Document:

vray-ex1011i_761.htm

Exhibit 10.11(i)

 

 

 

 

 

 

Certain confidential information contained in this document, marked by brackets as [***], has been omitted because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.

 

Amendment Nr. 8

 

to the

Development and Supply Agreement between ViewRay Incorporated and Siemens Aktiengesellschaft, Healthcare Sector dated 17th June 2008

 

by and between

 

 

ViewRay Technologies, Inc.

with its registered seat in Oakwood Village, OH, USA

-hereinafter referred to as “ViewRay”-

 

and

 

 

Siemens Healthcare GmbH

-hereinafter referred to as “SIEMENS”-

 

-ViewRay and Siemens hereinafter referred to individually as “Party” or collectively as “Parties”-

 

 

 

 

 

Preamble

 

Whereas, Siemens Aktiengesellschaft and ViewRay have signed a Development and Supply Agreement on June 17, 2008 as amended by eight amendments (Amendment 1 signed on June 26th, 2009; Amendment 2 signed on April 14th, 2010; Amendment 3 signed on February 2nd, 2009; Amendment 4 signed on May 11th, 2012, Amendment 5 signed on May 30th, 2012, Amendment 6 signed on February 21st, 2014, Amendment 7 signed on November 19th, 2015 (Development and Supply Agreement and all amendments together the “2008 Agreement”) according to which they have collaborated in the development of combining MR imaging and Radiation Therapy. 

 

Whereas, Siemens Aktiengesellschaft has transferred its Healthcare business, including the assignment to and assumption of the Development and Supply Agreement in its amended version, to a separate legal entity, Siemens Healthcare GmbH in May 1st, 2015. ViewRay has agreed to the assignment. 

 

Whereas, pursuant to Appendix 2 of the 2008 Agreement (the “Supply Agreement”) Siemens currently supplies ViewRay with Siemens’ Avanto MRI components (“Avanto”) for integration into ViewRay’s MRIdian Linac.  Siemens has plans to sunset the Avanto platform, and has developed the Avanto Dot MRI system (“Avanto Dot”) as an upgrade to the Avanto and as part of its lifecycle management for Siemens’ MRI systems.  Each of the Avanto and Avanto Dot are COMPONENTS as such term is used in the Supply Agreement.    

 

Whereas, Siemens and ViewRay desire to include Avanto Dot Components under the Supply Agreement in addition to the existing Avanto Components and extend the Supply Agreement to support their ongoing operations.   

 

Now therefore, the Parties agree as follows:

 

	
 
	
Article 1 -
	
Definitions

 

	
1.1
	
“Avanto” shall have the meaning given that term in the Preamble.

 

	
1.2
	
“Avanto Dot” shall have the meaning given that term in the Preamble.

 

	
1.3
	
“Deliverable” shall mean all deliverables provided by Siemens as specified in the SOW.

 

	
1.4
	
“Development Phase” shall mean the validation of the integration and interaction of the Avanto Dot with ViewRay’s MRIdian Linac, as provided in Article 2.  The Development Phase shall include the design, development and integration of the Software Patch (as defined in Section 2.4, together with the validation and verification of such integration.  

 

	
1.5
	
“NRE” shall mean a non-recurring engineering fee that ViewRay shall pay to Siemens for its services during the Development Phase in line with the milestones of Section 2.1.    

 

	
1.6
	
“Specifications” shall mean the design, functional, technical and other requirements for a Deliverable set forth in Annex 1 and the SOW. The Parties expect to rely on Siemens’ existing Specifications for Components wherever possible, with certain software and related Specifications created or modified as necessary for integration.

 

	
1.7
	
“Statement of Work” or “SOW”” shall mean the project plan, describing the organization, technical and other details of the work to be completed as part of the Development Phase.  The scope of work included in the SOW is described in Annex 2, which may be amended in writing from time-to-time.

 

	
1.8
	
“Upgrade Kit” shall mean a hardware and software package developed by Siemens that allows for an upgrade of a ViewRay’s MRIdian Linac from an Avanto to an Avanto Dot.

 

 

	
1.9
	
“Avanto Supply Limit” is the maximum number of Avanto components which can be ordered by ViewRay between 01.01.2019 and 31.12.2025 as described in Article 3.1.

	
1.10
	
 “Avanto Dot Supply Limit” is the maximum number of Avanto Dot components which can be ordered by ViewRay between 01.01.2019 and 31.12.2025 as described in Article 3.3.

	
1.11
	
“Avanto Dot Upgrade Supply Limit” is the maximum number of Upgrade Kits which can be ordered by ViewRay between 01.01.2019 and 31.12.2029 as described in Article 3.4.

	
1.12
	
“Software Patch” shall mean the package of all required changes Siemens has to implement in the current software baseline for Avanto Dot as defined in Annex 1.

	
1.13
	
“Wind-Down Period” shall mean a period of five years after expiration or termination of this Supply Agreement for any reason as described in Article 4.2.4.

 

	
 
	
Article 2 -
	
Development Phase

 

	
2.1
	
The Development Phase shall commence upon execution of this Amendment, and ViewRay will pay the $500,000 NRE to Siemens as follows: 

	
 
	
2.1.1
	
[***] upon execution of this Amendment;

	
 
	
2.1.2
	
[***] upon delivery of all software, hardware and other physical deliverables required to commence the Offline Development Phase as defined in Annex 2;

	
 
	
2.1.3
	
[***] upon successful completion of the activities described in Section 2.3.

 

	
2.2
	
Specifications for the Avanto Dot and Upgrade Kit, including the integration of each of the Avanto Dot and Upgrade Kit with ViewRay’s MRIdian Linac, are set forth in Annex 1.   Any changes to the Specifications need to be mutually agreed upon by the Parties according Section 8.3 of the Supply Agreement.

 

	
2.3
	
The Development Phase will be completed after successful demonstration of the integration  of the Avanto Dot and Upgrade Kit with the MRIdian Linac. ViewRay will perform the demonstration and confirmation within 6 month after receipt of a Software Patch version comparable with a Siemens internal “Customer Use Tests” (CUT) Version (without CE) in accordance with Annex 1 section 3 and the required hardware. The completion of the Development Phase will be documented in a joint review meeting by both Parties , based upon a review if the verification and validation tests fulfilled all the Specifications (with consent not to be unreasonably withheld) as described in Annex 1 as well as any mutually agreed changes to the Specifications due to the combined use of the Avanto Dot and Upgrade Kit with the MRIdian Linac system.

 

	
2.4
	
The Development Phase will include certain software related to the integration of the Avanto Dot and Upgrade Kit with the MRIdian Linac system (the “Software Patch”).  The Software Patch shall provide the functionality documented in the Specifications.

 

	
2.5
	
Siemens shall apply commercially reasonable efforts to provide maintenance and support for the Software Patch through [***] so that it continues to perform in accordance with the Specifications as delivered and/or upgraded.

 

	
 
	
2.5.1
	
Any maintenance or updates to the Software Patch: (i) shall not remove the functionality set forth in the Specifications or have a material adverse effect on the 

 

 

	
 
		
functionality of the Software Patch and (ii) Siemens will continue to provide bug fixes and resolve other defects to the Software Patch that become known post-release.  

 

	
 
	
2.5.2
	
The Software Patch shall be delivered free of any virus or otherwise malicious code, or any code or command intended to bring down the Software Patch or any computers, networks, data or other electronically stored information, or computer programs or systems.

 

	
 
	
Article 3 -
	
Supply of Avanto and Avanto Dot MRI Systems

 

 

	
3.1
	
ViewRay may purchase, and Siemens shall supply, components for up to [***] Avanto systems (the “Avanto Supply Limit”).  Avanto Supply Limit applies to the all and the total of Avanto system components delivered from [***], this includes potential supply in accordance with 3.2. The purchase price for the Avanto system components effective upon execution of this Amendment is set forth on Annex 3 attached hereto. 

 

	
3.2
	
The Parties acknowledge that an available supply of the Avanto systems is necessary during the development, testing and migration to Avanto Dot systems.  Therefore, in the event that Siemens causes an undue delay to the completion of the Development Phase due to intent or gross negligence, Siemens shall continue to supply Avanto systems for the additional period of such delay.  The Parties further acknowledge that it is mutually beneficial to complete the Development Phase as soon as practicable.  Accordingly, each Party will appoint a project manager within one week of the execution of this Amendment, who shall be responsible to complete a detailed development Annex.  In the event of any material delay to the activities contemplated in the development Annex by one Party, then upon request of the other Party’s project manager, the delaying Party will propose a corrective action plan within two weeks and, upon agreement with the non-delaying Party, implement such corrective action Plan.  Any repeated delays would be escalated to senior management of each Party.  

 

	
3.3
	
ViewRay may purchase, and Siemens shall supply, components for up to [***] Avanto Dot systems (the “Avanto Dot Supply Limit”) by placing orders for Avanto Dot system components until [***].  The Avanto Dot Supply Limit may be increased by the number of Avanto systems that ViewRay chooses to convert to Avanto Dot systems.  [***].  The purchase price for the Avanto Dot system components is set forth on Annex 3 attached hereto.

 

	
3.4
	
ViewRay may also purchase, and Siemens shall supply, components for up to [***] Upgrade Kits until [***]. If ViewRay wishes to extend this period until [***] Siemens can choose the delivery of refurbished components for the delivery after [***]. The total number of [***] Upgrade Kits remains in place. The purchase price for the Upgrade Kits shall be [***] per Upgrade Kit. 

 

	
3.5
	
Siemens shall continue to provide spare parts and service support for the Avanto Dot system components until [***].  From [***] to [***] Siemens will provide support for Avanto Dot system components based on commercially reasonable efforts, consistent with its provision of services to its customers. 
In case of insufficient residual supply on stock Siemens can allocate these units to their customer base on its sole discretion.

 

	
3.6
	
As part of its product lifecycle management, Siemens will proactively identify an upgrade path to any new or replacement MRI system to enable an orderly migration from the Avanto Dot to Siemens’ next generation MRI platform. Annex 3 includes indicative, non-binding pricing for the next generation platform, which is subject to mutual agreement in the future.

 

 

 

	
3.7
	
The provisions of this Amendment shall replace and supersede Sections 9 of the Supply Agreement in its entirety.  In addition, Sections 8.1 and 8.2 of the Supply Agreement are hereby deleted and replaced with the following:  

 

“8.1  SELLER is entitled to technically change the COMPONENTS without notice to BUYER; provided that the COMPONENTS continue to conform to the applicable specifications for the then-current COMPONENTS. Notwithstanding the foregoing, SELLER shall notify BUYER about the changes in writing at least nine (9) months before start of production of the changed COMPONENTS. SELLER shall not make technical changes to the COMPONENTS that will cause them to not conform to the applicable specifications, unless such changes are required for safety reasons and/or by a change in applicable law or regulations, in which case SELLER shall follow the procedure in Section 8.2.

 

8.2  If, as a result of a safety reasons and/or a change in applicable law or regulations, SELLER is required to make technical changes to the then-current COMPONENTS, and such changes could affect form, size, assembly, function or interfaces of the COMPONENTS so that such new or changed COMPONENTS fail to conform to the applicable specifications for the then-current COMPONENTS, SELLER shall as early as reasonably practicable, taking into consideration the regulatory requirements of introducing changes to the then-current COMPONENTS and the System notify BUYER and give BUYER access to specifications for the "new" COMPONENTS as well as access (at SELLER'S facility or at BUYER's request and expense at Buyer's Beachwood, Ohio facility) to a pre­production prototype of the new COMPONENTS prior to commercial release of the new COMPONENTS to permit BUYER to test the COMPONENTS and provide input to SELLER on its impact on the MRIdian Linac System. BUYER will notify SELLER not later than 9 months following the date it is notified of such technical changes by SELLER whether BUYER will adopt the new COMPONENTS for use in the MRIdian Linac System, and the parties shall cooperate to achieved the successful integration of the new COMPONENTS for use in the MRIdian Linac System. If BUYER adopts the new COMPONENTS for use in the MRIdian Linac System, Annex 1 and, to the extent applicable, Annex 2 will be amended to reflect the new COMPONENTS. SELLER is not obligated to continue to supply “old” COMPONENTS.”

 

 

	
3.8
	
Section 5.2 (Payment Terms) of the Supply Agreement shall be changed in a way that all payments shall be due within [***] days after invoice. 

 

	
3.9
	
[***]. 

 

	
 
	
Article 4 -
	
Term and Termination; Exclusivity

 

	
4.1
	
Article 9 of the 2008 Agreement is hereby deleted.

 

	
4.2
	
Article 13 of the Supply Agreement is hereby deleted and replaced with the following provisions:  

 

	
 
	
4.2.1
	
This Supply Agreement shall continue until January 1, 2026 unless it is terminated in accordance with Section 4.2.2 (the “Initial Term”). The term of the Supply Agreement will be automatically extended by twelve months unless terminated by either Party upon six months prior written notice with effect to the end of a calendar year.

 

	
 
	
4.2.2
	
Either Party may, without prejudice to any other rights it may have, terminate this Supply Agreement by providing written notice to the other Party if the other Party breaches any of its representations, warranties or obligations under 

 

 

	
 
		
this Supply Agreement and fails to cure such breach within 60 days after receiving written notice thereof from the non-breaching Party.

 

	
 
	
4.2.3
	
In the event of a CHANGE OF CONTROL of ViewRay by a third party that is a Direct Competitor of Siemens, either Party may terminate the 2008 Agreement in the form of this Amendment upon 90 days’ written notice to the other. For purposes of this Agreement, "Direct Competitor" means [***].  

 

	
 
	
4.2.4
	
Subject to the Avanto Supply Limit and Avanto Dot Supply Limit described in Sections 3.1-3.3, for a period of five years after expiration or termination of this Supply Agreement for any reason (the “Wind-Down Period”), Siemens will continue the supply of Components for ViewRay's MRIdian Linac System. This cooperation during the Wind-Down Period will include: (i) the continued manufacture and orderly supply of Components after the termination or expiration date, provided that in the  event that the termination was effected by Siemens as a result of ViewRay's material breach of this Supply Agreement, ViewRay will promptly pay all sums due Siemens under this Supply Agreement (other than those that are disputed in good faith by ViewRay) as of the date of termination; (ii) continued support of Components in accordance with the terms of this Supply Agreement after the termination or expiration date, provided that in the event that the termination was effected by  Siemens as a result of Buyer's material breach of this Supply Agreement ViewRay will promptly pay all sums due Siemens under this Supply Agreement (other than those that are disputed in good faith by ViewRay) as of the date of termination; and (iii) completion of the development phase of this agreement, including but not limited to NRE payments from ViewRay and all deliverables and activities outlined under Article 2, unless otherwise agreed in writing by the parties.

 

	
 
	
4.2.5
	
After the termination or expiration of this Supply Agreement, at Buyer's request, Siemens will continue to provide components for Upgrade Kits and support services to ViewRay for installed Components in accordance with Sections 3.4 and 3.5. ViewRay will continue to support such end users in the same manner that ViewRay provides similar support for other elements of the MRIdian Linac system.

 

	
 
	
4.2.6
	
[***].  

 

	
 
	
4.2.7
	
The provisions in Articles 7, 14 and 15 in the Supply Agreement shall survive the expiration or termination of this Supply Agreement. Any licenses granted by Siemens to ViewRay under this Supply Agreement or the 2008 Agreement will survive any expiration or termination of this Supply Agreement for any reason for as long as and to the extent that they are reasonably necessary to continue servicing and supporting existing accounts provided that ViewRay has paid any and all due payments to Siemens.

 

	
 
	
Article 5 -
	
Medical Device and Regulatory Requirements

 

	
5.1
	
The following stipulations of Article 5 shall overrule any and all prior agreements with regard to Medical Device and Regulatory Requirements.

	
5.2
	
Siemens shall document, implement, and maintain an acceptable quality system, such as the ISO 9001 for industrial (non-medical) products or ISO 13485 (for Medical Device Products) standard or equivalent certification.  Such quality system shall address records and controls required to ensure traceability of Components supplied to ViewRay, including product version numbers and/or serial numbers comparable but not beyond to the tracing within Siemens MAGNETOM systems.

 

 

 

	
5.3
	
All Components delivered to ViewRay shall undergo Siemens’ production testing protocols on component level before they are released for shipment. ViewRay will identify non-conforming Components in accordance with ViewRay’s internal inspection and testing procedures and notify Siemens of such non-conformance in writing, and where warranted, by issuing a more formal SCAR (Supplier Corrective Action Request).  Siemens shall acknowledge receipt of notice in writing and provide an initial written status response back to ViewRay within a reasonable period of time.  Siemens will investigate the non-conformance and implement correction and/or corrective actions, as required.  Siemens agrees to preserve and maintain all data associated with Component and other performance failures and corrective actions and to make that data available to ViewRay upon request and that all such data shall be maintained as confidential.

 

	
5.4
	
Siemens shall (a) inform ViewRay in a timely manner about any quality related notifications that Siemens makes regarding the Avanto and Avanto Dot Components (as listed in Annex 1) to its own end customers.  Siemens further agrees to work in good faith with ViewRay to  review and investigate all product complaints related to the Components (as listed in Annex 1) and provide a summary of their investigations and conclusions. Potential solutions need to be aligned on a case-by-case basis.

 

	
5.5
	
Siemens shall establish and maintain procedures to identify, control, and recall Components as a result of safety or efficacy reasons.  In the event of any product recall, product withdrawal or field correction related to the Components (as listed in Annex 1), the Parties agree that (a) they shall promptly notify each other and (b) they shall cooperate with each other as reasonably necessary. ViewRay shall be the point of contact for its end-user purchasers of any Component (whether directly or through any permitted sub-distributors) and be responsible for applicable regulatory authority contacts and for coordination of any end-user recall or field correction activities.  Siemens shall provide supporting information to ViewRay as relevant to any such recall, withdrawal or field correction.   

 

	
5.6
	
Upon reasonable request from ViewRay for a conflict materials report, Siemens will provide a report to ViewRay that provides disclosure of any critical materials used in the production of any Component.

 

	
 
	
Article 6 -
	
Miscellaneous

 

	
6.1
	
This Amendment shall take effect on the date it is signed by both Parties.  Except to the extent expressly amended by this Amendment, all of the clauses and conditions of the 2008 Agreement shall remain unaffected. The term "Agreement”, as used in the 2008 Agreement, shall henceforth be deemed to be a reference to the 2008 Agreement as amended by this Amendment.

 

	
6.2
	
This Amendment may be executed in counterparts, each of which will be deemed an original with all such counterparts together constituting one instrument. Capitalized terms used in this Amendment and  not defined herein are used with the meanings ascribed to them in the 2008 Agreement.

 

	
6.3
	
This Amendment may not be assigned or otherwise transferred, nor may any rights or obligations be assigned or delegated, by either Party without the prior written consent of the other Party hereto, which consent may not be unreasonably withheld, except that either Party may assign this Amendment in whole or in part and/ or its rights and obligations hereunder without the consent of the other Party to an Affiliate of such Party, or to a third-party successor in interest of all or part of the business to which this Amendment relates, whether as a result of a change of ownership (including by stock purchase, merger or consolidation) and/or as a result of the sale of all or a substantial part of the assets and/or all or a part of the business to which 

 

 

		
this Amendment relates and/or in connection with any type of spin-off, merger, consolidation, divestiture, dissolution and any other type of business combination or business reorganization. 

 

	
6.4
	
Any amendments as well as supplements to this Amendment must be in writing and signed by the Parties in order to be effective. A waiver of form shall be effective only if agreed upon in writing and signed by the Parties.

 

	
6.5
	
This Amendment shall constitute the entire understanding of the Parties regarding the subject matter hereof. Any general terms and conditions of the Parties shall not apply, even if printed on or referenced by a form used in connection with this Amendment.  If provisions of this Amendment conflict with any terms or provisions of the 2008 Agreement, this Amendment shall have precedence.

 

 

[Signature Page Follows]

 

 

In Witness Whereof, the parties have caused this Amendment 8 to be executed by their duly authorized representatives as of the dated shown below. 

 

ViewRay Technologies, Inc.                                              Siemens Healthcare GmbH

 

 

By: By:

Print Name:Print Name:      

Title:Title:      

Date:      Date:      

 

 

 

 

By: 

Print Name:

Title:

Date:vray-ex1026b_797.htm

 

 

Exhibit 10.26(b)

VIEWRAY, INC.

AMENDED AND RESTATED 2015 EMPLOYEE STOCK PURCHASE PLAN

 

ARTICLE I

PURPOSE, SCOPE AND ADMINISTRATION OF THE PLAN

 

1.1Purpose and Scope. The purpose of the Amended and Restated ViewRay, Inc. 2015 Employee Stock Purchase Plan, as it may be amended from time to time, (the “Plan”) is to assist employees of ViewRay, Inc., a Delaware corporation, (the “Company”) and its Designated Subsidiaries in acquiring a stock ownership interest in the Company pursuant to a plan which is intended to qualify as an “employee stock purchase plan” under Section 423 of the Code and to help such employees provide for their future security and to encourage them to remain in the employment of the Company and its Subsidiaries.

 

ARTICLE II

DEFINITIONS

 

Whenever the following terms are used in the Plan, they shall have the meaning specified below unless the context clearly indicates to the contrary. The singular pronoun shall include the plural where the context so indicates.

 

	
2.1
	
“Agent” means the brokerage firm, bank or other financial institution, entity or person(s), if any, engaged, retained, appointed or authorized to act as the agent of the Company or an Employee with regard to the Plan.

 

	
2.2
	
“Administrator” shall mean the Committee, or such individuals to which authority to administer the Plan has been delegated under Section 7.1 hereof.

 

	
2.3
	
“Board” shall mean the Board of Directors of the Company.

 

	
2.4
	
“Code” shall mean the Internal Revenue Code of 1986, as amended.

 

	
2.5
	
“Committee” shall mean the Compensation Committee of the Board.

 

	
2.6
	
“Common Stock” shall mean the common stock, par value $0.01, of the Company.

 

	
2.7
	
“Company” shall have such meaning as set forth in Section 1.1 hereof.

 

	
2.8
	
“Compensation” of an Employee shall mean the regular straight-time earnings or base salary, bonuses and commissions paid to the Employee from the Company on each Payday as compensation for services to the Company or any Designated Subsidiary (before deduction for any salary deferral contributions made by the Employee to any tax-qualified or nonqualified deferred compensation plan), including overtime, shift differentials, vacation pay, salaried production schedule premiums, holiday pay, jury duty pay, funeral leave pay, paid time off, military pay, prior week adjustments and weekly bonus, but excluding education or tuition 

 

 

		
reimbursements, imputed income arising under any group insurance or benefit program, travel expenses, business and moving reimbursements, income received in connection with any stock options, restricted stock, restricted stock units or other compensatory equity awards and all contributions made by the Company or any Designated Subsidiary for the Employee’s benefit under any employee benefit plan now or hereafter established. Such Compensation shall be calculated before deduction of any income or employment tax withholdings, but shall be withheld from the Employee’s net income.

 

	
2.9
	
“Designated Subsidiary” shall mean each Subsidiary that has been designated by the Board or Committee from time to time in its sole discretion as eligible to participate in the Plan, including any Subsidiary in existence on the Effective Date and any Subsidiary formed or acquired following the Effective Date, in accordance with Section 7.2 hereof.

 

	
2.10
	
“Effective Date” shall mean July 15, 2015, the date the Board originally adopted the Plan.

 

	
2.11
	
“Eligible Employee” shall mean an Employee who (a) is customarily scheduled to work at least twenty (20) hours per week, (b) whose customary employment is more than five (5) months in a calendar year and (c) after the granting of the Option would not be deemed for purposes of Section 423(b)(3) of the Code to possess five percent (5%) or more of the total combined voting power or value of all classes of stock of the Company or any Subsidiary. For purposes of clause (c), the rules of Section 424(d) of the Code with regard to the attribution of stock ownership shall apply in determining the stock ownership of an individual, and stock which an Employee may purchase under outstanding options shall be treated as stock owned by the Employee. Notwithstanding the foregoing, the Administrator may exclude from participation in the Plan as an Eligible Employee (x) any Employee that is a “highly compensated employee” of the Company or any Designated Subsidiary (within the meaning of Section 414(q) of the Code), or that is such a “highly compensated employee” (A) with compensation above a specified level, (B) who is an officer and/or (C) is subject to the disclosure requirements of Section 16(a) of the Exchange Act and/or (y) any Employee who is a citizen or resident of a foreign jurisdiction (without regard to whether they are also a citizen of the United States or a resident alien (within the meaning of Section 7701(b)(1)(A) of the Code)) if either (i) the grant of the Option is prohibited under the laws of the jurisdiction governing such Employee, or (ii) compliance with the laws of the foreign jurisdiction would cause the Plan or the Option to violate the requirements of Section 423 of the Code; provided that any exclusion pursuant to clauses (x), and/or (y) shall be applied in an identical manner under each Offering Period to all Employees of the Company and all Designated Subsidiaries, in accordance with Treasury Regulation Section 1.423-2(e).

 

	
2.12
	
“Employee” shall mean any person who renders services to the Company or a Designated Subsidiary in the status of an employee within the meaning of Section 3401(c) of the Code. “Employee” shall not include (i) any independent contractor, consultant, advisor or director of the Company or a Designated Subsidiary who does not render services to the Company or a Designated Subsidiary in the status of an employee within the meaning of Section 3401(c) of the Code or (ii) interim or temporary employee unless he or she has been employed with the Company or a Designated Subsidiary for two years or more. For purposes of the Plan, 

 

 

		
the employment relationship shall be treated as continuing intact while the individual is on military leave, sick leave or other leave of absence approved by the Company or Designated Subsidiary and meeting the requirements of Treasury Regulation Section 1.421-1(h)(2). Where the period of leave exceeds three (3) months, or such other period specified in Treasury Regulation Section 1.421-1(h)(2), and the individual’s right to reemployment is not guaranteed either by statute or by contract, the employment relationship shall be deemed to have terminated on the first day immediately following such three (3)-month period, or such other period specified in Treasury Regulation Section 1.421-1(h)(2).

 

	
2.13
	
“Enrollment Date” shall mean the first date of each Offering Period.

 

	
2.14
	
“Exercise Date” shall mean the last Trading Day of each Offering Period, except as provided in Section 5.2 hereof.

 

	
2.15
	
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended.

 

	
2.16
	
“Fair Market Value” shall mean, as of any date, the value of Common Stock determined as follows:

 

(a)If the Common Stock is (i) listed on any established securities exchange (such as the New York Stock Exchange, the NASDAQ Global Market and the NASDAQ Global Select Market), (ii) listed on any national market system or (iii) listed, quoted or traded on any automated quotation system, its Fair Market Value shall be the closing sales price for a share of Common Stock as quoted on such exchange or system for such date or, if there is no closing sales price for a share of Common Stock on the date in question, the closing sales price for a share of Stock on the last preceding date for which such quotation exists, as reported by The Wall Street Journal or such other source as the Administrator deems reliable;

 

(b)If the Common Stock is not listed on an established securities exchange, national market system or automated quotation system, but the Common Stock is regularly quoted by a recognized securities dealer, its Fair Market Value shall be the mean of the high bid and low asked prices for such date or, if there are no high bid and low asked prices for a share of Common Stock on such date, the high bid and low asked prices for a share of Common Stock on the last preceding date for which such information exists, as reported by The Wall Street Journal or such other source as the Administrator deems reliable; or

 

(c)If the Common Stock is neither listed on an established securities exchange, national market system or automated quotation system nor regularly quoted by a recognized securities dealer, its Fair Market Value shall be established by the Administrator in good faith.

 

	
2.17
	
“Grant Date” shall mean the first Trading Day of an Offering Period.

 

	
2.18
	
“New Exercise Date” shall have such meaning as set forth in Section 5.2(b) hereof.

 

 

 

	
2.19
	
“Offering Period” shall mean such period of time commencing on such date(s) as determined by the Board or Committee, in its sole discretion, and with respect to which Options shall be granted to Participants. The duration and timing of Offering Periods may be established or changed by the Board or Committee at any time, in its sole discretion. Notwithstanding the foregoing, in no event may an Offering Period exceed twenty-seven (27) months.

 

	
2.20
	
“Option” shall mean the right to purchase shares of Common Stock pursuant to the Plan during each Offering Period.

 

	
2.21
	
“Option Price” shall mean the purchase price of a share of Common Stock hereunder as provided in Section 4.2 hereof.

 

	
2.22
	
“Parent” means any entity that is a parent corporation of the Company within the meaning of Section 424 of the Code and the Treasury Regulations thereunder.

 

	
2.23
	
“Participant” shall mean any Eligible Employee who elects to participate in the Plan.

 

	
2.24
	
“Payday” shall mean the regular and recurring established day for payment of Compensation to an Employee of the Company or any Designated Subsidiary.

 

	
2.25
	
“Plan” shall have such meaning as set forth in Section 1.1 hereof.

 

	
2.26
	
“Plan Account” shall mean a bookkeeping account established and maintained by the Company in the name of each Participant.

 

	
2.27
	
“Section 423 Option” shall have such meaning as set forth in Section 3.1(b) hereof.

 

	
2.28
	
“Subsidiary” shall mean any entity that is a subsidiary corporation of the Company within the meaning of Section 424 of the Code and the Treasury Regulations thereunder. In addition, with respect to any sub-plans adopted under Section 7.1(d) hereof which are designed to be outside the scope of Section 423 of the Code, Subsidiary shall include any corporate or noncorporate entity in which the Company has a direct or indirect equity interest or significant business relationship.

 

	
2.29
	
“Trading Day” shall mean a day on which the principal securities exchange on which the Common Stock is listed is open for trading or, if the Common Stock is not listed on a securities exchange, shall mean a business day, as determined by the Administrator in good faith.

 

	
2.30
	
“Withdrawal Election” shall have such meaning as set forth in Section 6.1(a) hereof.

 

ARTICLE III

PARTICIPATION

 

 

 

	
 
	
3.1
	
Eligibility.

 

(a)Any Eligible Employee who shall be employed by the Company or a Designated Subsidiary on a given Enrollment Date for an Offering Period shall be eligible to participate in the Plan during such Offering Period, subject to the requirements of Articles IV and V hereof, and the limitations imposed by Section 423(b) of the Code and the Treasury Regulations thereunder.

 

(b)No Eligible Employee shall be granted an Option under the Plan which permits the Participant’s rights to purchase shares of Common Stock under the Plan, and to purchase stock under all other employee stock purchase plans of the Company, any Parent or any Subsidiary subject to Section 423 of the Code (any such Option or other option, a “Section 423 Option”), to accrue at a rate which exceeds $25,000 of fair market value of such stock (determined at the time the Section 423 Option is granted) for each calendar year in which any Section 423 Option granted to the Participant is outstanding at any time. For purposes of the limitation imposed by this subsection, (i) the right to purchase stock under a Section 423 Option accrues when the Section 423 Option (or any portion thereof) first becomes exercisable during the calendar year, (ii) the right to purchase stock under a Section 423 Option accrues at the rate provided in the Section 423 Option, but in no case may such rate exceed $25,000 of fair market value of such stock (determined at the time such option is granted) for any one calendar year, and (ii) a right to purchase stock which has accrued under a Section 423 Option may not be carried over to any other Section 423 Option; provided that Participants may carry forward amounts so accrued that represent a fractional share of stock and were withheld but not applied towards the purchase of Common Stock under an earlier Offering Period, and may apply such amounts towards the purchase of additional shares of Common Stock under a subsequent Offering Period.

 

The limitation under this Section 3.1(b) shall be applied in accordance with Section 423(b)(8) of the Code and the Treasury Regulations thereunder.

 

	
 
	
3.2
	
Election to Participate; Payroll Deductions

 

(a)Except as provided in Section 3.3 hereof, an Eligible Employee may become a Participant in the Plan only by means of payroll deduction. Each individual who is an Eligible Employee as of an Offering Period’s Enrollment Date may elect to participate in such Offering Period and the Plan by delivering to the Company a payroll deduction authorization no later than such period of time prior to the applicable Enrollment Date as determined by the Administrator, in its sole discretion.

 

(b)Subject to Section 3.1(b) hereof, payroll deductions (i) shall be equal to at least one percent (1%) of the Participant’s Compensation as of each Payday of the Offering Period following the Enrollment Date, but not more than the lesser of fifteen percent (15%) of the Participant’s Compensation as of each Payday of the Offering Period following the Enrollment Date or $30,000 per Offering Period; and (ii) may be expressed as a whole number percentage. Amounts deducted from a Participant’s Compensation with respect to an Offering Period pursuant to this Section 3.2 shall be deducted each Payday through payroll deduction and credited to the Participant’s Plan Account.

 

 

 

(c)Following at least one (1) payroll deduction, a Participant may decrease (to as low as zero) the amount deducted from such Participant’s Compensation only once during an Offering Period by completing and filing with the Company a new payroll deduction authorization form no later than such period of time prior to the end of the Offering Period then in effect, as determined by the Administrator in its sole discretion. A Participant may not increase the amount deducted from such Participant’s Compensation during an Offering Period.

 

(d)Notwithstanding the foregoing, upon the termination of an Offering Period, each Participant in such Offering Period shall automatically participate in the immediately following Offering Period at the same payroll deduction percentage as in effect at the termination of the prior Offering Period, unless such Participant delivers to the Company a different election with respect to the successive Offering Period in accordance with Section 3.2(a) hereof, or unless such Participant becomes ineligible for participation in the Plan.

 

	
3.3
	
Leave of Absence. During leaves of absence approved by the Company meeting the requirements of Treasury Regulation Section 1.421-1(h)(2) under the Code, a Participant may continue participation in the Plan by making cash payments to the Company on his or her normal payday equal to his or her authorized payroll deduction.

 

ARTICLE IV

PURCHASE OF SHARES

 

	
4.1
	
Grant of Option. Each Participant shall be granted an Option with respect to an Offering Period on the applicable Grant Date. Subject to the limitations of Section 3.1(b) hereof, the number of shares of Common Stock subject to a Participant’s Option shall be determined by dividing (a) such Participant’s payroll deductions accumulated prior to the Exercise Date and retained in the Participant’s Plan Account on such Exercise Date by (b) the applicable Option Price; provided that in no event shall a Participant be permitted to purchase during each Offering Period more than 3,000 shares of Common Stock (subject to any adjustment pursuant to Section 5.2 hereof). The Administrator may, for future Offering Periods, increase or decrease, in its absolute discretion, the maximum number of shares of Common Stock that a Participant may purchase during such future Offering Periods. Each Option shall expire on the Exercise Date for the applicable Offering Period immediately after the automatic exercise of the Option in accordance with Section 4.3 hereof, unless such Option terminates earlier in accordance with Article 6 hereof.

 

	
4.2
	
Option Price. The “Option Price” per share of Common Stock to be paid by a Participant upon exercise of the Participant’s Option on the applicable Exercise Date for an Offering Period shall be equal to eighty five percent (85%) of the lesser of the Fair Market Value of a share of Common Stock on (a) the applicable Grant Date and (b) the applicable Exercise Date; provided that in no event shall the Option Price per share of Common Stock be less than the par value per share of the Common Stock.

 

	
4.3
	
Purchase of Shares.

 

(a)On the applicable Exercise Date for an Offering Period, each Participant 

 

 

shall automatically and without any action on such Participant’s part be deemed to have exercised his or her Option to purchase at the applicable Option Price the largest number of whole shares of Common Stock which can be purchased with the amount in the Participant’s Plan Account. Any balance less than eighty five percent (85%) of the lesser of the Fair Market Value of a share of Common Stock on (i) the applicable Grant Date and (ii) the applicable Exercise Date remaining in the Participant’s Plan Account (after exercise of such Participant’s Option) as of such Exercise Date shall be carried forward to the next Offering Period, unless the Participant has elected to withdraw from the Plan pursuant to Section 6.1 hereof or, pursuant to Section 6.2 hereof, or such Participant has ceased to be an Eligible Employee. Any balance not carried forward to the next Offering Period in accordance with the prior sentence promptly shall be refunded to the applicable Participant.

 

(b)As soon as practicable following the applicable Exercise Date, the number of shares of Common Stock purchased by such Participant pursuant to Section 4.3(a) hereof shall be delivered (either in share certificate or book entry form), in the Company’s sole discretion, to either (i) the Participant or (ii) an account established in the Participant’s name at a stock brokerage or other financial services firm designated by the Company. If the Company is required to obtain from any commission or agency authority to issue any such shares of Common Stock, the Company shall seek to obtain such authority. Inability of the Company to obtain from any such commission or agency authority which counsel for the Company deems necessary for the lawful issuance of any such shares shall relieve the Company from liability to any Participant except to refund to the Participant such Participant’s Plan Account balance, without interest thereon.

 

(c)Shares of Common Stock purchased by a Participant pursuant to Section 4.3(a) will be subject to restrictions on transfer in the form of a holding period commencing on the Exercise Date and continuing through twelve (12) months following the Exercise Date for the Offering Period during which the shares were purchased, during which period such shares of Common Stock may not be sold, assigned, pledged, exchanged, hypothecated or otherwise transferred; provided, that the Participant remains an Employee during such holding period. If the Participant ceases to be an Employee during the holding period, such holding period will cease to apply.

 

	
4.4
	
Transferability of Rights. An Option granted under the Plan shall not be transferable, other than by will or the applicable laws of descent and distribution, and is exercisable during the Participant’s lifetime only by the Participant.  No option or interest or right to the Option shall be available to pay off any debts, contracts or engagements of the Participant or his or her successors in interest or shall be subject to disposition by pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempt at disposition of the option shall have no effect.

 

ARTICLE V

PROVISIONS RELATING TO COMMON STOCK

 

 

 

	
5.1
	
Common Stock Reserved. Subject to adjustment as provided in Section 5.2 hereof, the maximum number of shares of Common Stock that shall be made available for sale under the Plan shall be the sum of (a) 285,621 shares of Common Stock and (b) an annual increase on the first day of each year beginning in 2016 and ending in 2025 equal to the lesser of (i) one percent (1%) of the shares of Common Stock outstanding on the last day of the immediately preceding fiscal year and (ii) such number of shares of Common Stock as determined by the Board; provided, however, no more than 3,500,000 shares of Common Stock may be issued under the Plan. Shares of Common Stock made available for sale under the Plan may be authorized but unissued shares, treasury shares of Common Stock, or reacquired shares reserved for issuance under the Plan.

 

	
5.2
	
Adjustments Upon Changes in Capitalization, Dissolution, Liquidation, Merger or Asset Sale.

 

(a)Changes in Capitalization. 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 but not yet placed under Option, as well as the price per share and the number of shares of Common Stock covered by each Option under the Plan which has not yet been exercised shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or decrease in the number of shares of Common Stock effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” Such adjustment shall be made by the Administrator, whose determination in that respect shall be final, binding and conclusive. 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 of Common Stock subject to an Option.

 

(b)Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Offering Period then in progress shall be shortened by setting a new Exercise Date (the “New Exercise Date”), and shall terminate immediately prior to the consummation of such proposed dissolution or liquidation, unless provided otherwise by the Administrator. The New Exercise Date shall be before the date of the Company’s proposed dissolution or liquidation. The Administrator shall notify each Participant in writing, at least ten (10) business days prior to the New Exercise Date, that the Exercise Date for the Participant’s Option has been changed to the New Exercise Date and that the Participant’s Option shall be exercised automatically on the New Exercise Date, unless prior to such date the Participant has withdrawn from the Offering Period as provided in Section 6.1 hereof.

 

(c)Merger or Asset Sale.  In the event of a proposed sale of all or substantially all of the assets of the Company, or the merger of the Company with or into another corporation, each outstanding Option shall be assumed or an equivalent Option substituted by the successor corporation or a Parent or Subsidiary of the successor corporation.  In the event that the successor corporation refuses to assume or substitute for the Option, any Offering Periods then in progress shall be shortened by setting a New Exercise Date and any Offering Periods then 

 

 

in progress shall end on the New Exercise Date. The New Exercise Date shall be before the date of the Company’s proposed sale or merger. The Administrator shall notify each Participant in writing, at least ten (10) business days prior to the New Exercise Date, that the Exercise Date for the Participant’s Option has been changed to the New Exercise Date and that the Participant’s Option shall be exercised automatically on the New Exercise Date, unless prior to such date the Participant has withdrawn from the Offering Period as provided in Section 6.1 hereof.

 

	
5.3
	
Insufficient Shares. If the Administrator determines that, on a given Exercise Date, the number of shares of Common Stock with respect to which Options are to be exercised may exceed the number of shares of Common Stock remaining available for sale under the Plan on such Exercise Date, the Administrator shall make a pro rata allocation of the shares of Common Stock available for issuance on such Exercise Date in as uniform a manner as shall be practicable and as it shall determine in its sole discretion to be equitable among all Participants exercising Options to purchase Common Stock on such Exercise Date, and unless additional shares are authorized for issuance under the Plan, no further Offering Periods shall take place and the Plan shall terminate pursuant to Section 7.4 hereof. If an Offering Period is so terminated, then the balance of the amount credited to the Participant’s Plan Account which has not been applied to the purchase of shares of Common Stock shall be paid to such Participant in one lump sum in cash within thirty (30) days after such Exercise Date, without any interest thereon.

 

	
5.4
	
Rights as Stockholders. With respect to shares of Common Stock subject to an Option, a Participant shall not be deemed to be a stockholder of the Company and shall not have any of the rights or privileges of a stockholder. A Participant shall have the rights and privileges of a stockholder of the Company when, but not until, shares of Common Stock have been deposited in the designated brokerage account following exercise of his or her Option.

 

ARTICLE VI

TERMINATION OF PARTICIPATION

 

	
6.1
	
Cessation of Contributions; Voluntary Withdrawal.

 

(a)A Participant may cease payroll deductions during an Offering Period and elect to withdraw from the Plan by delivering written notice of such election to the Company in such form and at such time prior to the Exercise Date for such Offering Period as may be established by the Administrator (a “Withdrawal Election”). A Participant electing to withdraw from the Plan may elect to either (i) withdraw all of the funds then credited to the Participant’s Plan Account as of the date on which the Withdrawal Election is received by the Company, in which case amounts credited to such Plan Account shall be returned to the Participant in one (1) lump-sum payment in cash within thirty (30) days after such election is received by the Company, without any interest thereon, and the Participant shall cease to participate in the Plan and the Participant’s Option for such Offering Period shall terminate; or (ii) exercise the Option for the maximum number of whole shares of Common Stock on the applicable Exercise Date with any remaining Plan Account balance returned to the Participant in one (1) lump-sum payment in cash within thirty (30) days after such Exercise Date, without any interest thereon, and after such exercise cease to participate in the Plan. Upon receipt of a Withdrawal Election, 

 

 

the Participant’s payroll deduction authorization and his or her Option to purchase under the Plan shall terminate.

 

(b)A participant’s withdrawal from the Plan shall not have any effect upon his or her eligibility to participate in any similar plan which may hereafter be adopted by the Company or in succeeding Offering Periods which commence after the termination of the Offering Period from which the Participant withdraws.

 

(c)A Participant who ceases contributions to the Plan during any Offering Period shall not be permitted to resume contributions to the Plan during that Offering Period.

 

	
6.2
	
Termination of Eligibility. Upon a Participant’s ceasing to be an Eligible Employee, for any reason, such Participant’s Option for the applicable Offering Period shall automatically terminate, he or she shall be deemed to have elected to withdraw from the Plan, and such Participant’s Plan Account shall be paid to such Participant or, in the case of his or her death, to the person or persons entitled thereto pursuant to applicable law, within thirty (30) days after such cessation of being an Eligible Employee, without any interest thereon.

 

ARTICLE VII

GENERAL PROVISIONS

 

	
7.1
	
Administration.

 

(a)The Plan shall be administered by the Committee, which shall be composed of members of the Board. The Committee may delegate administrative tasks under the Plan to the services of an Agent and/or Employees to assist in the administration of the Plan, including establishing and maintaining an individual securities account under the Plan for each Participant.

 

(b)It shall be the duty of the Administrator to conduct the general administration of the Plan in accordance with the provisions of the Plan. The Administrator shall have the power, subject to, and within the limitations of, the express provisions of the Plan:

 

(i)To establish Offering Periods;

 

(ii)To determine when and how Options shall be granted and the provisions and terms of each Offering Period (which need not be identical);

 

(iii)To select Designated Subsidiaries in accordance with Section 7.2 hereof; and

 

(iv)To construe and interpret the Plan, the terms of any Offering Period and the terms of the Options and to adopt such rules for the administration, interpretation, and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules. The Administrator, in the exercise of this power, may correct any defect, omission or inconsistency in the Plan, any Offering Period or any Option, in a manner and to the extent it shall deem necessary or expedient to make the Plan fully effect, subject to Section 423 of the 

 

 

Code and the Treasury Regulations thereunder.

 

(c)The Administrator may adopt rules or procedures relating to the operation and administration of the Plan to accommodate the specific requirements of local laws and procedures. Without limiting the generality of the foregoing, the Administrator is specifically authorized to adopt rules and procedures regarding handling of participation elections, payroll deductions, payment of interest, conversion of local currency, payroll tax, withholding procedures and handling of stock certificates which vary with local requirements. In its absolute discretion, the Board may at any time and from time to time exercise any and all rights and duties of the Administrator under the Plan.

 

(d)The Administrator may adopt sub-plans applicable to particular Designated Subsidiaries or locations, which sub-plans may be designed to be outside the scope of Section 423 of the Code. The rules of such sub-plans may take precedence over other provisions of this Plan, with the exception of Section 5.1 hereof, but unless otherwise superseded by the terms of such sub-plan, the provisions of this Plan shall govern the operation of such sub- plan.

 

(e)All expenses and liabilities incurred by the Administrator in connection with the administration of the Plan shall be borne by the Company. The Administrator may, with the approval of the Committee, employ attorneys, consultants, accountants, appraisers, brokers or other persons. The Administrator, the Company and its officers and directors shall be entitled to rely upon the advice, opinions or valuations of any such persons. All actions taken and all interpretations and determinations made by the Administrator in good faith shall be final and binding upon all Participants, the Company and all other interested persons. No member of the Board or Administrator shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or the options, and all members of the Board or Administrator shall be fully protected by the Company in respect to any such action, determination, or interpretation.

 

	
7.2
	
Designation of Subsidiary Corporations. The Board or Committee shall designate from among the Subsidiaries, as determined from time to time, the Subsidiary or Subsidiaries that shall constitute Designated Subsidiaries. The Board or Committee may designate a Subsidiary, or terminate the designation of a Subsidiary, without the approval of the stockholders of the Company.

 

	
7.3
	
No Right to Employment. Nothing in the Plan shall be construed to give any person (including any Participant) the right to remain in the employ of the Company, a Parent or a Subsidiary or to affect the right of the Company, any Parent or any Subsidiary to terminate the employment of any person (including any Participant) at any time, with or without cause, which right is expressly reserved.

 

	
7.4
	
Amendment and Termination of the Plan.

 

(a)The Board may, in its sole discretion, amend, suspend or terminate the Plan at any time and from time to time; provided, however, that without approval of the 

 

 

Company’s stockholders given within twelve (12) months before or after action by the Board, the Plan may not be amended to increase the maximum number of shares of Common Stock subject to the Plan or change the designation or class of Eligible Employees; and provided, further that without approval of the Company’s stockholders, the Plan may not be amended in any manner that would cause the Plan to no longer be an “employee stock purchase plan” within the meaning of Section 423(b) of the Code.

 

(b)In the event the Administrator determines that the ongoing operation of the Plan may result in unfavorable financial accounting consequences, the Administrator may, to the extent permitted under Section 423 of the Code, in its discretion and, to the extent necessary or desirable, modify or amend the Plan to reduce or eliminate such accounting consequence including, but not limited to:

 

(i)altering the Option Price for any Offering Period including an Offering Period underway at the time of the change in Option Price;

 

(ii)shortening any Offering Period so that the Offering Period ends on a new Exercise Date, including an Offering Period underway at the time of the Administrator action; and

(iii)allocating shares of Common Stock.

 

Such modifications or amendments shall not require stockholder approval or the consent of any Participant.

 

(c)Upon termination of the Plan, the balance in each Participant’s Plan Account shall be refunded as soon as practicable after such termination, without any interest thereon.

 

	
7.5
	
Use of Funds; No Interest Paid. All funds received by the Company by reason of purchase of Common Stock under the Plan shall be included in the general funds of the Company free of any trust or other restriction and may be used for any corporate purpose. No interest shall be paid to any Participant or credited under the Plan.

 

	
7.6
	
Approval by Stockholders. The Plan shall be submitted for the approval of the Company’s stockholders within twelve (12) months after the date of the Board’s initial adoption of the Plan. Options may be granted prior to such stockholder approval; provided, however, that such Options shall not be exercisable prior to the time when the Plan is approved by the stockholders; provided, further that if such approval has not been obtained by the end of said twelve (12)-month period, all Options previously granted under the Plan shall thereupon terminate and be canceled and become null and void without being exercised.

 

	
7.7
	
Effect Upon Other Plans. The adoption of the Plan shall not affect any other compensation or incentive plans in effect for the Company, any Parent or any Subsidiary. Nothing in the Plan shall be construed to limit the right of the Company, any Parent or any Subsidiary (a) to establish any other forms of incentives or compensation for Employees of the Company or any Parent or any Subsidiary, or (b) to grant or assume Options otherwise than 

 

 

		
under the Plan in connection with any proper corporate purpose, including, but not by way of limitation, the grant or assumption of options in connection with the acquisition, by purchase, lease, merger, consolidation or otherwise, of the business, stock or assets of any corporation, firm or association.

 

	
7.8
	
Conformity to Securities Laws. Notwithstanding any other provision of the Plan, the Plan and the participation in the Plan by any individual who is then subject to Section 16 of the Exchange Act shall be subject to any additional limitations set forth in any applicable exemption rule under Section 16 of the Exchange Act (including any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the application of such exemptive rule. To the extent permitted by applicable law, the Plan shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.

 

	
7.9
	
Notice of Disposition of Shares. Each Participant shall give the Company prompt notice of any disposition or other transfer of any shares of Common Stock, acquired pursuant to the exercise of an Option, if such disposition or transfer is made (a) within two (2) years after the applicable Grant Date or (b) within one (1) year after the transfer of such shares of Common Stock to such Participant upon exercise of such Option. The Company may direct that any certificates evidencing shares acquired pursuant to the Plan refer to such requirement.

 

	
7.10
	
Tax Withholding. The Company or any Parent or any Subsidiary shall be entitled to require payment in cash or deduction from other compensation payable to each Participant of any sums required by federal, state or local tax law to be withheld with respect to any purchase of shares of Common Stock under the Plan or any sale of such shares.

 

	
7.11
	
Governing Law. The Plan and all rights and obligations thereunder shall be construed and enforced in accordance with the laws of the State of Delaware.

 

	
7.12
	
Notices. All notices or other communications by a participant to the Company under or in connection with the Plan shall be deemed to have been duly given when received in the form specified by the Company at the location, or by the person, designated by the Company for the receipt thereof.

 

	
7.13
	
Conditions to Issuance of Shares.

 

(a)Notwithstanding anything herein to the contrary, the Company shall not be required to issue or deliver any certificates or make any book entries evidencing shares of Common Stock pursuant to the exercise of an Option by a Participant, unless and until the Board or the Committee has determined, with advice of counsel, that the issuance of such shares of Common Stock is in compliance with all applicable laws, regulations of governmental authorities and, if applicable, the requirements of any securities exchange or automated quotation system on which the shares of Common Stock are listed or traded, and the shares of Common Stock are covered by an effective registration statement or applicable exemption from registration. In addition to the terms and conditions provided herein, the Board or the Committee may require that a Participant make such reasonable covenants, agreements, and representations as the Board or the Committee, in its discretion, deems advisable in order to comply with any such laws, regulations, or requirements.

 

 

 

(b)All certificates for shares of Common Stock delivered pursuant to the Plan and all shares of Common Stock issued pursuant to book entry procedures are subject to any stop-transfer orders and other restrictions as the Committee deems necessary or advisable to comply with federal, state, or foreign securities or other laws, rules and regulations and the rules of any securities exchange or automated quotation system on which the shares of Common Stock are listed, quoted, or traded. The Committee may place legends on any certificate or book entry evidencing shares of Common Stock to reference restrictions applicable to the shares of Common Stock.

(c)The Committee shall have the right to require any Participant to comply with any timing or other restrictions with respect to the settlement, distribution or exercise of any Option, including a window-period limitation, as may be imposed in the sole discretion of the Committee.

 

(d)Notwithstanding any other provision of the Plan, unless otherwise determined by the Committee or required by any applicable law, rule or regulation, the Company may, in lieu of delivering to any Participant certificates evidencing shares of Common Stock issued in connection with any Option, record the issuance of shares of Common Stock in the books of the Company (or, as applicable, its transfer agent or stock plan administrator).

 

	
7.14
	
Equal Rights and Privileges. Except with respect to sub-plans designed to be outside the scope of Section 423 of the Code, all Eligible Employees of the Company (or of any Designated Subsidiary) shall have equal rights and privileges under this Plan to the extent required under Section 423 of the Code or the regulations promulgated thereunder so that this Plan qualifies as an “employee stock purchase plan” within the meaning of Section 423 of the Code or the Treasury Regulations thereunder. Any provision of this Plan that is inconsistent with Section 423 of the Code or the Treasury Regulations thereunder shall, without further act or amendment by the Company or the Board, be reformed to comply with the equal rights and privileges requirement of Section 423 of the Code or the Treasury Regulations thereunder.

 

* * * * * *

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