Document:

exv4w2

Exhibit 4.2

Form of Note

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY IS EXCHANGEABLE FOR
SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR
IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE
BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.

UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY,
A NEW YORK CORPORATION (“DTC”), TO THE OPERATING PARTNERSHIP (AS DEFINED BELOW) OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY SECURITY ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

	 	 	 

	No.:
	 	 
	 
	 	 
	CUSIP No.: 00163M AL8

	 	Principal Amount:
	$300,000,000
	 	 

AMB PROPERTY, L.P.

4.500% Notes due 2017

AMB Property, L.P., a Delaware limited partnership (hereinafter called the “Operating Partnership”,
which term includes any successor under the Indenture referred to below), for value received,
hereby promises to pay to CEDE & CO., or registered assigns, the principal sum of THREE HUNDRED
MILLION DOLLARS ($300,000,000) on August 15, 2017, and to pay interest thereon from August 9, 2010
or from the most recent date to which interest has been paid or duly provided for, semiannually on
February 15 and August 15 of each year (each, an “Interest Payment Date”), commencing February 15,
2011, and at Maturity, at the rate of 4.500% per annum, until the principal hereof is paid or duly
made available for payment. Interest on this Note shall be calculated on the basis of a 360-day
year consisting of twelve 30-day months. The interest so payable and punctually paid or duly
provided for on any Interest Payment Date will, as provided in such Indenture, be paid to the
Person in whose name this Note (or one or more Predecessor Securities) is registered at the close
of business on the Regular Record Date for such interest, which shall be February 1 or August 1
(whether or not a Business Day), as the case may be, immediately preceding such Interest Payment
Date. Any such interest which is payable, but is not punctually paid or duly provided for, on any
Interest Payment Date shall forthwith cease to be payable to the registered Holder hereof on the
relevant Regular Record Date by virtue of having been such Holder, and may be paid to the Person in
whose name this Note (or one or more Predecessor Securities) is registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest to

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be fixed by the Trustee, notice whereof shall be given to the Holder of this Note not less than 10
days prior to such Special Record Date, or may be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the Notes may be listed, and
upon such notice as may be required by such exchange, all as more fully provided in such Indenture.

Payment of the principal of and the interest on this Note will be made at the office or agency of
the Operating Partnership maintained for that purpose in the Borough of Manhattan, The City of New
York, in such coin or currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided, however, that, at the option of the
Operating Partnership, interest may be paid by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register or by wire transfer to an account
maintained by the payee located in the United States of America.

This Note is one of a duly authorized issue of Securities of the Operating Partnership (herein
called the “Notes”) issued and to be issued under an Indenture dated as of June 30, 1998 (herein
called, together with all indentures supplemental thereto, the “Indenture”) among, the Operating
Partnership, AMB Property Corporation and U.S. Bank National Association, as successor-in-interest
to State Street Bank and Trust Company of California, N.A., as trustee (herein called the
“Trustee”, which term includes any successor trustee under the Indenture), to which Indenture and
all indentures supplemental thereto reference is hereby made for a statement of the respective
rights, limitations of rights, duties and immunities thereunder of the Operating Partnership, the
Trustee and the Holders of the Notes, and the terms upon which the Notes are, and are to be,
authenticated and delivered. This Note is one of the Securities of the series designated on the
face hereof, limited in aggregate principal amount to $300,000,000.

The Notes are subject to redemption prior to the Stated Maturity of the principal thereof as
provided in the Indenture.

If an Event of Default with respect to the Notes shall occur and be continuing, the principal of
the Notes may be declared due and payable in the manner and with the effect provided in the
Indenture.

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the
modification of the rights and obligations of the Operating Partnership and the rights of the
Holders of the Notes of each series issued under the Indenture at any time by the Operating
Partnership and the Trustee with the consent of the Holders of not less than a majority in
aggregate principal amount of the Notes at the time Outstanding of each series affected thereby.
The Indenture also contains provisions permitting the Holders of specified percentages in aggregate
principal amount of the Notes of any series at the time Outstanding, on behalf of the Holders of
all Notes of such series, to waive compliance by the Operating Partnership with certain provisions
of the Indenture and certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the holder of this Note shall be conclusive and binding upon such Holder and
upon all future Holders of this Note and of any Notes issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Note.

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter
or impair the obligation of the Operating Partnership, which is absolute and unconditional, to pay
the principal of and interest on this Note, at the time, place and rate, and in the coin or
currency, herein and in the Indenture prescribed.

As provided in the Indenture and subject to certain limitations set forth therein, the transfer of
this Note may be registered on the Security Register upon surrender of this Note for registration
of transfer at the

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office or agency of the Operating Partnership maintained for the purpose in any place where the
principal of and interest on this Note are payable, duly endorsed, or accompanied by a written
instrument of transfer in form satisfactory to the Operating Partnership and the Security Registrar
duly executed by the Holder hereof or by his attorney duly authorized in writing, and thereupon one
or more new Notes, of authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees. The Notes are issuable only in registered form
without coupons in the denominations of $1,000 and integral multiples thereof. As provided in the
Indenture and subject to certain limitations set forth therein, the Notes are exchangeable for a
like aggregate principal amount of Notes of authorized denominations as requested by the Holders
surrendering the same.

No service charge shall be made for any such registration of transfer or exchange, but the
Operating Partnership may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith, other than in certain cases provided in the
Indenture.

Prior to due presentment of this Note for registration of transfer, the Operating Partnership, the
Trustee and any agent of the Operating Partnership or the Trustee may treat the Person in whose
name this Note is registered as the owner hereof for all purposes, whether or not this Note be
overdue, and neither the Operating Partnership, the Trustee nor any such agent shall be affected by
notice to the contrary.

The Indenture contains provisions whereby (i) the Operating Partnership may be discharged from its
obligations with respect to the Notes (subject to certain exceptions) or (ii) the Operating
Partnership may be released from its obligations under specified covenants and agreements in the
Indenture, in each case if the Operating Partnership irrevocably deposits with the Trustee money or
Government Obligations sufficient to pay and discharge the entire indebtedness on all Securities,
and satisfies certain other conditions, all as more fully provided in the Indenture.

THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF
NEW YORK.

Capitalized terms used in this Note which are not defined herein shall have the meanings assigned
to them in the Indenture.

Unless the certificate of authentication hereon has been executed by or on behalf of the Trustee
under the Indenture by the manual signature of one of its authorized signatories, this Note shall
not be entitled to any benefits under the Indenture or be valid or obligatory for any purpose.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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IN WITNESS WHEREOF, the Operating Partnership has caused this instrument to be duly executed.

Dated: August 9, 2010

AMB PROPERTY, L.P.

By: AMB PROPERTY CORPORATION,

its sole general partner

	 	 	 	 	 

	By:
	 	 	 	 
	 
	 
	Name:

	 	 

	 	 
	Title:
	 	 	 	 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the Securities of the

series designated therein referred to

in the within-mentioned Indenture.

U.S. BANK NATIONAL ASSOCIATION, as Trustee

	 	 	 	 	 

	By:
	 	 	 	 
	 
	 
	Name:

	 	 

	 	 
	Title:
	 	 	 	 

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PARENT GUARANTEE

FOR VALUE RECEIVED, the undersigned hereby, jointly and severally with the Subsidiary Guarantors,
if any, unconditionally guarantees to the Holder of the accompanying 4.500% Note due 2017 (the
“Note”) issued by AMB Property, L.P. (the “Operating Partnership”) under an Indenture dated as of
June 30, 1998 (together with the First Supplemental Indenture thereto, the Second Supplemental
Indenture thereto, the Third Supplemental Indenture thereto, the Fourth Supplemental Indenture
thereto, the Fifth Supplemental Indenture thereto, the Sixth Supplemental Indenture thereto, the
Seventh Supplemental Indenture thereto, the Eighth Supplemental Indenture thereto, the Ninth
Supplemental Indenture thereto and the Tenth Supplemental Indenture thereto, the “Indenture”) among
the Operating Partnership, AMB Property Corporation, and U.S. Bank National Association, as
successor-in-interest to State Street Bank and Trust Company of California, N.A., as trustee
hereunder (the “Trustee”), (a) the full and prompt payment of the principal of and premium, if any,
on such Note when and as the same shall become due and payable, whether at Stated Maturity, by
acceleration, by redemption or otherwise, and (b) the full and prompt payment of the interest on
such Note when and as the same shall become due and payable, according to the terms of such Note
and of the Indenture. In case of the failure of the Operating Partnership punctually to pay any
such principal, premium or interest, the undersigned hereby agrees to cause any such payment to be
made punctually when and as the same shall become due and payable, whether at Stated Maturity, upon
acceleration, by redemption or otherwise, and as if such payment were made by the Operating
Partnership. The undersigned hereby agrees, jointly and severally with the Subsidiary Guarantors,
if any, that its obligations hereunder shall be as principal and not merely as surety, and shall be
absolute and unconditional, and shall not be affected, modified or impaired by the following: (a)
the failure to give notice to the Guarantors of the occurrence of an Event of Default under the
Indenture; (b) the waiver, surrender, compromise, settlement, release or termination of the
payment, performance or observance by the Operating Partnership or the Guarantors of any or all of
the obligations, covenants or agreements of either of them contained in the Indenture or the Notes;
(c) the acceleration, extension or any other changes in the time for payment of any principal of or
interest or any premium on any Note or for any other payment under the Indenture or of the time for
performance of any other obligations, covenants or agreements under or arising out of the Indenture
or the Notes; (d) the modification or amendment (whether material or otherwise) of any obligation,
covenant or agreement set forth in the Indenture or the Notes; (e) the taking or the omission of
any of the actions referred to in the Indenture and in any of the actions under the Notes; (f) any
failure, omission, delay or lack on the part of the Trustee to enforce, assert or exercise any
right, power or remedy conferred on the Trustee in the Indenture, or any other action or acts on
the part of the Trustee or any of the Holders from time to time of the Notes; (g) the voluntary or
involuntary liquidation, dissolution, sale or other disposition of all or substantially all the
assets, marshaling of assets and liabilities, receivership, insolvency, bankruptcy, assignment for
the benefit of creditors, reorganization, arrangement, composition with creditors or readjustment
of, or other similar proceedings affecting the Guarantors or the Operating Partnership or any of
the assets of any of them, or any allegation or contest of the validity of the Parent Guarantee in
any such proceeding; (h) to the extent permitted by law, the release or discharge by operation of
law of the Guarantors from the performance or observance of any obligation, covenant or agreement
contained in the Indenture; (i) to the extent permitted by law, the release or discharge by
operation of law of the Operating Partnership from the performance or observance of any obligation,
covenant or agreement contained in the Indenture; (j) the default or failure of the Operating
Partnership or the Trustee fully to perform any of its obligations set forth in the Indenture or
the Notes; (k) the invalidity, irregularity or unenforceability of the Indenture or the Notes or
any part of any thereof; (l) any judicial or governmental action affecting the Operating
Partnership or any Notes or consent or indulgence granted to the Operating Partnership by the
Holders or by the Trustee; or (m) the recovery of any judgment against the Operating Partnership or
any action to enforce the same or any other circumstance which might constitute a legal or
equitable discharge of a surety or guarantor. The undersigned hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of merger, sale, lease or conveyance
of all or substantially all of its assets,

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insolvency or bankruptcy of the Operating Partnership, any right to require a proceeding first
against the Operating Partnership, protest or notice with respect to such Notice or the
indebtedness evidenced thereby and all demands whatsoever, and covenants that this Parent Guarantee
will not be discharged except by complete performance of the obligations contained in such Note and
in this Parent Guarantee.

No reference herein to such Indenture and no provision of this Parent Guarantee or of such
Indenture shall alter or impair the guarantee of the undersigned, which is absolute and
unconditional, of the full and prompt payment of the principal of and premium, if any, and interest
on the Note.

THIS PARENT GUARANTEE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF
THE STATE OF NEW YORK.

This Parent Guarantee shall not be valid or obligatory for any purpose until the certificate of
authentication on the Note shall have been executed by the Trustee under the Indenture referred to
above by the manual signature of one of its authorized officers. The validity and enforceability of
this Parent Guarantee shall not be affected by the fact that it is not affixed to any particular
Note.

An Event of Default under the Indenture or the Notes shall constitute an event of default under
this Parent Guarantee, and shall entitle the Holders of Notes to accelerate the obligations of the
undersigned hereunder in the same manner and to the same extent as the obligations of the Operating
Partnership.

Notwithstanding any other provision of this Parent Guarantee to the contrary, the undersigned
hereby waives any claims or other rights which it may now have or hereafter acquire against the
Operating Partnership that arise from the existence or performance of its obligations under this
Parent Guarantee (all such claims and rights are referred to as “Guarantor’s Conditional Rights”),
including, without limitation, any right of subrogation, reimbursement, exoneration, contribution,
or indemnification, any right to participate in any claim or remedy against the Operating
Partnership, whether or not such claim, remedy or right arises in equity or under contract, statute
or common law, by any payment made hereunder or otherwise, including without limitation, the right
to take or receive from the Operating Partnership, directly or indirectly, in cash or other
property or by setoff or in any other manner, payment or security on account of such claim or other
rights. Guarantor hereby agrees not to exercise any rights which may be acquired by way of
contribution under this Parent Guarantee or any other agreement, by any payment made hereunder or
otherwise, including, without limitation, the right to take or receive from any other guarantor,
directly or indirectly, in cash or other property or by setoff or in any other manner, payment or
security on account of such contribution rights. If, notwithstanding the foregoing provisions, any
amount shall be paid to the undersigned on account of the Guarantor’s Conditional Rights and either
(i) such amount is paid to such undersigned party at any time when the indebtedness shall not have
been paid or performed in full, or (ii) regardless of when such amount is paid to such undersigned
party, any payment made by the Operating Partnership to a Holder that is at any time determined to
be a Preferential Payment (as defined below), then such amount paid to the undersigned shall be
held in trust for the benefit of Holder and shall forthwith be paid such Holder to be credited and
applied upon the indebtedness, whether matured or unmatured. Any such payment is herein referred to
as a “Preferential Payment” to the extent the Operating Partnership makes any payment to Holder in
connection with the Note, and any or all of such payment is subsequently invalidated, declared to
be fraudulent or preferential, set aside or required to be repaid or paid over to a trustee,
receiver or any other entity, whether under any bankruptcy act or otherwise.

To the extent that any of the provisions of the immediately preceding paragraph shall not be
enforceable, the undersigned agrees that until such time as the indebtedness has been paid and
performed in full and the period of time has expired during which any payment made by the Operating
Partnership or the undersigned to a Holder may be determined to be a Preferential Payment,
Guarantor’s Conditional Rights

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to the extent not validly waived shall be subordinate to Holders’ right to full payment and
performance of the indebtedness and the undersigned shall not enforce any of Guarantor’s
Conditional Rights until such time as the indebtedness has been paid and performed in full and the
period of time has expired during which any payment made by the Operating Partnership or the
undersigned to Holders may be determined to be a Preferential Payment.

The obligations of the undersigned to the Holders of the Notes and to the Trustee pursuant to this
Parent Guarantee and the Indenture are expressly set forth in Article 14 of the Indenture and
reference is hereby made to the Indenture for the precise terms of this Parent Guarantee and all of
the other provisions of the Indenture to which this Parent Guarantee relates.

Capitalized terms used in this Parent Guarantee which are not defined herein shall have the
meanings assigned to them in the Indenture.

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IN WITNESS WHEREOF, the undersigned has caused this Parent Guarantee to be duly executed.

Dated: August 9, 2010

AMB PROPERTY CORPORATION

	 	 	 	 	 

	By:
	 	 	 	 
	 
	 
	Name:

	 	 

	 	 
	Title:
	 	 	 	 

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ASSIGNMENT

FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s) unto:

	 	 	 

	PLEASE INSERT SOCIAL SECURITY OR

	 	 
	OTHER IDENTIFYING NUMBER OF ASSIGNEE:
	 	 
	 

	 	 

 

(Please print or typewrite name and address of assignee, including postal zip code of assignee)

 

this Note and all rights thereunder, hereby irrevocably constituting and appointing:

 

Attorney, to transfer this Note on the books of the Trustee, with full power of substitution in the
premises.

	 	 	 	 	 	 	 	 

	Dated: 
	 	 	 	 	 	 	 
	 

	 
	 	 	 	 
	 
	 

	 	 	 	 	Notice:
	 	The signature(s) on this Assignment
must correspond with the name(s) as
written upon the face of this Note in
every particular, without alteration or
enlargement or any change whatsoever.

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ABBREVIATIONS

          The following abbreviations, when used in the inscription on the face of this instrument,
shall be construed as though they were written out in full according to applicable laws or
regulations:

	 	 	 	 	 	 	 	 	 

	TEN COM—as tenants in common

	UNIF GIFT MIN ACT—
	 	 	 	Custodian	 	 
	 

	 	 	 
	 	 	 
	 

	 	 	 	(Cust)
	 	 	 	(Minor)

	 	 	 	 	 

	TEN ENT—as tenants by the entireties

	 	Under Uniform Gifts to Minors Act	 	 
	 

	 	 	 
	 

	 	 	 	(State)
	 
	 	 	 	 
	JT TEN—as joint tenants with right
of survivorship
                 and not as tenants
in common
	 	 	 	 

     Additional abbreviations may also be used though not in the above list.

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[FORM OF SCHEDULE FOR ENDORSEMENTS ON GLOBAL SECURITY

TO REFLECT CHANGES IN PRINCIPAL AMOUNT]

Schedule A

Changes to Principal Amount of Global Security

	 	 	 	 	 	 	 
	 	 	Principal Amount of Securities by which this	 	 	 	 
	 	 	Global Security is to be Reduced or Increased,	 	Remaining Principal Amount	 	Notation
	Date	 	and Reason for Reduction or Increase	 	of this Global Security	 	Made by
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	 
	 	 
	 	 

11exv10w3w1

Exhibit 10.3.1

CALLIDUS SOFTWARE INC.

2003 STOCK INCENTIVE PLAN

(Amended and Restated as of June 1, 2010)

     1. Purposes of the Plan. The purposes of this Plan are to attract and retain the best
available personnel for positions of substantial responsibility, to provide additional incentive to
Employees, Directors and Consultants and to promote the success of the Company’s business.

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

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

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

     (c) “Award” means any Option or other stock-based award granted under this Plan.

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

     (e) “Code” means the U.S. Internal Revenue Code of 1986, as amended.

     (f) “Committee” means a committee of Directors appointed by the Board in accordance
with Section 4 hereof.

     (g) “Common Stock” means the common stock, par value $0.001 per share, of the Company.

     (h) “Company” means Callidus Software Inc., a Delaware corporation.

     (i) “Consultant” means any person who is engaged by the Company or any Parent or
Subsidiary to render consulting or advisory services to such entity.

     (j) “Director” means a member of the Board of Directors of the Company.

     (k) “Employee” means any person employed by the Company or any Parent or Subsidiary of
the Company. A Service Provider shall not cease to be an Employee in the case of (i) any
leave of absence approved by the Company or protected as a matter of local law or (ii)
transfers between locations of the Company or between the Company, its Parent, any
Subsidiary, or any successor. Neither service as a Director nor payment of a director’s fee
by the Company shall be sufficient to constitute “employment” by the Company.

 

 

     (l) “Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.

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

     (i) If the Common Stock is listed on any established stock exchange or traded
on the Nasdaq National Market or the Nasdaq SmallCap Market, its Fair Market Value
shall be the closing sales price for such stock (or the closing bid, if no sales
were reported) as quoted on such exchange or system on the date of determination
(or if such date is not a trading date, on the previous trading date), as reported
in The Wall Street Journal or such other source as the Administrator deems
reliable;

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

     (n) “Incentive Stock Option” means an Option intended to qualify as an incentive stock
option within the meaning of Section 422 of the Code.

     (o) “Nonstatutory Stock Option” means an Option not intended to qualify as an Incentive
Stock Option.

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

     (q) “Option Agreement” means an agreement evidencing the terms and conditions of an
individual Option grant. Any Option Agreement is subject to the terms and conditions of the
Plan.

     (r) “Optionee” means the holder of an outstanding Option granted under the Plan.

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

     (t) “Participant” means the holder of an outstanding Award granted under the Plan.

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

     (v) “Plan” means this 2003 Stock Incentive Plan.

     (w) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3.

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

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     (y) “Share” means a share of the Common Stock, as adjusted in accordance with Section
13 below.

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

     3. Stock Subject to the Plan.

     (a) Subject to the provisions of Section 13 of the Plan, the maximum aggregate number
of Shares which may be issued under the Plan is 2,000,000 shares, plus (x) any Shares
remaining available for grant of awards under the Company’s 1997 Stock Option Plan on the
effective date of the Plan and (y) an annual increase on July 1 of each year during the term
of the Plan beginning July 1, 2004, in each case in an amount equal to the lesser of (i)
2,800,000 shares, (ii) 5.0% of the outstanding shares on the immediately preceding date or
(iii) an amount determined by the Board. The Shares may be authorized but unissued, or
reacquired, shares or treasury shares.

     (b) No Participant may receive Options and stock appreciation rights under the Plan in
any calendar year that relate to more than 1,500,000 Shares.

     (c) If any Shares covered by an Award, or to which such an Award relates, are
forfeited, or if an Award otherwise terminates in whole or in part without the delivery of
the full number of Shares related thereto, then the Shares covered by such Award, or to
which such Award relates, to the extent of any such forfeiture or termination, shall again
be, or shall become, available for issuance under the Plan. Shares that have been issued
but are repurchased by, or surrendered or forfeited to, the Company shall become available
for future grant under the Plan. For purposes of this paragraph, awards and options granted
under the Company’s 1997 Stock Option Plan shall be treated as Awards.

     4. Administration of the Plan.

     (a) The Plan shall be administered by the Board or a Committee appointed by the Board,
which Committee shall be constituted to comply with Applicable Laws.

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

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

     (b) Subject to the provisions of the Plan and, in the case of a Committee, the specific
duties delegated by the Board to such Committee, and subject to the approval of any relevant
authorities, the Administrator shall have the authority in its discretion:

3

 

     (i) to determine the Fair Market Value;

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

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

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

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

     (vi) to amend the terms of any Award; provided that (A) no such amendment
shall directly or indirectly reduce the exercise price of any Award without the
approval of the Company’s stockholders and (B) no such amendment shall impair the
rights of any Participant without the consent of the Participant;

     (vii) to grant Awards with such terms as the Administrator deems necessary or
appropriate in order to comply with or take advantage of the laws of any
jurisdiction in which a Participant resides or is employed or to establish a
sub-plan under this Plan for such purposes;

     (viii) to prescribe, amend and rescind rules and regulations relating to the
Plan, including rules and regulations relating to sub-plans established by the
Administrator for the purpose of qualifying for preferred tax treatment under
foreign tax laws or complying with foreign securities or other legal requirements;

     (ix) to allow Participants to satisfy withholding tax obligations by electing
to have the Company withhold from the Shares to be issued upon exercise of an Award
that number of Shares having a Fair Market Value equal to the amount required to be
withheld; and

     (x) to construe and interpret the terms of the Plan and awards granted
pursuant to the Plan.

     (c) All decisions, determinations and interpretations of the Administrator shall be
final and binding on all Participants.

4

 

     5. Eligibility.

     (a) Awards may be granted to Service Providers as determined by the Administrator in
its sole discretion, except that Incentive Stock Options may be granted only to Employees.

     (b) Neither the Plan nor any Award shall confer upon any Participant any right with
respect to continuing the Participant’s relationship as a Service Provider with the Company
or its Subsidiary, nor shall it interfere in any way with his or her right or the right of
the Company or its Subsidiary, as appropriate, to terminate such relationship at any time,
with or without cause.

     6. Term of Plan. The Plan shall become effective as determined by the Board. It shall
continue in effect for a term of ten years unless sooner terminated under Section 14 of the Plan.

     7. Terms of Options.

     (a) The term of each Option shall be stated in the Option Agreement; provided that the
term shall be no more than ten (10) years from the date of grant thereof. In the case of an
Incentive Stock Option granted to an Optionee who, at the time the Option is granted, owns
stock representing more than ten percent (10%) of the voting power of all classes of stock
of the Company or any Parent or Subsidiary, the term of the Option shall be five (5) years
from the date of grant or such shorter term as may be provided in the Option Agreement.

     (b) Each Option shall be designated in the Option Agreement as either an Incentive
Stock Option or a Nonstatutory Stock Option. However, notwithstanding such designation, to
the extent that the aggregate Fair Market Value of the Shares with respect to which
Incentive Stock Options are exercisable for the first time by the Optionee during any
calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds
$100,000, such Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 7(b), Incentive Stock Options shall be taken into account in the order in which they
were granted. The Fair Market Value of the Shares shall be determined as of the time the
Option with respect to such Shares is granted.

     (c) The per share exercise price for the Shares to be issued upon exercise of an Option
shall be such price as is determined by the Administrator, but in the case of any Incentive
Stock Option shall be subject to the following:

     (A) the exercise price of any Incentive Stock Option granted to an
Employee who, at the time of grant of such Option, owns stock representing
more than ten percent (10%) of the voting power of all classes of stock of
the Company or any Parent or Subsidiary shall be no less than 110% of the
Fair Market Value per Share on the date of grant; and

5

 

     (B) the exercise price of any Incentive Stock Option granted to any
other Employee shall be no less than 100% of the Fair Market Value per
Share on the date of grant.

     (d) The consideration to be paid for the Shares to be issued upon exercise of an
Option, including the method of payment, shall be determined by the Administrator (and, in
the case of an Incentive Stock Option, shall be determined at the time of grant). Such
consideration may consist of (1) cash, (2) check, (3) promissory note, (4) other Shares
which (x) in the case of Shares acquired upon exercise of an Option, have been owned by the
Optionee for more than six months on the date of surrender, and (y) have a Fair Market Value
on the date of surrender equal to the aggregate exercise price of the Shares as to which
such Option shall be exercised, (5) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan, or (6) any
combination of the foregoing methods of payment. In making its determination as to the type
of consideration to accept, the Administrator shall consider if acceptance of such
consideration may be reasonably expected to benefit the Company.

     8. Exercise of Option.

     (a) Any Option granted hereunder shall be exercisable according to the terms hereof at
such times and under such conditions as determined by the Administrator and set forth in the
Option Agreement. Unless the Administrator provides otherwise or unless required by local
law, vesting of Options granted hereunder shall be tolled during any unpaid leave of
absence. An Option may not be exercised for a fraction of a Share.

     (b) An Option shall be deemed exercised when the Company receives: (i) written or
electronic notice of exercise (in accordance with the Option Agreement) from the person
entitled to exercise the Option, and (ii) full payment for the Shares with respect to which
the Option is exercised. Full payment may consist of any consideration and method of
payment authorized by the Administrator and permitted by the Option Agreement and the Plan.
Shares issued upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse. Until the
Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a
duly authorized transfer agent of the Company), no right to vote or receive dividends or any
other rights as a stockholder shall exist with respect to the Shares, notwithstanding the
exercise of the Option. The Company shall issue (or cause to be issued) such Shares
promptly after the Option is exercised. No adjustment will be made for a dividend or other
right for which the record date is prior to the date the Shares are issued, except as
provided in Section 13 of the Plan.

     (c) Exercise of an Option in any manner shall result in a decrease in the number of
Shares thereafter available, both for purposes of the Plan and for sale under the Option, by
the number of Shares as to which the Option is exercised.

6

 

     9. Termination of Relationship as a Service Provider.

     (a) Termination. If an Optionee ceases to be a Service Provider, such Optionee may
exercise his or her Option within such period of time as is specified in the Option
Agreement (of at least 30 days) to the extent that the Option is vested on the date of
termination (but in no event later than the expiration of the term of the Option as set
forth in the Option Agreement). In the absence of a specified time in the Option Agreement,
the vested portion of the Option shall remain exercisable for 90 days following the
Optionee’s termination. If, after termination, the Optionee does not exercise his or her
Option within the time specified herein or in the Option Agreement, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

     (b) Disability of Optionee. If an Optionee ceases to be a Service Provider as a result
of the Optionee’s disability, the Optionee may exercise an Option to the extent the Option
is vested as of the date of termination, but only within 12 months from the date of such
termination (and in no event later than the expiration date of the term of such Option as
set forth in the Option Agreement). If such disability is not a “disability” as such term
is defined in Section 22(e)(3) of the Code, in the case of an Incentive Stock Option such
Incentive Stock Option shall automatically cease to be treated as an Incentive Stock Option
and shall be treated for tax purposes as a Nonstatutory Stock Option on the day three months
and one day following such termination. If, after termination, the Optionee does not
exercise his or her Option within the time specified herein, the Option shall terminate, and
the Shares covered by such Option shall revert to the Plan.

     (c) Death of Employee Participant. If an Employee Participant dies while a Service
Provider, all shares subject to all outstanding Awards that are held by such Employee
Participant at the time of death will have the vesting of such shares automatically
accelerated 12 months on the date of death. If the Award(s) is an Option(s), it may be
exercised at any time within 12 months following the date of death (but in no event later
than the expiration of the term of such Option(s) as set forth in the Option Agreement(s))
to the extent vested as of the date of death (after giving effect to the 12 month vesting
acceleration set forth in the preceding sentence).

     (d) Death of Consultant or Outside Director Service Provider. If a Participant who is
a Consultant or Outside Director dies while a Service Provider, all outstanding Options may
be exercised at any time within 12 months following the date of death (but in no event later
than the expiration of the term of such Option(s) as set forth in the Option Agreement(s))
to the extent vested as of the date of death. Unless otherwise specifically approved by the
Administrator in writing, no Consultant or Outside Director shall be entitled to accelerated
vesting of any kind upon death.

     (e) The Option(s) referenced in subsections (c) and (d) above may be exercised by the
executor or administrator of the Optionee’s estate or, if none, by the person(s) entitled to
exercise the Option(s) under the Optionee’s will or the laws of descent or distribution. If
the Option(s) is not so exercised within the time specified

7

 

herein, the Option(s) shall terminate, and the Shares covered by such Option(s) shall
revert to the Plan.

     (f) Buyout Provisions. The Administrator may at any time offer to buy out, for a
payment in cash or Shares, an Award previously granted, based on such terms and conditions
as the Administrator shall establish and communicate to the Participant at the time that
such offer is made.

     10. Formula Grants to Outside Directors. Awards may be granted to Outside Directors in
accordance with the policies established from time to time by the Board specifying the number of
shares (if any) to be subject to each such award and the time(s) at which such awards shall be
granted. The current policy with respect to Awards granted to Outside Directors under this Section
effective as of the date set forth under the title of this Plan and continuing until modified or
revoked by the Board from time to time, is as follows:

     (a) Initial Grants. As of the date on which any Outside Director first becomes a
member of the Board, whether by election by the stockholders or appointment by the Board,
such individual shall be:

     (i) Granted automatically a Nonstatutory Stock Option to purchase 25,000
Shares (an “Initial Option”); and

     (ii) Awarded automatically a restricted stock unit to purchase 7,500 Shares
(an “Initial RSU Award”).

     (b) Annual Grants and Awards. Immediately after the Company’s regularly scheduled
annual meeting of stockholders each year, the following grant and award shall be made (each,
an “Annual Option” or “Annual RSU Award,” as applicable):

     (i) Each Outside Director shall be granted automatically a Nonstatutory Stock
Option to purchase 15,000 Shares; provided that if such Outside Director has served
on the Board for less than one year, the number of Shares subject to such Annual
Option shall be reduced pro rata based on the portion of the year that such Outside
Director has served on the Board.

     (ii) Each Outside Director (other than the chair of the Board and Lead
Independent Director of the Board) shall be awarded automatically a restricted
stock unit to purchase 5,000 Shares; provided that if such Outside Director has
served on the Board for less than one year, the number of Shares subject to such
Annual RSU Award shall be reduced pro rata based on the portion of the year that
such Outside Director has served on the Board.

     (iii) The chair of the Board (so long as the chair is an Outside Director) and
the Lead Independent Director of the Board each shall be awarded automatically a
restricted stock unit to purchase 15,000 and 10,000 Shares, respectively; provided
that if such chair of the Board or Lead Independent Director has served on the
Board for less than one year, the number of Shares

8

 

subject to such Annual RSU Award shall be reduced pro rata based on the
portion of the year that such for such individual has served on the Board..

     (c) Terms of Options. Options granted to Outside Directors pursuant to this Section 10
shall be on the following terms, unless otherwise determined by the Board:

     (i) The exercise price per Share shall be 100% of the Fair Market Value per
Share on the date of grant of the Option.

     (ii) Each Initial Option shall vest and become exercisable over four years,
with the first 25% vesting on the first anniversary of the grant date and the
remainder vesting monthly thereafter.

     (iii) Each Annual Option shall be fully vested and exercisable immediately.

     (iv) The term of each such Option shall be five years unless otherwise
specified in the Option Agreement, provided that the term may not exceed ten (10)
years.

     (d) Terms of RSU Awards. RSUs awarded to Outside Directors pursuant to this Section 10
shall be on the following terms, unless otherwise determined by the Board:

     (i) Each Initial RSU Award and Annual RSU Award shall be fully vested
immediately; provided, however, no Shares shall be issued pursuant to an
Initial RSU Award or Annual RSU Award until the earlier of date of the applicable
Outside Director’s departure from the Board (whether by resignation, death or
failure to be reelected) or upon a change in control, at which time all of the
Shares subject to the applicable Outside Director’s RSU Awards shall be released.

     11. Non-Transferability of Awards. Except as otherwise determined by the Administrator,
Awards may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner
other than by will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Participant, only by the Participant.

     12. Other Stock Awards. The Administrator is hereby authorized to grant to Participants such
other Awards (including, without limitation, grants of restricted stock, restricted stock units,
stock bonus awards, and stock appreciation rights) 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 Administrator to be consistent
with the purposes of the Plan. Subject to the terms of the Plan, the Administrator shall determine
the terms and conditions of such Awards, which shall be set forth in an Award Agreement.

     13. Adjustments Upon Changes in Capitalization, Merger or Asset Sale.

9

 

     (a) Changes in Capitalization. Subject to any required action by the stockholders of
the Company, the number of shares of Common Stock covered by each outstanding Award, and the
number of shares of Common Stock which have been authorized for issuance under the Plan but
as to which no Awards have yet been granted or which have been returned to the Plan upon
cancellation or expiration of an Award, as well as the price per share of Common Stock
covered by each such outstanding Award, shall be proportionately adjusted for any increase
or decrease in the number of issued shares of Common Stock resulting from a stock split,
reverse stock split, stock dividend, combination or reclassification of the Common Stock, or
any other increase or decrease in the number of issued shares of Common Stock effected
without receipt of consideration by the Company. The conversion of any convertible
securities of the Company shall not be deemed to have been “effected without receipt of
consideration.” Such adjustment shall be made by the Board, whose determination in that
respect shall be final, binding and conclusive. Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be
made with respect to, the number or price of shares of Common Stock subject to an Award.

     (b) Dissolution or Liquidation. In the event of the proposed dissolution or
liquidation of the Company, the Administrator shall notify each Participant as soon as
practicable prior to the effective date of such proposed transaction. The Administrator in
its discretion may provide for a Participant to have the right to exercise his or her Award
prior to such transaction, including Shares as to which the Award would not otherwise be
exercisable. In addition, the Administrator may provide that any Company repurchase option
applicable to any Shares purchased upon exercise of an Award shall lapse as to all such
Shares, provided the proposed dissolution or liquidation takes place at the time and in the
manner contemplated. To the extent it has not been previously exercised, an Award will
terminate immediately prior to the consummation of such proposed action.

     (c) Merger or Asset Sale. In the event of a merger of the Company with or into another
corporation, or the sale of all or substantially all of the assets of the Company, each
outstanding Award shall be continued or assumed or an equivalent award substituted by the
Company or the successor corporation or a Parent or Subsidiary of the successor corporation.
In the event that any Award is not so continued, assumed or substituted, such Award shall
become fully vested and exercisable. If an Award becomes fully vested and exercisable in
lieu of continuation, assumption or substitution, the Administrator shall notify the
Participant in writing or electronically that the Award shall be fully exercisable for a
period of no less than 15 days from the date of such notice, and the Award shall terminate
upon the expiration of such period. For the purposes of this paragraph, the Award shall be
considered assumed if, following the merger or sale of assets, the option or right confers
the right to purchase or receive, for each Share subject to the Award immediately prior to
the merger or sale of assets, the consideration (whether stock, cash, or other securities or
property) received in the merger or sale of assets by holders of Common Stock for each Share
held on the effective date of the transaction (and if holders were offered a choice of
consideration, the type of consideration chosen by the holders of a majority of the
outstanding Shares); provided that if such consideration received is not solely common stock
of the successor corporation or its

10

 

Parent, the Administrator may provide for the consideration to be received upon the
exercise of the Award, for each Share subject to the Award, to be solely common stock of the
successor corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock.

     14. Amendment and Termination of the Plan.

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

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

     (c) Effect of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan by the Board shall impair the rights of any Participant with the
consent of the Participant. Termination of the Plan shall not affect the Administrator’s
ability to exercise the powers granted to it hereunder with respect to Awards granted under
the Plan prior to the date of such termination.

     15. Conditions Upon Issuance of Shares.

     (a) Legal Compliance. Shares shall not be issued pursuant to any Award granted
hereunder unless the issuance and delivery of such Shares shall comply with Applicable Laws.

     (b) Tax Withholding. The Administrator shall require payment of any amount the Company
may determine to be necessary to withhold for any income, employment or social insurance
taxes or contributions, as applicable, as a result of the exercise of an award.

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

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

11

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