operating Expenses, (xii) Operating Income,
    (xiii) Profit Before Tax, (xiv) Return on Assets,
    (xv) Return on Equity, (xvi) Return on Gross Fixed
    Assets, (xvii) Return on Sales, (xviii) Revenue
    Growth, and (xix) Total Stockholder Return. Any Performance
    Goals may be used to measure the performance of the Company as a
    whole or a business unit of the Company and may be measured
    relative to a peer group or index. The Performance Goals may
    differ from Participant to Participant and from Award to Award.
    Any criteria used may be (i) measured in absolute terms,
    (ii) compared to another company or companies,
    (iii) measured against the performance of the Company as a
    whole or a segment of the Company
    and/or
    (iv) measured on a pre-tax or post-tax basis (if
    applicable). Prior to the Determination Date, the Administrator
    will determine whether any significant element(s) will be
    included in or excluded from the calculation of any Performance
    Goal with respect to any Participant. Any Performance Goals may
    be used to measure the performance of the Company as a whole or
    a business unit of the Company and may be measured relative to a
    peer group or index. The Performance Goals may differ from
    Participant to Participant and from Award to Award. Prior to the
    Determination Date, the Administrator will determine whether any
    significant element(s) will be included in or excluded from the
    calculation of any Performance Goal with respect to any
    Participant. In all other respects, Performance Goals will be
    calculated in accordance with the Company’s financial
    statements, generally accepted accounting principles, or under a
    methodology established by the Administrator prior to the
    issuance of an Award, which is consistently applied and
    identified in the financial statements, including footnotes, or
    the management discussion and analysis section of the
    Company’s annual report.

 

    13.  Leaves of Absence/Transfer Between
    Locations.  Unless the Administrator provides
    otherwise or except as required by Applicable Laws, vesting of
    Awards granted hereunder will be suspended during any unpaid
    leave of absence. A Service Provider will not cease to be an
    Employee in the case of (i) any leave of absence approved
    by the Company or (ii) transfers between locations of the
    Company or between the Company, its Parent, or any Subsidiary.
    For purposes of Incentive Stock Options, no such leave may
    exceed ninety (90) days, unless reemployment upon
    expiration of such leave is guaranteed by statute or contract.
    If reemployment upon expiration of a leave of absence approved
    by the Company is not so guaranteed, then three (3) months
    following the ninety-first (91st) day of such leave any
    Incentive Stock Option held by the Participant will cease to be
    treated as an Incentive Stock Option and will be treated for tax
    purposes as a Nonstatutory Stock Option.

 

    14.  Transferability of
    Awards.  

 

    (a) Unless determined otherwise by the Administrator, an
    Award may not be sold, pledged, assigned, hypothecated,
    transferred, or disposed of in any manner other than by will or
    by the laws of descent or distribution

    

    13

 

    and may be exercised, during the lifetime of the Participant,
    only by the Participant. If the Administrator makes an Award
    transferable, such Award will contain such additional terms and
    conditions as the Administrator deems appropriate.

 

    (b) Award Transfer
    Program.  Notwithstanding any contrary
    provision of the Plan, the Administrator shall have all
    discretion and authority to determine and implement the terms
    and conditions of any Award Transfer Program instituted pursuant
    to this Section 14(b) and shall have the authority to amend
    the terms of any Award participating, or otherwise eligible to
    participate in, the Award Transfer Program, including (but not
    limited to) the authority to (i) amend (including to
    extend) the expiration date, post-termination exercise period
    and/or
    forfeiture conditions of any such Award, (ii) amend or
    remove any provisions of the Award relating to the Award
    holder’s continued service to the Company, (iii) amend
    the permissible payment methods with respect to the exercise or
    purchase of any such Award, (iv) amend the adjustments to
    be implemented in the event of changes in the capitalization and
    other similar events with respect to such Award, and
    (v) make such other changes to the terms of such Award as
    the Administrator deems necessary or appropriate in its sole
    discretion.

 

    15.  Adjustments; Dissolution or Liquidation;
    Merger or Change in Control.  

 

    (a) Adjustments.  Subject to any
    required action by the stockholders of the Company, the number
    of shares of Common Stock which have been authorized for
    issuance under the Plan, including Shares as to which no Award
    have yet been granted or which have been returned to the Plan
    upon cancellation or expiration of an Award, the number of
    Shares issuable pursuant to Options to be granted under
    Section 11 of the Plan, the number of Shares covered by
    each outstanding Award
    and/or the
    price per Share covered by each such outstanding Award, shall be
    proportionately adjusted for any dividend or other distribution
    (whether in the form of cash, Shares, other securities, or other
    property), recapitalization, stock split, reverse stock split,
    reorganization, merger, consolidation,
    split-up,
    spin-off, combination, repurchase, or exchange of Shares or
    other securities of the Company, or other change in the
    corporate structure of the Company affecting the Shares occurs
    such that an adjustment is determined by the Administrator (in
    its sole discretion) to be appropriate in order to prevent
    dilution or enlargement of the benefits or potential benefits
    intended to be made available under the Plan. Such adjustment
    shall be made by the Administrator, whose determination in that
    respect shall be final, binding and conclusive. Notwithstanding
    the preceding, the number of Shares subject to any Award always
    shall be a whole number. Except as expressly provided herein, no
    issuance by the Company of shares of stock of any class, or
    securities convertible into shares of stock of any class, shall
    affect, and no adjustment by reason thereof shall be made with
    respect to, the number or price of Shares subject to an Award.

 

    (b) Dissolution or Liquidation.  In
    the event of the proposed dissolution or liquidation of the
    Company, the Administrator will notify each Participant as soon
    as practicable prior to the effective date of such proposed
    transaction. To the extent it has not been previously exercised,
    an Award will terminate immediately prior to the consummation of
    such proposed action.

 

    (c) Change in Control.  In the
    event of a merger or Change in Control, each outstanding Award
    will be treated as the Administrator determines, including,
    without limitation, that each Award be assumed or an equivalent
    option or right substituted by the successor corporation or a
    Parent or Subsidiary of the successor corporation. The
    Administrator will not be required to treat all Awards similarly
    in the transaction.

 

    In the event that the successor corporation does not assume or
    substitute for the Award, the Participant will fully vest in and
    have the right to exercise all of his or her outstanding Options
    and Stock Appreciation Rights, including Shares as to which such
    Awards would not otherwise be vested or exercisable, all
    restrictions on Restricted Stock and Restricted Stock Units will
    lapse, and, with respect to Awards with performance-based
    vesting, all Performance Goals or other vesting criteria will be
    deemed achieved at one hundred percent (100%) of target levels
    and all other terms and conditions met. In addition, if an
    Option or Stock Appreciation Right is not assumed or substituted
    for in the event of a Change in Control, the Administrator will
    notify the Participant in writing or electronically that the
    Option or Stock Appreciation Right will be full vested and
    exercisable for a period of time determined by the Administrator
    in its sole discretion, and the Option or Stock Appreciation
    Right will terminate upon the expiration of such period.

    

    14

 

    For the purposes of this Section 15(c), an Award will be
    considered assumed if, following the Change in Control, the
    Award confers the right to purchase or receive, for each Share
    subject to the Award immediately prior to the Change in Control,
    the consideration (whether stock, cash, or other securities or
    property) received in the Change in Control by holders of Common
    Stock for each Share held on the effective date of the
    transaction (and if holders were offered a choice of
    consideration, the type of consideration chosen by the holders
    of a majority of the outstanding Shares); provided, however,
    that if such consideration received in the Change in Control is
    not solely common stock of the successor corporation or its
    Parent, the Administrator may, with the consent of the successor
    corporation, provide for the consideration to be received upon
    the exercise of an Option or Stock Appreciation Right or upon
    the payout of a Restricted Stock Unit, Performance Unit or
    Performance Share, for each Share subject to such Award, to be
    solely common stock of the successor corporation or its Parent
    equal in fair market value to the per share consideration
    received by holders of Common Stock in the Change in Control.

 

    Notwithstanding anything in this Section 15(c) to the
    contrary, an Award that vests, is earned or paid-out upon the
    satisfaction of one or more Performance Goals will not be
    considered assumed if the Company or its successor modifies any
    of such Performance Goals without the Participant’s
    consent; provided, however, a modification to such Performance
    Goals only to reflect the successor corporation’s
    post-Change in Control corporate structure will not be deemed to
    invalidate an otherwise valid Award assumption.

 

    (d) Outside Director Awards.  With
    respect to Awards granted to an Outside Director that are
    assumed or substituted for, if on the date of or following such
    assumption or substitution the Participant’s status as a
    Director or a director of the successor corporation, as
    applicable, is terminated other than upon a voluntary
    resignation by the Participant (unless such resignation is at
    the request of the acquirer), then the Participant will fully
    vest in and have the right to exercise Options
    and/or Stock
    Appreciation Rights as to all of the Shares underlying such
    Award, including those Shares which would not otherwise be
    vested or exercisable, all restrictions on Restricted Stock and
    Restricted Stock Units will lapse, and, with respect to
    Performance Units and Performance Shares, all Performance Goals
    or other vesting criteria will be deemed achieved at one hundred
    percent (100%) of target levels and all other terms and
    conditions met.

 

    16.  Tax Withholding.

 

    (a) Withholding
    Requirements.  Prior to the delivery of any
    Shares or cash pursuant to an Award (or exercise thereof), the
    Company will have the power and the right to deduct or withhold,
    or require a Participant to remit to the Company, an amount
    sufficient to satisfy federal, state, local, foreign or other
    taxes (including the Participant’s FICA obligation)
    required to be withheld with respect to such Award (or exercise
    thereof).

 

    (b) Withholding Arrangements.  The
    Administrator, in its sole discretion and pursuant to such
    procedures as it may specify from time to time, may permit a
    Participant to satisfy such tax withholding obligation, in whole
    or in part by (without limitation) (a) paying cash,
    (b) electing to have the Company withhold otherwise
    deliverable cash or Shares having a Fair Market Value equal to
    the amount required to be withheld, (c) delivering to the
    Company already-owned Shares having a Fair Market Value equal to
    the amount required to be withheld, or (d) selling a
    sufficient number of Shares otherwise deliverable to the
    Participant through such means as the Administrator may
    determine in its sole discretion (whether through a broker or
    otherwise) equal to the amount required to be withheld. The
    amount of the withholding requirement will be deemed to include
    any amount which the Administrator agrees may be withheld at the
    time the election is made, not to exceed the amount determined
    by using the maximum federal, state or local marginal income tax
    rates applicable to the Participant with respect to the Award on
    the date that the amount of tax to be withheld is to be
    determined. The Fair Market Value of the Shares to be withheld
    or delivered will be determined as of the date that the taxes
    are required to be withheld.

 

    17.  No Effect on Employment or
    Service.  Neither the Plan nor any Award will
    confer upon a Participant any right with respect to continuing
    the Participant’s relationship as a Service Provider with
    the Company, nor will they interfere in any way with the
    Participant’s right or the Company’s right to
    terminate such relationship at any time, with or without cause,
    to the extent permitted by Applicable Laws.

 

    18.  Date of Grant.  The date
    of grant of an Award will be, for all purposes, the date on
    which the Administrator makes the determination granting such
    Award, or such other later date as is determined by the

    

    15

 

    Administrator. Notice of the determination will be provided to
    each Participant within a reasonable time after the date of such
    grant.

 

    19.  Term of Plan.  Subject to
    stockholder approval in accordance with Section 23 of the
    Plan, the Plan will become effective January 1, 2008.
    Unless sooner terminated under Section 20 of the Plan, it
    will continue in effect for a term of ten (10) years from
    the later of (a) the effective date of the Plan, or
    (b) the earlier of the most recent Board or stockholder
    approval of an increase in the number of Shares reserved for
    issuance under the Plan.

 

    20.  Amendment and Termination of the
    Plan.  

 

    (a) Amendment and Termination.  The
    Board may at any time amend, alter, suspend or terminate the
    Plan.

 

    (b) Stockholder Approval.  The
    Company will obtain stockholder approval of any Plan amendment
    to the extent necessary and desirable to comply with Applicable
    Laws.

 

    (c) Effect of Amendment or
    Termination.  No amendment, alteration,
    suspension, or termination of the Plan will impair the rights of
    any Participant, unless mutually agreed otherwise between the
    Participant and the Administrator, which agreement must be in
    writing (which may include
    e-mail) and
    signed by the Participant and the Company. Termination of the
    Plan will not affect the Administrator’s ability to
    exercise the powers granted to it hereunder with respect to
    Awards granted under the Plan prior to the date of such
    termination.

 

    21.  Conditions Upon Issuance of
    Shares.  

 

    (a) Legal Compliance.  Shares will
    not be issued pursuant to the exercise of an Award unless the
    exercise of such Award and the issuance and delivery of such
    Shares will comply with Applicable Laws and will be further
    subject to the approval of counsel for the Company with respect
    to such compliance.

 

    (b) Investment Representations.  As
    a condition to the exercise of an Award, the Company may require
    the person exercising such Award to represent and warrant at the
    time of any such exercise that the Shares are being purchased
    only for investment and without any present intention to sell or
    distribute such Shares if, in the opinion of counsel for the
    Company, such a representation is required.

 

    22.  Inability to Obtain
    Authority.  The inability of the Company to
    obtain authority from any regulatory body having jurisdiction,
    which authority is deemed by the Company’s counsel to be
    necessary to the lawful issuance and sale of any Shares
    hereunder, will relieve the Company of any liability in respect
    of the failure to issue or sell such Shares as to which such
    requisite authority will not have been obtained.

 

    23.  Stockholder
    Approval.  The Plan will be subject to
    approval by the stockholders of the Company within twelve
    (12) months after the date the Plan is adopted. Such
    stockholder approval will be obtained in the manner and to the
    degree required under Applicable Laws.

    

    16

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00128-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00128-of-00352.parquet"}]]