Document:

exv10w1

Exhibit 10.1

 

    ACME
    PACKET, INC.

    

 

    2011
    Employee Stock Purchase Plan

 

    1. Purpose and History.

 

    The purpose of this Plan is to give Employees a convenient means
    of purchasing Common Stock of the Company through payroll
    deductions. The Company believes that ownership of Common Stock
    by Employees will foster greater Employee interest in the
    Company’s growth and development.

 

    This Plan was adopted by the Board on March 18, 2011. It is
    the Company’s intention that the Plan qualify as an
    “employee stock purchase plan” under Section 423
    of the Code. The provisions of the Plan shall, accordingly, be
    construed in a manner consistent with the requirements of that
    Code section.

 

    2. Definitions.

 

    As used in this Plan, the following terms shall have the
    following meanings:

 

    2.1. Board means the Company’s Board of
    Directors.

 

    2.2. Code means the Internal Revenue Code of
    1986, as amended from time to time, or any successor statute
    thereto, and any regulations issued from time to time thereunder.

 

    2.3. Committee means the Compensation
    Committee of the Board or such other committee delegated
    responsibility by the Board for the administration of the Plan,
    as provided in Section 4 of the Plan. For any period during
    which no such committee is in existence “Committee”
    shall mean the Board and all authority and responsibility
    assigned to the Committee under the Plan shall be exercised, if
    at all, by the Board.

 

    2.4. Common Stock or Stock
    means the common stock, par value $0.001 per share, of the
    Company.

 

    2.5. Company means Acme Packet, Inc., a
    corporation organized under the laws of the State of Delaware.

 

    2.6. Compensation means an Employee’s
    total compensation, including base pay or regular earnings plus
    commissions, overtime, and bonuses.

 

    2.7. Continuous Status as an Employee means
    the absence of any interruption or termination of service as an
    Employee. Continuous Status as an Employee shall not be
    considered interrupted in the case of (i) sick leave,
    (ii) military leave, (iii) any other leave of absence
    approved by the Plan administrator, provided that such leave is
    for a period of not more than three (3) months, unless
    reemployment upon the expiration of such leave is guaranteed by
    contract or statute, or unless provided otherwise pursuant to
    Company policy adopted from time to time or (iv) transfers
    between locations of the Company or between the Company and a
    Covered Entity.

 

    2.8. Contributions means all amounts credited
    to the account of a Participating Employee pursuant to the Plan.

 

    2.9. Corporate Transaction means (i) any
    merger or consolidation of the Company with or into another
    entity as a result of which the Stock of the Company is
    converted into or exchanged for the

    

    1

 

    right to receive cash, securities or other property or is
    cancelled, (ii) any sale or exchange of all of the Stock of
    the Company for cash, securities or other property,
    (iii) any sale, transfer, or other disposition of all or
    substantially all of the Company’s assets to one or more
    other persons in a single transaction or series of related
    transactions or (iv) any liquidation or dissolution of the
    Company.

 

    2.10. Covered Entity means any Subsidiary
    that may adopt the Plan from time to time in accordance with the
    procedures set forth in Section 14 hereof with the
    Company’s consent.

 

    2.11. Effective Date means June 1, 2011.

 

    2.12. Employee means an employee of the
    Company or a Covered Entity who is (i) customarily employed
    for at least twenty (20) hours per week and more than five
    (5) months in a calendar year and (ii) not a
    “highly-compensated employee” within the meaning of
    Section 414(q) of the Code and an officer of the Company.

 

    2.13. Fair Market Value has the meaning set
    forth in Section 6.4(c) below.

 

    2.14. New Plan Period Termination Date has
    the meaning set forth in Section 12.4 below.

 

    2.15. Participating Employee
    means an Employee who elects to participate in the Plan pursuant
    to Section 6.2, below.

 

    2.16. Payroll Deduction means a payroll
    deduction specified by a Participating Employee to be made from
    each payment for the pay periods during the Plan Period for the
    purchase of Shares under this Plan.

 

    2.17. Plan means this Acme Packet, Inc. 2011
    Employee Stock Purchase Plan.

 

    2.18. Plan Period Commencement Date means the
    first day of each Plan Period.

 

    2.19. Plan Period Termination Date means the
    last day of each Plan Period.

 

    2.20. Plan Period means each successive
    period described in Section 6.1, at the end of which each
    Participating Employee shall purchase Shares.

 

    2.21. Purchase Price means with respect to a
    Plan Period an amount equal to eighty five percent (85%) of the
    lower of (a) the Fair Market Value of a Share on the Plan
    Period Commencement Date and (b) the Fair Market Value of a
    Share on the Plan Period Termination Date.

 

    2.22. Share means a share of Common Stock, as
    adjusted in accordance with Section 12 of the Plan.

 

    2.23. Subsidiary means a corporation, in an
    unbroken chain of corporations beginning with the Company if, at
    the time of the granting of the option, each of the corporations
    other than the last corporation in the unbroken chain owns stock
    possessing fifty percent (50%) or more of the total combined
    voting power of all classes of stock in one of the other
    corporations in such chain.

 

    3. Shares Reserved For The Plan.

 

    Subject to adjustment as provided in Section 12 hereof, the
    number of Shares reserved for issuance hereunder shall be two
    million five hundred thousand (2,500,000). For purposes of
    applying the foregoing limitation, if any option expires,
    terminates or is cancelled for any reason without having been

    

    2

 

    exercised in full, the Shares not purchased or received by the
    Employee shall again be available for options to be granted
    under the Plan. Shares issued pursuant to the Plan may be either
    authorized but unissued shares or shares held by the Company in
    its treasury.

 

    4. Administration.

 

    The Plan shall be administered by the Committee, provided,
    however, that at any time and on any one or more occasions
    the Board may itself exercise any of the powers and
    responsibilities assigned the Committee under the Plan and when
    so acting shall have the benefit of all of the provisions of the
    Plan pertaining to the Committee’s exercise of its
    authorities hereunder; and provided, further, that the
    Committee may delegate its duties in order to facilitate the
    purchase and transfer of Shares and to provide for the
    day-to-day
    administration of the Plan with all powers necessary to enable
    the delegate to carry out its duties in that respect. Subject to
    the provisions of the Plan, the Committee shall have complete
    authority, in its discretion, to make or to select the manner of
    making all determinations with respect to each option to be
    granted by the Company under the Plan. In making such
    determinations, the Committee may take into account such factors
    as the Committee, in its discretion, shall deem relevant.
    Subject to the provisions of the Plan, the Committee shall also
    have complete authority to interpret the Plan, to prescribe,
    amend and rescind rules and regulations relating to the Plan and
    to make all other determinations necessary or advisable for the
    administration of the Plan. The Committee’s determinations
    made in good faith on matters referred to in the Plan shall be
    final, binding and conclusive on all persons having or claiming
    any interest under the Plan or an option granted pursuant to
    hereto.

 

    5. Eligibility for Awards.

 

    Subject to the requirements of Section 6.2 and the
    limitations imposed by Section 423(b) of the Code, any
    Employee shall be eligible to participate in a Plan Period under
    the Plan as of the applicable Plan Period Commencement Date.
    Notwithstanding any provision of the Plan to the contrary, no
    Employee shall be granted an option under the Plan if
    (i) immediately after the grant, such Employee (taking into
    account stock which would be attributed to such Employee
    pursuant to Section 424(d) of the Code) would own capital
    stock of the Company
    and/or hold
    outstanding options to purchase stock possessing five percent
    (5%) or more of the total combined voting power or value of all
    classes of stock of the Company or of any Subsidiary of the
    Company, or (ii) such option would permit his or her rights
    to purchase stock under all employee stock purchase plans
    (described in Section 423 of the Code) of the Company and
    its Subsidiaries to accrue at a rate which exceeds twenty-five
    thousand dollars ($25,000) of the Fair Market Value of such
    stock (determined on the basis of the Fair Market Value of such
    stock on the date or dates such option was granted) for each
    calendar year in which such option is outstanding at any time.

 

    6. Terms of Participation.

 

    6.1. Plan Periods.  Each calendar
    year shall be divided into two six-month Plan Periods, the first
    beginning on June 1 and ending on the immediately following
    November 30, and the second beginning on December 1 and
    ending on the immediately following May 31. The first Plan
    Period shall begin on June 1, 2011, unless the Committee
    shall have determined otherwise and communicated such
    determination to eligible Employees at least five
    (5) business days prior to the date the Plan Period is to
    commence. Each such period is referred to herein as a “Plan
    Period.”

    

    3

 

    6.2. Election to Participate and Plan
    Deductions.

 

    (a) Shares shall be offered for purchase under the Plan
    through a series of successive, non-overlapping Plan Periods
    until such time as (i) the maximum number of Shares
    available for issuance under the Plan shall have been purchased
    or (ii) the Plan shall have been sooner terminated. At any
    time and from time to time, the Committee may change the
    duration
    and/or the
    frequency of Plan Periods or suspend operation of the Plan with
    respect to Plan Periods not yet commenced.

 

    (b) An eligible Employee may become a Participating
    Employee in the Plan by completing an enrollment agreement on
    the form provided by the Company and filing it with the Company
    prior to the Company’s enrollment deadline for the Plan
    Period in which such Employee desires to participate, unless a
    later time for filing the subscription agreement is set by the
    Committee for all eligible Employees with respect to a given
    Plan Period. The enrollment agreement shall set forth the
    percentage of the Employee’s Compensation (subject to
    Section 6.2(c) below) to be paid as Contributions pursuant
    to the Plan. Payroll deductions shall commence on the first
    payroll following the Plan Period Commencement Date and shall
    end on the last payroll paid on or prior to the Plan Period
    Termination Date, unless sooner terminated by the Participating
    Employee as provided in Section 6.7.

 

    (c) A Participating Employee may elect to have payroll
    deductions taken from each payroll during any Plan Period in an
    amount not less than one percent (1%) and not more than fifteen
    percent (15%) in one percent (1%) increments (or such other
    percentage as the Committee may establish from time to time
    before any Plan Period Commencement Date) of such Participating
    Employee’s Compensation on each payroll date during the
    Plan Period. All payroll deductions made by a Participating
    Employee shall be credited to his or her account under the Plan.
    No interest shall accrue on Contributions to the Plan. A
    Participating Employee may not make any additional payments into
    such account.

 

    (d) Unless the Committee announces otherwise before the
    start of a particular Plan Period, an eligible Employee’s
    enrollment agreement in effect at the end of one Plan Period
    will remain in effect for each subsequent Plan Period.

 

    (e) A Participating Employee may discontinue his or her
    participation in the Plan as provided in Section 6.7. In
    addition, if the Committee has so announced to Employees at
    least five (5) days prior to the scheduled beginning of the
    next Plan Period to be affected by the Committee’s
    determination, a Participating Employee may, on one occasion
    only during each Plan Period, change the rate of his or her
    Contributions with respect to the Plan Period by completing and
    filing with the Company a new enrollment agreement authorizing a
    change in the payroll deduction rate; provided, however,
    that no such change shall enable a Participating Employee to
    resume Contributions other than as of a Plan Period Commencement
    Date following a withdrawal of Contributions during a Plan
    Period pursuant to Section 6.7. Any such change in payroll
    deduction rate shall be effective as of the first payroll period
    following the date of filing of the new enrollment agreement, if
    the agreement is filed at least ten (10) business days
    prior to such period and, if not, as of the second following
    payroll period.

 

    (f) Notwithstanding the foregoing, to the extent necessary
    to comply with Section 423(b)(8) of the Code and
    Section 5 herein, a Participating Employee’s Payroll
    Deductions may be decreased during any Plan Period to zero
    percent (0%). Payroll Deductions reduced to zero percent (0%) in
    compliance with this Section 6.2(f) shall re-commence
    automatically at the rate provided in such Participating
    Employee’s enrollment agreement at the beginning of the
    next Plan Period, unless terminated by the Participating
    Employee as provided in Section 6.7.

    

    4

 

    (g) Any amounts left over in a Participating
    Employee’s account upon expiration or termination of the
    Plan (or upon a withdrawal by a Participating Employee or upon a
    Participating Employee purchasing the maximum dollar amount or
    number of shares hereunder) shall be returned to the
    Participating Employee.

 

    6.3. Shares.

 

    (a) If the Committee determines that, on a given Plan
    Period Termination Date, the number of shares with respect to
    which options are to be exercised may exceed (i) the number
    of Shares that were available for sale under the Plan on the
    Plan Period Commencement Date, or (ii) the number of shares
    available for sale under the Plan on such Plan Period
    Termination Date, then the Company shall make a pro rata
    allocation of the Shares available for purchase on such Plan
    Period Termination Date in as uniform a matter as shall be
    practicable and as it shall determine in its sole discretion to
    be equitable among all Participating Employees exercising
    options to purchase Common Stock on such Plan Period Termination
    Date. The Company shall make pro rata allocation of the Shares
    available on the Plan Period Commencement Date pursuant to the
    preceding sentence, notwithstanding any authorization of
    additional Shares for issuance under the Plan by the
    Company’s stockholders subsequent to such Plan Period
    Commencement Date.

 

    (b) The Participating Employee shall have no interest or
    voting right in Shares covered by his or her option until such
    option has been exercised.

 

    (c) Shares to be delivered to a Participating Employee
    under the Plan will be registered in the name of the
    Participating Employee.

 

    6.4. Grant of Options.

 

    (a) A Participating Employee shall be granted a separate
    purchase right for each Plan Period in which he or she
    participates. The purchase right shall be granted on the Plan
    Period Commencement Date for the Plan Period and shall provide
    the Participating Employee with the right to purchase Shares
    upon the terms set forth below.

 

    (b) The number of Shares purchasable by a Participating
    Employee on each Plan Period Termination Date during the Plan
    Period, pursuant to Section 6.5 below, shall be determined
    by dividing such Employee’s Contributions accumulated
    during such Plan Period prior to such Plan Period Termination
    Date and retained in the Participating Employee’s account
    as of the Plan Period Termination Date by the applicable
    Purchase Price. However, the maximum number of Shares a
    Participating Employee may purchase during each Plan Period
    shall be one thousand (1,000) shares of Common Stock, unless
    otherwise determined by the Committee and announced to Employees
    at least five (5) days prior to the scheduled beginning of
    the next Plan Period to be affected by the Committee’s
    determination, provided further that such purchase shall be
    subject to the limitations set forth in Sections 6.2(c).

 

    (c) The fair market value of the Shares on a given date
    (the “Fair Market Value”) means the value of a share
    of Common Stock on a particular date determined by such methods
    or procedures as may be established by the Committee. Unless
    otherwise determined by the Committee, the Fair Market Value of
    the Common Stock as of any date, is the closing price for the
    common stock as reported by the NASDAQ Global Select Market (or
    on any other national securities exchange on which the common
    stock is then listed) for that date or, if no closing price is
    reported for that date, the closing price on the next preceding
    date for which a closing price was reported.

    

    5

 

    6.5. Exercise.

 

    Unless a Participating Employee withdraws from the Plan as
    provided in Section 6.7, each purchase right shall be
    automatically exercised on each Plan Period Termination Date,
    and Shares shall accordingly be purchased on behalf of each
    Participating Employee on each such Plan Period Termination
    Date. The purchase shall be effected by applying the
    Participating Employee’s Contributions for the Plan Period
    ending on such Plan Period Termination Date to the purchase of
    Shares (subject to the limitation on the maximum number of
    Shares purchasable per Participating Employee on any one Plan
    Period Termination Date) at the Purchase Price in effect for the
    Participating Employee for that Plan Period Termination Date.
    The Shares purchased upon exercise of an option hereunder shall
    be deemed to be transferred to the Participating Employee on the
    Plan Period Termination Date. During his or her lifetime, a
    Participating Employee’s option to purchase Shares
    hereunder is exercisable only by him or her.

 

    6.6. Delivery.

 

    As promptly as practicable after each Plan Period Termination
    Date, the Company shall arrange the delivery to each
    Participating Employee, as appropriate, of the Shares purchased
    upon exercise of his or her option.

 

    6.7. Voluntary Withdrawal; Termination of
    Employment.

 

    (a) A Participating Employee may withdraw all but not less
    than all of the Contributions credited to his or her account
    under the Plan at any time prior to each Plan Period Termination
    Date by giving written notice to the Company in accordance with
    the Company’s policy regarding withdrawal from the Plan.
    All of the Participating Employee’s Contributions credited
    to his or her account will be paid to him or her promptly after
    receipt of his or her notice of withdrawal and his or her option
    for the current Plan Period will be automatically terminated,
    and no further Contributions for the purchase of Shares will be
    made (or will be permitted to be made) during the Plan Period.

 

    (b) Upon termination of the Participating Employee’s
    Continuous Status as an Employee prior to a Plan Period
    Termination Date for any reason, including retirement or death,
    the Contributions credited to his or her account will be
    returned to him or her or, in the case of his or her death, to
    the person or persons entitled thereto under Section 8, and
    his or her option will be automatically terminated.

 

    (c) In the event a Participating Employee fails to remain
    in Continuous Status as an Employee of the Company for at least
    twenty (20) hours per week during the Plan Period in which
    the Employee is a Participating Employee, he or she will be
    deemed to have elected to withdraw from the Plan and the
    Contributions credited to his or her account and remaining there
    will be returned to him or her and his or her option terminated.

 

    (d) A Participating Employee’s withdrawal during a
    Plan Period will not have any effect upon his or her eligibility
    to participate in a succeeding Plan Period or in any similar
    plan which may hereafter be adopted by the Company.

 

    7. No Special Service Rights.

 

    Nothing contained in this Plan shall confer upon any Employee
    any right with respect to the continuation of his or her
    employment with the Company or any Covered Entity or any other
    entity, corporation, partnership, limited liability company or
    business trust controlling, controlled by or under common
    control with the Company, or interfere in any way with the right
    of any such entity, subject to

    

    6

 

    the terms of any separate employment agreement or provision of
    law or corporate articles or by-laws to the contrary, at any
    time to terminate such employment relationship or to increase or
    decrease, or otherwise adjust, the other terms and conditions of
    the Employee’s employment.

 

    8. Designation of Beneficiary.

 

    8.1. A Participating Employee may file a written
    designation of a beneficiary who is to receive any Shares and
    cash, if any, from the Participating Employee’s account
    under the Plan in the event of such Participating
    Employee’s death subsequent to the end of a Plan Period but
    prior to delivery to him or her of such Shares and cash. Any
    such beneficiary shall also be entitled to receive any cash from
    the Participating Employee’s account under the Plan in the
    event of such Participating Employee’s death during a Plan
    Period.

 

    8.2. Such designation of beneficiary may be changed by the
    Participating Employee at any time by written notice. In the
    event of the death of a Participating Employee and in the
    absence of a beneficiary validly designated under the Plan who
    is living at the time of such Participating Employee’s
    death, the Company shall deliver such Shares
    and/or cash
    to the executor or administrator of the estate of the
    Participating Employee, or if no such executor or administrator
    has been appointed (to the knowledge of the Company), the
    Company, in its discretion, may deliver such Shares
    and/or cash
    to the spouse or to any one or more dependents or relatives of
    the Participating Employee, or if no spouse, dependent or
    relative is known to the Company, then to such other person as
    the Company may designate.

 

    9. Transferability of Options and Shares.

 

    Neither Contributions credited to a Participating
    Employee’s account nor any rights with regard to the
    exercise of an option or to receive Shares under the Plan may be
    assigned, transferred, pledged or otherwise disposed of in any
    way (other than by will, the laws of descent and distribution,
    or as provided in Section 8) by the Participating
    Employee. Any such attempt at assignment, transfer, pledge or
    other disposition shall be without effect, except that the
    Company may treat such act as an election to withdraw funds in
    accordance with Section 6.7. In addition, if the Committee
    has so announced to Participating Employees at least five
    (5) days prior to the scheduled beginning of the next Plan
    Period, any Shares acquired on the Plan Period Termination Date
    of such Plan Period may be subject to restrictions specified by
    the Committee on the transfer of such Shares. Any Participating
    Employee selling or transferring any or all of his or her Shares
    purchased pursuant to the Plan must provide written notice of
    such sale or transfer to the Company within five
    (5) business days after the date of sale or transfer. Such
    notice to the Company shall include the gross sales price, if
    any, the Plan Period during which the Shares being sold were
    purchased by the Participating Employee, the number of Shares
    being sold or transferred and the date of sale or transfer.

 

    10. Use of Funds.

 

    All Contributions received or held by the Company under the Plan
    may be used by the Company for any corporate purpose, and the
    Company shall not be obligated to segregate such Contributions
    from its other assets.

 

    11. Reports.

 

    Individual accounts will be maintained for each Participating
    Employee in the Plan. Statements of account will be given to
    Participating Employees at least annually, which statements will
    set forth, with

    

    7

 

    respect to the immediately prior calendar year, the amounts of
    Contributions, the per Share Purchase Price, the number of
    Shares purchased and the remaining cash balance, if any.

 

    12. Adjustments Upon Changes in Capitalization;
    Corporate Transactions.

 

    12.1. Adjustment in General.  All
    of the share numbers set forth in the Plan reflect the capital
    structure of the Company as of the date of the Board’s
    adoption of this Plan. If subsequent to that date the
    outstanding Shares (or any other securities covered by the Plan
    by reason of the prior application of this Section) are
    increased, decreased, or exchanged for a different number or
    kind of shares or other securities, or if additional shares or
    new or different shares or other securities are distributed with
    respect to Shares, as a result of a reorganization,
    recapitalization, reclassification, stock dividend, stock split,
    reverse stock split, or other similar distribution with respect
    to such shares of Stock, an appropriate and proportionate
    adjustment will be made in (i) the maximum numbers and
    kinds of shares provided in Section 3, (ii) the
    numbers and kinds of shares or other securities subject to the
    then outstanding options, and (iii) the exercise price for
    each share or other unit of any other securities subject to then
    outstanding options.

 

    12.2. Adjustment Upon the Occurrence of Certain
    Unusual or Nonrecurring Events.  In the event
    of any corporate action not specifically covered by
    Section 12.1, including but not limited to an extraordinary
    cash distribution on Common Stock, a corporate separation or
    other reorganization or liquidation, the Committee may make such
    adjustment of outstanding options and their terms, if any, as
    it, in its sole discretion, may deem equitable and appropriate
    in the circumstances. The Committee may make adjustments in the
    terms and conditions of, and the criteria included in, options
    in recognition of unusual or nonrecurring events (including,
    without limitation, the events described in this Section)
    affecting the Company or the financial statements of the Company
    or of changes in applicable laws, regulations, or accounting
    principles, whenever the Committee determines that such
    adjustments are appropriate in order to prevent dilution or
    enlargement of the benefits or potential benefits intended to be
    made available under the Plan.

 

    12.3. Related Matters.  Any
    adjustment in Awards made pursuant to Section 12.1 or 12.2
    shall be determined and made, if at all, by the Committee,
    acting in its sole discretion, and shall include any correlative
    modification of terms which the Committee may deem necessary or
    appropriate so as to ensure the rights of the Participating
    Employees in their respective options are not substantially
    diminished nor enlarged as a result of the adjustment and
    corporate action other than as expressly contemplated in this
    Section 12.

 

    12.4. Corporate Transactions.  In
    the event of a Corporate Transaction that is a dissolution or
    liquidation of the Company, the Plan Period then in progress
    will terminate immediately prior to the consummation of such
    action, unless otherwise provided by the Committee. In the event
    of a Corporate Transaction other than a dissolution or
    liquidation of the Company, each option outstanding under the
    Plan shall be assumed or an equivalent option shall be
    substituted by the successor corporation or a parent or
    subsidiary of such successor corporation. In the event that the
    successor corporation refuses to assume or substitute for
    outstanding options, the Plan Period then in progress shall be
    shortened and a new Plan Period Termination Date shall be set
    (the “New Plan Period Termination Date”), as of which
    date the Plan Period then in progress will terminate. The New
    Plan Period Termination Date shall be on or before the date of
    consummation of the transaction and the Committee shall notify
    each Participating Employee in writing, at least ten
    (10) days prior to the New Plan Period Termination Date,
    that the Plan Period Termination Date for his or her option has
    been changed to the New Plan Period Termination

    

    8

 

    Date and that his or her option will be exercised automatically
    on the New Plan Period Termination Date, unless prior to such
    date he or she has withdrawn from the Plan Period as provided in
    Section 6.7. For purposes of this Section 12.4, an
    option granted under the Plan shall be deemed to be assumed,
    without limitation, if, at the time of issuance of the stock or
    other consideration upon a Corporate Transaction, each holder of
    an option under the Plan would be entitled to receive upon
    exercise of the option the same number and kind of shares of
    stock or the same amount of property, cash or securities as such
    holder would have been entitled to receive upon the occurrence
    of the transaction if the holder had been, immediately prior to
    the transaction, the holder of the number of Shares covered by
    the option at such time (after giving effect to any adjustments
    in the number of Shares covered by the option as provided for in
    this Section 12); provided however that if the
    consideration received in the transaction is not solely common
    stock of the successor corporation or its parent (as defined in
    Section 424(e) of the Code), the Committee may, with the
    consent of the successor corporation, provide for the
    consideration to be received upon exercise of the option to be
    solely common stock of the successor corporation or its parent
    equal in fair market value to the per Share consideration
    received by holders of common stock in the transaction.

 

    13. Settlement of Awards.

 

    13.1. Violation of
    Law.  Notwithstanding any other provision of
    the Plan to the contrary, if, at any time, in the reasonable
    opinion of the Company, the issuance of Shares pursuant to the
    Plan may constitute a violation of law, then the Company may
    delay such issuance of such Shares until (i) approval shall
    have been obtained from such governmental agencies, other than
    the Securities and Exchange Commission, as may be required under
    any applicable law, rule, or regulation and (ii) in the
    case where such issuance would constitute a violation of a law
    administered by or a regulation of the Securities and Exchange
    Commission, one of the following conditions shall have been
    satisfied:

 

    (a) the Shares are, at the time of the issue of such
    Shares, effectively registered under the Securities Act of
    1933; or

 

    (b) the Company shall have determined, on such basis as it
    deems appropriate (including an opinion of counsel in form and
    substance satisfactory to the Company) that the sale, transfer,
    assignment, pledge, encumbrance or other disposition of such
    Shares or such beneficial interest, as the case may be, does not
    require registration under the Securities Act of 1933, as
    amended or any applicable State securities laws.

 

    The Company shall make all reasonable efforts to bring about the
    occurrence of said events.

 

    13.2. Corporate Restrictions on Rights in
    Stock.  Any Shares to be issued pursuant to
    the Plan shall be subject to all restrictions upon the transfer
    thereof which may be now or hereafter imposed by the charter,
    certificate or articles, and by-laws, of the Company.

 

    13.3. Investment
    Representations.  The Company shall be under
    no obligation to issue any Shares unless the Shares to be issued
    pursuant to the Plan have been effectively registered under the
    Securities Act of 1933, as amended.

 

    13.4. Placement of Legends; Stop Orders;
    etc.  Each Share to be issued pursuant to the
    Plan may bear a reference to any applicable restriction under
    the Plan. All certificates for Shares or other securities
    delivered under the Plan shall be subject to such stock transfer
    orders and other restrictions as the Committee may deem
    advisable under the rules, regulations, and other requirements
    of any stock exchange upon which the Common Stock is then
    listed, and any applicable federal or state securities

    

    9

 

    law, and the Committee may cause a legend or legends to be put
    on any such certificates to make appropriate reference to such
    restrictions.

 

    14. Adopting Subsidiaries.

 

    Any Subsidiary of the Company may request that its Employees be
    allowed to participate in the Plan in accordance with procedures
    to be adopted by the Board. The Board of Directors of the
    Company may, in its sole discretion, approve or reject any such
    request. Any such Subsidiary whose request is approved by the
    Board of Directors shall be referred to herein as a
    “Covered Entity.” In addition, the Board of Directors
    of the Company may determine, in its sole discretion, that a
    Subsidiary that is a Covered Entity will cease to be a Covered
    Entity with respect to Plan Periods not yet commenced.

 

    15. Amendment and Termination.

 

    (a) The Board may at any time terminate the Plan or make
    such modifications of the Plan as it shall deem advisable.
    Except as provided in Section 12, no termination of the
    Plan may affect options previously granted, provided that the
    Plan or a Plan Period may be terminated by the Board on a Plan
    Period Termination Date or by the Board’s setting a new
    Plan Period Termination Date with respect to a Plan Period then
    in progress if the Board determines that termination of the Plan
    and/or any
    Plan Period is in the best interests of the Company and its
    stockholders or if continuation of the Plan
    and/or a
    Plan Period would cause the Company to incur adverse accounting
    charges as a result of the Plan. Except as provided in
    Section 12 or this Section 15, no amendment to the
    Plan shall make any change in any option previously granted
    which adversely affects the rights of any Participating Employee.

 

    (b) In addition to the foregoing, without stockholder
    consent and without regard to whether any Participating Employee
    rights may be considered to have been adversely affected, the
    Committee shall be entitled to change the Plan Periods,
    establish the exchange ratio applicable to amounts withheld in a
    currency other than United States dollars (if applicable),
    permit payroll withholding in excess of the amount designated by
    a Participating Employee to adjust for delays or mistakes in the
    Company’s processing of properly completed withholding
    elections, establish reasonable waiting and adjustment periods
    and/or
    accounting and crediting procedures to ensure that amounts
    applied toward the purchase of Common Stock for each
    Participating Employee properly correspond with amounts withheld
    from the Participating Employee’s Compensation, and
    establish such other limitations or procedures as the Committee
    determines in its sole discretion advisable which are consistent
    with the Plan.

 

    16. Notices and Other Communications.

 

    Any notice, demand, request or other communication hereunder to
    any party shall be deemed to be sufficient if contained in a
    written instrument delivered in person or duly sent by first
    class registered, certified or overnight mail, postage prepaid,
    or telecopied with a confirmation copy by regular, certified or
    overnight mail, addressed or telecopied, as the case may be,
    (i) if to a Participating Employee, at his or her residence
    address last filed with the Company and (ii) if to the
    Company, at its principal place of business, addressed to the
    attention of its Treasurer, or to such other address or
    telecopier number, as the case may be, as the addressee may have
    designated by notice to the addressor. All such notices,
    requests, demands and other communications shall be deemed to
    have been received: (i) in the case of personal delivery,
    on the date of such delivery; (ii) in the case of mailing,
    when received by the addressee; and (iii) in the case of
    facsimile transmission, when confirmed by facsimile machine
    report. In addition, the Company may, in its sole discretion,
    deliver any documents related to the Plan by

    

    10

 

    electronic means or request that Participating Employee
    communicate with the Company with respect to the Plan by
    electronic means. By participating in the Plan, each
    Participating Employee will have consented to receive such
    documents by electronic delivery and, if requested, to agree to
    participate in the Plan through an on-line or electronic system
    established and maintained by the Company or another third party
    designated by the Company, and such consent shall remain in
    effect throughout the Participating Employee’s term of
    employment or service with the Company and thereafter until
    withdrawn in writing by Participant.

 

    17. Governing Law.

 

    The Plan and all options and actions taken thereunder shall be
    governed, interpreted and enforced in accordance with the laws
    of the State of Delaware without regard to the conflict of laws
    principles thereof.

 

    18. Term of Plan.

 

    The Plan shall become effective May 5, 2011 and shall
    continue in effect until terminated pursuant to Section 15.

    

    11exv10w5

Exhibit 10.5

HCA
Holdings, Inc.

Restricted Share Unit Agreement

(Director)

     THIS RESTRICTED SHARE UNIT AGREEMENT (this “Agreement”) is made and entered into as of
the
___
day of March, 2011 (the “Grant Date”), between HCA
Holdings, Inc., a Delaware corporation
(the “Company”), and [director], (the “Grantee”). Capitalized terms not otherwise defined
herein shall have the meaning ascribed to such terms in the 2006 Stock Incentive Plan for Key
Employees of HCA Holdings, Inc. and its Affiliates, as Amended and Restated (the “Plan”).

     WHEREAS, the Company has adopted the Plan, which permits the issuance of awards that are based
on Shares of the Company, including the grant of a right to receive one Share at a specified date
(or dates) in the future (a “Restricted Share Unit”); and

     WHEREAS, the Company has determined that a portion of the Grantee’s annual retainer for
services as a director of the Company (a “Director”) should be paid to the Grantee in the form of
Restricted Share Units, to be granted pursuant to the terms and conditions set forth in this award
Agreement;

     NOW, THEREFORE, the parties hereto agree as follows:

     1. Grant of Restricted Share Unit Award.

          1.1 The Company hereby grants to the Grantee an award (“Award”) of [number] Restricted Share
Units (“RSUs”) on the terms and conditions set forth in this Agreement and as otherwise provided in
the Plan.

          1.2 The Grantee’s rights with respect to the Award shall remain forfeitable at all times prior
to the dates on which the RSUs shall vest in accordance with Section 2 hereof. This Award may not
be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by Grantee
other than by will or the laws of descent and distribution.

     2. Vesting and Payment.

          2.1 Except as provided in Section 2.2, the Award shall vest __________________________, so
long as the Grantee continues to serve on the Board through such date (such _________ period
sometimes referred to as the “Restricted Period”).

 

 

          2.2 Notwithstanding Section 2.1 above, all RSUs covered by the Award shall immediately vest
upon the occurrence of a Change in Control that occurs prior to the expiration of the Restricted
Period. If the Grantee’s service as a Director is terminated for any reason other than death or
Disability, the Grantee shall forfeit all rights with respect to all RSUs that are not vested on
such date; provided, however, if such termination is with Cause (as defined below), all RSUs
whether vested or unvested shall immediately become void and of no effect. If the Grantee’s
service as a Director is terminated by death or Disability, the RSUs covered by the Award shall
immediately vest, but only in proportion to the length of the Director’s service as a director
during such Restricted Period. For purposes of this Agreement, Cause shall mean the reasons for
which a Director can be removed from the Board by the Company pursuant to the governing documents
of the Company (including, without limitation, the Company’s by-laws and charter). For purposes of
this Agreement, “Disability” shall mean that the Grantee is unable to perform the essential duties
of a Director. Notwithstanding the foregoing, this provision is subject in its entirety to Section
9 of the Plan.

          2.3 The Grantee shall be entitled to payment in respect of all RSUs covered by the Award upon
the vesting of such RSUs. Subject to the provisions of the Plan, such payment shall be made
through the issuance to the Grantee, as promptly as practicable thereafter (or to the executors or
administrators of Grantee’s estate, as promptly as practicable after the Company’s receipt of
notification of Grantee’s death, as the case may be), of a number of Shares equal to the number of
such vested RSUs. Notwithstanding the foregoing, if the Grantee shall have elected to defer
payment of such vested RSUs to such later date as may be permitted by the Company, in accordance
with the requirements of Section 409A of the Code, by ______________________, 20___, payment of
such vested RSUs shall instead be made on such later date (the “Deferral Election”).

     3. Dividend Equivalent Rights.

          In the event that the Grantee makes a Deferral Election with respect to the settlement of the
vested RSUs, the Grantee shall receive Dividend Equivalent Rights in respect of any vested RSUs
covered by this Award at the time of any payment of dividends to stockholders on Shares. The
amount of any such Dividend Equivalent Right shall equal the amount that would be payable to the
Grantee as a stockholder in respect of a number of Shares equal to the number of vested RSUs then
credited to the Grantee hereunder. Any such Dividend Equivalent Right shall be paid in accordance
with the Company’s payment practices as may be established from time to time and as of the date on
which such dividend would have been payable in respect of such number of Shares. No Dividend
Equivalent Rights shall be paid under any circumstances in respect of RSUs that are not vested.

     4. No Right to Continued Service.

          Nothing in this Agreement or the Plan shall be interpreted or construed to confer upon the
Grantee any right to continue service as a member of the Board.

 

 

     5. Adjustments.

          Notwithstanding anything else contained in this Agreement, the RSUs granted hereunder and this
Agreement shall be subject to adjustment, substitution or cancellation in accordance with the
provisions of Sections 8 and 9 of the Plan.

     6. Grantee Bound by the Plan.

          This Agreement shall be construed in accordance and consistent with, and subject to, the terms
of the Plan. The Grantee hereby acknowledges receipt of a copy of the Plan and agrees to be bound
by all the terms and provisions thereof.

     7. Plan Governs.

          The terms of this Agreement are governed by the terms of the Plan, and in the case of any
inconsistency between the terms of this Agreement and the terms of the Plan, the terms of the Plan
shall govern.

     8. Modification of Agreement.

          Subject to the provisions of Section 3 of the Plan, this Agreement may be modified, amended,
suspended or terminated, and any terms or conditions may be waived, but only by a written
instrument executed by the parties hereto.

     9. Severability.

          If any provision of this Agreement is, or becomes, or is deemed to be invalid, illegal, or
unenforceable in any jurisdiction or as to any Person or the Award, or would disqualify the Plan or
Award under any laws deemed applicable by the Committee, such provision shall be construed or
deemed amended to conform to the applicable laws, or if it cannot be construed or deemed amended
without, in the determination of the Committee, materially altering the intent of the Plan or the
Award, such provision shall be stricken as to such jurisdiction, Person or Award, and the remainder
of the Plan and Award shall remain in full force and effect.

     10. Taxes.

          The Grantee shall be responsible for all taxes due in connection with the grant or vesting or
any payment or transfer with respect to the RSUs and Shares payable hereunder.

     11. Governing Law.

          The validity, interpretation, construction and performance of this Agreement shall be governed
by the laws of the State of Delaware without giving effect to the conflicts of law principles
thereof, except to the extent that such laws are preempted by Federal law.

 

 

     12. Successors in Interest.

          This Agreement shall inure to the benefit of and be binding upon any successor to the Company.
This Agreement shall inure to the benefit of the Grantee’s legal representatives. All obligations
imposed upon the Grantee and all rights granted to the Company under this Agreement shall be
binding upon the Grantee’s heirs, executors, administrators and successors.

     13. Resolution of Disputes.

          Any dispute or disagreement which may arise under, or as a result of, or in any way related
to, the interpretation, construction or application of this Agreement shall be determined by the
Board. Any determination made hereunder shall be final, binding and conclusive on the Grantee and
the Company for all purposes.

	14.	 	Entire Agreement.

          This Agreement and the Plan contain the entire agreement and understanding of the parties
hereto with respect to the subject matter contained herein and supersede all prior communications,
representations and negotiations in respect thereto.

	 	 	 

	 

	 	HCA Holdings, Inc.

By:

	 
	 	 
	 

	 	Grantee:
	 
	 	 
	 
	 

	 	 
	 

	 	Please Print
	 
	 	 
	 

	 	Grantee:
	 
	 	 
	 
	 

	 	 
	 

	 	Signature

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