Document:

Settlement Agreement with Linear Technology Corporation

 Exhibit 10.16 
  
 MONOLITHIC POWER SYSTEMS, INC HAS REQUESTED THAT PORTIONS OF THIS DOCUMENT BE ACCORDED CONFIDENTIAL TREATMENT PURSUANT TO RULE 24b-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED. ACCORDINGLY, CERTAIN INFORMATION IN THIS EXHIBIT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE COMMISSION. OMITTED INFORMATION HAS BEEN REPLACED BY [**]. 
  
 SETTLEMENT AGREEMENT 
  
 This Settlement Agreement (“Agreement”) is made and entered into as of this 21st
day of January, 2005 (the “Effective Date”), by and among Linear Technology Corp. (“Linear”), Monolithic Power Systems, Inc. (“Monolithic”), and Timothy D. Cox
(“Cox”). 
  
 RECITALS 
  
 WHEREAS, Linear is a corporation organized and existing under the laws of Delaware,
with its principal place of business located at 1630 McCarthy Boulevard, Milpitas, California 95035. 
  
 WHEREAS, Monolithic is a corporation organized and existing under the laws of California, with its principal place of business at 983 University Avenue, Building A,
Los Gatos, California 95032. 
  
 WHEREAS, Cox is an individual residing at
[**] 
  
 WHEREAS, on May 3, 2004, Linear filed an action in the Superior
Court of the State of California for the County of Santa Clara entitled, Linear Technology Corp. v. Monolithic Power Systems, Timothy D. Cox, and Does 1-25 bearing Case No. 104CV019058 (the “Action”), alleging that Monolithic and Cox have
misappropriated Linear’s trade secrets, engaged in unfair business practices, and unfair competition, and that Cox has breached his Proprietary Information Agreement with Linear and violated his duty of good faith and fair dealing. 

 
 WHEREAS, on June 2, 2004, Monolithic and Cox filed their Answer to Linear’s
complaint, denying each and every allegation contained therein and asserting affirmative defenses including, but not limited to failure to state a cause of action, unclean hands, waiver and estoppel, failure to mitigate, justification, good faith,
excuse and unenforceability of contract. 
  
 WHEREAS, the parties desire to
finally settle all claims in the Action and, therefore, enter into this Agreement upon the terms and conditions hereinafter set forth. 
  
 AGREEMENT 
  
 Based on the foregoing, for good and valuable consideration, the parties agree as follows: 
  

	[**]	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. 

	    	Confidential treatment has been requested with respect to the omitted portions. 

 1.    Non-Solicitation of Linear’s Employees. 
  
 For a period of [**] following the Effective Date of the Agreement, Monolithic will
not solicit Linear’s employees, either directly or via third parties. This Agreement, however, does not preclude Monolithic from interviewing or hiring any Linear employee who initiates contact with Monolithic regarding employment. If, within
[**] following the Effective Date, Monolithic hires any Linear employee, at Linear’s request, Monolithic will provide evidence demonstrating that the former Linear employee was hired without violation of this paragraph. 
  
 2.    Non-Disclosure of Information Regarding Linear Employees.

  
 Cox, Fredrick E. “Eddie” Beville, Wei Chen
(“Chen”), John Cantelmo, Karl Edwards, and Steven Hobrecht (collectively, “Cox et al.”) will not provide Monolithic with the following information regarding any Linear employee: (1) the employee’s compensation at
Linear, (2) with respect to any Linear customer whose relationship with Linear is maintained in confidence (“Confidential Linear Customer”), the existence of a relationship between the Linear employee and the Confidential Linear Customer,
or (3) the identity of any personal contacts that the employee has at Linear customers if the fact that such contact is a conduit to Linear business with the customer is confidential to Linear. This Agreement does not restrict Cox et al. from
providing Monolithic with other information about any Linear employee, including their capabilities, provided that such information does not violate such employee’s privacy rights and is not Linear Proprietary Information as defined in
paragraph 3 of this Agreement. 
  
 3.    Confirmation
that MPS Does Not Possess Linear Proprietary Information. 
  
 Monolithic hereby confirms that it does not possess any Linear Proprietary Information. Linear Proprietary Information, for purposes of this Agreement, means information that Linear maintains in confidence regarding: 
  

	 	(a)	Linear’s design, development, manufacture, testing, and performance of current and future products, 

  

	 	(b)	Linear’s product roadmaps, 

  

	 	(c)	Linear’s comparative analyses of competitive products, 

  

	 	(d)	Costs, prices, and profits related to Linear’s products, 

  

	 	(e)	Linear’s sales arrangements with particular customers, including, but not limited to, information regarding products, prices, and volume sold, 

  

	 	(f)	Linear’s sales and support strategies, 

  

	[**]	Certain information on this page has been omitted and filed separately with the Securities and Exchange Commission. 

	    	Confidential treatment has been requested with respect to the omitted portions. 

	 	(g)	Linear customers’ product needs and development plans which were disclosed to Linear on a confidential basis and not otherwise disclosed to Monolithic, 

  

	 	(h)	Linear’s customer data, including lists of customer contact information, and/or 

  

	 	(i)	Linear’s in-house employee directory, and any other Linear employee list. 

  
 4.    Statement Regarding Non-Use of Linear Proprietary Information. 
  
 Cox et. al. will provide a certification under oath, in the form attached hereto as Exhibit A, that no use has been made or
will be made of Linear Proprietary Information on behalf of Monolithic. 
  
 5.    Certification Regarding Non-Use of Emailed Documents 
  
 Chen will provide a certification under oath, in the form attached hereto as Exhibit B, that he made no use for the benefit of Monolithic of any Linear documents
and/or technical information emailed from his Linear account before or after his departure from Linear. 
  
 6.    Stipulation and Release. 
  
 (a)    Stipulation of Dismissal. 
  
 Within ten (10) business days of the Effective Date, Linear agrees to dismiss the Action with prejudice, each side to bear its own attorneys’ fees and costs.
Specifically, Linear will file a Request for Dismissal of Complaint with Prejudice in the form attached hereto as Exhibit C. 
  
 (b)    Mutual Release. 
  
 Excepting only the warranties, covenants and obligations set forth in this Agreement, the parties, each on its own behalf and on behalf of its respective assigns,
agents, past, present, and future employees, directors, officers, representatives, servants, predecessors, successors, parent companies, corporate affiliates, subsidiaries, and partners, hereby release, discharge and acquit each other, and the
others’ respective representatives including, without limitation, the others’ assigns, agents, past, present, and future employees, directors, officers, representatives, servants, attorneys, predecessors, successors, parent companies,
corporate affiliates, subsidiaries, and partners, from any and all past, present or future claims or causes of action of any kind, including claims for attorneys’ fees or costs, whether known or unknown, suspected or claimed, disclosed or
undisclosed, matured or not matured, which the releasing party ever had, now has, or which may hereafter accrue or otherwise be acquired, that arise in any way from Monolithic’s hiring of Cox et al. or from any of the claims that were asserted
in the Action. Notwithstanding the foregoing, the parties do not intend to 

  

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release each other from any claims related to any patents held by a party. This release is specific to the claims described in this paragraph, and is not a general
release of all claims between the parties. 
  
 (c)    Release of Unknown Claims. 
  
 It
is understood and agreed that the above release, which is limited to the claims described therein, is a full and final release of all claims described in paragraph 6(b), including, without limitation, all unknown and unanticipated injuries, debts,
or damages to the releasing party, as well as those now known or disclosed. Each party understands and agrees that this is a full and final release as to the claims described in paragraph 6(b). To the extent it is applicable, each party expressly
waives the provisions of California Civil Code Section 1542, which provides as follows: 
  
 A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
DEBTOR. 
  
 Each party realizes and acknowledges that it may have sustained
losses arising from the claims released in paragraph 6(b) that are presently unknown and unsuspected, and that such losses may give rise to additional losses and expenses in the future which are not now anticipated. Nevertheless, each party
acknowledges that this release has been negotiated and agreed upon in light of this realization and, being fully aware of the situation, does nevertheless intend to release, acquit, and forever discharge its claims as described in paragraph 6(b).
Each party fully understands that if the facts with respect to this Agreement are found hereafter to be other than or different from the facts now believed by it to be true, it expressly accepts and assumes the risk of such possible difference in
fact and agrees that this Agreement shall be and remain effective, notwithstanding any such difference. 
  
 7.    Denial of Liability 
  
 The Parties agree that the Settlement is a compromise to avoid further trouble, litigation and expense, and it is further agreed that Monolithic and Cox do not
admit liability to Linear or anyone else, with respect to the Action or as a result of the events that formed the basis of the Action, and that they expressly deny any and all such liability. 
  
 8.    Confidentiality and Public Statement. 
  
 The parties and their attorneys agree that the terms of the Agreement shall be
confidential and maintained in the strictest confidence. No party shall disclose to anyone not a party to the Agreement, whether orally or in writing, the terms of the Agreement. The parties agree that the only thing they will say publicly about
this case is that the matter has been resolved to the mutual satisfaction of the parties, that Monolithic and Cox do not admit (but in fact expressly deny) liability to Linear, and that the settlement does not resolve the 

  

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patent litigation pending between the parties before the U.S. International Trade Commission. The confidentiality restriction of this paragraph shall not apply to (i)
disclosure by the parties to their employees, attorneys, officers and directors who have a need to know; (ii) disclosure by the parties to their accountants, bookkeepers, and agents who have a need to know; (iii) disclosure as may be required by law
(which could include, by way of example and not intending to be limited to, tax reporting, regulatory requirements, securities laws); or (iv) disclosure as may be necessary to enforce the Agreement. 
  
 9.    Acknowledgement. 
  
 The parties acknowledge that they are sophisticated persons or entities that have
performed their own investigations regarding the issues in this lawsuit and have had an opportunity to consult with legal counsel of their choice before entering into this Agreement. The parties further acknowledge that they are entering into this
Agreement based solely upon the representations, covenants, warranties, and consideration reflected on the face of this Agreement, and that no oral or written statements, inducements, or information not reflected on the face of this Agreement has
played any material role in their respective decisions to enter into this Agreement. This Agreement is executed voluntarily by each party with full knowledge of the Agreement’s significance and legal effect. 
  
 10.    Severability. 
  
 In the event that any provision of this Agreement, or the application of any provision
to any person or in any circumstances, shall be determined to be invalid, unlawful, or unenforceable to any extent, the remainder of this Agreement and its application to other persons or in other circumstances shall not be affected by such a
determination, and each remaining provision and application of this Agreement shall continue in full force and effect and may be enforced to the fullest extent permitted by law. 
  
 11.    Successors and Assigns. 
  
 All covenants and agreements herein shall bind and inure to the benefit of the respective successors, assigns, representatives,
employees, transferees, directors, officers, attorneys, parent companies, subsidiaries, divisions, partners and joint venturers of the parties hereto. 
  
 12.    Escalation, Notice and Cure. 
  
 The parties will use reasonable efforts to resolve any dispute arising out of this Agreement or any Exhibit hereto. In the event that either party believes that the
other may have breached the agreement, the parties must discuss (through a meeting of appropriate representatives from each party) the matter in good faith to resolve the matter amicably before taking any other action or initiating any proceeding
for breach of the Agreement. Each party agrees to provide the other party with thirty (30) days written notice of any alleged failure to comply with the terms of this Agreement. The thirty (30) day notice period 

  

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will serve as an opportunity to cure for the allegedly breaching party, and during that time the accusing party may not seek legal relief. 
  
 13.    Consequences of Violation of Agreement. 

 
 If any party violates any provision in this Agreement and the parties are unable to
resolve their dispute pursuant to paragraph 12, the party or parties prevailing in any court proceeding on the question of violation of this Agreement will be entitled to recover from the party or parties who do not prevail on this question
recoverable court costs and reasonable attorneys’ fees incurred by the prevailing party or parties, in addition to any other remedies awarded to the prevailing party or parties. 
  
 14.    Counterparts. 
  
 This Agreement may be executed in two or more partially or fully executed counterparts each of which shall be deemed an original and
shall bind the signatory, but all of which together shall constitute but one and the same instrument. 
  
 15.    Amendment. 
  
 No modification of or amendment to this Agreement shall be effective unless in writing and signed by all parties to this Agreement. 
  
 16.    Governing Law. 
  
 This Agreement shall be governed by the laws of the State of California, excepting
principles of conflicts of law. 
  
 17.    Entire
Agreement. 
  
 This Agreement represents the entire agreement and
understanding between and among the parties relating to the subject matter hereof and merges all prior and contemporaneous communications relating to the subject matter hereof. 
  

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 IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the date first written above. 

 

			
	Linear Technology Corp.
		
	 By:
	 	 /s/ Lothar Maier

	 	 	 Lothar Maier, Chief Executive Officer

  

			
	Monolithic Power Systems, Inc.
		
	 By:
	 	 /s/ Michael Hsing

	 	 	 Michael Hsing, President and CEO

  

			
	Timothy D. Cox
		
	 By:
	 	 /s/ Timothy D. Cox

	 	 	 Timothy D. CoxRESTATED 2001 STOCK INCENTIVE PLAN

 Exhibit 10.50 
  
 ENVIRONMENTAL POWER CORPORATION 
  
 RESTATED 2001 STOCK INCENTIVE PLAN 
  

Section 1. Purpose 
  
 The purpose of the Plan is to promote the interests of the Company and its shareholders by aiding the Company in attracting and retaining employees,
officers, consultants, independent contractors and non-employee directors capable of assuring the future success of the Company, to offer such persons incentives to put forth maximum efforts for the success of the Company’s business and to
afford such persons an opportunity to acquire a proprietary interest in the Company. 
  
 Section 2. Definitions 
  
 As used in the Plan, the following terms shall have the meanings set forth below: 
  
 (a) “Affiliate” shall mean (i) any entity that, directly or indirectly through one or more
intermediaries, is controlled by the Company and (ii) any entity in which the Company has a significant equity interest, in each case as determined by the Committee. 
  
 (b) “Award” shall mean any Option, Stock Appreciation Right, Restricted Stock, Performance Award,
Other Stock Grant or Other Stock-Based Award granted under the Plan. 
  
 (c) “Award Agreement” shall mean any written agreement, contract or other instrument or document evidencing any Award granted under the Plan. 
  
 (d) “Board” shall mean the Board of Directors of the Company. 
  
 (e) “Code” shall mean the Internal Revenue Code of
1986, as amended from time to time, and any regulations promulgated thereunder. 
  
 (f) “Committee” shall mean a committee of Directors designated by the Board to administer the Plan. The Committee shall be
comprised of not less than such number of Directors as shall be required to permit Awards granted under the Plan to qualify under Rule 16b-3, and each member of the Committee shall be a “Non-Employee Director” within the meaning of Rule
16b-3 and an “outside director” within the meaning of Section 162(m) of the Code. The Company expects to have the Plan administered in accordance with the requirements for the award of “qualified performance-based compensation”
within the meaning of Section 162(m) of the Code. 
  
 (g) “Company” shall mean Environmental Power Corporation, a Delaware corporation, and any successor corporation. 
  

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 (h) “Director” shall mean a member of the Board. 
  
 (i) “Eligible Person” shall mean any employee,
officer, consultant, independent contractor or Director providing services to the Company or any Affiliate whom the Committee determines to be an Eligible Person. 
  
 (j) “Fair Market Value” shall mean, with respect to any property (including, without limitation,
any Shares or other securities), the fair market value of such property determined by such methods or procedures as shall be established from time to time by the Committee. Notwithstanding the foregoing, unless otherwise determined by the Committee,
the Fair Market Value of Shares as of a given date shall be determined as follows: 
  
 (i) If the Shares are then listed on a national securities exchange or reported on the National Association of Securities Dealers
Automated Quotation system (“NASDAQ”) or other system reporting a closing price, the closing price of a Share on such date; 
  
 (ii) If the Shares are then not so listed or reported but traded in the over-the-counter market, the average closing bid and asked prices
per Share on such date; or 
  
 (iii) In all other
cases, the fair market value per Share, as estimated in good faith by the Committee. 
  
 (k) “Incentive Stock Option” shall mean an option granted under Section 6(a) of the Plan that is intended to meet the
requirements of Section 422 of the Code or any successor provision. 
  
 (l) “Non-Qualified Stock Option” shall mean an option granted under Section 6(a) of the Plan that is not intended to be an Incentive Stock Option. 
  
 (m) “Option” shall mean an Incentive Stock Option
or a Non-Qualified Stock Option. 
  
 (n)
“Other Stock Grant” shall mean any right granted under Section 6(e) of the Plan. 
  
 (o) “Other Stock-Based Award” shall mean any right granted under Section 6(f) of the Plan. 
  
 (p) “Participant” shall mean an Eligible Person
designated to be granted an Award under the Plan. 
  
 (q) “Performance Award” shall mean any right granted under Section 6(d) of the Plan. 
  
 (r) “Person” shall mean any individual, corporation, partnership, association or trust. 
  
 (s) “Plan” shall mean the Environmental Power
Corporation 2001 Stock Incentive Plan, as amended from time to time, the provisions of which are set forth herein. 
  

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 (t) “Restricted Stock” shall mean any Shares granted under Section 6(c) of the
Plan. 
  
 (u) “Rule 16b-3” shall mean
Rule 16b-3 promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934, as amended, or any successor rule or regulation. 
  
 (v) “Share” or “Shares” shall mean shares of common stock, $.01 par value per share, of the Company or such other
securities or property as may become subject to Awards pursuant to an adjustment made under Section 4(c) of the Plan. 
  
 (w) “Stock Appreciation Right” shall mean any right granted under Section 6(b) of the Plan. 
  
 Section 3. Administration 
  
 (a) Power and Authority of the Committee. The Plan
shall be administered by the Committee. Subject to the express provisions of the Plan and to applicable law, the Committee shall have full power and authority to: (i) designate Participants; (ii) determine the type or types of Awards to be granted
to each Participant under the Plan; (iii) determine the number of Shares to be covered by (or with respect to which payments, rights or other matters are to be calculated in connection with) each Award; (iv) determine the terms and conditions of any
Award or Award Agreement; (v) amend the terms and conditions of any Award or Award Agreement and accelerate the exercisability of Options or the lapse of restrictions relating to Restricted Stock or other Awards; (vi) determine whether, to what
extent and under what circumstances Awards may be exercised in cash, Shares, other securities, other Awards or other property, or canceled, forfeited or suspended; (vii) determine whether, to what extent and under what circumstances cash, Shares,
promissory notes, other securities, other Awards, other property and other amounts payable with respect to an Award under the Plan shall be deferred either automatically or at the election of the holder thereof or the Committee; (viii) interpret and
administer the Plan and any instrument or agreement, including an Award Agreement, relating to the Plan; (ix) establish, amend, suspend or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper
administration of the Plan; and (x) make any other determination and take any other action that the Committee deems necessary or desirable for the administration of the Plan. Unless otherwise expressly provided in the Plan, all designations,
determinations, interpretations and other decisions under or with respect to the Plan or any Award shall be within the sole discretion of the Committee, may be made at any time and shall be final, conclusive and binding upon any Participant, any
holder or beneficiary of any Award and any employee of the Company or any Affiliate. 
  
 (b) Delegation. The Committee may delegate its powers and duties under the Plan to one or more Directors or to a committee of
Directors, subject to such terms, conditions and limitations as the Committee may establish in its sole discretion. 
  

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 (c) Power and Authority of the Board of Directors. In the event the Committee has
not been designed, the Board shall exercise the powers and duties of the Committee under the Plan. Furthermore, notwithstanding anything to the contrary contained herein, the Board may, at any time and from time to time, without any further action
of the Committee, exercise the powers and duties of the Committee under the Plan. 
  
 Section 4. Shares Available for Awards 
  

(a) Shares Available. Subject to adjustment as provided in Section 4(c) of the Plan, the aggregate number of Shares that may be
issued under all Awards under the Plan shall be 857,143. Shares to be issued under the Plan may be either authorized but unissued Shares or Shares acquired in the open market or otherwise. Any Shares that are used by a Participant as full or partial
payment to the Company of the purchase price relating to an Award, or in connection with the satisfaction of tax obligations relating to an Award, shall again be available for granting Awards (other than Incentive Stock Options) under the Plan. In
addition, if any Shares covered by an Award or to which an Award relates are not purchased or are forfeited, or if an Award otherwise terminates without delivery of any Shares, then the number of Shares counted against the aggregate number of Shares
available under the Plan with respect to such Award, to the extent of any such forfeiture or termination, shall again be available for granting Awards under the Plan. Notwithstanding the foregoing, the number of Shares available for granting
Incentive Stock Options under the Plan shall not exceed 857,143, subject to adjustment as provided in the Plan and subject to the provisions of Section 422 or 424 of the Code or any successor provision. 
  
 (b) Accounting for Awards. For purposes of this
Section 4, if an Award entitles the holder thereof to receive or purchase Shares, the number of Shares covered by such Award or to which such Award relates shall be counted on the date of grant of such Award against the aggregate number of Shares
available for granting Awards under the Plan. 
  
 (c) Adjustments. In the event that the Committee shall determine that any dividend or other distribution (whether in the form of cash, Shares, other securities or other property), recapitalization, stock split, reverse stock split,
reorganization, merger, consolidation, split-up, spin-off, combination, repurchase or exchange of Shares or other securities of the Company, issuance of warrants or other rights to purchase Shares or other securities of the Company or other similar
corporate transaction or event affects the Shares such that an adjustment is determined by the Committee to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the
Plan, then the Committee shall, in such manner as it may deem equitable, adjust any or all of (i) the number and type of Shares (or other securities or other property) that thereafter may be made the subject of Awards, (ii) the number and type of
Shares (or other securities or other property) subject to outstanding Awards and (iii) the purchase or exercise price with respect to any Award; provided, however, that the number of Shares covered by any Award or to which such Award
relates shall always be a whole number. 
  
 (d)
Award Limitations Under the Plan. No Eligible Person may be granted any Award or Awards under the Plan, the value of which Award or Awards is based solely on an 

  

 4 

 
increase in the value of the Shares after the date of grant of such Award or Awards, for more than 142,857 Shares (subject to adjustment as provided for in
Section 4(c) of the Plan), in the aggregate in any calendar year. The foregoing annual limitation specifically includes the grant of any Award or Awards representing “qualified performance-based compensation” within the meaning of Section
162(m) of the Code. 
  
 Section 5. Eligibility

  
 Any Eligible Person shall be eligible to be designated a
Participant. In determining which Eligible Persons shall receive an Award and the terms of any Award, the Committee may take into account the nature of the services rendered by the respective Eligible Persons, their present and potential
contributions to the success of the Company or such other factors as the Committee, in its discretion, shall deem relevant. Notwithstanding the foregoing, an Incentive Stock Option may only be granted to full or part-time employees (which term as
used herein includes, without limitation, officers and Directors who are also employees), and an Incentive Stock Option shall not be granted to an employee of an Affiliate unless such Affiliate is also a “subsidiary corporation” of the
Company within the meaning of Section 424(f) of the Code or any successor provision. 
  
 Section 6. Awards 
  
 (a) Options. The Committee is hereby authorized to grant Options to Participants with the following terms and conditions and with
such additional terms and conditions not inconsistent with the provisions of the Plan as the Committee shall determine: 
  
 (i) Exercise Price. The purchase price per Share purchasable under an Option shall be determined by the Committee; provided,
however, that such purchase price shall not be less than 100% of the Fair Market Value of a Share on the date of grant of such Option. 
  
 (ii) Option Term. The term of each Option shall be fixed by the Committee. 
  
 (iii) Time and Method of Exercise. The Committee
shall determine the time or times at which an Option may be exercised in whole or in part and the method or methods by which, and the form or forms (including, without limitation, cash, Shares, promissory notes, other securities, other Awards or
other property, or any combination thereof, having a Fair Market Value on the exercise date equal to the relevant exercise price) in which, payment of the exercise price with respect thereto may be made or deemed to have been made. 
  
 (iv) Incentive Stock Options. Notwithstanding
anything in the Plan to the contrary, the following additional provisions shall apply to the grant of stock options which are intended to qualify as Incentive Stock Options: 
  
 (A) The aggregate Fair Market Value (determined as of the time the option is granted) of the Shares with respect to which
Incentive Stock Options are 

  

 5 

 
exercisable for the first time by any participant during any calendar year (under this Plan and all other plans of the Company and its Affiliates) shall not
exceed $100,000. 
  
 (B) All Incentive Stock Options must be
granted within ten years from the earlier of the date on which this Plan was adopted by Board of Directors or the date this Plan was approved by the shareholders of the Company. 
  
 (C) Unless sooner exercised, all Incentive Stock Options shall expire and no longer be exercisable no later than 10 years
after the date of grant; provided, however, that in the case of a grant of an Incentive Stock Option to a participant who, at the time such Option is granted, owns (within the meaning of Section 422 of the Code) stock possessing more than 10% of the
total combined voting power of all classes of stock of the Company or of its Affiliate, such Incentive Stock Option shall expire and no longer be exercisable no later than 5 years from the date of grant. 
  
 (D) The purchase price per Share for an Incentive Stock Option shall be not
less than 100% of the Fair Market Value of a Share on the date of grant of the Incentive Stock Option; provided, however, that, in the case of the grant of an Incentive Stock Option to a participant who, at the time such Option is granted, owns
(within the meaning of Section 422 of the Code) stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or of its Affiliate, the purchase price per Share purchasable under an Incentive Stock Option
shall be not less than 110% of the Fair Market Value of a Share on the date of grant of the Inventive Stock Option. 
  
 (E) Any Incentive Stock Option authorized under the Plan shall contain such other provisions as the Committee shall deem advisable, but shall in all
events be consistent with and contain all provisions required in order to qualify the Option as an Incentive Stock Option. 
  
 (b) Stock Appreciation Rights. The Committee is hereby authorized to grant Stock Appreciation Rights to Participants subject to the
terms of the Plan and any applicable Award Agreement. A Stock Appreciation Right granted under the Plan shall confer on the holder thereof a right to receive upon exercise thereof the excess of (i) the Fair Market Value of one Share on the date of
exercise (or, if the Committee shall so determine, at any time during a specified period before or after the date of exercise) over (ii) the grant price of the Stock Appreciation Right as specified by the Committee, which price shall not be less
than 100% of the Fair Market Value of one Share on the date of grant of the Stock Appreciation Right. Subject to the terms of the Plan and any applicable Award Agreement, the grant price, term, methods of exercise, dates of exercise, methods of
settlement and any other terms and conditions of any Stock Appreciation Right shall be as determined by the Committee. The Committee may impose such conditions or restrictions on the exercise of any Stock Appreciation Right as it may deem
appropriate. 
  

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 (c) Restricted Stock. The Committee is hereby authorized to grant Restricted Stock
to Participants with the following terms and conditions and with such additional terms and conditions not inconsistent with the provisions of the Plan as the Committee shall determine: 
  
 (i) Restrictions. Shares of Restricted Stock shall be subject to such restrictions as the Committee
may impose (including, without limitation, a waiver by the Participant of the right to vote or to receive any dividend or other right or property with respect thereto), which restrictions may lapse separately or in combination at such time or times,
in such installments or otherwise as the Committee may deem appropriate. 
  
 (ii) Stock Certificates. Any Restricted Stock granted under the Plan shall be registered in the name of the Participant and shall bear an appropriate legend referring to the terms, conditions and restrictions
applicable to such Restricted Stock. 
  
 (iii)
Forfeiture. Except as otherwise determined by the Committee, upon termination of employment (as determined under criteria established by the Committee) during the applicable restriction period, all Shares of Restricted Stock subject to
restriction at such time shall be forfeited and reacquired by the Company; provided, however, that the Committee may, when it finds that a waiver would be in the best interest of the Company, waive in whole or in part any or all
remaining restrictions with respect to Shares of Restricted Stock. 
  
 (d) Performance Awards. The Committee is hereby authorized to grant Performance Awards to Participants subject to the terms of the Plan and any applicable Award Agreement. A Performance Award granted under the
Plan (i) may be denominated or payable in cash, Shares (including, without limitation, Restricted Stock), other securities, other Awards or other property and (ii) shall confer on the holder thereof the right to receive payments, in whole or in
part, upon the achievement of such performance goals during such performance periods as the Committee shall establish. Subject to the terms of the Plan and any applicable Award Agreement, the performance goals to be achieved during any performance
period, the length of any performance period, the amount of any Performance Award granted, the amount of any payment or transfer to be made pursuant to any Performance Award and any other terms and conditions of any Performance Award shall be
determined by the Committee. 
  
 (e) Other
Stock Grants. The Committee is hereby authorized, subject to the terms of the Plan and any applicable Award Agreement, to grant to Participants Shares without restrictions thereon as are deemed by the Committee to be consistent with the purpose
of the Plan. 
  
 (f) Other Stock-Based
Awards. The Committee is hereby authorized to grant to Participants subject to the terms of the Plan and any applicable Award Agreement, such other Awards that are denominated or payable in, valued in whole or in part by reference to, or
otherwise based on or related to, Shares (including, without limitation, securities convertible into Shares), as are deemed by the Committee to be consistent with the purpose 

  

 7 

 
of the Plan. Shares or other securities delivered pursuant to a purchase right granted under this Section 6(f) shall be purchased for such consideration,
which may be paid by such method or methods and in such form or forms (including, without limitation, cash, Shares, promissory notes, other securities, other Awards or other property or any combination thereof), as the Committee shall determine, the
value of which consideration, as established by the Committee, shall not be less than 100% of the Fair Market Value of such Shares or other securities as of the date such purchase right is granted. 
  
 (g) General 
  
 (i) No Cash Consideration for Awards. Awards shall be
granted for no cash consideration or for such minimal cash consideration as may be required by applicable law. 
  
 (ii) Awards May Be Granted Separately or Together. Awards may, in the discretion of the Committee, be granted either alone or in
addition to, in tandem with or in substitution for any other Award or any award granted under any plan of the Company or any Affiliate other than the Plan. Awards granted in addition to or in tandem with other Awards or in addition to or in tandem
with awards granted under any such other plan of the Company or any Affiliate may be granted either at the same time as or at a different time from the grant of such other Awards or awards. 
  
 (iii) Forms of Payment under Awards. Subject to the
terms of the Plan and of any applicable Award Agreement, payments or transfers to be made by the Company or an Affiliate upon the grant, exercise or payment of an Award may be made in such form or forms as the Committee shall determine (including,
without limitation, cash, Shares, promissory notes, other securities, other Awards or other property or any combination thereof), and may be made in a single payment or transfer, in installments or on a deferred basis, in each case in accordance
with rules and procedures established by the Committee. Such rules and procedures may include, without limitation, provisions for the payment or crediting of reasonable interest on installment or deferred payments or the grant or crediting of
dividend equivalents with respect to installment or deferred payments. 
  
 (iv) Limits on Transfer of Awards. No Award (other than Other Stock Grants) and no right under any such Award shall be transferable by a Participant otherwise than by will or by the laws of descent and
distribution and the Company shall not be required to recognize any attempted assignment of such rights by any participant. Each Award or right under any Award shall be exercisable during the Participant’s lifetime only by the Participant or,
if permissible under applicable law, by the Participant’s guardian or legal representative. No Award or right under any such Award may be pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation, attachment or
encumbrance thereof shall be void and unenforceable against the Company or any Affiliate. 
  

 8 

 (v) Term of Awards. The term of each Award shall be for such period as may be
determined by the Committee; provided, however, that in the case of an Incentive Stock Option such option shall not be exercisable after the expiration of 10 years from the date such option is granted. 
  
 (vi) Restrictions; Securities Exchange Listing. All
Shares or other securities delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such restrictions as the Committee may deem advisable under the Plan, applicable federal or state securities laws and regulatory
requirements, and the Committee may cause appropriate entries to be made or legends to be affixed to reflect such restrictions. If any securities of the Company are traded on a securities exchange or system, the Company shall not be required to
deliver any Shares or other securities covered by an Award unless and until such Shares or other securities have been admitted for trading on such securities exchange or system. 
  
 Section 7. Amendment and Termination; Adjustments 
  
 (a) Amendments to the Plan. The Board may amend,
alter, suspend, discontinue or terminate the Plan at any time; provided, however, that, notwithstanding any other provision of the Plan or any Award Agreement, without the approval of the shareholders of the Company, no such amendment, alteration,
suspension, discontinuation or termination shall be made that, absent such approval: 
  
 (i) would violate the rules or regulations of the NASDAQ National Market System or any securities exchange that are applicable to the
Company; or 
  
 (ii) would cause the Company to
be unable, under the Code, to grant Incentive Stock Options under the Plan. 
  
 (b) Amendments to Awards. The Committee may waive any conditions of or rights of the Company under any outstanding Award, prospectively or retroactively. Except as otherwise provided herein or in the Award
Agreement, the Committee may not amend, alter, suspend, discontinue or terminate any outstanding Award, prospectively or retroactively, if such action would adversely affect the rights of the holder of such Award, without the consent of the
Participant or holder or beneficiary thereof. 
  
 (c) Correction of Defects, Omissions and Inconsistencies. The Committee may correct any defect, supply any omission or reconcile any inconsistency in the Plan or any Award in the manner and to the extent it shall deem desirable to
carry the Plan into effect. 
  
 Section 8.
Income Tax Withholding 
  
 In order to comply with all
applicable federal or state income tax laws or regulations, the Company may take such action as it deems appropriate to ensure that all applicable federal or state payroll, withholding, income or other taxes, which are the sole and absolute
responsibility of a Participant, are withheld or collected from such Participant. In order to assist a Participant in 

  

 9 

 
paying all or a portion of the federal and state taxes to be withheld or collected upon exercise or receipt of (or the lapse of restrictions relating to) an
Award, the Committee, in its discretion and subject to such additional terms and conditions as it may adopt, may permit the Participant to satisfy such tax obligation by (i) electing to have the Company withhold a portion of the Shares otherwise to
be delivered upon exercise or receipt of (or the lapse of restrictions relating to) such Award with a Fair Market Value equal to the amount of such taxes or (ii) delivering to the Company Shares other than Shares issuable upon exercise or receipt of
(or the lapse of restrictions relating to) such Award with a Fair Market Value equal to the amount of such taxes. The election, if any, must be made on or before the date that the amount of tax to be withheld is determined. 
  
 Section 9. General Provisions 
  
 (a) No Rights to Awards. No Eligible Person,
Participant or other Person shall have any claim to be granted any Award under the Plan, and there is no obligation for uniformity of treatment of Eligible Persons, Participants or holders or beneficiaries of Awards under the Plan. The terms and
conditions of Awards need not be the same with respect to any Participant or with respect to different Participants. 
  
 (b) Award Agreements. No Participant will have rights under an Award granted to such Participant unless and until an Award
Agreement shall have been duly executed on behalf of the Company and, if requested by the Company, signed by the Participant. 
  
 (c) Plan Provisions Control. In the event that any provision of an Award Agreement conflicts with or is inconsistent in any respect
with the terms of the Plan as set forth herein or subsequently amended, the terms of the Plan shall control. 
  
 (d) No Limit on Other Compensation Arrangements. Nothing contained in the Plan shall prevent the Company or any Affiliate from
adopting or continuing in effect other or additional compensation arrangements, and such arrangements may be either generally applicable or applicable only in specific cases. 
  
 (e) No Right to Employment. The grant of an Award shall not be construed as giving a Participant the
right to be retained in the employ of the Company or any Affiliate, nor will it affect in any way the right of the Company or an Affiliate to terminate such employment at any time, with or without cause. In addition, the Company or an Affiliate may
at any time dismiss a Participant from employment free from any liability or any claim under the Plan or any Award, unless otherwise expressly provided in the Plan or in any Award Agreement. 
  
 (f) Governing Law. The validity, construction and
effect of the Plan or any Award, and any rules and regulations relating to the Plan or any Award, shall be determined in accordance with the laws of the State of Delaware. 
  
 (g) Severability. If any provision of the Plan or any Award is or becomes or is deemed to be invalid,
illegal or unenforceable in any jurisdiction or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be 

  

 10 

 
construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended without, in the determination of the Committee,
materially altering the purpose or intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction or Award, and the remainder of the Plan or any such Award shall remain in full force and effect. 
  
 (h) No Trust or Fund Created. Neither the Plan nor
any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Company or any Affiliate and a Participant or any other Person. To the extent that any Person acquires a right to receive
payments from the Company or any Affiliate pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Company or any Affiliate. 
  
 (i) No Fractional Shares. No fractional Shares shall be issued or delivered pursuant to the Plan or
any Award, and the Committee shall determine whether cash shall be paid in lieu of any fractional Shares or whether such fractional Shares or any rights thereto shall be canceled, terminated or otherwise eliminated. 
  
 (j) Headings. Headings are given to the Sections and
subsections of the Plan solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof. 
  
 Section 10. Effective Date of the Plan 
  
 The Plan shall be effective as of August 20, 2001, subject to approval by
the shareholders of the Company within one year thereafter. 
  
 Section 11. Term of the Plan 
  
 No Award shall be granted under the Plan after ten years from the date set forth in Section 10 or any earlier date of discontinuation or termination established pursuant to Section 7(a) of the Plan. However, unless otherwise expressly
provided in the Plan or in an applicable Award Agreement, any Award theretofore granted may extend beyond such date. 
  
 Restated by the Board of Directors on March 29, 2005 
  

 11

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