Document:

exv10wxoy

Table of Contents

Exhibit 10(o)

2004

OMNIBUS STOCK AND INCENTIVE PLAN

FOR

DENBURY RESOURCES INC.

(Plan as of December 30, 2008)

(as
amended on December 30, 2008)

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	1.	 	Purpose	 	 	1	 
	2.	 	Definitions	 	 	1	 
	 

	 	(a)
	 	“Administrator”
	 	 	1	 
	 

	 	(b)
	 	“Agreed Price”
	 	 	1	 
	 

	 	(c)
	 	“Applicable Laws”
	 	 	1	 
	 

	 	(d)
	 	“Award”
	 	 	1	 
	 

	 	(e)
	 	“Board”
	 	 	1	 
	 

	 	(f)
	 	“Broker Assisted Exercise”
	 	 	1	 
	 

	 	(g)
	 	“Cause”
	 	 	2	 
	 

	 	(h)
	 	“Change in Control”
	 	 	2	 
	 

	 	(i)
	 	“Change in Control Price”
	 	 	3	 
	 

	 	(j)
	 	“Code”
	 	 	3	 
	 

	 	(k)
	 	“Committee”
	 	 	3	 
	 

	 	(l)
	 	“Common Stock”
	 	 	3	 
	 

	 	(m)
	 	“Company”
	 	 	3	 
	 

	 	(n)
	 	“Date of Grant”
	 	 	3	 
	 

	 	(o)
	 	“Director”
	 	 	3	 
	 

	 	(p)
	 	“Disability”
	 	 	3	 
	 

	 	(q)
	 	“Effective Date”
	 	 	3	 
	 

	 	(r)
	 	“Eligible Person(s)”
	 	 	4	 
	 

	 	(s)
	 	“Employee(s)”
	 	 	4	 
	 

	 	(t)
	 	“Fair Market Value”
	 	 	4	 
	 

	 	(u)
	 	“Holder”
	 	 	4	 
	 

	 	(v)
	 	“Incentive Stock Option”
	 	 	4	 
	 

	 	(w)
	 	“Investment Committee”
	 	 	4	 
	 

	 	(x)
	 	Purposely Omitted
	 	 	4	 
	 

	 	(y)
	 	“Non-Qualified Stock Option”
	 	 	4	 
	 

	 	(z)
	 	“Option”
	 	 	4	 
	 

	 	(aa)
	 	“Option Price”
	 	 	4	 
	 

	 	(bb)
	 	“Parent”
	 	 	4	 
	 

	 	(cc)
	 	“Performance Award”
	 	 	5	 
	 

	 	(dd)
	 	“Performance Measures”
	 	 	5	 
	 

	 	(ee)
	 	“Performance Period”
	 	 	5	 
	 

	 	(ff)
	 	“Plan”
	 	 	5	 
	 

	 	(gg)
	 	“Plan Year”
	 	 	5	 
	 

	 	(hh)
	 	“Reserved Shares”
	 	 	5	 
	 

	 	(ii)
	 	“Restriction(s)” “Restricted”
	 	 	5	 
	 

	 	(jj)
	 	“Restricted Period”
	 	 	5	 
	 

	 	(kk)
	 	“Restricted Shares”
	 	 	5	 
	 

	 	(ll)
	 	“Restricted Share Award”
	 	 	6	 
	 

	 	(mm)
	 	“Restricted Share Distributions”
	 	 	6	 
	 

	 	(nn)
	 	“Retirement Vesting Date”
	 	 	6	 
	 

	 	(oo)
	 	“SAR”
	 	 	6	 

(as
amended on December 30, 2008)

i

Table of Contents

TABLE OF CONTENTS

	 	 	 	 	 	 	 	 	 
	 

	 	(pp)
	 	“Share(s)”
	 	 	6	 
	 

	 	(qq)
	 	“Spread”
	 	 	6	 
	 

	 	(rr)
	 	“Separation”
	 	 	6	 
	 

	 	(ss)
	 	“Subsidiary”
	 	 	6	 
	 

	 	(tt)
	 	“1933 Act”
	 	 	6	 
	 

	 	(uu)
	 	“1934 Act”
	 	 	6	 
	 

	 	(vv)
	 	“Vested”
	 	 	7	 
	 

	 	(ww)
	 	“10% Person”
	 	 	7	 
	3.	 	Award of Reserved Shares	 	 	7	 
	4.	 	Conditions for Grant of Awards	 	 	7	 
	5.	 	Grant of Options	 	 	8	 
	6.	 	Option Price	 	 	9	 
	7.	 	Exercise of Options	 	 	9	 
	8.	 	Vesting of Options	 	 	9	 
	9.	 	Termination of Option Period	 	 	10	 
	10.	 	Acceleration	 	 	11	 
	11.	 	Adjustment of Reserved Shares	 	 	11	 
	12.	 	Transferability of Awards	 	 	13	 
	13.	 	Issuance of Reserved Shares	 	 	13	 
	14.	 	Administration of the Plan	 	 	14	 
	15.	 	Tax Withholding	 	 	15	 
	16.	 	Restricted Share Awards	 	 	15	 
	17.	 	Performance Awards	 	 	16	 
	18.	 	Stock Appreciation Rights	 	 	17	 
	19.	 	Section 83(b) Election	 	 	19	 
	20.	 	Vesting of Awards Upon Retirement	 	 	19	 
	21.	 	Interpretation	 	 	20	 
	22.	 	Amendment and Discontinuation of the Plan	 	 	20	 
	23.	 	Effective Date and Termination Date	 	 	20	 
	24.	 	Section 409A	 	 	20	 

(as
amended on December 30, 2008)

ii

Table of Contents

2004 OMNIBUS STOCK AND INCENTIVE PLAN FOR

DENBURY RESOURCES INC.

     1. Purpose. The purpose of this Plan is to advance the interests of Denbury
Resources Inc., a Delaware Corporation, and increase shareholder value by providing
additional incentives to attract, retain and motivate those qualified and competent
employees and Directors, upon whose efforts and judgment its success is largely dependent.

     2. Definitions. As used herein, the following terms shall have the meaning
indicated:

     (a) “Administrator” shall mean the person(s) designated by the Committee to carry out
nondiscretionary administrative duties with respect to the Plan and Awards.

     (b) “Agreed Price” shall relate to the grant of an Award in the form of a SAR, and shall
mean the value assigned to the Award’s Reserved Shares which will form the basis for
calculating the Spread on the date of exercise of the SAR, which assigned value shall be
the Fair Market Value of such Reserved Shares on the Date of Grant.

     (c) “Applicable Laws” means the requirements relating to the administration of stock option
plans under U.S. state corporate laws, U.S. federal and state securities laws, and the
Code; and the similar laws of any foreign country or jurisdiction where Options are, or
will be, granted.

     (d) “Award” shall mean either an Option, a SAR, a Restricted Share Award, or a Performance
Award, except that where it shall be appropriate to identify the specific type of Award,
reference shall be made to the specific type of Award; and provided, further, that
references to Award shall be deemed to be references to the written agreement evidencing
such Award, and provided, finally, without limitation, that unless expressly provided to
the contrary in the terms of the Award, in the event of a conflict between the terms of the
Plan and the terms of an Award, the terms of the Plan are controlling.

     (e) “Board” shall mean the Board of Directors of the Parent.

     (f) “Broker Assisted Exercise” shall mean a special sale and remittance procedure pursuant
to which the Holder of an Option shall concurrently provide irrevocable written
instructions to (a) an Administrator designated brokerage firm
(“Broker”) to effect the
immediate sale of the Reserved Shares and remit to the Administrator, out of the sale
proceeds available on the settlement date, sufficient funds to cover the aggregate Option
Price plus all applicable Federal, state and local income and employment taxes required to
be withheld by the Company, and (b) the Administrator to deliver the certificates for the
Shares directly to such brokerage firm in order to complete the sale.

(as
amended on December 30, 2008)

1

Table of Contents

     (g) “Cause” shall mean either (i) a final, nonappealable conviction of a Holder for
commission of a felony involving moral turpitude, or (ii) Holder’s willful gross misconduct
that causes material economic harm to the Company or that brings substantial discredit to
the Company’s reputation.

     (h) “Change in Control” shall mean any one of the following:

     (1) “Continuing Directors” no longer constitute a majority of the Board; the
term “Continuing Director” means any individual who has served in such capacity for
one year or more, together with any new directors whose election by such Board or
whose nomination for election by the stockholders of the Company was approved by a
vote of a majority of the Directors of the Company then still in office who were
either directors at the beginning of such one-year period or whose election or
nomination for election was previously so approved;

     (2) after the Effective Date, any person or group of persons acting together
as an entity (other than the Texas Pacific Group and its Affiliates) become (i) the
beneficial owners (as defined in Rule 13d-3 under the Securities Exchange Act of
1934, as amended) directly or indirectly, of shares of common stock representing
thirty percent (30%) or more of the voting power of the Company’s then outstanding
securities entitled generally to vote for the election of the Company’s Directors,
and (ii) the largest beneficial owner directly or indirectly of the Company’s then
outstanding securities entitled generally to vote for the election of the Company’s
Directors;

     (3) the merger or consolidation to which the Company is a party if (i) the
stockholders of the Company immediately prior to the effective date of such merger
or consolidation have beneficial ownership (as defined in Rule 13d-3 under the
Exchange Act) of less than forty percent (40%) of the combined voting power to vote
for the election of directors of the surviving corporation or other entity
following the effective date of such merger or consolidation; or (ii) fifty percent
(50%) or more of the individuals constituting the members the Investment Committee
are terminated due to the Change in Control; or

     (4) the sale of all or substantially all, of the assets of the Company or the
liquidation or dissolution of the Company.

     (5) Notwithstanding the foregoing provisions of this Section 2(h), if a Holder’s
Separation is for a reason other than for Cause, and occurs not more than 90 days prior to
the date on which a Change in Control occurs, for
purposes of Awards, such termination shall be deemed to have occurred immediately
following a Change in Control.

     (6) Notwithstanding anything herein to the contrary, under no circumstances
will a change in the constitution of the board of directors of any Subsidiary, a
change in the beneficial ownership of any Subsidiary, the merger or consolidation
of a Subsidiary with any other entity, the sale of all or substantially all

(as
amended on December 30, 2008)

2

Table of Contents

of the
assets of any Subsidiary or the liquidation or dissolution of any Subsidiary
constitute a “Change in Control” under this Plan.

     (i) “Change in Control Price” shall mean the higher of (i) the highest price per Share paid
in any transaction reported on the NYSE or such other exchange or market as is the
principal trading market for the Common Stock, or (ii) the highest price per share paid in
any bona fide transaction related to a Change in Control, at any time during the 60 day
period immediately preceding such occurrence; with such occurrence date to be determined by
the Committee and any payments of a change in control price to be made within the time
limits established under Section 10(b) hereof.

     (j) “Code” shall mean the Internal Revenue Code of 1986, as now or hereafter amended.

     (k) “Committee” shall mean the Compensation Committee of the Board, provided, further, that
in granting Performance Awards, Committee shall refer to only those members of the
Compensation Committee who are “Outside Directors” within the meaning of Section 162(m) of
the Code.

     (l) “Common Stock” shall mean the common stock, $.001 par value, of the Parent.

     (m) “Company” shall mean, individually and collectively, the Parent and the Subsidiaries,
except that when it shall be appropriate to refer only to Denbury Resources Inc., the
reference will be to “Parent”.

     (n) “Date of Grant” shall mean the date on which the Committee takes formal action to grant
an Award, provided that it is followed, as soon as reasonably practicable, by written
notice to the Eligible Person receiving the Award.

     (o) “Director” shall mean a member of the Board.

     (p) “Disability” shall mean a Holder’s present incapacity resulting from an injury or
illness (either mental or physical) which, in the reasonable opinion of the Administrator
based on such medical evidence as it deems necessary, will result in death or can be
expected to continue for a period of at least twelve (12) months and will prevent the
Holder from performing the normal
services required of the Holder by the Company; provided, however, that such disability did
not result, in whole or in part: (i) from chronic alcoholism; (ii) from addiction to
narcotics; (ii) from a felonious undertaking; or (iv) from an intentional self-inflicted
wound.

     (q) “Effective Date” shall mean May 12, 2004.

(as
amended on December 30, 2008)

3

Table of Contents

     (r) “Eligible Person(s)” shall mean those persons or entities, as applicable, who are
Employees, or non-employee Directors.

     (s) “Employee(s)” shall mean each person whose customary work schedule is a minimum of
thirty (30) hours per week, and who is designated as an employee on the books of the
Company.

     (t) “Fair Market Value” per Share on the date of reference shall be the Closing Price on
such date, provided, further, that if the actual transaction involving the Shares occurs at
a time when the New York Stock Exchange is closed for regular trading, then it shall be the
most recent Closing Price; provided, further, that “Closing Price” means the closing price
of the Shares on the New York Stock Exchange as reported in any newspaper of general
circulation.

     (u) “Holder” shall mean, at each time of reference, each person with respect to whom an
Award is in effect; provided, further, that following the death of a Holder, it shall refer
to the person who succeeds to the rights of such Holder.

     (v) “Incentive Stock Option” shall mean an Option that is an incentive stock option as
defined in Section 422 of the Code.

     (w) “Investment Committee” shall mean the committee of that name established by the Board,
who shall be solely responsible for selecting its members, and whose members on the
Effective Date are Messrs. Gareth Roberts, Ronald T. Evans, Mark Worthey and Phil Rykhoek.

     (x) Purposely Omitted

     (y) “Non-Qualified Stock Option” shall mean an Option that is not an Incentive Stock
Option.

     (z) “Option” (when capitalized) shall mean the grant of the right to purchase Reserved
Shares through the payment of the Option Price and taking the form of either an Incentive
Stock Option or a Non-Qualified Stock Option; except that, where it shall be appropriate to
identify a specific type of Option, reference shall be made to the specific type of Option;
provided, further, without limitation, that a single Option may include both Incentive
Stock Option and Non-Qualified Stock Option provisions.

     (aa) “Option Price” shall mean the price per Reserved Share which is required to be paid by
the Holder in order to exercise his or her right to acquire the Reserved Share under the
terms of the Option.

     (bb) “Parent” shall mean Denbury Resources Inc.

(as
amended on December 30, 2008)

4

Table of Contents

     (cc) “Performance Award” shall mean the award which is granted contingent upon the
attainment of the performance objectives during the Performance Period, all as described
more fully in Section 17.

     (dd) “Performance Measures” shall mean one or more of the following: (i) earnings per
share, (ii) return on average common equity, (iii) pre-tax income, (iv) pre-tax operating
income, (v) net revenue, (vi) net income, (vii) profits before taxes, (viii) book value per
share, (ix) changes in amounts of oil and gas reserves, (x) changes in production rates,
(xi) net asset value, (xii) net asset value per share, (xiii) sales, (xiv) finding costs,
or (xv) operating cost reductions, but shall not include remaining in the employ of the
Company for a specified period of time.

     (ee) “Performance Period” shall mean the period described in Section 17 with respect
to which the performance objectives relate.

     (ff) “Plan” shall mean this 2004 Omnibus Stock and Incentive Plan for Denbury
Resources Inc.

     (gg) “Plan Year” shall mean the calendar year.

     (hh) “Reserved Shares” shall mean, at each time of reference, the total number of
Shares described in Section 3 with respect to which the Committee may grant an Award, all
of which Reserved Shares shall be held in the Parent’s treasury or shall be made available
from the Parent’s authorized and unissued Shares.

     (ii) “Restriction(s)” “Restricted” and similar shall mean the restrictions applicable
to Reserved Shares subject to an Award which constitute “a substantial risk of forfeiture”
of such Reserved Shares within the meaning of Section 83(a)(1) of the Code.

     (jj) “Restricted Period” shall mean the period during which Restricted Shares are
subject to Restrictions.

     (kk) “Restricted Shares” shall mean the Reserved Shares granted to an Eligible Person
which are subject to Restrictions; provided, further, that the Committee may, in its sole
discretion, determine that the Restrictions which otherwise would have been imposed have
been fully satisfied on the Date of Grant by reason of prior service and/or other
considerations, and thus provide that such Restricted Shares shall be fully Vested on the
Date of Grant.

(as
amended on December 30, 2008)

5

Table of Contents

     (ll) “Restricted Share Award” shall mean the award of Restricted Shares.

     (mm) “Restricted Share Distributions” shall mean any amounts, whether Shares, cash or
other property (other than regular cash dividends) paid or distributed by the Parent with
respect to Restricted Shares during a Restricted Period.

     (nn) “Retirement Vesting Date” shall mean the first birthday of a Holder on which that
Holder has attained the later of (i) his 60th birthday, and (ii) the birthday on which that
Holder attains an age equal to (x) 65 minus (y) the number which results from multiplying
(A) fifty percent (50%) times (B) that Holder’s full years of service as an Employee on
such birthday, with such product of (A) and (B) rounded down to the nearest whole number
before being deducted from 65. For example only, and without limiting the generality of
the foregoing, a Holder who has completed 70 months of service (i.e., 5 full years of
service) as an Employee on his 62nd birthday will not have attained his Retirement Vesting
Date, whereas a Holder who has completed 72 months of service (i.e., 6 full years of
service) as an Employee on his 62nd birthday will have attained his Retirement Vesting
Date.

     (oo) “SAR” shall mean a stock appreciation right as defined in Section 18 hereof.

     (pp) “Share(s)” shall mean a share or shares of Common Stock.

     (qq) “Spread” shall mean the difference between the Option Price, or the Agreed Price,
as the case may be, of the Share(s) on the date of the Award, and the Fair Market Value of
such Share(s) on the date of reference.

     (rr) “Separation” shall mean the date on which a Holder ceases to have an employment
relationship with the Company for any reason, including death or Disability; and provided,
further, without limitation, such employment relationship will cease, in the case of a
non-Employee Director, upon his or her ceasing to be a Director; provided, however, that a
Separation will not be considered to have occurred while an Employee is on sick leave,
military leave, or any other leave of absence approved by the Company, if the period of
such leave does not exceed 90 days, or, if longer, so long as the Employee’s right to
redeployment with the Company is guaranteed either by statute or by contract.

     (ss) “Subsidiary” shall mean, where the Award is an Incentive Stock Option, a
“subsidiary corporation”, whether now or hereafter existing, as defined in Section 424(f)
of the Code, and on the case of any other Award, shall mean any entity which would be a
subsidiary corporation as defined in Section 424(f) of the Code if it were a corporation.
Notwithstanding the foregoing, Genesis Energy, Inc. shall not be considered a Subsidiary
for purposes of this Plan.

     (tt) “1933 Act” shall mean the Securities Act of 1933, as amended.

     (uu) “1934 Act” shall mean the Securities Exchange Act of 1934, as amended.

(as
amended on December 30, 2008)

6

Table of Contents

     (vv) “Vested” and similar terms shall mean the number of Option Shares which have
become nonforfeitable and the number of Restricted Shares on which
the Restrictions
have lapsed; provided, further, and without limitation, that the lapse of Restrictions based on
the attainment of performance objectives is also a Vesting event.

     (ww) “10% Person” shall mean a person who owns directly (or indirectly through attribution
under Section 425(d) of the Code) at the Date of Grant of an Incentive Stock Option, stock
possessing more than 10% of the total combined voting power of all classes of voting stock
(as defined in Section 424 of the Code) of the Parent on the Date of Grant.

     3. Award of Reserved Shares.

     (a) As of the Effective Date (as amended), 7,000,000 Shares shall automatically, and
without further action, become Reserved Shares. Notwithstanding the foregoing, not more
than 3,350,000 Reserved Shares may be issued under the Plan as a result of the Vesting of
Restricted Stock or Performance Awards. To the extent any Award shall terminate, expire or
be canceled, the Reserved Shares subject to such Award (or with respect to which the Award
is measured), shall remain Reserved Shares. Where an Award is settled on a basis other
than the issuance of Reserved Shares, the Reserved Shares which measured the amount of such
Award settlement shall be canceled and no longer considered Reserved Shares.

     (b) Notwithstanding any provision in this Plan to the contrary, no person whose
compensation may be subject to the limitations on deductibility under Section 162(m) of the
Code shall be eligible for a grant during a single calendar year of an Award with respect
to, or measured by, more than 500,000 Reserved Shares. The limitation under this Section
3(b) shall be construed so as to comply with the requirements of Section 162(m) of the
Code.

     4. Conditions for Grant of Awards.

     (a) Without limiting the generality of the provisions hereof which deal specifically
with each form of Award, Awards shall only be granted to such one or more Eligible Persons
as shall be selected by the Committee.

     (b) In granting Awards, the Committee shall take into consideration the contribution
the Eligible Person has made or may be reasonably expected to make to the success of the
Company and such other factors as the Committee shall determine. The Committee shall also
have the authority to consult with and receive recommendations from officers and other
personnel of the Company with regard to these matters. The Committee may from time to time
in granting Awards under the Plan prescribe such terms and conditions concerning such
Awards as it deems appropriate, including, without limitation, relating an Award to
achievement of specific goals established by the Committee or to the continued
employment of the Eligible Person for a specified period of time, provided that such
terms and conditions are not inconsistent with the provisions of this Plan.

     (c) Incentive Stock Options may be granted only to Employees, and all other Awards may
be granted to any Eligible Person.

(as
amended on December 30, 2008)

7

Table of Contents

     (d) The Plan shall not confer upon any Holder any right with respect to continuation
of employment by the Company, or any right to provide services to the Company, nor shall it
interfere in any way with his or her right or the Company’s right to terminate his or her
employment at any time.

     (e) The Awards granted to Eligible Persons shall be in addition to regular salaries,
pension, life insurance or other benefits (if any) related to their service to the Company,
and nothing herein shall be deemed to limit the ability of the Company to enter into any
other compensation arrangements with any Eligible Person.

     (f) The Administrator shall determine in each case whether periods of military or
government service shall constitute a continuation of employment or service for the
purposes of this Plan or any Award.

     (g) Notwithstanding any provision hereof to the contrary, each Award which in whole or
in part involves the issuance of Reserved Shares may provide for the issuance of such
Reserved Shares for consideration consisting of cash or cash equivalents, or such other
consideration as the Committee may determine, including (without limitation) as
compensation for past services rendered.

     (h) The Committee may delegate in writing to the Administrator the
authority to grant Awards to new Employees of the Company, provided that such authority
contains limits on the maximum amount or number of Awards (on both an individual basis and,
if the Committee so designates, on an aggregate basis) that the
Administrator may grant under such authority. Such authority shall also
designate the terms and conditions for these grants.

     5. Grant of Options.

     (a) The Committee may grant Options to Eligible Persons from time to time, alone, in
addition to, or in tandem with, other Awards granted under the Plan. An Option granted
hereunder shall be either an Incentive Stock Option or a Non-Qualified Stock Option, and
shall clearly state whether it is (in whole or in part) an Incentive Stock Option or a
Non-Qualified Stock Option; provided, further, that failure of an Option designated as an
Incentive Stock Option to qualify as an Incentive Stock Option will not affect its
validity, and the portion which does not qualify as an Incentive Stock Option shall be a
Non-Qualified Stock Option.

     (b) If both Incentive Stock Options and Non-Qualified Stock Options are granted to a
Holder, the right to exercise, to the full extent thereof, Options of
either type shall not be contingent in whole or in part upon the exercise of, or
failure to exercise, Options of the other type.

     (c) The aggregate Fair Market Value (determined as of the Date of Grant) of the
Reserved Shares with respect to which any Incentive Stock Option is exercisable for the
first time by a Holder during any calendar year under the Plan and all such plans of the
Company (as defined in Section 425 of the Code) shall not exceed $100,000; provided,
further, without

(as
amended on December 30, 2008)

8

Table of Contents

limitation, that any portion of an Option designated as an Incentive Stock
Option which exceeds such $100,000 limit will, notwithstanding such designation, be a
validly granted Non-Qualified Stock Option.

     (d) The Committee may at any time offer to buy out for a payment in cash, an Option
previously granted, based on such terms and conditions as the Committee shall establish and
as communicated to the Holder by the Administrator at the time that such
offer is made.

     6. Option Price.

     (a) The Option Price shall be any price determined by the Committee which is not less
than one hundred percent (100%) of the Fair Market Value per Share on the Date of Grant;
provided, however, that in the case of an Incentive Stock Option granted to a 10% Person
the Option Price shall not be less than 110% of the Fair Market Value per Share on the Date
of Grant. The Administrator shall determine the Fair Market Value per Share.

     (b) Unless further limited by the Committee in any Option, the Option Price may be
paid in cash, by certified or cashier’s check, by wire transfer, by money order, through a
Broker Assisted Exercise, with Shares (but with Shares only if expressly permitted by the
terms of the Option and only with Shares owned by the Holder for at least 6 months prior to
the exercise date), or by a combination of the above; provided, however, that the
Administrator may accept a personal check in full or partial payment. If the Option Price
is permitted to be, and is, paid in whole or in part with Shares, the value of the Shares
surrendered shall be the Shares’ Fair Market Value on the date delivered to the
Administrator.

     7. Exercise of Options.

     An Option shall be deemed exercised when (i) the Administrator has received written notice
of such exercise in accordance with the terms of the Option, and (ii) full payment of the
aggregate Option Price plus required withholding tax amounts, if any, described in Section
15, of the Reserved Shares as to which the Option is exercised has been made. Separate
stock certificates shall be issued by the Parent for any Reserved Shares acquired as a
result of exercising an Incentive Stock Option and a Non-Qualified Stock Option.

     8. Vesting of Options.

     (a) Without limitation, each Option shall Vest in whole or in part, and shall expire,
according to the terms of the Option. Unless otherwise expressly provided in an Option,
each Option which is not an Annual Option as described in Section 8(b) below, shall Vest,
and Reserved Shares subject to such Option shall become Vested Option Shares, on the dates
set forth in the following Vesting Schedule:

(as
amended on December 30, 2008)

9

Table of Contents

     (1) 25% of the Reserved Shares on the first anniversary of the Date of Grant;

     (2) 25% of the Reserved Shares on the second anniversary of the Date of Grant;

     (3) 25% of the Reserved Shares on the third anniversary of the Date of Grant;
and

     (4) 25% of the Reserved Shares on the fourth anniversary of the Date of Grant.

     (b) Except as otherwise expressly provided in such Option, an Option which is
expressly designated as an “Annual” Option shall not Vest, and shall remain 100%
forfeitable, until the fourth (4th) anniversary of its Date of Grant, and on
such fourth (4th) anniversary of its Date of Grant such Annual Option shall
become 100% Vested, and all Reserved Shares subject to such Annual Option shall become
Vested Option Shares.

     (c) The Committee, in its sole discretion, may accelerate the date on which all or any
portion of an otherwise unvested Option shall Vest or restrictions on Restricted Shares
will lapse.

     9. Termination of Option Period.

     (a) Unless the terms of an Option expressly provide for a different date of
termination, the unexercised portion of an Option shall automatically and without notice
terminate and become null and void at the time of the earliest to occur of the following:

     (1) on the 90th day following Holder’s Separation for any reason except death,
Disability or for Cause; or

     (2) immediately upon Separation as a result, in whole or in material part, of
a discharge for Cause; or

     (3) on the first anniversary of a Separation by reason of death or Disability;

     (4) in the case of a 10% Person, on the fifth (5th ) anniversary of
the Date of Grant; or

     (5) on the tenth (10th) anniversary of the Date of Grant.

     (b) Notwithstanding any provision of the Plan to the contrary, in the event of the
proposed dissolution or liquidation of the Parent, or in the event of a proposed sale of
all or substantially all of the assets of the Company, or the proposed merger of the Parent
with or into another corporation (collectively, the “Transaction”), unless otherwise
expressly provided (by express reference to this Section 9(b)) in the terms of an Option,
after the

(as
amended on December 30, 2008)

10

Table of Contents

public announcement of the Transaction, the Committee may, in its sole
discretion, direct the Administrator to deliver a written notice (“Cancellation Notice”) to
any Holder of an Option, canceling the unexercised Vested portion (including the portion
which becomes Vested by reason of acceleration), if any, of such Option, effective on the
date specified in the Cancellation Notice (“Cancellation
Date”). Notwithstanding the
forgoing, the Cancellation Date may not be earlier than the last to occur of (i) the
15th day following delivery of the Cancellation Notice, and (ii) the
60th day prior to the proposed date for the consummation of the Transaction
(“Proposed Date”). Without limitation, the Cancellation Notice will provide that, unless
the Holder elects in writing to waive, in whole or in part, a Conditional Exercise, that
the exercise of the Option will be a Conditional Exercise. A “Conditional Exercise” shall
mean that in the event the Transaction does not occur within 180 days of the Proposed Date,
the exercising Holder shall be refunded any amounts paid to exercise such Holder’s Option,
such Option will be reissued, and the purported exercise of such Option shall be null and
void ab intitio.

     10. Acceleration.

     (a) Unless otherwise expressly provided in the Award, in the event the Holder’s
Separation is by reason of the Holder’s death, or Disability, all Awards granted to the
Holder shall become fully exercisable, Vested, or the Restricted Period shall terminate, as
the case may be (hereafter, in this Section 10, such Award shall be “accelerated”).

     (b) Unless otherwise expressly provided in an Award, in the event of a Change in
Control (i) all Awards shall be accelerated, and (ii) in the sole discretion of the
Committee, the value of some or all Awards may be cashed out on the basis of the Change in
Control Price, at any time during the 60 day period immediately preceding any bona fide
transaction related to a Change in Control; provided, further, that if a date prior to such
occurrence is selected for a cash out, any subsequent increase in the Change in Control
Price will be paid to each Holder on the date of such occurrence, or as soon thereafter as
reasonably
possible, but not later than 2 1/2 months from the occurrence of the Change in Control.

     11. Adjustment of Reserved Shares.

     (a) If at any time while the Plan is in effect or Awards with respect to Reserved
Shares are outstanding, there shall be any increase or decrease in the number of issued and
outstanding Shares through the declaration of a stock dividend or through any
recapitalization resulting in a stock split-up, combination or exchange of Shares, then and
in such event:

     (i) appropriate adjustment shall be made in the maximum number of Reserved
Shares which may be granted under Section 3, and equitably in the Reserved Shares
which are then subject to each Award, so that the same proportion of the Parent’s
issued and outstanding Common Stock shall continue to be subject to grant under
Section 3, and to such Award, and

(as
amended on December 30, 2008)

11

Table of Contents

     (ii) in addition, and without limitation, in the case of each Award
(including, without limitation, Options) which requires the payment of
consideration by the Holder in order to acquire Reserved Shares, an appropriate
equitable adjustment shall be made in the consideration (including, without
limitation the Option Price) required to be paid to acquire the each Reserved
Share, so that (i) the aggregate consideration to acquire all of the Reserved
Shares subject to the Award remains the same and, (ii) so far as possible, (and
without disqualifying an Incentive Stock Option) the relative cost of acquiring
each Reserved Share subject to such Award remains the same.

All such determinations shall be made by the Board in its sole discretion.

     (b) The Committee may change, or may direct the Administrator to change, the terms of
Options outstanding under this Plan, with respect to the Option Price or the number of
Reserved Shares subject to the Options, or both, when, in the Committee’s judgment, such
adjustments become appropriate by reason of a corporate transaction (as defined in Treasury
Regulation § 1.425-1(a)(1)(ii)); provided, however, that if by reason of such corporate
transaction an Incentive Stock Option is assumed or a new Incentive Stock Option is
substituted therefor, the Committee, or at the direction of the Committee, the
Administrator, may only change the terms of such Incentive Stock Option such that (i) the
excess of the aggregate Fair Market Value of the Shares subject to the substituted
Incentive Stock Option immediately after the substitution or assumption, over the aggregate
Option Price of such Shares at such time, is not more than the excess of the aggregate Fair
Market Value of all Reserved Shares subject to the Incentive Stock Option immediately
before such substitution or assumption over the aggregate Option Price of such Reserved
Shares at such time, and (ii) the substituted Incentive Stock Option, or the assumption of
the original Incentive Stock Option does not give the Holder additional benefits which such
Holder did not have under the original Incentive Stock Option. Without limiting the
generality of any other provisions hereof, including, without limitation, Section 21,
except to the minimum extent, if any, required by Section 424(a) of the Code with respect
to Incentive Stock Options, no change made under the authority of this Section 11(b) in the
terms of an Option shall alter such Option’s material provisions in a way that makes such
Option less valuable to its Holder.

     (c) Except as otherwise expressly provided herein, the issuance by the Parent of
shares of its capital stock of any class, or securities convertible into shares of capital
stock of any class, either in connection with direct sale for adequate consideration, or
upon the exercise of rights or warrants to subscribe therefor, or upon conversion of shares
or obligations of the Parent convertible into such shares or other securities, shall not
affect, and no adjustment by reason thereof shall be made with respect to, Reserved Shares
subject to Awards granted under the Plan.

     (d) Without limiting the generality of the foregoing, the existence of outstanding
Awards with respect to Reserved Shares granted under the Plan shall not affect in any
manner the right or power of the Parent to make, authorize or consummate (1) any or all
adjustments, recapitalizations, reorganizations or other changes in the Parent’s capital

(as
amended on December 30, 2008)

12

Table of Contents

structure or its business; (2) any merger or consolidation of the Parent; (3) any issue by
the Parent of debt securities, or preferred or preference stock which would rank above the
Reserved Shares subject to outstanding Awards; (4) the dissolution or liquidation of the
Parent; (5) any sale, transfer or assignment of all or any part of the assets or business
of the Company; or (6) any other corporate act or proceeding, whether of a similar
character or otherwise.

     12. Transferability of Awards. Each Award shall provide that such Award shall not be
transferable by the Holder otherwise than by will or the laws of descent and distribution,
and that so long as an Holder lives, only such Holder or his or her guardian or legal
representative shall have the right to exercise such Incentive Stock Option.

     13. Issuance of Reserved Shares. No Holder shall be, or have any of the rights or
privileges of, the owner of Reserved Shares subject to an Award unless and until
certificates representing such Common Stock shall have been issued and delivered to such
Holder. As a condition of any issuance of Common Stock, the Administrator may obtain such
agreements or undertakings, if any, as the Administrator may deem necessary or advisable to
assure compliance with any such law or regulation or shareholder agreement including, but
not limited to, a representation, warranty or agreement to be bound by any legends that
are, in the opinion of the Administrator, necessary or appropriate to comply with the
provisions of any securities law deemed by the Administrator to be applicable to the
issuance of the Reserved Shares and which are endorsed upon the Share certificates.

     Share certificates issued to the Holder receiving such Reserved Shares who is a party
to any shareholders agreement, voting trust, or any similar agreement shall bear the
legends contained in such agreements. Notwithstanding any provision hereof to the
contrary, no Reserved Shares shall be required to be issued with respect to an Award unless
counsel for the Parent shall be reasonably satisfied that such issuance will be in
compliance with applicable federal or state securities laws.

     In no event shall the Company be required to sell or issue Reserved Shares under any
Award if the sale or issuance thereof would constitute a violation of applicable federal or
state securities law or regulation or a violation of any other law or regulation of any
governmental authority or any national securities exchange. As a condition to any sale or
issuance of Reserved Shares, the Company may place legends on Reserved Shares, issue stop
transfer orders, and require such agreements or undertakings as the Company may deem
necessary or advisable to assure compliance with any such law or regulation.

     Without limitation, the Company shall use its best efforts to register the Reserved
Shares with the Securities and Exchange Commission under a Form S-8.

(as
amended on December 30, 2008)

13

Table of Contents

     14. Administration of the Plan.

     (a) The Plan shall be administered by the Committee and, except for the powers
reserved to the Board in Section 21 hereof, the Committee
shall have all of the
administrative powers under Plan. Without limitation, all members of the Committee must be
independent Directors under applicable rules of the New York Stock Exchange.

     (b) The Committee, from time to time, may adopt rules and regulations for carrying out
the purposes of the Plan and, without limitation, may delegate all of what, in its sole
discretion, it determines to be primarily administrative or ministerial duties to
the Administrator. The determinations under, and the interpretations of, any provision of
the Plan or an Award by the Committee (or the Administrator in the exercise of his
administrative authority) shall, in all cases, be in its sole discretion, and shall be
final and conclusive.

     (c) Any and all determinations and interpretations of the Committee shall be made
either (i) by a majority vote of the members of the Committee at a meeting duly called,
with at least 2 days prior notice, or (ii) without a meeting, by the written approval of
all members of the Committee.

     (d) No member of the Committee, or the Administrator, shall be liable for any action
taken or omitted to be taken by such member or by any other member of the Committee or by
the Administrator with respect to the Plan, and to the extent of liabilities not
otherwise insured under a policy purchased by the Company, the Company does hereby
indemnify and agree to defend and save harmless any member of the Committee, and the
Administrator, with respect to any liabilities asserted or incurred in connection with the
exercise and performance of their powers and duties hereunder, unless such liabilities are
judicially determined to have arisen out of such person’s gross negligence, fraud or bad
faith. Such indemnification shall include attorney’s fees and all other costs and expenses
reasonably incurred in defense of any action arising from such act of commission or
omission. Nothing herein shall be deemed to limit the Company’s ability to insure itself
with respect to its obligations hereunder.

     (e) In particular, and without limitation, except for the authority granted to the
Administrator under Section 4(h) to make determinations described in subsections (i), (ii),
and (iii) below while carrying out the general delegation by the Committee with respect to
the grant of Awards to new Employees, the Committee shall have the sole authority,
consistent with the terms of the Plan:

     (i) to determine whether and to what extent Awards are to be granted hereunder
to one or more Eligible Persons;

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

     (iii) to determine the terms and conditions of any Award granted hereunder,
and to amend or waive any such terms and conditions except to the extent, if any,
expressly prohibited by the Plan;

(as
amended on December 30, 2008)

14

Table of Contents

     (iv) to determine whether and under what circumstances an Option may be
settled in Restricted Shares instead of Reserved Shares;

     (v) to determine whether, to what extent, and under what circumstances Awards
under the Plan are to be made, and operate, on a tandem basis vis-a-vis other
Awards under the Plan; and

     (vi) to determine (or to delegate to the Administrator the authority to
determine) whether to permit payment of tax withholding requirements in Shares.

     (f) Without limitation, Committee (and the Administrator in carrying out his
responsibilities under Section 4(h)) shall have the authority to adopt, alter, and repeal
any or all of its rules, guidelines, and practices with respect to the Plan, and all
questions of interpretation, with respect to the Plan or any Award shall be decided by the
Committee (or by the Administrator in carrying out his duties under Section 4(h)), whose
decision shall be final, conclusive and binding upon the Company and each other affected
party.

     (g) Without limitation, the Committee in its sole discretion may limit the authority
granted, or previously granted, hereunder by the Committee to the Administrator by
notifying the Administrator in writing of such change.

     15. Tax Withholding. On or immediately prior to the date on which a payment is made
to a Holder hereunder or, if earlier, the date on which an amount is required to be
included in the income of the Holder as a result of an Award, the Holder shall be required
to pay to the Company, in cash, or in Shares (but in Shares only if expressly permitted in
the Award, or by written authorization of the Administrator, and then only in the minimum
amount required to satisfy the minimum withholding requirements with respect to such
Award), the amount (if any) which the Company reasonably determines to be necessary in
order for the Company to comply with applicable federal or state tax withholding
requirements, and the collection of employment taxes; provided, further, without
limitation, that the Administrator may require that such payment be made in cash.

     16. Restricted Share Awards.

     (a) The Committee may grant Awards of Restricted Shares to any Eligible Person, for no
cash consideration, for such minimum consideration as may be required by applicable law, or
for such other consideration as may be
specified in the grant. The terms and conditions of Restricted Shares shall be
specified in the Award. The Committee, in its sole discretion, shall determine what
rights, if any, the person to whom an Award of Restricted Shares is made shall have in the
Restricted Shares during the Restriction Period and the Restrictions applicable to the
particular Award, including whether the holder of the Restricted Shares shall have the
right to vote the Restricted Shares and the extent, if any, of Holder’s right to receive
Restricted Share Distributions. Unless otherwise provided in the Restricted Share Award,
upon the expiration of Restrictions, the Restricted Shares shall cease to be Restricted
Shares.

(as
amended on December 30, 2008)

15

Table of Contents

     (b) The Restrictions on Restricted Shares shall lapse in whole, or in installments,
over whatever Restricted Period shall be selected by the Committee.

     (c) Without limitations, the Committee may accelerate the date on which Restrictions
lapse with respect to any Restricted Shares.

     (d) During the Restricted Period, the certificates representing the Restricted Shares,
and any Restricted Share Distributions, shall be registered in the Holder’s name and bear a
restrictive legend disclosing the Restrictions, the existence of the Plan, and the existence
of such Restricted Share Award. Such certificates shall be deposited by the Holder with the
Company, together with stock powers or other instruments of assignment, each endorsed in
blank, which will permit the transfer to the Company of all or any portion of the Restricted
Shares, and any assets constituting Restricted Share Distributions, which shall be forfeited
in accordance with the terms of such Restricted Share Award. Restricted Shares shall
constitute issued and outstanding Common Stock for all corporate purposes and the Holder
shall have all rights, powers and privileges of a holder of unrestricted Shares except those
that are expressly excluded under the terms of the Restricted Share Award, and Holder will
not be entitled to delivery of the stock certificates until all Restrictions shall have
terminated, and the Company will retain custody of all related Restricted Share
Distributions (which will be subject to the same Restrictions, terms, and conditions as the
related Restricted Shares) until the conclusion of the Restricted Period with respect to the
related Restricted Shares; and provided, further, that any Restricted Share Distributions
shall not bear interest or be segregated into a separate account but shall remain a general
asset of the Company, subject to the claims of the Company’s creditors, until the conclusion
of the applicable Restricted Period; and provided, finally, that any material breach of any
terms of the Restricted Share Award, as reasonably determined by the Administrator, will
cause a forfeiture of both Restricted Shares and Restricted Share Distributions.

     17. Performance Awards.

     (a) Performance Awards during a Plan Year may be granted only to the Chief Executive
Officer and the four (4) highest paid employees as of the last day of such Plan Year
(“Covered Employees”), and shall in all events be specifically designated as Performance
Awards. Nothing herein shall be construed as limiting the Committee’s authority to grant
other types of Awards to Eligible Persons, including Covered Employees, conditioned on the
satisfaction of such criteria, including those comprising the Performance Measures, as the
Committee, in its sole discretion, may select.

     (b) Without limitation, the Committee’s grant of Performance Awards may, in its sole
discretion, be made in Reserved Shares, or in cash, or in a combination of Reserved Shares
and cash, but the cash portion of such Award may not exceed $500,000 in a Plan Year.

     (c) The Committee shall select the Performance Measures which will be required to be
satisfied during the Performance Period in order to earn the Performance Award. Such
Performance Measures, and the duration of any Performance Period, may
differ with respect

(as
amended on December 30, 2008)

16

Table of Contents

to each
Covered Employee, or with respect to separate Performance
Awards issued to the same Covered Employee. The selected Performance Measures, the
Performance Period(s), and any other conditions to the Company’s obligation to pay a
Performance Award shall be set forth in each Performance Award on or before the first to
occur of (i) the 90th day of the selected Performance Period, (ii) the first date
on which more than 25% of the Performance Period has elapsed, and (iii) the first date, if
any, on which satisfaction of the Performance Measure(s) is no longer substantially
uncertain.

     (d) Performance Awards shall be paid in a single payment,but will not be paid prior to
the date on which the Performance Measures are attained, except that such payment may be
accelerated upon the death or Disability of the Covered Employee, or as a result of a Change
in Control, it being understood that if such acceleration events occur prior to the
attainment of the Performance Measures, the Performance Award will not be exempt from
Section 162(m) of the Code. Any accelerated payment made upon death or Disability (as
defined in Section 409A of the Code or rules or regulation thereunder) or as a result of a
Change in Control (as defined in Section 409A of the Code or rules or regulation thereunder)
will be paid within 2 1/2 months of the end of the taxable year in which the death or such
disability of the Covered Employee occurs or in which such change in control occurs.

     (e) The extent to which any applicable performance objective has been achieved shall be
conclusively determined by the Committee, but may be specifically delegated to the
Administrator. Without limitation, where a Covered Employee has satisfied the
Performance Measures with respect to a Performance Award, if permitted under the terms of
such Performance Award, the Committee, in its sole discretion, may reduce the maximum amount
payable under such Performance Award.

     18. Stock Appreciation Rights

     (a) The Committee shall have authority to grant (i) a SAR with respect to Reserved
Shares, including, without limitation, Reserved Shares covered by any Option (“Related
Option”), or (ii) a SAR with respect to, or as to some or all of, a Performance Award
(“Related Performance Award”). A SAR granted with respect to a related Option or Related
Performance Award must be granted on the Date of Grant of such Related Option or Related
Performance Award.

     (b) For the purposes of this Section 18, the following definitions shall apply:

     (i) The term “SAR” shall mean a right granted under this Plan, including,
without limitation, a right granted in tandem with an Award, that shall entitle the
Holder thereof to an amount equal to the SAR Spread payable as described in Section
18(d).

     (ii) The term “SAR Spread” shall mean with respect to each SAR an amount equal
to the product of (1) the excess of (A) the Fair Market Value per Share on the date
of exercise, over (B) (x) if the SAR is granted in tandem with an Option, then the
Option Price per Reserved Share of the Related Option, (y) if the SAR is

(as
amended on December 30, 2008)

17

Table of Contents

granted in
tandem with a Performance Award, the Agreed Price under the
Related Performance Award, or (z) if the SAR is granted by itself with respect
to a designated number of Reserved Shares, the Agreed Price which, without
limitation, is the Fair Market Value of the Reserved Shares on the Date of Grant, in
each case multiplied by (2) the number of Reserved Shares with respect to which such
SAR is being exercised; provided, however, without limitation, that with respect to
any SAR granted in tandem with an Incentive Stock Option, in no event shall the SAR
Spread exceed the amount permitted to be treated as the SAR Spread under applicable
Treasury Regulations or other legal authority without disqualifying the Option as an
Incentive Stock Option.

     (c) To exercise the SAR the Holder shall:

     (i) Give written notice thereof to the Company, specifying the SAR being
exercised and the number or Reserved Shares with respect to which such SAR is being
exercised, and

     (ii) If requested by the Company, deliver within a reasonable time the
agreement evidencing the SAR being exercised and, if applicable, the Related Option
agreement, or Related Performance Award agreement, to the Secretary of the Company
who shall endorse or cause to be endorsed thereon a notation of such exercise and
return all agreements to the Holder.

     (d) As soon as practicable, but within 2 1/2 months after the exercise of a SAR the
Company shall transfer to the Holder Reserved Shares having a Fair Market Value on the date
the SAR s exercised equal to either the SAR Spread, or the Offer Spread, as the case may be;
provided, however, without limiting the generality of Section 15, that the Company, in its
sole discretion, may withhold from such transferred Reserved Shares any amount necessary to
satisfy the Company’s minimum obligation for federal and state withholding taxes with
respect to such exercise.

     (e) A SAR may be exercised only if and to the extent that it is permitted under the
terms of the Award which, in the case of a Related Option, shall be only when such Related
Option is eligible to be exercised.

     (f) Upon the exercise or termination of a Related Option, or the payment or termination
of a Related Performance Award, the SAR with respect to such Related Option or Related
Performance Award likewise shall terminate.

     (g) A SAR shall be transferable (i) only to the extent, if any, provided in the
agreement evidencing the SAR, or (ii) if granted with respect to a Related Option, or
Related Performance Award, only to the extent, if any, that such Related Option, or Related
Performance Award, is transferable, and under the same conditions.

     (h) Each SAR shall be on such terms and conditions not inconsistent with this Plan as
the Committee may determine.

(as
amended on December 30, 2008)

18

Table of Contents

     (i) The Holder shall have no rights as a stockholder with respect to the related
Reserved Shares as a result of the grant of a SAR.

     (j) With respect to a Holder who, on the date of a proposed exercise of a SAR is an
officer (as that term is used in Rule 16a-1 promulgated under the 1934 Act or any similar
rule which may subsequently be in effect), such proposed exercise may only occur as
permitted by Rule 16b-3, including without limitation paragraph (e)(3)(iii) (or any similar
rule which may subsequently be in effect promulgated pursuant to Section 16(b) of the 1934
Act).

     19. Section 83(b) Election.

     If as a result of receiving an Award, a Holder receives Restricted Shares, then such
Holder may elect under Section 83(b) of the Code to include in his or her gross income, for
his or her taxable year in which the Restricted Shares are transferred to such Holder, the
excess of the Fair Market Value (determined without regard to any Restriction other than one
which by its terms will never lapse), of such Restricted Shares at the Date of Grant, over
the amount (if any) paid for the Restricted Shares. If the Holder makes the Section 83(b)
election described above, the Holder shall (i) make such election in a manner that is
satisfactory to the Administrator, (ii) provide the Administrator with a copy of such
election, (iii) agree to promptly notify the Company if any Internal Revenue Service or
state tax agent, on audit or otherwise, questions the validity or correctness of such
election or of the amount of income reportable on account of such election, and (iv) agree
to pay the withholding amounts described in Section 15.

     20. Vesting of Awards Upon Retirement.

     Unless otherwise expressly provided in the Award or in the Plan, the unVested portion
of each Award granted to a Holder in the form of Option Shares, SARs and owned by that
Holder on the date of that Holder’s Separation will vest 100% on the date of that Holder’s
Separation if, and only if, such Separation occurs on or after the date that Holder attains
their Retirement Vesting Date. Without limiting the generality of the foregoing, the
Vesting of the unVested portion of an Award granted to a Holder in the form of Restricted
Shares shall not accelerate as a result of that Holder’s Separation after attaining their
Retirement Vesting Date except to the extent, if any, that such Vesting is expressly
provided for in the Award.

(as
amended on December 30, 2008)

19

Table of Contents

     21. Interpretation.

     (a) If any provision of the Plan is held invalid for any reason, such holding shall not
affect the remaining provisions hereof, but instead the Plan shall be construed and enforced
as if such provision had never been included in the Plan.

     (b) THIS PLAN SHALL BE GOVERNED BY THE LAWS OF THE STATE OF DELAWARE.

     (c) Headings contained in this Agreement are for convenience only and shall in no
manner be construed as part of this Plan.

     (d) Any reference to the masculine, feminine, or neuter gender shall be a reference to
such other gender as is appropriate.

     (e) Nothing contained in this Plan shall prevent the Board from adopting other or
additional compensation arrangements, subject to shareholder approval if such approval is
required; and such arrangements may be either generally applicable or applicable only in
specific cases.

     22. Amendment and Discontinuation of the Plan. The Board, or the Committee (subject to
the prior written authorization of the Board), may from time to time amend the Plan or any
Award; provided, however, that (except to the extent provided in Section 9(b)) no such
amendment may, without approval by the shareholders of the Parent, (a) increase the number
of Reserved Shares or change the class of Eligible Persons, (b) permit the granting of
Awards which expire beyond the maximum 10-year period described in Section 9(a)(5), or (c)
make any change for which applicable law or regulatory authority (including the regulatory
authority of the NYSE or any other market or exchange on which the Common Stock is traded)
would require shareholder approval or for which shareholder approval would be required under
Section 162(m) of the Code to secure complete deductibility of all compensation paid as a
result of Awards; and provided, further, that no amendment or suspension of the Plan or any
Award issued hereunder shall, except as specifically permitted in this Plan or under the
terms of such Award, substantially impair any Award previously granted to any Holder without
the consent of such Holder.

     23. Effective Date and Termination Date. The Plan shall be effective as of its
Effective Date, and shall terminate on the tenth anniversary of such Effective Date;
provided, further, without limitation, that unless otherwise expressly provided in an Award,
the termination of the Plan shall not terminate an Award which is outstanding on such date.

     24. Section 409A. It is the intention of the Company that no Award shall be “deferred
compensation” subject to Section 409A of the Code, unless and to the extent that the
Committee specifically determines otherwise, and the Plan and the terms and conditions of
all Awards shall be interpreted accordingly. The terms and conditions governing any Awards
that the Committee determines will be subject to Section 409A of the Code, including any
rules for elective or mandatory deferral of the delivery of cash or shares of Common Stock
pursuant thereto and any rules regarding treatment of such Awards in the event of a Change
of Control, shall be set forth in the applicable Award Agreement, deferral election forms
and procedures, and rules established by the Committee, and shall comply in all respects
with Section 409A of the Code. The following rules will apply to Awards intended to be
subject to Section 409A of the Code (“409A Awards”):

(as
amended on December 30, 2008)

20

Table of Contents

     (a) If a Participant is permitted to elect to defer an Award or any payment under an
Award, such election will be permitted only at times in compliance with Code Section 409A,
including applicable transition rules thereunder.

     (b) The Company shall have no authority to accelerate distributions relating to 409A
Awards in excess of the authority permitted under Section 409A.

     (c) Any distribution of a 409A Award following a termination of employment that would
be subject to Code Section 409A(a)(2)(A)(i) as a distribution following a separation from
service of a “specified employee” as defined under Code Section 409A(a)(2)(B)(i), shall
occur no earlier than the expiration of the six-month period following such Termination of
Employment.

     (d) In the case of any distribution of a 409A Award, if the timing of such distribution
is not otherwise specified in the Plan or an Award Agreement or other governing document,
the distribution shall be made not later than the end of the calendar year during which the
settlement of the 409A Award is specified to occur.

     (e) In the case of an Award providing for distribution or settlement upon vesting or
the lapse of a risk of forfeiture, if the time of such distribution or settlement is not
otherwise specified in the Plan or an Award Agreement or other governing document, the
distribution or settlement shall be made not later than March 15 of the year following the
year in which the Award vested or the risk of forfeiture lapsed.

 

	 	 	 	 	 
	 	DENBURY RESOURCES INC.

 	 
	 	By  	/s/
Phil Rykhoek	 
	 	 	 	 
	 	 	 	 
	 

(as
amended on December 30, 2008)

21exv10w3

Exhibit 10.3

Cavium Networks, Inc.

2007 Equity Incentive Plan

Approved By Board: February 1, 2007

Approved By Stockholders: April 12, 2007

Termination Date: January 31 , 2017

1. General.

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

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

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

2. Administration.

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

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

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

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

1

 

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

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

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

          (vi) To amend the Plan in any respect the Board deems necessary or advisable, including,
without limitation, relating to Incentive Stock Options and certain nonqualified deferred
compensation under Section 409A of the Code and/or to bring the Plan or Stock Awards granted under
the Plan into compliance therewith, subject to the limitations, if any, of applicable law. However,
except as provided in Section 10(a) relating to Capitalization Adjustments, stockholder approval
shall be required for any amendment of the Plan that either (A) materially increases the number of
shares of Common Stock available for issuance under the Plan, (B) materially expands the class of
individuals eligible to receive Awards under the Plan, (C) materially increases the benefits
accruing to Participants under the Plan or materially reduces the price at which shares of Common
Stock may be issued or purchased under the Plan, (D) materially extends the term of the Plan, or
(E) expands the types of Awards available for issuance under the Plan, but only to the extent
required by applicable law or listing requirements. Except as provided above, rights under any
Award granted before amendment of the Plan shall not be impaired by any amendment of the Plan
unless (1) the Company requests the consent of the affected Participant, and (2) such Participant
consents in writing.

          (vii) To submit any amendment to the Plan for stockholder approval, including, but not limited
to, amendments to the Plan intended to satisfy the requirements of (i) Section 162(m) of the Code
and the regulations thereunder regarding the exclusion of performance-based compensation from the
limit on corporate deductibility of compensation paid to Covered Employees, (ii) Section 422 of the
Code regarding Incentive Stock Options or (iii) Rule 16b-3.

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

2

 

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

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

          (xi) To effect, at any time and from time to time, with the consent of any adversely affected
Optionholder, (A) the reduction of the exercise price of any outstanding Option under the Plan, (B)
the cancellation of any outstanding Option under the Plan and the grant in substitution therefor of
(1) a new Option under the Plan or another equity plan of the Company covering the same or a
different number of shares of Common Stock, (2) a Restricted Stock Award (including a stock bonus),
(3) a Stock Appreciation Right, (4) Restricted Stock Unit, (5) an Other Stock Award, (6) cash
and/or (7) other valuable consideration (as determined by the Board, in its sole discretion), or
(C) any other action that is treated as a repricing under generally accepted accounting principles.

     (c) Delegation to Committee.

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

          (ii) Section 162(m) and Rule 16b-3 Compliance. In the sole discretion of the Board, the
Committee may consist solely of two or more Outside Directors, in accordance with Section 162(m) of
the Code, or solely of two or more Non-Employee Directors, in accordance with Rule 16b-3. In
addition, the Board or the Committee, in its sole discretion, may (A) delegate to a Committee of
Directors who need not be Outside Directors the authority to grant Awards to eligible persons who
are either (1) not then Covered Employees and are not expected to be Covered Employees at the time
of recognition of income resulting from such Stock Award, or (2) not persons with respect to whom
the Company wishes to comply with Section 162(m) of the Code, or (B) delegate to a Committee of
Directors who need not be Non-Employee Directors the authority to grant Stock Awards to eligible
persons who are not then subject to Section 16 of the Exchange Act.

     (d) Delegation to an Officer. The Board may delegate to one or more Officers the authority to
do one or both of the following (i) designate Employees who are not Officers to be recipients of
Options (and, to the extent permitted by applicable law, other Stock Awards) and the terms thereof,
and (ii) determine the number of shares of Common Stock to be subject to

3

 

such Stock Awards granted to such Employees; provided, however, that the Board resolutions
regarding such delegation shall specify the total number of shares of Common Stock that may be
subject to the Stock Awards granted by such Officer and that such Officer may not grant a Stock
Award to himself or herself. Notwithstanding anything to the contrary in this Section 2(d), the
Board may not delegate to an Officer authority to determine the Fair Market Value pursuant to
Section 14(w)(ii) below.

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

3. Shares Subject to the Plan.

     (a) Share Reserve. Subject to the provisions of Section 10(a) relating to Capitalization
Adjustments, the aggregate number of shares of common stock of the Company that may be issued
pursuant to Stock Awards after the Effective Date shall not exceed five million (5,000,000) shares,
plus an annual increase to be added on January 1st each year for a period of ten (10)
years, commencing on January 1, 2008 and ending on (and including) January 1, 2017 (each such day,
a “Calculation Date”), equal to the lesser of (i) five percent (5%) of the shares of Common Stock
outstanding on each such Calculation Date (rounded down to the nearest whole share); or (ii) five
million (5,000,000) shares of Common Stock. Notwithstanding the foregoing, the Board may act,
prior to the first day of any fiscal year of the Company, to increase the share reserve by such
number of shares of Common Stock as the Board shall determine, which number shall be less than each
of (i) and (ii). For clarity, the limitation in this Section 3(a) is a limitation in the number of
shares of the Company’s common stock that may be issued pursuant to the Plan. Accordingly, this
Section 3(a) does not limit the granting of Stock Awards except as provided in Section 8(a).
Shares may be issued in connection with a merger or acquisition as permitted by NASD Rule
4350(i)(1)(A)(iii) or, if applicable, NYSE Listed Company Manual Section 303A.08, or AMEX Company
Guide Section 711 and such issuance shall not reduce the number of shares available for issuance
under the Plan. Furthermore, if a Stock Award (A) expires or otherwise terminates without having
been exercised in full or (B) is settled in cash (i.e., the holder of the Stock Award receives cash
rather than stock), such expiration, termination or settlement shall not reduce (or otherwise
offset) the number of shares of the Company’s common stock that may be issued pursuant to the Plan.

     (b) If any shares of common stock issued pursuant to a Stock Award are forfeited back to the
Company because of the failure to meet a contingency or condition required to vest such shares in
the Participant, then the shares which are forfeited shall revert to and again become available for
issuance under the Plan. Also, any shares reacquired by the Company pursuant to Section 9(g) or as
consideration for the exercise of an Option shall again become available for issuance under the
Plan. Notwithstanding the provisions of this Section 3(b), any such shares shall not be
subsequently issued pursuant to the exercise of Incentive Stock Options.

     (c) Incentive Stock Option Limit. Notwithstanding anything to the contrary in this Section 3,
subject to the provisions of Section 10(a) relating to Capitalization Adjustments, the aggregate
maximum number of shares of Common Stock that may be issued pursuant to the exercise of Incentive
Stock Options shall be ten million (10,000,000) shares of Common Stock.

4

 

     (d) Section 162(m) Limitation on Annual Grants. Subject to the provisions of Section 10(a)
relating to Capitalization Adjustments, at such time as the Company may be subject to the
applicable provisions of Section 162(m) of the Code, no Employee shall be eligible to be granted
during any calendar year Stock Awards whose value is determined by reference to an increase over an
exercise or strike price of at least one hundred percent (100%) of the Fair Market Value of the
Common Stock on the date the Stock Award is granted covering more than ten million (10,000,000)
shares of Common Stock.

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

4. Eligibility.

     (a) Eligibility for Specific Stock Awards. Incentive Stock Options may be granted only to
employees of the Company or a parent corporation or subsidiary corporation (as such terms are
defined in Code Sections 424(e) and (f)). Stock Awards other than Incentive Stock Options may be
granted to Employees, Directors and Consultants.

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

     (c) Consultants. A Consultant shall be eligible for the grant of a Stock Award only if, at
the time of grant, a Form S-8 Registration Statement under the Securities Act (“Form S-8”) is
available to register either the offer or the sale of the Company’s securities to such Consultant
because of the nature of the services that the Consultant is providing to the Company, because the
Consultant is a natural person, or because of any other rule governing the use of Form S-8.

5. Option Provisions.

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

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

5

 

     (b) Exercise Price. Subject to the provisions of Section 4(b) regarding Ten Percent
Stockholders, the exercise price of each Option shall be not less than one hundred percent (100%) of the Fair Market Value of the Common Stock subject to the Option on the date the
Option is granted. Notwithstanding the foregoing, an Option may be granted with an exercise price
lower than one hundred percent (100%) of the Fair Market Value of the Common Stock subject to the
Option if such Option is granted pursuant to an assumption or substitution for another option in a
manner consistent with the provisions of Section 424(a) of the Code (whether or not such options
are Incentive Stock Options).

     (c) Consideration. The purchase price of Common Stock acquired pursuant to the exercise of an
Option shall be paid, to the extent permitted by applicable law and as determined by the Board in
its sole discretion, by any combination of the methods of payment set forth below. The Board shall
have the authority to grant Options that do not permit all of the following methods of payment (or
otherwise restrict the ability to use certain methods) and to grant Options that require the
consent of the Company to utilize a particular method of payment. The methods of payment permitted
by this Section 5(c) are:

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

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

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

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

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

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

          (i) Restrictions on Transfer. An Option shall not be transferable except by will or by the
laws of descent and distribution and shall be exercisable during the lifetime of the Optionholder
only by the Optionholder; provided, however, that the Board may, in its sole discretion, permit transfer of the Option in a manner consistent with applicable tax and
securities laws upon the Optionholder’s request.

6

 

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

          (iii) Beneficiary Designation. Notwithstanding the foregoing, the Optionholder may, by
delivering written notice to the Company, in a form provided by or otherwise satisfactory to the
Company, designate a third party who, in the event of the death of the Optionholder, shall
thereafter be entitled to exercise the Option.

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

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

     (g) Extension of Termination Date. An Optionholder’s Option Agreement may provide that if the
exercise of the Option following the termination of the Optionholder’s Continuous Service (other
than upon the Optionholder’s death or Disability) would be prohibited at any time solely because
the issuance of shares of Common Stock would violate the registration requirements under the
Securities Act, then the Option shall terminate on the earlier of (i) the expiration of a period of
three (3) months after the termination of the Optionholder’s Continuous Service during which the
exercise of the Option would not be in violation of such registration requirements, or (ii) the
expiration of the term of the Option as set forth in the Option Agreement.

     (h) Disability of Optionholder. In the event that an Optionholder’s Continuous Service
terminates as a result of the Optionholder’s Disability, the Optionholder may exercise his or her
Option (to the extent that the Optionholder was entitled to exercise such Option as of the date of
termination of Continuous Service), but only within such period of time ending on the

7

 

earlier of (i) the date twelve (12) months following such termination of Continuous Service
(or such longer or shorter period specified in the Option Agreement), or (ii) the expiration of the
term of the Option as set forth in the Option Agreement. If, after termination of Continuous
Service, the Optionholder does not exercise his or her Option within the time specified herein or
in the Option Agreement (as applicable), the Option shall terminate.

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

     (j) Non-Exempt Employees. No Option granted to an Employee that is a non-exempt employee for
purposes of the Fair Labor Standards Act shall be first exercisable for any shares of Common Stock
until at least six months following the date of grant of the Option. The foregoing provision is
intended to operate so that any income derived by a non-exempt employee in connection with the
exercise or vesting of an Option will be exempt from his or her regular rate of pay.

6. Provisions of Stock Awards other than Options.

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

          (i) Consideration. A Restricted Stock Award may be awarded in consideration for (A) past or
future services actually or to be rendered to the Company or an Affiliate, or (B) any other form of
legal consideration that may be acceptable to the Board in its sole discretion and permissible
under applicable law.

8

 

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

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

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

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

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

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

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

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

          (v) Dividend Equivalents. Dividend equivalents may be credited in respect of shares of Common
Stock covered by a Restricted Stock Unit Award, as determined by the Board and contained in the
Restricted Stock Unit Award Agreement. At the sole discretion of

9

 

the Board, such dividend equivalents may be converted into additional shares of Common Stock
covered by the Restricted Stock Unit Award in such manner as determined by the Board. Any
additional shares covered by the Restricted Stock Unit Award credited by reason of such dividend
equivalents will be subject to all the terms and conditions of the underlying Restricted Stock Unit
Award Agreement to which they relate.

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

          (vii) Compliance with Section 409A of the Code. Notwithstanding anything to the contrary set
forth herein, any Restricted Stock Unit Award granted under the Plan that is not exempt from the
requirements of Section 409A of the Code shall contain such provisions so that such Restricted
Stock Unit Award will comply with the requirements of Section 409A of the Code. Such restrictions,
if any, shall be determined by the Board and contained in the Restricted Stock Unit Award Agreement
evidencing such Restricted Stock Unit Award. For example, such restrictions may include, without
limitation, a requirement that any Common Stock that is to be issued in a year following the year
in which the Restricted Stock Unit Award vests must be issued in accordance with a fixed
pre-determined schedule.

     (c) Stock Appreciation Rights. Each Stock Appreciation Right Agreement shall be in such form
and shall contain such terms and conditions as the Board shall deem appropriate. Stock
Appreciation Rights may be granted as stand-alone Stock Awards or in tandem with other Stock
Awards. The terms and conditions of Stock Appreciation Right Agreements may change from time to
time, and the terms and conditions of separate Stock Appreciation Right Agreements need not be
identical; provided, however, that each Stock Appreciation Right Agreement shall include (through
incorporation of the provisions hereof by reference in the Agreement or otherwise) the substance of
each of the following provisions:

          (i) Term. No Stock Appreciation Right shall be exercisable after the expiration of ten (10)
years from the date of its grant or such shorter period specified in the Stock Appreciation Right
Agreement.

          (ii) Strike Price. Each Stock Appreciation Right will be denominated in shares of Common Stock
equivalents. The strike price of each Stock Appreciation Right shall not be less than one hundred
percent (100%) of the Fair Market Value of the Common Stock equivalents subject to the Stock
Appreciation Right on the date of grant.

          (iii) Calculation of Appreciation. The appreciation distribution payable on the exercise of a
Stock Appreciation Right will be not greater than an amount equal to the excess of (A) the
aggregate Fair Market Value (on the date of the exercise of the Stock Appreciation Right) of a
number of shares of Common Stock equal to the number of shares of Common Stock equivalents in which
the Participant is vested under such Stock Appreciation Right, and with respect to which the
Participant is exercising the Stock Appreciation Right on such date, over (B) the strike price that
will be determined by the Board at the time of grant of the Stock Appreciation Right.

10

 

          (iv) Vesting. At the time of the grant of a Stock Appreciation Right, the Board may impose
such restrictions or conditions to the vesting of such Stock Appreciation Right as it, in its sole
discretion, deems appropriate.

          (v) Exercise. To exercise any outstanding Stock Appreciation Right, the Participant must
provide written notice of exercise to the Company in compliance with the provisions of the Stock
Appreciation Right Agreement evidencing such Stock Appreciation Right.

          (vi) Payment. The appreciation distribution in respect to a Stock Appreciation Right may be
paid in Common Stock, in cash, in any combination of the two or in any other form of consideration,
as determined by the Board and contained in the Stock Appreciation Right Agreement evidencing such
Stock Appreciation Right.

          (vii) Termination of Continuous Service. In the event that a Participant’s Continuous Service
terminates, the Participant may exercise his or her Stock Appreciation Right (to the extent that
the Participant was entitled to exercise such Stock Appreciation Right as of the date of
termination) but only within such period of time ending on the earlier of (A) the date three (3)
months following the termination of the Participant’s Continuous Service (or such longer or shorter
period specified in the Stock Appreciation Right Agreement), or (B) the expiration of the term of
the Stock Appreciation Right as set forth in the Stock Appreciation Right Agreement. If, after
termination, the Participant does not exercise his or her Stock Appreciation Right within the time
specified herein or in the Stock Appreciation Right Agreement (as applicable), the Stock
Appreciation Right shall terminate.

          (viii) Compliance with Section 409A of the Code. Notwithstanding anything to the contrary
set forth herein, any Stock Appreciation Rights granted under the Plan that are not exempt from the
requirements of Section 409A of the Code shall contain such provisions so that such Stock
Appreciation Rights will comply with the requirements of Section 409A of the Code. Such
restrictions, if any, shall be determined by the Board and contained in the Stock Appreciation
Right Agreement evidencing such Stock Appreciation Right. For example, such restrictions may
include, without limitation, a requirement that a Stock Appreciation Right that is to be paid
wholly or partly in cash must be exercised and paid in accordance with a fixed pre-determined
schedule.

     (d) Performance Awards.

          (i) Performance Stock Awards. A Performance Stock Award is a Stock Award that may be granted,
may vest, or may be exercised based upon the attainment during a Performance Period of certain
Performance Goals. A Performance Stock Award may, but need not, require the completion of a
specified period of Continuous Service. The length of any Performance Period, the Performance Goals
to be achieved during the Performance Period, and the measure of whether and to what degree such
Performance Goals have been attained shall be conclusively determined by the Committee in its sole
discretion. The maximum number of fully vested shares that may be issued to any Participant in a
calendar year attributable to Stock Awards described in this Section 6(d)(i) shall not exceed ten
million (10,000,000) shares of Common Stock. In addition, to the extent permitted by applicable
law and the applicable Award Agreement, the Board may determine that cash may be used in payment of Performance Stock
Awards.

11

 

          (ii) Performance Cash Awards. A Performance Cash Award is a cash award that may be granted
upon the attainment during a Performance Period of certain Performance Goals. A Performance Cash
Award may also require the completion of a specified period of Continuous Service. The length of
any Performance Period, the Performance Goals to be achieved during the Performance Period, and the
measure of whether and to what degree such Performance Goals have been attained shall be
conclusively determined by the Committee in its sole discretion. The maximum amount that may be
paid to any Participant in a calendar year attributable to cash awards described in this Section
6(d)(ii) shall not exceed ten million dollars ($10,000,000). The Board may provide for or, subject
to such terms and conditions as the Board may specify, may permit a Participant to elect for, the
payment of any Performance Cash Award to be deferred to a specified date or event. The Committee
may specify the form of payment of Performance Cash Awards, which may be cash or other property, or
may provide for a Participant to have the option for his or her Performance Cash Award, or such
portion thereof as the Board may specify, to be paid in whole or in part in cash or other property.
In addition, to the extent permitted by applicable law and the applicable Award Agreement, the
Board may determine that Common Stock authorized under this Plan may be used in payment of
Performance Cash Awards, including additional shares in excess of the Performance Cash Award as an
inducement to hold shares of Common Stock.

     (e) Other Stock Awards. Other forms of Stock Awards valued in whole or in part by reference
to, or otherwise based on, Common Stock may be granted either alone or in addition to Stock Awards
provided for under Section 5 and the preceding provisions of this Section 6. Subject to the
provisions of the Plan, the Board shall have sole and complete authority to determine the persons
to whom and the time or times at which such Other Stock Awards will be granted, the number of
shares of Common Stock (or the cash equivalent thereof) to be granted pursuant to such Other Stock
Awards and all other terms and conditions of such Other Stock Awards.

7. Non-Discretionary Grants to Eligible Directors.

     (a) Initial Grants. Without any further action of the Board, (i) each person who becomes a
Non-Employee Director as of the Effective Date, and (ii) each person who, after the Effective Date,
is elected or appointed for the first time to be a Non-Employee Director automatically shall, upon
the Effective Date or the date of his or her initial election or appointment to be a Non-Employee
Director, as applicable, be granted an Initial Grant as described in Section 7(c) below.

     (b) Annual Grants. Without any further action of the Board, on the date of each Annual
Meeting, commencing on the date of the Annual Meeting in 2008, each person who is then a
Non-Employee Director automatically shall be granted an Annual Grant as described in Section 7(c)
below, if as of such date, he or she will have served on the Board for at least the preceding six
(6) months.

12

 

     (c) Form of Initial and Annual Grants. On or before the end of the Company’s fiscal year, the
Board shall determine if all Initial and Annual Grants to be granted in the subsequent fiscal year
shall be in the form of Options described in Section 5 (subject to Section 7(c)(i) below),
Restricted Stock Awards described in Section 6(a), Restricted Stock Unit Awards described in
Section 6(b), Stock Appreciation Rights described in Section 6(c), or Performance Stock Awards
described in Section 6(d). If the Board does not make such a determination on or before the end of
the Company’s fiscal year, all Initial and Annual Grants to be granted in the subsequent fiscal
year shall be in the form of Options described in Section 5 (subject to Section 7(c)(i) below).

          (i) Options.

               (A) Initial Grants. If the Initial Grant is in the form of an Option, the Initial Grant shall
be a Nonstatutory Stock Option to purchase fifty thousand (50,000) shares of Common Stock on the
terms and conditions set forth in Section 5, provided that each Initial Grant shall vest and be
exercisable as follows: 1/48th of the shares shall vest monthly over four years from the
date of grant.

               (B) Annual Grants. Subject to Section 7(b), if the Annual Grant is in the form of an Option,
the Annual Grant shall be a Nonstatutory Stock Option to purchase twelve thousand five hundred
(12,500) shares of Common Stock on the terms and conditions set forth in Section 5, provided that
each Annual Grant shall vest and be exercisable as follows: 1/48th of the shares shall
vest monthly over four years from the date of grant.

          (ii) Other Types of Stock Awards. If the Initial or Annual Grant is in the form of a
Restricted Stock Award, Restricted Stock Unit Award, Stock Appreciation Right or Performance Stock
Award, the number of shares of Common Stock subject to such Initial or Annual Grant shall be
determined by the Board in its sole discretion.

8. Covenants of the Company.

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

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

13

 

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

9. Miscellaneous.

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

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

     (c) Stockholder Rights. No Participant shall be deemed to be the holder of, or to have any of
the rights of a holder with respect to, any shares of Common Stock subject to such Stock Award
unless and until such Participant has exercised the Stock Award pursuant to its terms and the
Participant shall not be deemed to be a stockholder of record until the issuance of the Common
Stock pursuant to such exercise has been entered into the books and records of the Company.

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

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

     (f) Investment Assurances. The Company may require a Participant, as a condition of
exercising or acquiring Common Stock under any Stock Award, (i) to give written assurances
satisfactory to the Company as to the Participant’s knowledge and experience in financial and
business matters and/or to employ a purchaser representative reasonably satisfactory to the

14

 

Company who is knowledgeable and experienced in financial and business matters and that he or
she is capable of evaluating, alone or together with the purchaser representative, the merits and
risks of exercising the Stock Award; and (ii) to give written assurances satisfactory to the
Company stating that the Participant is acquiring Common Stock subject to the Stock Award for the
Participant’s own account and not with any present intention of selling or otherwise distributing
the Common Stock. The foregoing requirements, and any assurances given pursuant to such
requirements, shall be inoperative if (A) the issuance of the shares upon the exercise or
acquisition of Common Stock under the Stock Award has been registered under a then currently
effective registration statement under the Securities Act, or (B) as to any particular requirement,
a determination is made by counsel for the Company that such requirement need not be met in the
circumstances under the then applicable securities laws. The Company may, upon advice of counsel
to the Company, place legends on stock certificates issued under the Plan as such counsel deems
necessary or appropriate in order to comply with applicable securities laws, including, but not
limited to, legends restricting the transfer of the Common Stock.

     (g) Withholding Obligations. Unless prohibited by the terms of a Stock Award Agreement, the
Company may, in its sole discretion, satisfy any federal, state or local tax withholding obligation
relating to an Award by any of the following means (in addition to the Company’s right to withhold
from any compensation paid to the Participant by the Company) or by a combination of such means:
(i) causing the Participant to tender a cash payment; (ii)  withholding shares of Common Stock from
the shares of Common Stock issued or otherwise issuable to the Participant in connection with the
Award; (iii) withholding cash from an Award settled in cash; or (iv) by such other method as may be
set forth in the Award Agreement.

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

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

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

15

 

amended after the Effective Date. Notwithstanding any provision of the Plan to the contrary,
in the event that following the Effective Date the Board determines that any Award may be subject
to Section 409A of the Code and related Department of Treasury guidance (including such Department
of Treasury guidance as may be issued after the Effective Date), the Board may adopt such
amendments to the Plan and the applicable Award Agreement or adopt other policies and procedures
(including amendments, policies and procedures with retroactive effect), or take any other actions,
that the Board determines are necessary or appropriate to (i) exempt the Award from Section 409A of
the Code and/or preserve the intended tax treatment of the benefits provided with respect to the
Award, or (2) comply with the requirements of Section 409A of the Code and Department of Treasury
regulations and other interpretive guidance issued thereunder, including without limitation any
such regulations or other guidance that may be issued or amended after the Effective Date.

10. Adjustments upon Changes in Common Stock; Other Corporate Events.

     (a) Capitalization Adjustments. In the event of a Capitalization Adjustment, the Board shall
appropriately adjust: (i) the class(es) and maximum number of securities subject to the Plan
pursuant to Section 3(a), (ii) the class(es) and maximum number of securities that may be issued
pursuant to the exercise of Incentive Stock Options pursuant to Section 3(c), (iii) the class(es)
and maximum number of securities that may be awarded to any person pursuant to Section 3(d) and
6(d)(i), (iv) the class(es) and number of securities that may be awarded to Non-Employee Directors
pursuant to Section 7, and (v) the class(es) and number of securities and price per share of stock
subject to outstanding Stock Awards. The Board shall make such adjustments, and its determination
shall be final, binding and conclusive.

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

     (c) Corporate Transaction. The following provisions shall apply to Stock Awards in the event
of a Corporate Transaction unless otherwise provided in the instrument evidencing the Stock Award
or any other written agreement between the Company or any Affiliate and the holder of the Stock
Award or unless otherwise expressly provided by the Board at the time of grant of a Stock Award.
Except as otherwise stated in the Stock Award Agreement, in the event of a Corporate Transaction,
then, notwithstanding any other provision of the Plan, the Board shall take one or more of the
following actions with respect to Stock Awards, contingent upon the closing or completion of the
Corporate Transaction:

16

 

          (i) arrange for the surviving corporation or acquiring corporation (or the surviving or
acquiring corporation’s parent company) to assume or continue the Stock Award or to substitute a
similar stock award for the Stock Award (including, but not limited to, an award to acquire the
same consideration paid to the stockholders of the Company pursuant to the Corporate Transaction);

          (ii) arrange for the assignment of any reacquisition or repurchase rights held by the Company
in respect of Common Stock issued pursuant to the Stock Award to the surviving corporation or
acquiring corporation (or the surviving or acquiring corporation’s parent company);

          (iii) accelerate the vesting of the Stock Award (and, if applicable, the time at which the
Stock Award may be exercised) to a date prior to the effective time of such Corporate Transaction
as the Board shall determine (or, if the Board shall not determine such a date, to the date that is
five (5) days prior to the effective date of the Corporate Transaction), with such Stock Award
terminating if not exercised (if applicable) at or prior to the effective time of the Corporate
Transaction;

          (iv) arrange for the lapse of any reacquisition or repurchase rights held by the Company with
respect to the Stock Award; and

          (v) cancel or arrange for the cancellation of the Stock Award, to the extent not vested or not
exercised prior to the effective time of the Corporate Transaction, in exchange for such cash
consideration as the Board, in its sole discretion, may consider appropriate.

The Board need not take the same action with respect to all Stock Awards or with respect to all
Participants.

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

11. Termination or Suspension of the Plan.

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

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

17

 

12. Effective Date of Plan.

     The Plan shall become effective on the IPO Date, but no Stock Award shall be exercised (or, in
the case of a Restricted Stock Award, Restricted Stock Unit Award, or Other Stock Award, shall be
granted) unless and until the Plan has been approved by the stockholders of the Company, which
approval shall be within twelve (12) months before or after the date the Plan is adopted by the
Board.

13. Choice of Law.

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

14. Definitions. As used in the Plan, the definitions contained in this Section 14 shall
apply to the capitalized terms indicated below:

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

     (b) “Annual Grant” means a Stock Award granted annually to a Non-Employee Director who meets
the specified criteria pursuant to Section 7(b) of the Plan.

     (c) “Annual Meeting” means the annual meeting of the stockholders of the Company.

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

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

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

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

          (i) any Exchange Act Person becomes the Owner, directly or indirectly, of securities of the
Company representing more than fifty percent (50%) of the combined voting power of the Company’s
then outstanding securities other than by virtue of a merger, consolidation or similar transaction.
Notwithstanding the foregoing, a Change in Control shall

18

 

not be deemed to occur (A) on account of the acquisition of securities of the Company by an investor, any affiliate thereof or any other Exchange Act Person from the Company in a transaction or series of related transactions the primary purpose of which is to obtain financing for the Company through the issuance of equity securities or (B) solely because the level of Ownership held by any Exchange Act Person (the “
Subject Person”) exceeds the designated percentage threshold of the outstanding voting
securities as a result of a repurchase or other acquisition of voting securities by the Company
reducing the number of shares outstanding, provided that if a Change in Control would occur (but
for the operation of this sentence) as a result of the acquisition of voting securities by the
Company, and after such share acquisition, the Subject Person becomes the Owner of any additional
voting securities that, assuming the repurchase or other acquisition had not occurred, increases
the percentage of the then outstanding voting securities Owned by the Subject Person over the
designated percentage threshold, then a Change in Control shall be deemed to occur;

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

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

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

          (v) individuals who, on the date this Plan is adopted by the Board, are members of the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the members of the Board; (provided, however, that if the appointment or election (or
nomination for election) of any new Board member was approved or recommended by a majority vote of
the members of the Incumbent Board then still in office, such new member shall, for purposes of
this Plan, be considered as a member of the Incumbent Board).

     The term Change in Control shall not include a sale of assets, merger or other transaction effected exclusively for the purpose of changing the domicile of the Company.

19

 

     Notwithstanding the foregoing or any other provision of this Plan, the definition of Change in
Control (or any analogous term) in an individual written agreement between the Company or any
Affiliate and the Participant shall supersede the foregoing definition with respect to Awards
subject to such agreement; provided, however, that if no definition of Change in Control or any
analogous term is set forth in such an individual written agreement, the foregoing definition shall
apply.

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

     (i) “Committee” means a committee of one (1) or more Directors to whom authority has been
delegated by the Board in accordance with Section 2(c).

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

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

     (l) “Consultant” means any person, including an advisor, who is (i) engaged by the Company or
an Affiliate to render consulting or advisory services and is compensated for such services, or
(ii) serving as a member of the board of directors of an Affiliate and is compensated for such
services. However, service solely as a Director, or payment of a fee for such service, shall not
cause a Director to be considered a “Consultant” for purposes of the Plan.

     (m) “Continuous Service” means that the Participant’s service with the Company or an
Affiliate, whether as an Employee, Director or Consultant, is not interrupted or terminated. A
change in the capacity in which the Participant renders service to the Company or an Affiliate as
an Employee, Consultant or Director or a change in the entity for which the Participant renders
such service, provided that there is no interruption or termination of the Participant’s service
with the Company or an Affiliate, shall not terminate a Participant’s Continuous Service. For
example, a change in status from an employee of the Company to a consultant to an Affiliate or to a
Director shall not constitute an interruption of Continuous Service. To the extent permitted by
law, the Board or the chief executive officer of the Company, in that party’s sole discretion, may
determine whether Continuous Service shall be considered interrupted in the case of any leave of
absence approved by that party, including sick leave, military leave or any other personal leave.
Notwithstanding the foregoing, a leave of absence shall be treated as Continuous Service for
purposes of vesting in a Stock Award only to such extent as may be provided in the Company’s leave
of absence policy, in the written terms of any leave of absence agreement or policy applicable to
the Participant, or as otherwise required by law.

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

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

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

20

 

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

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

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

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

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

     (r) “Effective Date” means the effective date of the Plan as set forth in Section 12.

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

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

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

     (v) “Exchange Act Person” means any natural person, Entity or “group” (within the meaning of
Section 13(d) or 14(d) of the Exchange Act), except that “Exchange Act Person” shall not include
(i) the Company or any Subsidiary of the Company, (ii) any employee benefit plan of the Company or
any Subsidiary of the Company or any trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any Subsidiary of the Company, (iii) an underwriter
temporarily holding securities pursuant to an offering of such securities, (iv) an Entity Owned,
directly or indirectly, by the stockholders of the Company in substantially the same proportions as
their Ownership of stock of the Company; or (v) any natural person, Entity or “group” (within the
meaning of Section 13(d) or 14(d) of the Exchange Act) that, as of the Effective Date of the Plan
as set forth in Section 12, is the Owner, directly or indirectly, of securities of the Company
representing more than fifty percent (50%) of the combined voting power of the Company’s then
outstanding securities.

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

21

 

          (i) If the Common Stock is listed on any established stock exchange, the Fair Market Value of
a share of Common Stock shall be the closing sales price for such stock (or the closing bid, if no
sales were reported) as quoted on such exchange (or the exchange with the greatest volume of
trading in the Common Stock) on the date of determination, as reported in The Wall Street Journal
or such other source as the Board deems reliable. Unless otherwise provided by the Board, if there
is no closing sales price (or closing bid if no sales were reported) for the Common Stock on the
date of determination, then the Fair Market Value shall be the closing sales price (or closing bid
if no sales were reported) on the last preceding date for which such quotation exists.

          (ii) In the absence of such market for the Common Stock, the Fair Market Value shall be
determined by the Board in good faith.

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

     (y) “Initial Grant” means a Stock Award granted to a Non-Employee Director who meets the
specified criteria pursuant to Section 7(a) of the Plan.

     (z) “IPO Date” means the date of the underwriting agreement between the Company and the
underwriter(s) managing the initial public offering of the Common Stock, pursuant to which the
Common Stock is priced for the initial public offering.

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

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

     (cc) “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.

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

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

22

 

     (ff) “Optionholder” means a person to whom an Option is granted pursuant to the Plan or, if
permitted under the terms of this Plan, such other person who holds an outstanding Option.

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

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

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

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

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

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

     (mm) “Performance Criteria” means the one or more criteria that the Board shall select for
purposes of establishing the Performance Goals for a Performance Period. The Performance Criteria
that shall be used to establish such Performance Goals may be based on any one of, or combination
of, the following: (i) earnings per share; (ii) earnings before interest, taxes and depreciation;
(iii) earnings before interest, taxes, depreciation and amortization; (iv) total stockholder
return; (v) return on equity; (vi) return on assets, investment, or capital employed; (vii)
operating margin; (viii) gross margin; (ix) operating income; (x) net income (before or after
taxes); (xi) net operating income; (xii) net operating income after tax; (xiii) pre-tax profit;
(xiv) operating cash flow; (xv) sales or revenue targets; (xvi) increases in revenue or product
revenue; (xvii) expenses and cost reduction goals; (xviii) improvement in or attainment of working
capital levels; (xix) economic value added (or an equivalent metric); (xx) market share; (xxi) cash
flow; (xxii) cash flow per share; (xxiii) share price performance; (xxiv) debt reduction; (xxv)
implementation or completion of projects or processes; (xxvi) customer satisfaction; (xxvii)
stockholders’ equity; and (xxviii) to the extent that an Award is not intended to comply

23

 

with Section 162(m) of the Code, other measures of performance selected by the Board. Partial
achievement of the specified criteria may result in the payment or vesting corresponding to the
degree of achievement as specified in the Stock Award Agreement or the written terms of a
Performance Cash Award. The Board shall, in its sole discretion, define the manner of calculating
the Performance Criteria it selects to use for such Performance Period.

     (nn) “Performance Goals” means, for a Performance Period, the one or more goals established by
the Board for the Performance Period based upon the Performance Criteria. Performance Goals may be
based on a Company-wide basis, with respect to one or more business units, divisions, Affiliates,
or business segments, and in either absolute terms or relative to the performance of one or more
comparable companies or the performance of one or more relevant indices. At the time of the grant
of any Award, the Board is authorized to determine whether, when calculating the attainment of
Performance Goals for a Performance Period: (i) to exclude restructuring and/or other nonrecurring
charges; (ii) to exclude exchange rate effects, as applicable, for non-U.S. dollar denominated net
sales and operating earnings; (iii) to exclude the effects of changes to generally accepted
accounting standards required by the Financial Accounting Standards Board; (iv) to exclude the
effects of any statutory adjustments to corporate tax rates; and (v) to exclude the effects of any
“extraordinary items” as determined under generally accepted accounting principles. In addition,
the Board retains the discretion to reduce or eliminate the compensation or economic benefit due
upon attainment of Performance Goals.

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

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

     (qq) “Plan” means this Cavium Networks, Inc. 2007 Equity Incentive Plan.

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

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

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

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

24

 

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

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

     (xx) “Stock Appreciation Right” means a right to receive the appreciation on Common Stock that
is granted pursuant to the terms and conditions of Section 6(c).

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

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

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

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

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

25

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00154-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00154-of-00352.parquet"}]]