Document:

Polycom, Inc. 2004 Equity Incentive Plan (May 27, 2009 Restatement)

 Exhibit 10.1 
  
 POLYCOM, INC. 
 2004 EQUITY INCENTIVE PLAN 
 (May 27, 2009 Restatement) 
  
 SECTION 1 
 BACKGROUND AND PURPOSE 
  
 1.1 Background and Effective Date. The Plan permits the grant of Nonqualified Stock Options, Incentive Stock Options, SARs, Restricted Stock, Performance Units, and Performance Shares. The Plan was
effective as of June 2, 2004 upon approval by an affirmative vote of the holders of a majority of the Shares that are present in person or by proxy and entitled to vote at the 2004 Annual Meeting of Stockholders of the Company. This amended and
restated Plan is effective as of May 27, 2009, subject to approval by an affirmative vote of the holders of a majority of the Shares that are present in person or by proxy and entitled to vote at the 2009 Annual Meeting of Stockholders of the
Company. 
  
 1.2 Purpose of the Plan. The Plan is
intended to attract, motivate, and retain (a) employees of the Company and its Subsidiaries, (b) consultants who provide significant services to the Company and its Subsidiaries, and (c) directors of the Company who are employees of
neither the Company nor any Subsidiary. The Plan also is designed to encourage stock ownership by Participants, thereby aligning their interests with those of the Company’s shareholders and to permit the payment of compensation that qualifies
as performance-based compensation under Section 162(m) of the Code. 
  
 SECTION 2 
 DEFINITIONS 
  
 The following words and phrases shall have the following meanings unless a different meaning is plainly required by the context: 
  
 2.1 “1934 Act” means the Securities Exchange Act of
1934, as amended. Reference to a specific section of the 1934 Act or regulation thereunder shall include such section or regulation, any valid regulation promulgated under such section, and any comparable provision of any future legislation or
regulation amending, supplementing or superseding such section or regulation. 
  
 2.2 “Award” means, individually or collectively, a grant under the Plan of Incentive Stock Options, Nonqualified Stock Options, SARs, Restricted Stock, Restricted Stock Units, Performance Units, or
Performance Shares. 
  
 2.3 “Award Agreement”
means the written agreement setting forth the terms and conditions applicable to each Award granted under the Plan. 
  
 2.4 “Board” or “Board of Directors” means the Board of Directors of the Company. 
  
 2.5 “Code” means the Internal Revenue Code of 1986,
as amended. Reference to a specific section of the Code or regulation thereunder shall include such section or regulation, any valid regulation promulgated under such section, and any comparable provision of any future legislation or regulation
amending, supplementing or superseding such section or regulation. 
  
 2.6 “Committee” means the committee appointed by the Board (pursuant to Section 3.1) to administer the Plan. 

 2.7 “Company” means Polycom, Inc., a Delaware corporation, or any successor thereto.

  
 2.8 “Consultant” means any consultant,
independent contractor, or other person who provides significant services to the Company or its Subsidiaries, but who is neither an Employee nor a Director. 
  
 2.9 “Director” means any individual who is a member of the Board of Directors of the Company. 
  
 2.10 “Disability” means a permanent disability in accordance
with a policy or policies established by the Committee (in its discretion) from time to time. 
  
 2.11 “Earnings Per Share” means as to any Performance Period, the Company’s Profit After Tax, divided by a weighted average number of common shares outstanding and dilutive common equivalent
shares deemed outstanding, determined in accordance with generally accepted accounting principles. 
  
 2.12 “Employee” means any employee of the Company or of a Subsidiary, whether such employee is so employed at the time the Plan is
adopted or becomes so employed subsequent to the adoption of the Plan. 
  
 2.13 “Exchange Program” means a program established by the Committee under which outstanding Awards are amended to provide for a lower Exercise Price or surrendered or cancelled in exchange for (a) Awards with a lower
Exercise Price, (b) a different type of Award, (c) cash, or (d) a combination of (a), (b) and/or (c). Notwithstanding the preceding, the term Exchange Program does not include any (i) action described in Section 4.3,
nor (ii) transfer or other disposition permitted under Section 12.7. 
  
 2.14 “Exercise Price” means the price at which a Share may be purchased by a Participant pursuant to the exercise of an Option. 
  
 2.15 “Fair Market Value” means the closing per share selling price for Shares on Nasdaq on the relevant
date, or if there were no sales on such date, average of the closing sales prices on the immediately following and preceding trading dates, in either case as reported by The Wall Street Journal or such other source selected in the discretion of the
Committee (or its delegate). Notwithstanding the preceding, for federal, state, and local income tax reporting purposes, fair market value shall be determined by the Committee (or its delegate) in accordance with uniform and nondiscriminatory
standards adopted by it from time to time. 
  
 2.16
“Fiscal Year” means the fiscal year of the Company. 
  
 2.17 “Grant Date” means, with respect to an Award, the date that the Award was granted. The Grant Date of an Award shall not be earlier than the date the Award is approved by the Committee. 
  
 2.18 “Incentive Stock Option” means an Option to purchase
Shares that is designated as an Incentive Stock Option and is intended to meet the requirements of Section 422 of the Code. 
  
 2.19 “Nonemployee Director” means a Director who is an employee of neither the Company nor of any Subsidiary. 
  
 2.20 “Nonqualified Stock Option” means an option to purchase
Shares that is not intended to be an Incentive Stock Option. 
  
 2.21 “Option” means an Incentive Stock Option or a Nonqualified Stock Option. 
  
 2.22 “Participant” means an Employee, Consultant, or Nonemployee Director who has an outstanding Award. 

 2.23 “Performance Goals” means the goal(s) (or combined goal(s)) determined by the
Committee (in its discretion) to be applicable to a Participant with respect to an Award. As determined by the Committee, the Performance Goals applicable to an Award may provide for a targeted level or levels of achievement using one or more of the
following measures: (a) Earnings Per Share, (b) Profit After Tax, (c) Return on Equity, (d) Revenue, and (e) Total Shareholder Return. The Performance Goals may differ from Participant to Participant and from Award to Award.
Any criteria used may be measured, as applicable, (i) in absolute terms, (ii) in relative terms (including, but not limited to, passage of time and/or against another company or companies), (iii) on a per-share basis,
(iv) against the performance of the Company as a whole or a business unit of the Company and/or (v) on a pre-tax or after-tax basis. Prior to the Determination Date, the Committee shall determine whether any element(s) or item(s) shall be
included in or excluded from the calculation of any Performance Goal with respect to any Participants. 
  
 2.24 “Performance Period” means any Fiscal Year or such longer period as determined by the Committee in its sole discretion. 

 
 2.25 “Performance Share” means an Award granted to a
Participant pursuant to Section 9. 
  
 2.26
“Performance Unit” means an Award granted to a Participant pursuant to Section 8. 
  
 2.27 “Period of Restriction” means the period during which the transfer of Shares of Restricted Stock are subject to restrictions and
therefore, the Shares are subject to a substantial risk of forfeiture. As provided in Section 7, such restrictions may be based on the passage of time, the achievement of target levels of performance, or the occurrence of other events as
determined by the Committee, in its discretion. 
  
 2.28
“Plan” means the Polycom, Inc. 2004 Equity Incentive Plan, as set forth in this instrument and as hereafter amended from time to time. 
  
 2.29 “Profit After Tax” means as to any Performance Period, the Company’s income after taxes, determined in accordance with
generally accepted accounting principles. 
  
 2.30
“Restricted Stock” means an Award granted to a Participant pursuant to Section 7. 
  
 2.31 “Restricted Stock Unit or RSU” means an Award granted to a Participant pursuant to Section 10. 
  
 2.32 “Retirement” means, in the case of an Employee or a
Nonemployee Director a Termination of Service occurring in accordance with a policy or policies established by the Committee (in its discretion) from time to time. With respect to a Consultant, no Termination of Service shall be deemed to be on
account of “Retirement.” 
  
 2.33 “Return on
Equity” means as to any Performance Period, the percentage equal to the Company’s Profit After Tax divided by average stockholder’s equity, determined in accordance with generally accepted accounting principles. 
  
 2.34 “Revenue” means as to any Performance Period, the
Company’s net revenues generated from third parties, determined in accordance with generally accepted accounting principles. 
  
 2.35 “Rule 16b-3” means Rule 16b-3 promulgated under the 1934 Act, and any future regulation amending, supplementing or superseding such
regulation. 
  
 2.36 “Section 16 Person”
means a person who, with respect to the Shares, is subject to Section 16 of the 1934 Act. 
  
 2.37 “Shares” means the shares of common stock of the Company. 

 2.38 “Stock Appreciation Right” or “SAR” means an Award, granted alone
or in connection with a related Option, that pursuant to Section 6 is designated as an SAR. 
  
 2.39 “Subsidiary” means any corporation in an unbroken chain of corporations beginning with the Company as the corporation at the top of
the chain, but only if each of the corporations below the Company (other than the last corporation in the unbroken chain) then 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. 
  
 2.40
“Termination of Service” means (a) in the case of an Employee, a cessation of the employee-employer relationship between the Employee and the Company or a Subsidiary for any reason, including, but not by way of limitation, a
termination by resignation, discharge, death, Disability, Retirement, or the disaffiliation of a Subsidiary, but excluding any such termination where there is a simultaneous reemployment by the Company or a Subsidiary; (b) in the case of a
Consultant, a cessation of the service relationship between the Consultant and the Company or a Subsidiary for any reason, including, but not by way of limitation, a termination by resignation, discharge, death, Disability, or the disaffiliation of
a Subsidiary, but excluding any such termination where there is a simultaneous re-engagement of the consultant by the Company or a Subsidiary; and (c) in the case of a Nonemployee Director, a cessation of the Director’s service on the
Board for any reason, including, but not by way of limitation, a termination by resignation, death, Disability, Retirement or non-reelection to the Board. 
  
 2.41 “Total Shareholder Return” means as to any Performance Period, the total return (change in share price plus reinvestment of any
dividends) of a Share. 
  
 SECTION 3 
 ADMINISTRATION 
  
 3.1 The Committee. The Plan shall be administered by the Committee. The Committee shall consist of not less than two (2) Directors who
shall be appointed from time to time by, and shall serve at the pleasure of, the Board of Directors. The Committee shall be comprised solely of Directors who are (a) “outside directors” under Section 162(m), and
(b) “non-employee directors” under Rule 16b-3. 
  
 3.2 Authority of the Committee. It shall be the duty of the Committee to administer the Plan in accordance with the Plan’s provisions. The Committee shall have all powers and discretion necessary or appropriate to
administer the Plan and to control its operation, including, but not limited to, the power to (a) determine which Employees, Consultants and directors shall be granted Awards, (b) prescribe the terms and conditions of the Awards,
(c) interpret the Plan and the Awards, (d) adopt such procedures and subplans as are necessary or appropriate to permit participation in the Plan by Employees, Consultants and Directors who are foreign nationals or employed outside of the
United States, (e) adopt rules for the administration, interpretation and application of the Plan as are consistent therewith, and (f) interpret, amend or revoke any such rules. Notwithstanding the preceding, the Committee shall not
implement an Exchange Program without the approval of the holders of a majority of the Shares that are present in person or by proxy and entitled to vote at any Annual or Special Meeting of Stockholders of the Company. Notwithstanding any contrary
provision of the Plan, if the Company’s stockholders approve the option exchange program described in the proxy statement with respect to the Company’s 2009 Annual Meeting of Stockholders under which outstanding Options may be surrendered
or cancelled (and therefore made available for future grant under Section 4.2) in exchange for a lesser number of Awards (the “Exchange”), the Committee may, in its sole discretion, commence the Exchange within twelve (12) months
after the date of such Annual Meeting. 
  
 3.3 Delegation by
the Committee. The Committee, in its sole discretion and on such terms and conditions as it may provide, may delegate all or any part of its authority and powers under the Plan to one or more Directors or officers of the Company, except
that the Committee may not delegate all or any part of its authority under the Plan with respect to Awards granted to a Nonemployee Director. Notwithstanding the foregoing, with respect to 

 Awards that are intended to qualify as performance-based compensation under Section 162(m) of the Code, the
Committee may not delegate its authority and powers with respect to such Awards if such delegation would cause the Awards to fail to so qualify. 
  
 3.4 Decisions Binding. All determinations and decisions made by the Committee, the Board, and any delegate of the Committee pursuant to the
provisions of the Plan shall be final, conclusive, and binding on all persons, and shall be given the maximum deference permitted by law. 
  
 SECTION 4 
 SHARES SUBJECT TO THE PLAN

  
 4.1 Number of Shares. Subject to adjustment as
provided in Section 4.3, the total number of Shares available issuance under the Plan shall equal the sum of (a) 16,100,000, (b) the number of Shares (not to exceed 2,700,000) that remain available for grant under the Company’s
1996 Stock Incentive Plan as of June 2, 2004, and (c) any Shares (not to exceed 11,991,366) that otherwise would have been returned to the 1996 Stock Incentive Plan after June 1, 2004 on account of the expiration, cancellation or
forfeiture of awards granted under the 1996 Stock Incentive Plan. Shares granted under the Plan may be either authorized but unissued Shares or treasury Shares. 
  

4.2 Lapsed Awards. If an Award is settled in cash, or is cancelled, terminates, expires, or lapses for any reason, any Shares subject to
such Award again shall be available to be the subject of an Award, except as determined by the Committee. 
  
 4.3 Adjustments in Awards and Authorized Shares. In the event that any dividend or other distribution (whether in the form of cash, Shares,
other securities, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, or exchange of Shares or other securities of the Company, or other change
in the corporate structure of the Company affecting the Shares such that an adjustment is determined by the Committee (in its sole discretion) to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the Plan, then the Committee shall, in such manner as it may deem equitable, adjust the number and class of Shares which may be delivered under the Plan, the number and class of Shares which may be added annually
to the Shares reserved under the Plan, the number, class, and price of Shares subject to outstanding Awards, and the numerical limits of Sections 5.1, 6.1, 7.1, 8.1, 9.1, 10.1 and 11.2. Notwithstanding the preceding, the number of Shares
subject to any Award always shall be a whole number. 
  
 4.4
Full Value Awards. Beginning on May 27, 2009, grants of Restricted Stock, Restricted Stock Units, Performance Shares and Performance Units under the Plan shall count against the numerical limits in Section 4.1 of the Plan as 1.5
Shares for every one Share subject thereto, excluding any Awards granted pursuant to the Exchange. Awards granted pursuant to the Exchange shall count against the numerical limits in Section 4.1 of the Plan as one Share for every one Share subject
thereto. Also, beginning on May 27, 2009, if Shares acquired pursuant to Restricted Stock, Restricted Stock Units, Performance Shares and Performance Units are forfeited to the Company and otherwise would return to the Plan pursuant to
Section 4.2 of the Plan, 1.5 times the number of Shares so forfeited shall become available for issuance. 
  
 SECTION 5 
 STOCK OPTIONS 
  
 5.1 Grant of Options. Subject to the terms and provisions of the Plan, Options may be granted to Employees,
Directors and Consultants at any time and from time to time as determined by the Committee in its sole discretion. The Committee, in its sole discretion, shall determine the number of Shares subject to each Option, provided that during any Fiscal
Year, no Participant shall be granted Options (and/or SARs) covering 

 
more than a total of 750,000 Shares. Notwithstanding the foregoing, during the Fiscal Year in which a Participant first becomes an Employee, he or she may be
granted Options (and/or SARs) to purchase up to a total of an additional 750,000 Shares. The Committee may grant Incentive Stock Options, Nonqualified Stock Options, or a combination thereof. 
  
 5.2 Award Agreement. Each Option shall be evidenced by an Award
Agreement that shall specify the Exercise Price, the expiration date of the Option, the number of Shares covered by the Option, any conditions to exercise the Option, and such other terms and conditions as the Committee, in its discretion, shall
determine. The Award Agreement shall also specify whether the Option is intended to be an Incentive Stock Option or a Nonqualified Stock Option. 
  
 5.3 Exercise Price. Subject to the provisions of this Section 5.3, the Exercise Price for each Option shall be determined by the
Committee in its sole discretion. 
  
 5.3.1
Nonqualified Stock Options. The Exercise Price of each Nonqualified Stock option shall be determined by the Committee in its discretion but shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on the
Grant Date. 
  
 5.3.2 Incentive Stock
Options. In the case of an Incentive Stock Option, the Exercise Price shall be not less than one hundred percent (100%) of the Fair Market Value of a Share on the Grant Date; provided, however, that if on the Grant Date, the Employee
(together with persons whose stock ownership is attributed to the Employee pursuant to Section 424(d) of the Code) owns stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or any of its
Subsidiaries, the Exercise Price shall be not less than one hundred and ten percent (110%) of the Fair Market Value of a Share on the Grant Date. 
  
 5.3.3 Substitute Options. Notwithstanding the provisions of Section 5.3.2, in the event that the Company or a Subsidiary
consummates a transaction described in Section 424(a) of the Code (e.g., the acquisition of property or stock from an unrelated corporation), persons who become Employees, Nonemployee Directors or Consultants on account of such transaction may
be granted Options in substitution for options granted by their former employer. If such substitute Options are granted, the Committee, in its sole discretion and consistent with Section 424(a) of the Code, may determine that such substitute
Options shall have an exercise price less than one hundred percent (100%) of the Fair Market Value of the Shares on the Grant Date. 
  
 5.4 Expiration of Options. 
  
 5.4.1 Expiration Dates. Each Option shall terminate no later than the first to occur of the following events: 
  
 (a) The date for termination of the Option set forth in the
written Award Agreement; or 
  
 (b) The
expiration of ten (10) years from the Grant Date. 
  
 5.4.2 Death of Participant. Notwithstanding Section 5.4.1, if a Participant dies prior to the expiration of his or her Options, the Committee, in its discretion, may provide that his or her Options shall be exercisable for up to
three (3) years after the date of death. With respect to extensions that were not included in the original terms of the Option but were provided by the Committee after the date of grant, if at the time of any such extension, the exercise price
per Share of the Option is less than the Fair Market Value of a Share, the extension shall, unless otherwise determined by the Committee, be limited to the earlier of (1) the maximum term of the Option as set by its originals terms, or
(2) ten (10) years from the Grant Date. 
  
 5.4.3 Committee Discretion. Subject to the ten and thirteen-year limits of Sections 5.4.1 and 5.4.2, the Committee, in its sole discretion, (a) shall provide in each Award Agreement when each Option expires and becomes
unexercisable, and (b) may, after an Option is granted, extend the maximum term of the Option (subject to Section 5.8.4 regarding Incentive Stock Options). With respect to the Committee’s authority in 

 Section 5.4.3(b), if, at the time of any such extension, the exercise price per Share of the Option
is less than the Fair Market Value of a Share, the extension shall, unless otherwise determined by the Committee, be limited to the earlier of (1) the maximum term of the Option as set by its originals terms, or (2) ten (10) years
from the Grant Date. Unless otherwise determined by the Committee, any extension of the term of an Option pursuant to this Section 5.4.3 shall comply with Section 409A of the Code to the extent applicable. 
  
 5.5 Exercisability of Options. Options granted under the Plan
shall be exercisable at such times and be subject to such restrictions and conditions as the Committee shall determine in its sole discretion. After an Option is granted, the Committee, in its sole discretion, may accelerate the exercisability of
the Option. 
  
 5.6 Payment. Options shall be
exercised by the Participant giving notice and following such procedures as the Company (or its designee) may specify from time to time. Exercise of an Option also requires that the Participant make arrangements satisfactory to the Company for full
payment of the Exercise Price for the Shares. All exercise notices shall be given in the form and manner specified by the Company from time to time. 
  
 The Exercise Price shall be payable to the Company in full in cash or its equivalent. The Committee, in its sole discretion, also may permit exercise
(a) by tendering previously acquired Shares having an aggregate Fair Market Value at the time of exercise equal to the total Exercise Price, or (b) by any other means which the Committee, in its sole discretion, determines to both provide
legal consideration for the Shares, and to be consistent with the purposes of the Plan. As soon as practicable after receipt of a notification of exercise satisfactory to the Company and full payment for the Shares purchased, the Company shall
deliver to the Participant (or the Participant’s designated broker), Share certificates (which may be in book entry form) representing such Shares. 
  
 5.7 Restrictions on Share Transferability. The Committee may impose such restrictions on any Shares acquired pursuant to the exercise of an
Option as it may deem advisable, including, but not limited to, restrictions related to applicable federal securities laws, the requirements of any national securities exchange or system upon which Shares are then listed or traded, or any blue sky
or state securities laws. 
  
 5.8 Certain Additional Provisions
for Incentive Stock Options . 
  
 5.8.1
Exercisability. The aggregate Fair Market Value (determined on the Grant Date(s)) of the Shares with respect to which Incentive Stock Options are exercisable for the first time by any Employee during any calendar year (under all plans of the
Company and its Subsidiaries) shall not exceed $100,000. 
  
 5.8.2 Termination of Service. No Incentive Stock Option may be exercised more than three (3) months after the Participant’s Termination of Service for any reason other than Disability or death, unless
(a) the Participant dies during such three-month period, and/or (b) the Award Agreement or the Committee permits later exercise (in which case the Option instead may be deemed to be a Nonqualified Stock Option). No Incentive Stock Option
may be exercised more than one (1) year after the Participant’s Termination of Service on account of Disability, unless (a) the Participant dies during such one-year period, and/or (b) the Award Agreement or the Committee permit
later exercise (in which case the option instead may be deemed to be a Nonqualified Stock Option). 
  
 5.8.3 Employees Only. Incentive Stock Options may be granted only to persons who are Employees on the Grant Date. 
  
 5.8.4 Expiration. No Incentive Stock Option may be
exercised after the expiration of ten (10) years from the Grant Date; provided, however, that if the Option is granted to an Employee who, together with persons whose stock ownership is attributed to the Employee pursuant to Section 424(d)
of the Code, owns stock possessing more than 10% of the total combined voting power of all classes of the stock of the Company or any of its Subsidiaries, the Option may not be exercised after the expiration of five (5) years from the Grant
Date. 

 SECTION 6 
 STOCK APPRECIATION RIGHTS 
  
 6.1
Grant of SARs. Subject to the terms and conditions of the Plan, a SAR may be granted to Employees, Directors and Consultants at any time and from time to time as shall be determined by the Committee, in its sole discretion. 

 
 6.1.1 Number of Shares. The Committee shall have
complete discretion to determine the number of SARs granted to any Participant, provided that during any Fiscal Year, no Participant shall be granted SARs (and/or Options) covering more than a total of 750,000 Shares. Notwithstanding the foregoing,
during the Fiscal Year in which a Participant first becomes an Employee, he or she may be granted SARs (and/or Options) covering up to a total of an additional 750,000 Shares. 
  
 6.1.2 Exercise Price and Other Terms. The Committee, subject to the provisions of the Plan, shall
have complete discretion to determine the terms and conditions of SARs granted under the Plan. The Exercise Price of each SAR shall be determined by the Committee in its discretion but shall not be less than one hundred percent (100%) of the
Fair Market Value of a Share on the Grant Date. 
  
 6.2 SAR
Agreement. Each SAR grant shall be evidenced by an Award Agreement that shall specify the exercise price, the term of the SAR, the conditions of exercise, and such other terms and conditions as the Committee, in its sole discretion, shall
determine. 
  
 6.3 Expiration of SARs. An SAR granted
under the Plan shall expire upon the date determined by the Committee, in its sole discretion, and set forth in the Award Agreement. Notwithstanding the foregoing, the rules of Section 5.4 also shall apply to SARs. 
  
 6.4 Payment of SAR Amount. Upon exercise of an SAR, a Participant
shall be entitled to receive payment from the Company in an amount determined by multiplying: 
  
 (a) The difference between the Fair Market Value of a Share on the date of exercise over the exercise price; times 
  
 (b) The number of Shares with respect to which the SAR is
exercised. At the discretion of the Committee, the payment upon SAR exercise may be in cash, in Shares of equivalent value, or in some combination thereof. 
  
 SECTION 7 
 RESTRICTED STOCK 
  
 7.1 Grant of Restricted Stock. Subject to the terms and
provisions of the Plan, the Committee, at any time and from time to time, may grant Shares of Restricted Stock to Employees, Directors and Consultants as the Committee, in its sole discretion, shall determine. The Committee, in its sole discretion,
shall determine the number of Shares to be granted to each Participant, provided that during any Fiscal Year, no Participant shall receive more than a total of 375,000 Shares of Restricted Stock (and/or Performance Shares or Restricted Stock Units).
Notwithstanding the foregoing, during the Fiscal Year in which a Participant first becomes an Employee, he or she may be granted up to a total of an additional 375,000 Shares of Restricted Stock (and/or Performance Shares or Restricted Stock Units).

  
 7.2 Restricted Stock Agreement. Each Award of
Restricted Stock shall be evidenced by an Award Agreement that shall specify the Period of Restriction, the number of Shares granted, and such other terms and conditions as the Committee, in its sole discretion, shall determine. Unless the Committee
determines otherwise, Shares of Restricted Stock shall be held by the Company as escrow agent until the restrictions on such Shares have lapsed. 

 7.3 Transferability. Except as provided in this Section 7, Shares of Restricted Stock
may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated until the end of the applicable Period of Restriction. 
  
 7.4 Other Restrictions. The Committee, in its sole discretion, may impose such other restrictions on Shares of Restricted Stock as it may deem
advisable or appropriate, in accordance with this Section 7.4. 
  
 7.4.1 General Restrictions. The Committee may set restrictions based upon continued employment or service with the Company and its affiliates, the achievement of specific performance objectives (Company-wide,
departmental, or individual), applicable federal or state securities laws, or any other basis determined by the Committee in its discretion. 
  
 7.4.2 Section 162(m) Performance Restrictions. For purposes of qualifying grants of Restricted Stock as
“performance-based compensation” under Section 162(m) of the Code, the Committee, in its discretion, may set restrictions based upon the achievement of Performance Goals. The Performance Goals shall be set by the Committee on or
before the latest date permissible to enable the Restricted Stock to qualify as “performance-based compensation” under Section 162(m) of the Code. In granting Restricted Stock which is intended to qualify under Section 162(m) of
the Code, the Committee shall follow any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Restricted Stock under Section 162(m) of the Code (e.g., in determining the Performance Goals).

  
 7.4.3 Legend on Certificates. The
Committee, in its discretion, may legend the certificates representing Restricted Stock to give appropriate notice of such restrictions. 
  
 7.5 Removal of Restrictions. Except as otherwise provided in this Section 7, Shares of Restricted Stock covered by each Restricted Stock
grant made under the Plan shall be released from escrow as soon as practicable after the last day of the Period of Restriction. The Committee, in its discretion, may accelerate the time at which any restrictions shall lapse or be removed. After the
restrictions have lapsed, the Participant shall be entitled to have any legend or legends under Section 7.4.3 removed from his or her Share certificate, and the Shares shall be freely transferable by the Participant. The Committee (in its
discretion) may establish procedures regarding the release of Shares from escrow and the removal of legends, as necessary or appropriate to minimize administrative burdens on the Company. 
  
 7.6 Voting Rights. During the Period of Restriction, Participants holding Shares of Restricted Stock granted
hereunder may exercise full voting rights with respect to those Shares, unless the Committee determines otherwise. 
  
 7.7 Dividends and Other Distributions. During the Period of Restriction, Participants holding Shares of Restricted Stock shall be entitled to
receive all dividends and other distributions paid with respect to such Shares unless otherwise provided in the Award Agreement. Any such dividends or distribution shall be subject to the same restrictions on transferability and forfeitability as
the Shares of Restricted Stock with respect to which they were paid, unless otherwise provided in the Award Agreement. 
  
 7.8 Return of Restricted Stock to Company. On the date set forth in the Award Agreement, the Restricted Stock for which restrictions have not
lapsed shall revert to the Company and again shall become available for grant under the Plan. 
  
 SECTION 8 
 PERFORMANCE UNITS 
  

 8.1 Grant of Performance Units. Performance Units may be granted to Employees, Directors and Consultants at any time and from
time to time, as shall be determined by the Committee, in its sole discretion. 

 The Committee shall have complete discretion in determining the number of Performance Units granted to each Participant
provided that during any Fiscal Year, no Participant shall receive Performance Units having an initial value greater than $3,000,000. 
  
 8.2 Value of Performance Units. Each Performance Unit shall have an initial value that is established by the Committee on or before the Grant
Date. 
  
 8.3 Performance Objectives and Other
Terms. The Committee, in its discretion, shall set performance objectives or other vesting criteria which, depending on the extent to which they are met, will determine the number or value of Performance Units that will be paid out to the
Participants. Each Award of Performance Units shall be evidenced by an Award Agreement that shall specify the Performance Period, and such other terms and conditions as the Committee, in its sole discretion, shall determine. 
  
 8.3.1 General Performance Objectives or Vesting
Criteria. The Committee may set performance objectives or vesting criteria based upon the achievement of Company-wide, departmental, or individual goals, applicable federal or state securities laws, or any other basis determined by the Committee
in its discretion (for example, but not by way of limitation, continuous service as an Employee, Director or Consultant). 
  
 8.3.2 Section 162(m) Performance Objectives. For purposes of qualifying grants of Performance Units as “performance-based
compensation” under Section 162(m) of the Code, the Committee, in its discretion, may determine that the performance objectives applicable to Performance Units shall be based on the achievement of Performance Goals. The Performance Goals
shall be set by the Committee on or before the latest date permissible to enable the Performance Units to qualify as “performance-based compensation” under Section 162(m) of the Code. In granting Performance Units that are intended to
qualify under Section 162(m) of the Code, the Committee shall follow any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Performance Units under Section 162(m) of the Code (e.g.,
in determining the Performance Goals). 
  
 8.4 Earning of
Performance Units. After the applicable Performance Period has ended, the holder of Performance Units shall be entitled to receive a payout of the number of Performance Units earned by the Participant over the Performance Period, to be
determined as a function of the extent to which the corresponding performance objectives have been achieved. After the grant of a Performance Unit, the Committee, in its sole discretion, may reduce or waive any performance objectives for such
Performance Unit. 
  
 8.5 Form and Timing of Payment of
Performance Units. Payment of earned Performance Units shall be made as soon as practicable after the expiration of the applicable Performance Period. The Committee, in its sole discretion, may pay earned Performance Units in the form of
cash, in Shares (which have an aggregate Fair Market Value equal to the value of the earned Performance Units at the close of the applicable Performance Period) or in a combination thereof. 
  
 8.6 Cancellation of Performance Units. On the date set forth in
the Award Agreement, all unearned or unvested Performance Units shall be forfeited to the Company, and again shall be available for grant under the Plan. 
  
 SECTION 9 
 PERFORMANCE SHARES 
  
 9.1 Grant of Performance Shares. Performance Shares may be
granted to Employees, Directors and Consultants at any time and from time to time, as shall be determined by the Committee, in its sole discretion. The Committee shall have complete discretion in determining the number of Performance Shares granted
to each Participant, provided that during any Fiscal Year, no Participant shall be granted more than a total of 375,000 

 Performance Shares (and/or Shares of Restricted Stock or Restricted Stock Units). Notwithstanding the foregoing, during
the Fiscal Year in which a Participant first becomes an Employee, he or she may be granted up to a total of an additional 375,000 Performance Shares (and/or Shares of Restricted Stock or Restricted Stock Units). 
  
 9.2 Value of Performance Shares. Each Performance Share shall
have an initial value equal to the Fair Market Value of a Share on the Grant Date. 
  
 9.3 Performance Share Agreement. Each Award of Performance Shares shall be evidenced by an Award Agreement that shall specify any vesting conditions, the number of Performance Shares granted, and such
other terms and conditions as the Committee, in its sole discretion, shall determine. 
  
 9.4 Performance Objectives and Other Terms. The Committee, in its discretion, shall set performance objectives or other vesting criteria which, depending on the extent to which they are met, will determine
the number or value of Performance Shares that will be paid out to the Participants. Each Award of Performance Shares shall be evidenced by an Award Agreement that shall specify the Performance Period, and such other terms and conditions as the
Committee, in its sole discretion, shall determine. 
  
 9.4.1 General Performance Objectives or Vesting Criteria. The Committee may set performance objectives or vesting criteria based upon the achievement of Company-wide, departmental, or individual goals, applicable federal or state
securities laws, or any other basis determined by the Committee in its discretion (for example, but not by way of limitation, continuous service as an Employee, Director or Consultant). 
  
 9.4.2 Section 162(m) Performance Objectives. For purposes of qualifying grants of Performance
Shares as “performance-based compensation” under Section 162(m) of the Code, the Committee, in its discretion, may determine that the performance objectives applicable to Performance Shares shall be based on the achievement of
Performance Goals. The Performance Goals shall be set by the Committee on or before the latest date permissible to enable the Performance Shares to qualify as “performance-based compensation” under Section 162(m) of the Code. In
granting Performance Shares that are intended to qualify under Section 162(m) of the Code, the Committee shall follow any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Performance
Shares under Section 162(m) of the Code (e.g., in determining the Performance Goals). 
  
 9.5 Earning of Performance Shares. After the applicable Performance Period has ended, the holder of Performance Shares shall be entitled to receive a payout of the number of Performance Shares earned by
the Participant over the Performance Period, to be determined as a function of the extent to which the corresponding performance objectives have been achieved. After the grant of a Performance Share, the Committee, in its sole discretion, may reduce
or waive any performance objectives for such Performance Share. 
  
 9.6 Form and Timing of Payment of Performance Shares. Payment of vested Performance Shares shall be made as soon as practicable after vesting (subject to any deferral permitted under Section 12.1). The Committee, in its
sole discretion, may pay Performance Shares in the form of cash, in Shares or in a combination thereof. 
  
 9.7 Cancellation of Performance Shares. On the date set forth in the Award Agreement, all unvested Performance Shares shall be forfeited to
the Company, and except as otherwise determined by the Committee, again shall be available for grant under the Plan. 
  
 SECTION 10 
 RESTRICTED STOCK UNITS 
  
 10.1 Grant of RSUs. Restricted Stock Units may be granted to
Employees, Directors and Consultants at any time and from time to time, as shall be determined by the Committee, in its sole discretion. The Committee shall 

 have complete discretion in determining the number of Restricted Stock Units granted to each Participant, provided that
during any Fiscal Year, no Participant shall be granted more than a total of 375,000 Restricted Stock Units (and/or Shares of Restricted Stock or Performance Shares). Notwithstanding the foregoing, during the Fiscal Year in which a Participant first
becomes an Employee, he or she may be granted up to a total of an additional 375,000 Restricted Stock Units (and/or Shares of Restricted Stock or Performance Shares). 
  
 10.2 Value of RSUs. Each Restricted Stock Unit shall have an initial value equal to the Fair Market Value of a
Share on the Grant Date. 
  
 10.3 RSU Agreement. Each
Award of Restricted Stock Units shall be evidenced by an Award Agreement that shall specify any vesting conditions, the number of Restricted Stock Units granted, and such other terms and conditions as the Committee, in its sole discretion, shall
determine. 
  
 10.4 Earning of RSUs. After the
applicable vesting period has ended, the holder of Restricted Stock Units shall be entitled to receive a payout of the number of Restricted Stock Units earned by the Participant over the vesting period. After the grant of a Restricted Stock Unit,
the Committee, in its sole discretion, may reduce or waive any vesting condition for such Restricted Stock Unit. 
  
 10.5 Form and Timing of Payment of RSUs. Payment of vested Restricted Stock Units shall be made as soon as practicable after vesting (subject
to any deferral permitted under Section 12.1). The Committee, in its sole discretion, may pay Restricted Stock Units in the form of cash, in Shares or in a combination thereof. 
  
 10.6 Cancellation of RSUs. On the date set forth in the Award Agreement, all unvested Restricted Stock Units
shall be forfeited to the Company, and except as otherwise determined by the Committee, again shall be available for grant under the Plan. 
  
 SECTION 11 
 NONEMPLOYEE DIRECTOR AWARDS

  
 11.1 General. Nonemployee Directors will be
entitled to receive all types of Awards under this Plan, including discretionary Awards not covered under this Section 11. All grants of Restricted Stock Units to Nonemployee Directors pursuant to this Section 11 will be automatic and
nondiscretionary, except as otherwise provided herein, and will be made in accordance with the following provisions: 
  
 11.2 Awards.
  
 11.2.1 Initial Grants. 
  
 (a) Each Nonemployee Director who first becomes a Nonemployee Director on or after November 7, 2007, but prior to the 2009 Annual
Meeting of the Company’s Stockholders, automatically shall receive, as of the date that the individual first is appointed or elected as a Nonemployee Director, the number of Shares of Restricted Stock determined by multiplying (A) 10,000
by (B) the percentage determined by dividing (i) the number of calendar months that remain in the one-year period commencing on the date of the last Annual Meeting of the Company’s Stockholders immediately preceding the date the
individual is first appointed or elected as a Nonemployee Director, including the month in which the individual is so appointed or elected, by (ii) 12, rounded down to the nearest whole Share. 
  
 (b) Each Nonemployee Director who first becomes a
Nonemployee Director on or after the 2009 Annual Meeting of the Company’s Stockholders, automatically shall receive, as of the date that the individual first is appointed or elected as a Nonemployee Director, the number of Restricted Stock
Units determined by multiplying (A) 10,000 by (B) the percentage determined by dividing (i) the 

 number of calendar months that remain in the one-year period commencing on the date of the last Annual
Meeting of the Company’s Stockholders immediately preceding the date the individual is first appointed or elected as a Nonemployee Director, including the month in which the individual is so appointed or elected, by (ii) 12, rounded down
to the nearest whole Restricted Stock Unit. 
  
 11.2.2 Ongoing Grants. Each Nonemployee Director who is reelected as such at an Annual Meeting of the Company’s Stockholders, automatically shall receive, as of the date of such Annual Meeting, 10,000 Restricted Stock Units.

  
 11.3 Terms of Restricted Stock and Restricted Stock Unit
Awards.
  
 11.3.1 Award Agreement.
Each Award of Restricted Stock and Restricted Stock Units granted pursuant to this Section 11 shall be evidenced by a written Award Agreement between the Participant and the Company. 
  
 11.3.2 Vesting Schedule/Period of Restriction. Each
Award of Restricted Stock granted pursuant to Section 11.2.1(a) and each Award of Restricted Stock Units granted pursuant to Sections 11.2.1(b) and 11.2.2 shall vest at such times and be subject to such restrictions and conditions as the
Committee shall determine in its sole discretion. Except as otherwise determined by the Committee in its sole discretion and set forth in the Award Agreement, once a Participant ceases to be a Director, the Restricted Stock for which restrictions
have not lapsed and the Shares subject to Restricted Stock Units that have not vested shall revert to the Company and again shall become available for grant under the Plan. 
  
 11.3.3 Other Terms. All provisions of the Plan not inconsistent with this Section 11 shall apply
to Awards of Restricted Stock and Restricted Stock Units granted to Nonemployee Directors. 
  
 11.4 Elections by Nonemployee Directors. Pursuant to such procedures as the Committee (in its discretion) may adopt from time to time, each Nonemployee Director may elect to forego receipt of all or a
portion of the annual retainer, committee fees and meeting fees otherwise due to the Nonemployee Director in exchange for Awards. The number of Shares subject to Awards received by any Nonemployee Director shall equal the amount of foregone
compensation divided by the Fair Market Value of a Share on the date the compensation otherwise would have been paid to the Nonemployee Director, rounded up to the nearest whole number of Shares. The procedures adopted by the Committee for elections
under this Section 11.4 shall be designed to ensure that any such election by a Nonemployee Director will not disqualify him or her as a “non-employee director” under Rule 16b-3. Unless otherwise determined by the Committee, the
elections permitted under this Section 11.4 shall comply with Section 409A of the Code. 
  
 SECTION 12 
 MISCELLANEOUS 
  
 12.1 Deferrals. The Committee, in its sole discretion, may permit a Participant to defer receipt of the payment
of cash or the delivery of Shares that would otherwise be due to such Participant under an Award. Any such deferral elections shall be subject to such rules and procedures as shall be determined by the Committee in its sole discretion and, unless
otherwise expressly determined by the Committee, shall comply with the requirements of Section 409A of the Code. 
  
 12.2 No Effect on Employment or Service. Nothing in the Plan shall interfere with or limit in any way the right of the Company to terminate
any Participant’s employment or service at any time, with or without cause. For purposes of the Plan, transfer of employment of a Participant between the Company and any one of its Subsidiaries (or between Subsidiaries) shall not be deemed a
Termination of Service. Employment with the Company and its Subsidiaries is on an at-will basis only. 
  
 12.3 Participation. No Employee, Director or Consultant shall have the right to be selected to receive an Award under this Plan, or, having
been so selected, to be selected to receive a future Award. 

 12.4 Indemnification. Each person who is or shall have been a member of the Committee, or of
the Board, shall be indemnified and held harmless by the Company against and from (a) any loss, cost, liability, or expense that may be imposed upon or reasonably incurred by him or her in connection with or resulting from any claim, action,
suit, or proceeding to which he or she may be a party or in which he or she may be involved by reason of any action taken or failure to act under the Plan or any Award Agreement, and (b) from any and all amounts paid by him or her in settlement
thereof, with the Company’s approval, or paid by him or her in satisfaction of any judgment in any such claim, action, suit, or proceeding against him or her, provided he or she shall give the Company an opportunity, at its own expense, to
handle and defend the same before he or she undertakes to handle and defend it on his or her own behalf. The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under
the Company’s Certificate of Incorporation or Bylaws, by contract, as a matter of law, or otherwise, or under any power that the Company may have to indemnify them or hold them harmless. 
  
 12.5 Successors. All obligations of the Company under the Plan,
with respect to Awards granted hereunder, shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of
the business or assets of the Company. 
  
 12.6 Beneficiary
Designations. If permitted by the Committee, a Participant under the Plan may name a beneficiary or beneficiaries to whom any vested but unpaid Award shall be paid in the event of the Participant’s death. Each such designation shall
revoke all prior designations by the Participant and shall be effective only if given in a form and manner acceptable to the Committee. In the absence of any such designation, any vested benefits remaining unpaid at the Participant’s death
shall be paid to the Participant’s estate and, subject to the terms of the Plan and of the applicable Award Agreement, any unexercised vested Award may be exercised by the administrator or executor of the Participant’s estate. 

 
 12.7 Limited Transferability of Awards. No Award granted under
the Plan may be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated, other than by will, by the laws of descent and distribution, or to the limited extent provided in Section 12.6. All rights with respect to an Award
granted to a Participant shall be available during his or her lifetime only to the Participant. Notwithstanding the foregoing, a Participant may, if the Committee (in its discretion) so permits, transfer an Award to an individual or entity other
than the Company. Any such transfer shall be made in accordance with such procedures as the Committee may specify from time to time. 
  
 12.8 No Rights as Stockholder. Except to the limited extent provided in Sections 7.6, no Participant (nor any beneficiary) shall have any
of the rights or privileges of a stockholder of the Company with respect to any Shares issuable pursuant to an Award (or exercise thereof), unless and until certificates representing such Shares shall have been issued, recorded on the records of the
Company or its transfer agents or registrars, and delivered to the Participant (or beneficiary). 
  
 SECTION 13 
 AMENDMENT, TERMINATION, AND DURATION 
  
 13.1 Amendment, Suspension, or Termination. The Board, in its
sole discretion, may amend, suspend or terminate the Plan, or any part thereof, at any time and for any reason. The amendment, suspension, or termination of the Plan shall not, without the consent of the Participant, alter or impair any rights or
obligations under any Award theretofore granted to such Participant. No Award may be granted during any period of suspension or after termination of the Plan. 
  

13.2 Duration of the Plan. The Plan shall be effective as of June 2, 2004, and subject to Section 13.1 (regarding the
Board’s right to amend or terminate the Plan), shall remain in effect thereafter. However, without further stockholder approval, no Incentive Stock Option may be granted under the Plan after June 2, 2014. 

 SECTION 14 
 TAX WITHHOLDING 
  
 14.1
Withholding Requirements. Prior to the delivery of any Shares or cash pursuant to an Award (or exercise thereof), the Company shall have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an
amount sufficient to satisfy federal, state, and local taxes (including the Participant’s FICA obligation) required to be withheld with respect to such Award (or exercise thereof). 
  
 14.2 Withholding Arrangements. The Committee, in its sole discretion and pursuant to such procedures as it may
specify from time to time, may permit a Participant to satisfy such tax withholding obligation, in whole or in part by (a) electing to have the Company withhold otherwise deliverable Shares, or (b) delivering to the Company already-owned
Shares having a Fair Market Value equal to the minimum amount required to be withheld. 
  
 SECTION 15 
 LEGAL CONSTRUCTION 
  

 15.1 Gender and Number. Except where otherwise indicated by the context, any masculine term used herein also shall include the
feminine; the plural shall include the singular and the singular shall include the plural. 
  
 15.2 Severability. In the event any provision of the Plan shall be held illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining parts of the Plan, and the Plan shall
be construed and enforced as if the illegal or invalid provision had not been included. 
  
 15.3 Requirements of Law. The granting of Awards and the issuance of Shares under the Plan shall be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental
agencies or national securities exchanges as may be required. 
  
 15.4 Securities Law Compliance. With respect to Section 16 Persons, transactions under this Plan are intended to qualify for the exemption provided by Rule 16b-3. To the extent any provision of the Plan, Award Agreement or
action by the Committee fails to so comply, it shall be deemed null and void, to the extent permitted by law and deemed advisable or appropriate by the Committee. 
  
 15.5 Governing Law. The Plan and all Award Agreements shall be construed in accordance with and governed by the
laws of the State of California (with the exception of its conflict of laws provisions). 
  
 15.6 Captions. Captions are provided herein for convenience only, and shall not serve as a basis for interpretation or construction of the Plan. 

 APPENDIX A TO 2004 EQUITY INCENTIVE PLAN 
  
 Terms and Conditions for French Option Grants 
  
 The following terms and conditions will apply in the case of Option grants to
French residents and to those individuals who are otherwise subject to the laws of France who satisfy the eligibility requirements of Section 2 below. 
  
 SECTION 1 
 DEFINITIONS 
  
 As used in this Appendix A, the following definitions will apply: 

 
 1.1 “Applicable Laws” means the legal requirements
relating to the administration of equity compensation 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 French corporate,
securities, labor and tax laws. 
  
 1.2
“Employee” means (i) any person employed by the Company or a Subsidiary in a salaried position within the meaning Applicable Laws, who does not own more than 10% of the voting power of all classes of stock of the Company, or
any Parent or Subsidiary, and who is a resident of the Republic of France or (ii) any person employed by the Company or a Subsidiary who is a resident of the Republic of France for tax purposes or who performs his or her duties in France and is
subject to French income social security contributions on his or her remuneration. 
  
 1.3 “Fair Market Value” means, as of any date, the dollar value of Common Stock determined as follows: 
  
 1.3.1 If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq
National Market of the Nasdaq Stock Market, its Fair Market Value will be the average quotation price for the last 20 days preceding the date of determination for such Common Stock (or the average closing bid for such 20 day period, if no sales were
reported) as quoted on such exchange or system and reported in The Wall Street Journal or such other source as the Committee deems reliable; 
  
 1.3.2 If the Common Stock is quoted on the Nasdaq Stock market (but not on the Nasdaq National Market thereof) or regularly quoted by a
recognized securities dealer but selling prices are not reported, its Fair Market Value will be the mean between the high bid and low asked prices for the Common Stock for the last 20 days preceding the date of determination; or 
  
 1.3.3 In the absence of an established market for the Common
Stock, the Fair Market Value thereof will be determined in good faith by the Committee. 
  
 1.4 “Subsidiary” means any participating subsidiary of the Company located in the Republic of France and that falls within the definition of “subsidiary” within the meaning of
Section L. 225-180 paragraph 1 of the French commercial code. 
  
 1.5 “Termination of Service” means if the Participant is an Employee, the last day of any statutory or contractual notice period whether worked or not (provided, only the employer, and not the Participant, may decide
whether the Participant works during the notice period) and irrespective of whether the termination of the employment agreement is due to resignation or dismissal of the Employee for any reason whatsoever; if the Participant is a corporate officer
as defined in Section 2 of this Appendix A, Termination of Service means the date on which he or she effectively leaves his or her position as a corporate officer for any reason whatsoever. 

 SECTION 2 
 ELIGIBILITY 
  
 2.1
Eligibility. Options granted pursuant to this Appendix A may be granted only to Employees, the Président du conseil d’administration, the membres du directoire, the Directeur général, the
directeurs généraux délégués, the Gérant of a company with capital divided by shares; provided, however, that the administrateurs and the membres du conseil de surveillance who
are also Employees of the Subsidiary in accordance with a valid employment agreement pursuant to Applicable Laws may be granted Options hereunder. For the purpose of this Appendix A, when applicable, the rules set forth for an Employee will be
applicable to the aforementioned corporate officers. 
  
 SECTION 3

 STOCK SUBJECT TO THE PLAN 
  
 3.1 Stock Subject to the Plan. The total number of Options outstanding which may be exercised for newly issued Shares may at no time exceed that
number equal to one-third of the Company’s voting stock, whether preferred stock of the Company or Common Stock. If any Optioned Stock is to consist of reacquired Shares, such Optioned Stock must be purchased by the Company, in the limit of 10%
of its share capital, prior to the date of the grant of the corresponding new Option and must be reserved and set aside for such purposes. In addition, the new Option must be granted within one (1) year of the acquisition of the Shares
underlying such new Option. 
  
 SECTION 4 
 LIMITATIONS 
  
 4.1 Limitations Upon Granting of Options. 
  
 4.1.1 Declaration of Dividend; Capital Increase. To the extent applicable to the Company, Options cannot be granted during the 20
trading days from (i) the date the Common Stock is trading on an ex-dividend basis or (ii) a capital increase. 
  
 4.1.2 Non-Public Information. To the extent applicable to the Company, the Company will not grant Options during the closed periods
required under Section L 225-177 of the French Commercial Code. As a result, notwithstanding any other provision of the Plan, Options cannot be granted: 
  

(a) during the ten (10) trading days preceding and following the date on which the consolidated accounts, or, if unavailable, the
annual accounts, are made public; 
  
 (b) during
the period between the date on which the Company’s governing bodies (i.e., the Committee) become aware of information which, if made public, could have a material impact on the price of the Shares, and the date ten (10) trading days after
such information is made public. 
  
 4.1.3
Right to Employment. Neither the Plan nor any Option will confer upon any Participant any right with respect to continuing the Participant’s employment relationship with the Company or any Subsidiary. 
  
 SECTION 5 
 EXERCISE PRICE 
  
 5.1 Exercise Price. The exercise price for the Shares to be issued pursuant to exercise of an Option will be determined by the Committee upon the date of grant of the Option and stated in the Award Agreement, but in no event will be
lower than the higher of (i) eighty percent (80%) of the Fair Market Value on the date the Option is granted or of the average purchase price of these Shares by the Company, or (ii) the exercise price as determined under
Section 5.3 of the Plan. The exercise price cannot be modified while the Option is outstanding, except as required by Applicable Laws. 

 SECTION 6 
 TERM OF OPTION 
  
 6.1 Term of
Option. The term of each Option will be as stated in the Award Agreement; provided, however, that the maximum term of an Option will not exceed ten (10) years from the date of grant of the Option. 
  
 SECTION 7 
 EXERCISE OF OPTION; RESTRICTION ON SALE 
  
 7.1 Exercise of Option; Restriction on Sale. 
  
 7.1.1 Except as otherwise explicitly set forth in the Award Agreement, Options granted hereunder may be not be exercised within one
(1) year of the date the Option is granted (the “Initial Exercise Date”) whether or not the Option has vested prior to such time; provided, however, that the Initial Exercise Date will be automatically adjusted to conform with any
changes under Applicable Laws so that the length of time from the date of grant to the Initial Exercise Date when added to the length of time in which Shares may not be disposed of after the Initial Exercise Date as provided in Section 7.1.2
below, will allow for favorable tax and social security treatment under Applicable Laws. Thereafter, Options may be exercised to the extent they have vested. Options granted hereunder will vest as the Committee determines, subject to
Section 5.5 of the Plan. 
  
 7.1.2 The
Shares subject to an Option may not be transferred, assigned or hypothecated in any manner otherwise than by will or by the laws of descent or distribution before the date three (3) years from the Initial Exercise Date, except for any events
provided for in Article 91 ter of Annex II to the French tax code; provided, however, that the duration of this restriction on sale will be automatically adjusted to conform with any changes to the holding period required for favorable tax
and social security treatment under Applicable Laws to the extent permitted under Applicable Laws. 
  
 7.1.3 Death of Participant. In the event of the death of an Participant while an Employee, the Option may be exercised at
any time within six (6) months following the date of death by the Participant’s estate or by a person who acquired the right to exercise the Option by bequest or inheritance, but only to the extent that the Participant was entitled to
exercise the Option at the date of death. 
  
 SECTION 8 

NON-TRANSFERABILITY OF OPTIONS 
  
 8.1 Non-Transferability of Options. An Option 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. 
  
 SECTION 9 
 CHANGES IN CAPITALIZATION

  
 9.1 Changes in Capitalization. If any adjustment
provided for in Section 4.3 of the Plan to the exercise price and the number of shares of Common Stock covered by outstanding Options would violate Applicable Laws in such a way to jeopardize the favorable tax and social security treatment of
this Plan together with this Appendix A and the Options granted thereunder, then no such adjustment will be made prior to the exercise of any such outstanding Option. 

 SECTION 10 
 INFORMATION STATEMENTS TO PARTICIPANTS 
  
 10.1 Information Statements to Participants. The Company or its French Parent or Subsidiary, as required under Applicable Laws, will provide to each Participant, with copies to the appropriate governmental entities, such statements
of information as required by the Applicable Laws. 
  
 SECTION 11

 AMENDMENT OR TERMINATION OF PLAN 
  
 11.1 Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan will impair the rights
of any Participant, unless mutually agreed otherwise between the Participant and the Committee, which agreement must be in writing and signed by the Participant and the Company. Any favorable amendments or alterations are automatically deemed to be
approved by Participant. Termination of the Plan will not affect the Committee’s ability to exercise the powers granted to it hereunder with respect to Options granted under the Plan prior to the date of such termination. 
  
 SECTION 12 
 REPORTS TO SHAREHOLDERS 
  
 12.1 Reporting to the Shareholders’ Meeting. The Subsidiary of the Company, if required under Applicable Laws, will provide its shareholders with an annual report with respect to Options granted and/or
exercised by its Employees in the financial year.Polycom, Inc. 1996 Stock Incentive Plan (as amended through May 27, 2009)

 Exhibit 10.2 
  
 POLYCOM, INC. 1996 STOCK INCENTIVE PLAN 
  
 (AS AMENDED THROUGH MAY 27, 2009) 
  
 The following constitute the provisions of the 1996 Stock Incentive Plan (herein called the “Plan”) of Polycom, Inc. (herein called the
“Corporation”). 
  
 ARTICLE ONE 
  
 GENERAL PROVISIONS 
  

	I.	PURPOSE OF THE PLAN 

  
 This 1996 Stock Incentive Plan is intended to promote the interests of Polycom, Inc., a Delaware corporation, by providing eligible persons with the
opportunity to acquire a proprietary interest, or otherwise increase their proprietary interest, in the Corporation as an incentive for them to remain in the service of the Corporation. 
  
 Capitalized terms shall have the meanings assigned to such terms in the attached Appendix. 
  

	II.	STRUCTURE OF THE PLAN 

  
 A. The Plan shall be divided into three (3) separate equity programs: 
  

 (i) the Discretionary Option Grant Program under which eligible persons may, at the discretion of the Plan Administrator,
be granted options to purchase shares of Common Stock, 
  
 (ii) the Stock Issuance Program under which eligible persons may, at the discretion of the Plan Administrator, be issued shares of Common Stock directly, either through the immediate purchase of such shares or as a bonus for services
rendered the Corporation (or any Parent or Subsidiary), and 
  
 (iii) the Automatic Option Grant Program under which Eligible Directors shall automatically receive option grants at periodic intervals to purchase shares of Common Stock. 
  
 B. The Discretionary Option Grant and Stock Issuance Programs became
effective immediately upon the Plan Effective Date, and the Automatic Option Grant Program became effective upon the Underwriting Date. 
  
 C. The provisions of Articles One and Five shall apply to all equity programs under the Plan and shall accordingly govern the interests of all persons
under the Plan. 
  

	III.	ADMINISTRATION OF THE PLAN 

  
 A. Prior to the Section 12(g) Registration Date, the Discretionary Option Grant and Stock Issuance Programs were administered by the Board. Beginning
with the Section 12(g) Registration Date, the Primary Committee shall have sole and exclusive authority to administer the Discretionary Option Grant and Stock Issuance Programs with respect to Section 16 Insiders. 
  
 B. Administration of the Discretionary Option Grant and Stock Issuance
Programs with respect to all other persons eligible to participate in those programs may, at the Board’s discretion, be vested in the Primary Committee or a Secondary Committee, or the Board may retain the power to administer those programs
with respect to all such persons. The members of the Secondary Committee may be Board members who are also Employees. 

 C. Members of the Primary Committee or any Secondary Committee shall serve for such period of time as the
Board may determine and may be removed by the Board at any time. The Board may also at any time terminate the functions of any Secondary Committee and reassume all powers and authority previously delegated to such committee. 
  
 D. Each Plan Administrator shall, within the scope of its administrative
functions under the Plan, have full power and authority to establish such rules and regulations as it may deem appropriate for proper administration of the Discretionary Option Grant and Stock Issuance Programs and to make such determinations under,
and issue such interpretations of, the provisions of such programs and any outstanding options or stock issuances thereunder as it may deem necessary or advisable. Decisions of the Plan Administrator within the scope of its administrative functions
under the Plan shall be final and binding on all parties who have an interest in the Discretionary Option Grant or Stock Issuance Program under its jurisdiction or any stock option or stock issuance thereunder. 
  
 E. Service on the Primary Committee or the Secondary Committee shall
constitute service as a Board member, and members of each such committee shall accordingly be entitled to full indemnification and reimbursement as Board members for their service on such committee. No member of the Primary Committee or the
Secondary Committee shall be liable for any act or omission made in good faith with respect to the Plan or any option grants or stock issuances under the Plan. 
  

F. Administration of the Automatic Option Grant Program shall be self-executing in accordance with the terms of that program, and no Plan Administrator
shall exercise any discretionary functions with respect to option grants made thereunder. 
  

	IV.	ELIGIBILITY 

  
 A. The persons eligible to participate in the Discretionary Option Grant and Stock Issuance Programs are as follows: 
  
 (i) Employees, 
  
 (ii) non-employee members of the Board or the board of directors of any Parent or Subsidiary, and 
  
 (iii) consultants and other independent advisors who provide
services to the Corporation (or any Parent or Subsidiary). 
  
 B.
Each Plan Administrator shall, within the scope of its administrative jurisdiction under the Plan, have full authority (subject to the provisions of the Plan) to determine, (i) with respect to the option grants under the Discretionary Option
Grant Program, which eligible persons are to receive option grants, the time or times when such option grants are to be made, the number of shares to be covered by each such grant, the status of the granted option as either an Incentive Option or a
Non-Statutory Option, the time or times at which each option is to become exercisable, the vesting schedule (if any) applicable to the option shares and the maximum term for which the option is to remain outstanding and (ii) with respect to
stock issuances under the Stock Issuance Program, which eligible persons are to receive stock issuances, the time or times when such issuances are to be made, the number of shares to be issued to each Participant, the vesting schedule (if any)
applicable to the issued shares and the consideration to be paid for such shares. 
  
 C. The Plan Administrator shall have the absolute discretion either to grant options in accordance with the Discretionary Option Grant Program or to effect stock issuances in accordance with the Stock Issuance
Program. 
  
 D. The individuals eligible to participate in the
Automatic Option Grant Program shall be limited to (i) those individuals serving as non-employee Board members on the Underwriting Date, (ii) those individuals who first become non-employee Board members after the Underwriting Date,
whether through appointment by the Board 

 or election by the Corporation’s stockholders, and (iii) those individuals who continue to serve as
non-employee Board members through one or more Annual Stockholders Meetings held after the Underwriting Date. A non-employee Board member shall not be eligible to receive an initial option grant under the Automatic Option Grant Program on the
Underwriting Date if such individual has previously been in the employ of the Corporation (or any Parent or Subsidiary) or has otherwise received a prior stock option grant from the Corporation. A non-employee Board member who first joins the Board
after the Underwriting Date shall not be eligible to receive an initial option grant under the Automatic Option Grant Program if such individual has previously been in the employ of the Corporation (or any Parent or Subsidiary). Non-employee Board
members who have previously been in the employ of the Corporation (or any Parent or Subsidiary) or who have previously received a stock option grant from the Corporation shall, however, be eligible to receive one or more annual option grants under
the Automatic Option Grant Program over their period of continued Board service. 
  

	V.	STOCK SUBJECT TO THE PLAN 

  
 A. The stock issuable under the Plan shall be shares of authorized but unissued or reacquired Common Stock, including shares repurchased by the
Corporation on the open market. The maximum number of shares of Common Stock which may be issued over the term of the Plan shall not exceed approximately 23,150,000 shares. 
  
 B. No one person participating in the Plan may receive options, separately exercisable stock appreciation rights and direct
stock issuances for more than 600,000 shares of Common Stock in the aggregate per calendar year, beginning with the 1996 calendar year. 
  
 C. No more than ten percent (10%) of the maximum number of shares which may be issued under the Plan may be issued pursuant to the Stock Issuance
Program. 
  
 D. Shares of Common Stock subject to outstanding
options shall be available for subsequent issuance under the Plan to the extent (i) the options (including any options incorporated from the Predecessor Plan) expire or terminate for any reason prior to exercise in full or (ii) the options
are canceled in accordance with the cancellation-regrant provisions of Article Two. In addition, any unvested shares issued under the Plan and subsequently repurchased by the Corporation, at the option exercise or direct issue price paid per share,
pursuant to the Corporation’s repurchase rights under the Plan shall be added back to the number of shares of Common Stock reserved for issuance under the Plan and shall accordingly be available for reissuance through one or more subsequent
option grants or direct stock issuances under the Plan. However, should the exercise price of an option under the Plan (including any option incorporated from the Predecessor Plan) be paid with shares of Common Stock or should shares of Common Stock
otherwise issuable under the Plan be withheld by the Corporation in satisfaction of the withholding taxes incurred in connection with the exercise of an option or the vesting of a stock issuance under the Plan, then the number of shares of Common
Stock available for issuance under the Plan shall be reduced by the gross number of shares for which the option is exercised or which vest under the stock issuance, and not by the net number of shares of Common Stock issued to the holder of such
option or stock issuance. 
  
 E. Should any change be made to the
Common Stock by reason of any stock split, stock dividend, recapitalization, combination of shares, exchange of shares or other change affecting the outstanding Common Stock as a class without the Corporation’s receipt of consideration,
appropriate adjustments shall be made to (i) the maximum number and/or class of securities issuable under the Plan, (ii) the maximum number and/or class of securities for which any one person may be granted options, separately exercisable
stock appreciation rights and direct stock issuances per calendar year, (iii) the number and/or class of securities for which automatic option grants are to be made subsequently per Eligible Director under the Automatic Option Grant Program and
(iv) the number and/or class of securities and the exercise price per share in effect under each outstanding option (including any option incorporated from the Predecessor Plan) in order to prevent the dilution or enlargement of benefits
thereunder. The adjustments determined by the Plan Administrator shall be final, binding and conclusive. 

 ARTICLE TWO 
  
 DISCRETIONARY OPTION GRANT PROGRAM 
  

	I.	OPTION TERMS 

  
 Each option shall be evidenced by one or more documents in the form approved by the Plan Administrator; provided, however, that each such document shall comply with the terms specified below. Each document evidencing
an Incentive Option shall, in addition, be subject to the provisions of the Plan applicable to such options. 
  

	 	A.	EXERCISE PRICE. 

  
 (i) The exercise price per share shall be fixed by the Plan Administrator but shall not be less than one hundred percent (100%) of
the Fair Market Value per share of Common Stock on the option grant date. 
  
 (ii) The exercise price shall become immediately due upon exercise of the option and shall, subject to the provisions of Section I of Article Five and the documents evidencing the option, be payable in one or more of
the forms specified below: 
  
 (iii) cash or
check made payable to the Corporation, 
  
 (iv)
shares of Common Stock held for the requisite period necessary to avoid a charge to the Corporation’s earnings for financial reporting purposes and valued at Fair Market Value on the Exercise Date, or 
  
 (v) to the extent the option is exercised for vested shares,
through a special sale and remittance procedure pursuant to which the Optionee shall concurrently provide irrevocable written instructions to (a) a Corporation-designated brokerage firm to effect the immediate sale of the purchased shares and
remit to the Corporation, out of the sale proceeds available on the settlement date, sufficient funds to cover the aggregate exercise price payable for the purchased shares plus all applicable Federal, state and local income and employment taxes
required to be withheld by the Corporation by reason of such exercise and (b) the Corporation to deliver the certificates for the purchased shares directly to such brokerage firm in order to complete the sale transaction. 
  
 Except to the extent such sale and remittance procedure is
utilized, payment of the exercise price for the purchased shares must be made on the Exercise Date. 
  

	 	B.	EXERCISE AND TERM OF OPTIONS. Each option shall be exercisable at such time or times, during such period and for such number of shares as shall be determined by the Plan
Administrator and set forth in the documents evidencing the option. However, no option shall have a term in excess of seven (7) years measured from the option grant date. 

  

	 	C.	EFFECT OF TERMINATION OF SERVICE. 

  
 (i) The following provisions shall govern the exercise of any options held by the Optionee at the time of cessation of Service or death:

  
 (1) Any option outstanding at the time of the
Optionee’s cessation of Service for any reason shall remain exercisable for such period of time thereafter as shall be determined by the Plan Administrator and set forth in the documents evidencing the option, but no such option shall be
exercisable after the expiration of the option term. 
  
 (2) Any option exercisable in whole or in part by the Optionee at the time of death may be exercised subsequently by the personal representative of the Optionee’s estate or by the person or persons to whom the option is transferred
pursuant to the Optionee’s will or in accordance with the laws of descent and distribution. 

 (3) During the applicable post-Service exercise period, the option may not be exercised
in the aggregate for more than the number of vested shares for which the option is exercisable on the date of the Optionee’s cessation of Service. Upon the expiration of the applicable exercise period or (if earlier) upon the expiration of the
option term, the option shall terminate and cease to be outstanding for any vested shares for which the option has not been exercised. However, the option shall, immediately upon the Optionee’s cessation of Service, terminate and cease to be
outstanding to the extent the option is not otherwise at that time exercisable for vested shares. 
  
 (4) Should the Optionee’s Service be terminated for Misconduct, then all outstanding options held by the Optionee shall terminate
immediately and cease to be outstanding. 
  
 (ii)
The Plan Administrator shall have the discretion, exercisable either at the time an option is granted or at any time while the option remains outstanding, to: 
  

(1) extend the period of time for which the option is to remain exercisable following the Optionee’s cessation of Service from the
period otherwise in effect for that option to such greater period of time as the Plan Administrator shall deem appropriate, but in no event beyond the expiration date of the option term, and/or 
  
 (2) permit the option to be exercised, during the applicable
post-Service exercise period, not only with respect to the number of vested shares of Common Stock for which such option is exercisable at the time of the Optionee’s cessation of Service but also with respect to one or more additional
installments in which the Optionee would have vested under the option had the Optionee continued in Service. 
  

	 	D.	STOCKHOLDER RIGHTS. The holder of an option shall have no stockholder rights with respect to the shares subject to the option until such person shall have exercised the option, paid
the exercise price and become a holder of record of the purchased shares. 

  

	 	E.	REPURCHASE RIGHTS. The Plan Administrator shall have the discretion to grant options which are exercisable for unvested shares of Common Stock. Should the Optionee cease Service
while holding such unvested shares, the Corporation shall have the right to repurchase, at the exercise price paid per share, any or all of those unvested shares. The terms upon which such repurchase right shall be exercisable (including the period
and procedure for exercise and the appropriate vesting schedule for the purchased shares) shall be established by the Plan Administrator and set forth in the document evidencing such repurchase right. 

  

	 	F.	LIMITED TRANSFERABILITY OF OPTIONS. During the lifetime of the Optionee, Incentive Options shall be exercisable only by the Optionee and shall not be assignable or transferable
other than by will or by the laws of descent and distribution following the Optionee’s death. However, Non-Statutory Options may, in connection with the Optionee’s estate plan, be assigned in whole or in part during the Optionee’s
lifetime to one or more members of the Optionee’s immediate family or to a trust established exclusively for one or more such family members; provided, however, that unless the Plan Administrator determines otherwise in a stock option
agreement, Non-Statutory Options provided to Optionees employed by the Company’s European subsidiaries are not so transferable. The assigned portion may only be exercised by the person or persons who acquire a proprietary interest in the option
pursuant to the assignment. The terms applicable to the assigned portion shall be the same as those in effect for the option immediately prior to such assignment and shall be set forth in such documents issued to the assignee as the Plan
Administrator may deem appropriate. 

  

	II.	INCENTIVE OPTIONS 

  
 The terms specified below shall be applicable to all Incentive Options. Except as modified by the provisions of this Section II, all the provisions of
Articles One, Two and Five shall be applicable to Incentive Options. Options which are specifically designated as Non-Statutory Options when issued under the Plan shall NOT be subject to the terms of this Section II. 

 A. ELIGIBILITY. Incentive Options may only be granted to Employees. 
  
 B. DOLLAR LIMITATION. The aggregate Fair Market Value of the shares of Common
Stock (determined as of the respective date or dates of grant) for which one or more options granted to any Employee under the Plan (or any other option plan of the Corporation or any Parent or Subsidiary) may for the first time become exercisable
as Incentive Options during any one (1) calendar year shall not exceed the sum of One Hundred Thousand Dollars ($100,000). To the extent the Employee holds two (2) or more such options which become exercisable for the first time in the
same calendar year, the foregoing limitation on the exercisability of such options as Incentive Options shall be applied on the basis of the order in which such options are granted. 
  
 C. 10% STOCKHOLDER. If any Employee to whom an Incentive Option is granted is a 10% Stockholder, then the exercise price per
share shall not be less than one hundred ten percent (110%) of the Fair Market Value per share of Common Stock on the option grant date, and the option term shall not exceed five (5) years measured from the option grant date. 

 

	III.	CORPORATE TRANSACTION/CHANGE IN CONTROL 

  
 A. In the event of any Corporate Transaction, each outstanding option shall automatically accelerate so that each such option shall, immediately prior to
the effective date of the Corporate Transaction, become fully exercisable with respect to the total number of shares of Common Stock at the time subject to such option and may be exercised for any or all of those shares as fully-vested shares of
Common Stock. However, an outstanding option shall not so accelerate if and to the extent: (i) such option is, in connection with the Corporate Transaction, to be assumed by the successor corporation (or parent thereof) or (ii) such option
is to be replaced with a cash incentive program of the successor corporation which preserves the spread existing on the unvested option shares at the time of the Corporate Transaction and provides for subsequent payout in accordance with the same
vesting schedule applicable to such option. 
  
 B. All outstanding
repurchase rights shall also terminate automatically, and the shares of Common Stock subject to those terminated rights shall immediately vest in full, in the event of any Corporate Transaction, except to the extent those repurchase rights are to be
assigned to the successor corporation (or parent thereof) in connection with such Corporate Transaction. 
  
 C. The Plan Administrator shall have the discretion, exercisable either at the time the option is granted or at any time while the option remains
outstanding, to provide for the automatic acceleration of one or more outstanding options (and the automatic termination of one or more outstanding repurchase rights with the immediate vesting of the shares of Common Stock subject to those rights)
upon the occurrence of a Corporate Transaction, whether or not those options are to be assumed (or those repurchase rights are to be assigned) in the Corporate Transaction. 
  
 D. Immediately following the consummation of the Corporate Transaction, all outstanding options shall terminate and cease to
be outstanding, except to the extent assumed by the successor corporation (or parent thereof). 
  
 E. Each option which is assumed in connection with a Corporate Transaction shall be appropriately adjusted, immediately after such Corporate Transaction, to apply to the number and class of securities which would have
been issuable to the Optionee in consummation of such Corporate Transaction had the option been exercised immediately prior to such Corporate Transaction. Appropriate adjustments shall also be made to (i) the number and class of securities
available for issuance under the Plan following the consummation of such Corporate Transaction, (ii) the exercise price payable per share under each outstanding option, provided the aggregate exercise price payable for such securities shall
remain the same and (iii) the maximum number and/or class of securities for which any one person may be granted stock options, separately exercisable stock appreciation rights and direct stock issuances under the Plan per calendar year.

 F. The Plan Administrator shall have full power and authority to grant options under the Discretionary
Option Grant Program which will automatically accelerate in whole or in part should the Optionee’s Service subsequently terminate by reason of an Involuntary Termination within a designated period (not to exceed twelve (12) months)
following the effective date of any Corporate Transaction in which those options are assumed or replaced and do not otherwise accelerate. Any options so accelerated shall remain exercisable for fully-vested shares until the EARLIER of (i) the
expiration of the option term or (ii) the expiration of the one (1)-year period measured from the effective date of the Involuntary Termination. In addition, the Plan Administrator may provide that one or more of the Corporation’s
outstanding repurchase rights with respect to shares held by the Optionee at the time of such Involuntary Termination shall immediately terminate in whole or in part, and the shares subject to those terminated rights shall accordingly vest.

  
 G. The Plan Administrator shall have full power and authority
to grant options under the Discretionary Option Grant Program which will automatically accelerate in whole or in part should the Optionee’s Service subsequently terminate by reason of an Involuntary Termination within a designated period (not
to exceed twelve (12) months) following the effective date of any Change in Control. Each option so accelerated shall remain exercisable for fully-vested shares until the EARLIER of (i) the expiration of the option term or (ii) the
expiration of the one (1)-year period measured from the effective date of the Involuntary Termination. In addition, the Plan Administrator may provide that one or more of the Corporation’s outstanding repurchase rights with respect to shares
held by the Optionee at the time of such Involuntary Termination shall immediately terminate in whole or in part, and the shares subject to those terminated rights shall accordingly vest. 
  
 H. The portion of any Incentive Option accelerated in connection with a Corporate Transaction or Change in Control shall
remain exercisable as an Incentive Option only to the extent the applicable One Hundred Thousand Dollar ($100,000) limitation is not exceeded. To the extent such dollar limitation is exceeded, the accelerated portion of such option shall be
exercisable as a Non-Statutory Option under the Federal tax laws. 
  
 I. The grant of options under the Discretionary Option Grant Program shall in no way affect the right of the Corporation to adjust, reclassify, reorganize or otherwise change its capital or business structure or to merge, consolidate,
dissolve, liquidate or sell or transfer all or any part of its business or assets. 
  

	IV.	CANCELLATION AND REGRANT OF OPTIONS 

  
 A. The Plan Administrator shall have the authority to effect, at any time, and from time to time, with the consent of the affected option holders the
cancellation of any or all outstanding options under the Discretionary Option Grant Program (including outstanding options incorporated from the Predecessor Plan) and to grant in substitution new options covering the same or different number of
shares of Common Stock but with an exercise price per share based on the Fair Market Value per share of Common Stock on the new grant date. However, any repricing of stock options, effected either by reducing the exercise price of outstanding
options or canceling outstanding options and granting replacement options with a lower exercise price, shall require the approval of the holders of a majority of the Corporation’s voting shares, with the sole exception of that certain exchange
offer to be commenced as soon as is reasonably practicable following May 20, 2003, pursuant to which holders of options to purchase a maximum of 7,000,000 shares of the Corporation’s Common Stock with an exercise price per share of at
least ten percent (10%) higher than the closing price of a share of the Company’s Common Stock on the Nasdaq National Market on the trading day prior to the commencement of the exchange offer, shall be offered the opportunity to elect to
cancel such options (the “Cancelled Options”), in exchange for the grant of replacement options to purchase 0.80 shares of the Corporation’s Common Stock for each share under the Cancelled Options (the “Replacement
Options”), with such Replacement Options to be granted no less than six months and one day following the cancellation of the Cancelled Options, at a price equal to the fair market value of the Corporation’s Common Stock on such date of
grant (the “New Grant Date”). Each Replacement Option will have a term equal to the lesser of (i) the remaining term of the Cancelled Option, or (ii) five and one-half (51/2) years. The vesting commencement date and vesting
schedule for each Replacement Option will be the same as for the Cancelled Option which it replaces, subject to adjustment for any shares previously exercised, 

 
except that vesting will be suspended during the period between the cancellation date of the Cancelled Options and the New Grant Date. Further, optionholders
who receive Replacement Options will be prohibited from exercising those Replacement Options for an additional six months following the New Grant Date. Executive Officers and Directors of the Corporation shall not participate in this exchange offer,
and this exchange offer will be structured so that the Corporation avoids incurring financial accounting charges. 
  
 B. Notwithstanding the foregoing and any other provision set forth in the Plan to the contrary, the Plan Administrator may, in its sole discretion,
institute a single option exchange program, as described in the proxy statement with respect to the Company’s 2009 Annual Meeting of Stockholders, under which outstanding options granted under the Plan may be surrendered or cancelled in
exchange for a lesser number of equity awards granted under the Company’s 2004 Equity Incentive Plan. 
  

	V.	STOCK APPRECIATION RIGHTS 

  
 A. The Plan Administrator shall have full power and authority to grant to selected Optionees tandem stock appreciation rights and/or limited stock
appreciation rights. 
  
 B. The following terms shall govern the
grant and exercise of tandem stock appreciation rights: 
  
 (i) One or more Optionees may be granted the right, exercisable upon such terms as the Plan Administrator may establish, to elect between the exercise of the underlying option for shares of Common Stock and the
surrender of that option in exchange for a distribution from the Corporation in an amount equal to the excess of (a) the Fair Market Value (on the option surrender date) of the number of shares in which the Optionee is at the time vested under
the surrendered option (or surrendered portion thereof) over (b) the aggregate exercise price payable for such shares. 
  
 (ii) No such option surrender shall be effective unless it is approved by the Plan Administrator. If the surrender is so approved, then
the distribution to which the Optionee shall be entitled may be made in shares of Common Stock valued at Fair Market Value on the option surrender date, in cash, or partly in shares and partly in cash, as the Plan Administrator shall in its sole
discretion deem appropriate. 
  
 (iii) If the
surrender of an option is rejected by the Plan Administrator, then the Optionee shall retain whatever rights the Optionee had under the surrendered option (or surrendered portion thereof) on the option surrender date and may exercise such rights at
any time prior to the LATER of (a) five (5) business days after the receipt of the rejection notice or (b) the last day on which the option is otherwise exercisable in accordance with the terms of the documents evidencing such option,
but in no event may such rights be exercised more than ten (10) years after the option grant date. 
  
 C. The following terms shall govern the grant and exercise of limited stock appreciation rights: 
  
 (i) One or more Section 16 Insiders may be granted
limited stock appreciation rights with respect to their outstanding options. 
  
 (ii) Upon the occurrence of a Hostile Take-Over, each individual holding one or more options with such a limited stock appreciation right shall have the unconditional right (exercisable for a thirty (30)-day period
following such Hostile Take-Over) to surrender each such option to the Corporation, to the extent the option is at the time exercisable for vested shares of Common Stock. In return for the surrendered option, the Optionee shall receive a cash
distribution from the Corporation in an amount equal to the excess of (A) the Take-Over Price of the shares of Common Stock which are at the time vested under each surrendered option (or surrendered portion thereof) over (B) the aggregate
exercise price payable for such shares. Such cash distribution shall be paid within five (5) days following the option surrender date. 
  
 (iii) The Plan Administrator shall pre-approve, at the time the limited stock appreciation right is granted, the subsequent exercise of
that right in accordance with the terms of the grant and the provisions of this Section V.C. No additional approval of the Plan Administrator or the Board shall be required at the time of the actual option surrender and cash distribution.

 (iv) The balance of the option (if any) shall continue in full force and effect in
accordance with the documents evidencing such option. 
  
 ARTICLE
THREE 
  
 STOCK ISSUANCE PROGRAM 
  

	I.	STOCK ISSUANCE TERMS 

  
 Shares of Common Stock may be issued under the Stock Issuance Program through direct and immediate issuances without any intervening option grants. Each
such stock issuance shall be evidenced by a Stock Issuance Agreement which complies with the terms specified below. 
  

	 	A.	PURCHASE PRICE. 

  
 (i) The purchase price per share shall be fixed by the Plan Administrator, but shall not be less than one hundred percent (100%) of
the Fair Market Value per share of Common Stock on the issuance date. 
  
 (ii) Subject to the provisions of Section I of Article Five, shares of Common Stock may be issued under the Stock Issuance Program for any of the following items of consideration which the Plan Administrator may deem
appropriate in each individual instance: 
  
 (1)
cash or check made payable to the Corporation, or 
  
 (2) past services rendered to the Corporation (or any Parent or Subsidiary). 
  

	 	B.	VESTING PROVISIONS. 

  
 (i) Shares of Common Stock issued under the Stock Issuance Program may, in the discretion of the Plan Administrator, be fully and
immediately vested upon issuance or may vest in one or more installments over the Participant’s period of Service or upon attainment of specified performance objectives. The elements of the vesting schedule applicable to any unvested shares of
Common Stock issued under the Stock Issuance Program, namely: 
  
 (1) the Service period to be completed by the Participant or the performance objectives to be attained, 
  
 (2) the number of installments in which the shares are to vest, 
  
 (3) the interval or intervals (if any) which are to lapse between installments, and 
  
 (4) the effect which death, Permanent Disability or other
event designated by the Plan Administrator is to have upon the vesting schedule, shall be determined by the Plan Administrator and incorporated into the Stock Issuance Agreement. 
  
 (ii) Any new, substituted or additional securities or other property including money paid other than as a
regular cash dividend) which the Participant may have the right to receive with respect to the Participant’s unvested shares of Common Stock by reason of any stock dividend, stock split, recapitalization, combination of shares, exchange of
shares or other change affecting the outstanding Common Stock as a class without the Corporation’s receipt of consideration shall be issued subject to (i) the same vesting requirements applicable to the Participant’s unvested shares
of Common Stock and (ii) such escrow arrangements as the Plan Administrator shall deem appropriate. 
  
 (iii) The Participant shall have full stockholder rights with respect to any shares of Common Stock issued to the Participant under the
Stock Issuance Program, whether or not the Participant’s interest in those shares is vested. Accordingly, the Participant shall have the right to vote such shares and to receive any regular cash dividends paid on such shares. 

 (iv) Should the Participant cease to remain in Service while holding one or more unvested
shares of Common Stock issued under the Stock Issuance Program or should the performance objectives not be attained with respect to one or more such unvested shares of Common Stock, then those shares shall be immediately surrendered to the
Corporation for cancellation, and the Participant shall have no further stockholder rights with respect to those shares. To the extent the surrendered shares were previously issued to the Participant for consideration paid in cash or cash equivalent
(including the Participant’s purchase-money indebtedness), the Corporation shall repay to the Participant the cash consideration paid for the surrendered shares and shall cancel the unpaid principal balance of any outstanding purchase-money
note of the Participant attributable to the surrendered shares. 
  
 (v) The Plan Administrator may in its discretion waive the surrender and cancellation of one or more unvested shares of Common Stock (or other assets attributable thereto) which would otherwise occur upon the
cessation of the Participant’s Service or the non-attainment of the performance objectives applicable to those shares. Such waiver shall result in the immediate vesting of the Participant’s interest in the shares of Common Stock as to
which the waiver applies. Such waiver may be effected at any time, whether before or after the Participant’s cessation of Service or the attainment or non-attainment of the applicable performance objectives. 
  

	II.	CORPORATE TRANSACTION/CHANGE IN CONTROL 

  
 A. All of the Corporation’s outstanding repurchase/cancellation rights under the Stock Issuance Program shall terminate automatically, and all the
shares of Common Stock subject to those terminated rights shall immediately vest in full, in the event of any Corporate Transaction, except to the extent those repurchase/cancellation rights are to be assigned to the successor corporation (or parent
thereof) in connection with such Corporate Transaction. 
  
 B. The
Plan Administrator shall have the discretionary authority, exercisable either at the time the unvested shares are issued or any time while the Corporation’s repurchase/cancellation rights remain outstanding under the Stock Issuance Program, to
provide that those rights shall automatically terminate in whole or in part, and the shares of Common Stock subject to those terminated rights shall immediately vest, in the event the Participant’s Service should subsequently terminate by
reason of an Involuntary Termination within a designated period (not to exceed twelve (12) months) following the effective date of any Corporate Transaction in which those repurchase/cancellation rights are assigned to the successor corporation
(or parent thereof). 
  
 C. The Plan Administrator shall have the
discretionary authority, exercisable either at the time the unvested shares are issued or any time while the Corporation’s repurchase/cancellation rights remain outstanding under the Stock Issuance Program, to provide that those rights shall
automatically terminate in whole or in part, and the shares of Common Stock subject to those terminated rights shall immediately vest, in the event the Participant’s Service should subsequently terminate by reason of an Involuntary Termination
within a designated period (not to exceed twelve (12) months) following the effective date of any Change in Control. 
  

	III.	SHARE ESCROW/LEGENDS 

  
 Unvested shares may, in the Plan Administrator’s discretion, be held in escrow by the Corporation until the Participant’s interest in such
shares vests or may be issued directly to the Participant with restrictive legends on the certificates evidencing those unvested shares. 

 ARTICLE FOUR 
  
 AUTOMATIC OPTION GRANT PROGRAM 
  

	I.	OPTION TERMS 

  

	 	A.	GRANT DATES. Option grants shall be made on the dates specified below: 

  
 (i) On the date of each Annual Stockholders Meeting held on or after May 20, 2003, each non-employee member of the Board who is to
continue to serve on the Board (an “Eligible Director”), whether or not that Eligible Director is standing for re-election to the Board at that particular Annual Meeting, shall automatically be granted a Non-Statutory Option to purchase an
amount equal to 25,000 shares of Common Stock. There shall be no limit on the number of such option grants any one Eligible Director may receive over his or her period of Board service, and Eligible Directors who have previously been in the employ
of the Corporation (or any Parent or Subsidiary) or who have otherwise received a stock option grant from the Corporation shall be eligible to receive such option grants over their period of continued Board service. Each individual serving as a
non-employee Board member shall, upon the date such individual joins the Board of Directors, be automatically granted on such date a non-statutory option to purchase 30,000 shares if joining between January 27, 1999 and May 17, 2001 or
60,000 shares if joining on or after May 17, 2001 (a “Primary Grant”), provided such individual (i) had not previously been in the employ of the Corporation (or any parent or Subsidiary) and (ii) had not otherwise received a
prior stock option grant from the Corporation. 
  
 (ii) Each Eligible Director on October 26, 1999 shall automatically be granted a Non-Statutory Option to purchase a number of shares of Common Stock equal to (x) 30,000 minus (y) the number of shares of Common Stock Options
granted to such individual since the prior Annual Stockholders Meeting and including the grant at such meeting (the “Interim Option”). 
  
 (iii) Each individual serving as a non-employee Board member on the Underwriting Date and each Eligible Director elected to the Board
prior to January 26, 1999 was automatically granted, on such date, a Non-Statutory Option to purchase 40,000 shares of Common Stock (an “Initial Grant”), provided such individual (i) had not previously been in the employ of the
Corporation (or any Parent or Subsidiary) and (ii) had not otherwise received a prior stock option grant from the Corporation , except that prior to the 1998 Annual Meeting such Initial grant was for 32,000 shares instead of 40,000. On every
Annual Shareholder Meeting after the Underwriting Date but on or prior to January 26, 1999, each Eligible Director was granted a Non-Statutory Option for 10,000 shares of Common Stock, provided such individual was an Eligible Director for at
least six (6) months, except that prior to the 1998 Annual Meeting, such option was to purchase 8,000 shares, not 10,000. After January 26, 1999 and prior to October 26, 1999, Eligible Directors were granted a Non-Statutory Option to
purchase 7,500 shares of Common Stock on the date of each Annual Shareholders Meeting and grants of Non-Statutory Options to purchase 7,500 shares of Common Stock on the next three (3) three (3) month anniversaries following each
applicable Annual Shareholders Meeting. The automatic annual grant of 30,000 shares of Common Stock is intended to replace these previous automatic quarterly grants. 
  

	 	B.	EXERCISE PRICE. 

  
 (i) The exercise price per share for any option grant under this Article Four shall be equal to one hundred percent (100%) of the
Fair Market Value per share of Common Stock on the option grant date. 
  
 (ii) The exercise price shall be payable in one or more of the alternative forms authorized under the Discretionary Option Grant Program. Except to the extent the sale and remittance procedure specified thereunder is
utilized, payment of the exercise price for the purchased shares must be made on the Exercise Date. 

 C. OPTION TERM. Each option granted on or after May 17, 2001 shall have a term of seven
(7) years measured from the grant date. Each option granted between October 26, 1999 and May 17, 2001 shall have a term of five (5) years measured from the grant date. The Interim Option shall have a term of five (5) years
from the date of the 1999 Annual Stockholders Meeting. Each option granted on or after January 26, 1999 and on or before October 26, 1999 shall have a term of two (2) years measured from the option grant date. Each option granted
prior to January 26, 1999 shall have a term of ten (10) years from its date of grant. 
  
 D. EXERCISE AND VESTING OF OPTIONS. Automatic option grants made on the date of each Annual Stockholders Meeting held on or after May 20, 2003 shall
vest and become exercisable on the first anniversary of their grant date, provided the Optionee remains a Board member on such date. Each Interim Option shall vest and become exercisable on the first anniversary of the 1999 Annual Shareholders
Meeting, provided the Optionee remains a Board member on such date. Each option granted on or after January 26, 1999 and on or before October 26, 1999 shall be fully vested and immediately exercisable on the option grant date for any or
all of the option shares. Any shares purchased under an option granted prior to January 26, 1999 shall be subject to repurchase by the Corporation, at the exercise price paid per share, upon the Optionee’s cessation of Board service prior
to vesting in those shares. Each Initial Grant and each Primary Grant shall vest, and the Corporation’s repurchase right shall lapse, in a series of four (4) successive equal annual installments over the Optionee’s period of continued
service as a Board member, with the first such installment to vest upon the Optionee’s completion of one (1) year of Board service measured from the option grant date. With respect to annual share grants made prior to January 26,
1999, such options shall vest, and the Corporation’s repurchase right shall lapse, in two (2) successive equal annual installments over the Optionee’s period of continued service as a Board member, with the first such installment to
vest upon the Optionee’s completion of one (1) year of Board service measured from the option grant date. 
  
 E. EFFECT OF TERMINATION OF BOARD SERVICE. The following provisions shall govern the exercise of any options held by the Optionee at the time the Optionee
ceases to serve as a Board member: 
  
 (i) The
Optionee (or, in the event of Optionee’s death, the personal representative of the Optionee’s estate or the person or persons to whom the option is transferred pursuant to the Optionee’s will or in accordance with the laws of descent
and distribution) shall have a twelve (12)-month period following the date of such cessation of Board service in which to exercise each such option; provided, however, in no event shall the option be exercised later than the option term provided in
such option. 
  
 (ii) During the twelve
(12)-month exercise period, the option may not be exercised in the aggregate for more than the number of vested shares of Common Stock for which the option is exercisable at the time of the Optionee’s cessation of Board service. 
  
 (iii) Should the Optionee cease to serve as a Board member
by reason of death or Permanent Disability, then all shares at the time subject to the option shall immediately vest so that such option may, during the twelve (12)-month exercise period following such cessation of Board service, be exercised for
all or any portion of those shares as fully-vested shares of Common Stock. 
  
 (iv) In no event shall the option remain exercisable after the expiration of the option term. Upon the expiration of the twelve (12)-month exercise period or (if earlier) upon the expiration of the option term, the
option shall terminate and cease to be outstanding for any vested shares for which the option has not been exercised. However, the option shall, immediately upon the Optionee’s cessation of Board service for any reason other than death or
Permanent Disability, terminate and cease to be outstanding to the extent the option is not otherwise at that time exercisable for vested shares. 
  

	 	II.	CORPORATE TRANSACTION/CHANGE IN CONTROL/HOSTILE TAKE-OVER 

  
 A. In the event of any Corporate Transaction, the shares of Common Stock at the time subject to each outstanding option but not otherwise vested shall
automatically vest in full so that each such option shall, immediately prior to the effective date of the Corporate Transaction, become fully exercisable for all of the 

 shares of Common Stock at the time subject to such option and may be exercised for all or any portion of those shares as
fully-vested shares of Common Stock. Immediately following the consummation of the Corporate Transaction, each automatic option grant shall terminate and cease to be outstanding, except to the extent assumed by the successor corporation (or parent
thereof). 
  
 B. In connection with any Change in Control, the
shares of Common Stock at the time subject to each outstanding option but not otherwise vested shall automatically vest in full so that each such option shall, immediately prior to the effective date of the Change in Control, become fully
exercisable for all of the shares of Common Stock at the time subject to such option and may be exercised for all or any portion of those shares as fully-vested shares of Common Stock. Each such option shall remain exercisable for such fully-vested
option shares until the expiration or sooner termination of the option term. 
  
 C. Each option which is assumed in connection with a Corporate Transaction shall be appropriately adjusted, immediately after such Corporate Transaction, to apply to the number and class of securities which would have
been issuable to the Optionee in consummation of such Corporate Transaction had the option been exercised immediately prior to such Corporate Transaction. Appropriate adjustments shall also be made to the exercise price payable per share under each
outstanding option, provided the aggregate exercise price payable for such securities shall remain the same. 
  
 D. The grant of options under the Automatic Option Grant Program shall in no way affect the right of the Corporation to adjust, reclassify, reorganize or
otherwise change its capital or business structure or to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of its business or assets. 
  

	III.	REMAINING TERMS 

  
 The remaining terms of each option granted under the Automatic Option Grant Program shall be the same as the terms in effect for option grants made under
the Discretionary Option Grant Program. 
  
 ARTICLE FIVE

  
 MISCELLANEOUS 
  

	I.	FINANCING 

  
 A. The Plan Administrator may permit any Optionee or Participant to pay the option exercise price under the Discretionary Option Grant Program or the purchase price of shares issued under the Stock Issuance Program by
delivering a promissory note payable in one or more installments. The terms of any such promissory note (including the interest rate and the terms of repayment) shall be established by the Plan Administrator in its sole discretion. Promissory notes
may be authorized with or without security or collateral. In all events, the maximum credit available to the Optionee or Participant may not exceed the sum of (i) the aggregate option exercise price or purchase price payable for the purchased
shares plus (ii) any Federal, state and local income and employment tax liability incurred by the Optionee or the Participant in connection with the option exercise or share purchase. 
  
 B. The Plan Administrator may, in its discretion, determine that one or more
such promissory notes shall be subject to forgiveness by the Corporation in whole or in part upon such terms as the Plan Administrator may deem appropriate. 
  

	II.	TAX WITHHOLDING 

  
 A. The Corporation’s obligation to deliver shares of Common Stock upon the exercise of stock options or stock appreciation rights or upon the
issuance or vesting of such shares under the Plan shall be subject to the satisfaction of all applicable Federal, state and local income and employment tax withholding requirements. 

 B. The Plan Administrator may, in its discretion, provide any or all holders of Non-Statutory Options or
unvested shares of Common Stock under the Plan (other than the options granted or the shares issued under the Automatic Option Grant Program) with the right to use shares of Common Stock in satisfaction of all or part of the Taxes incurred by such
holders in connection with the exercise of their options or the vesting of their shares. Such right may be provided to any such holder in either or both of the following formats: 
  
 (i) STOCK WITHHOLDING: The election to have the Corporation withhold, from the shares of Common Stock
otherwise issuable upon the exercise of such Non-Statutory Option or the vesting of such shares, a portion of those shares with an aggregate Fair Market Value equal to the percentage of the Taxes (not to exceed one hundred percent
(100%)) designated by the holder. 
  
 (ii)
STOCK DELIVERY: The election to deliver to the Corporation, at the time the Non-Statutory Option is exercised or the shares vest, one or more shares of Common Stock previously acquired by such holder (other than in connection with the option
exercise or share vesting triggering the Taxes) with an aggregate Fair Market Value equal to the percentage of the Taxes (not to exceed one hundred percent (100%)) designated by the holder. 
  

	III.	EFFECTIVE DATE AND TERM OF THE PLAN 

  
 A. The Plan became effective with respect to the Discretionary Option Grant and the Stock Issuance Programs immediately upon the Plan Effective Date. The
Automatic Option Grant Program under the Plan became effective on the Underwriting Date. Options may be granted under the Discretionary Option Grant Program at any time on or after the Plan Effective Date. In addition, the initial option grants
under the Automatic Option Grant Program were made on the Underwriting Date to each Eligible Director at that time. 
  
 B. The Plan shall serve as the successor to the Predecessor Plan, and no further option grants or direct stock issuances shall be made under the
Predecessor Plan after the Plan Effective Date. All options outstanding under the Predecessor Plan as of such date shall be incorporated into the Plan at that time and shall be treated as outstanding options under the Plan. 
  
 However, each outstanding option so incorporated shall continue to be
governed solely by the terms of the documents evidencing such option, and no provision of the Plan shall be deemed to affect or otherwise modify the rights or obligations of the holders of such incorporated options with respect to their acquisition
of shares of Common Stock. 
  
 C. One or more provisions of the
Plan, including (without limitation) the option/vesting acceleration provisions of Article Two relating to Corporate Transactions and Changes in Control, may, in the Plan Administrator’s discretion, be extended to one or more options
incorporated from the Predecessor Plan which do not otherwise contain such provisions. 
  
 D. The Plan shall terminate upon the earliest of (i) December 31, 2005, (ii) the date on which all shares available for issuance under the Plan shall have been issued pursuant to the exercise of the
options or the issuance of shares (whether vested or unvested) under the Plan or (iii) the termination of all outstanding options in connection with a Corporate Transaction. Upon such Plan termination, all outstanding stock options and unvested
stock issuances shall continue to have force and effect in accordance with the provisions of the documents evidencing such options or issuances. 
  

	IV.	AMENDMENT OF THE PLAN 

  
 A. The Board shall have complete and exclusive power and authority to amend or modify the Plan in any or all respects. However, no such amendment or
modification shall adversely affect any rights and obligations with respect to options, stock appreciation rights or unvested stock issuances at the time outstanding under the Plan unless the Optionee or the Participant consents to such amendment or
modification. In addition, certain 

 amendments may require stockholder approval pursuant to applicable laws or regulations. Notwithstanding the foregoing,
the approval of the holders of not less than a majority of the outstanding common stock of the Corporation entitled to vote shall be required to take the following actions: 
  
 (i) amend the Plan to materially modify the requirements for eligibility under the Plan; 
  
 (ii) amend the Plan to materially increase the number of
shares of Common Stock which may be issued over the term of the Plan; or 
  
 (iii) amend the Plan to materially increase the benefits accruing to participants under the Plan as such benefits are currently set forth in the Plan. 
  
 B. Options to purchase shares of Common Stock may be granted under the Discretionary Option Grant Program and shares of
Common Stock may be issued under the Stock Issuance 
  
 Program
that are in each instance in excess of the number of shares then available for issuance under the Plan, provided any excess shares actually issued under those programs are held in escrow until there is obtained stockholder approval of an amendment
sufficiently increasing the number of shares of Common Stock available for issuance under the Plan. If such stockholder approval is not obtained within twelve (12) months after the date the first such excess grants or issuances are made, then
(i) any unexercised options granted on the basis of such excess shares shall terminate and cease to be outstanding and (ii) the Corporation shall promptly refund to the Optionees and the Participants the exercise or purchase price paid for
any excess shares issued under the Plan and held in escrow, together with interest (at the applicable Short-Term Federal Rate) for the period the shares were held in escrow, and such shares shall thereupon be automatically canceled and cease to be
outstanding. 
  

	V.	USE OF PROCEEDS 

  
 Any cash proceeds received by the Corporation from the sale of shares of Common Stock under the Plan shall be used for general corporate purposes.

  

	VI.	REGULATORY APPROVALS 

  
 A. The implementation of the Plan, the granting of any option or stock appreciation right under the Plan and the issuance of any shares of Common Stock
(i) upon the exercise of any option or stock appreciation right or (ii) under the Stock Issuance Program shall be subject to the Corporation’s procurement of all approvals and permits required by regulatory authorities having
jurisdiction over the Plan, the options and stock appreciation rights granted under it and the shares of Common Stock issued pursuant to it. 
  
 B. No shares of Common Stock or other assets shall be issued or delivered under the Plan unless and until there shall have been compliance with all
applicable requirements of Federal and state securities laws, including the filing and effectiveness of the Form S-8 registration statement for the shares of Common Stock issuable under the Plan, and all applicable listing requirements of any stock
exchange (or the Nasdaq National Market, if applicable) on which Common Stock is then listed for trading. 
  

	VII.	NO EMPLOYMENT/SERVICE RIGHTS 

  
 Nothing in the Plan shall confer upon the Optionee or the Participant any right to continue in Service for any period of specific duration or interfere
with or otherwise restrict in any way the rights of the Corporation (or any Parent or Subsidiary employing or retaining such person) or of the Optionee or the Participant, which rights are hereby expressly reserved by each, to terminate such
person’s Service at any time for any reason, with or without cause. 

 APPENDIX TO 1996 STOCK INCENTIVE PLAN 
  
 The following definitions shall be in effect under the Plan: 
  
 A. AUTOMATIC OPTION GRANT PROGRAM shall mean the automatic option grant program in effect under the Plan. 
  
 B. BOARD shall mean the Corporation’s Board of Directors. 
  
 C. CHANGE IN CONTROL shall mean a change in ownership or control of the
Corporation effected through either of the following transactions: 
  
 (i) the acquisition, directly or indirectly, by any person or related group of persons (other than the Corporation or a person that directly or indirectly controls, is controlled by, or is under common control with,
the Corporation), of beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities pursuant to
a tender or exchange offer made directly to the Corporation’s stockholders, or 
  
 (ii) a change in the composition of the Board over a period of thirty-six (36) consecutive months or less such that a majority of the
Board members ceases, by reason of one or more contested elections for Board membership, to be comprised of individuals who either (A) have been Board members continuously since the beginning of such period or (B) have been elected or
nominated for election as Board members during such period by at least a majority of the Board members described in clause (A) who were still in office at the time the Board approved such election or nomination. 
  
 D. CODE shall mean the Internal Revenue Code of 1986, as amended. 

 
 E. COMMON STOCK shall mean the Corporation’s common stock.

  
 F. CORPORATE TRANSACTION shall mean either of the following
stockholder-approved transactions to which the Corporation is a party: 
  
 (i) a merger or consolidation in which securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities are transferred to a person or
persons different from the persons holding those securities immediately prior to such transaction; or 
  
 (ii) the sale, transfer or other disposition of all or substantially all of the Corporation’s assets in complete liquidation or
dissolution of the Corporation. 
  
 G. CORPORATION shall mean
Polycom, Inc., a Delaware corporation, and any corporate successor to all or substantially all of the assets or voting stock of Polycom, Inc. which shall by appropriate action adopt the Plan. 
  
 H. DISCRETIONARY OPTION GRANT PROGRAM shall mean the discretionary option
grant program in effect under the Plan. 
  
 I. ELIGIBLE DIRECTOR
shall mean a non-employee Board member eligible to participate in the Automatic Option Grant Program in accordance with the eligibility provisions of Article One. 
  
 J. EMPLOYEE shall mean an individual who is in the employ of the Corporation (or any Parent or Subsidiary), subject to the
control and direction of the employer entity as to both the work to be performed and the manner and method of performance. 
  
 K. EXERCISE DATE shall mean the date on which the Corporation shall have received written notice of the option exercise. 

 L. FAIR MARKET VALUE per share of Common Stock on any relevant date shall be determined in accordance
with the following provisions: 
  
 (i) If the
Common Stock is at the time traded on the Nasdaq National Market, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question, as such price is reported by the National Association of Securities
Dealers on the Nasdaq National Market or any successor system. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price on the last preceding date for which such
quotation exists. 
  
 (ii) If the Common Stock is
at the time listed on any Stock Exchange, then the Fair Market Value shall be the closing selling price per share of Common Stock on the date in question on the Stock Exchange determined by the Plan Administrator to be the primary market for the
Common Stock, as such price is officially quoted in the composite tape of transactions on such exchange. If there is no closing selling price for the Common Stock on the date in question, then the Fair Market Value shall be the closing selling price
on the last preceding date for which such quotation exists. 
  
 (iii) For purposes of any option grants made on the Underwriting Date, the Fair Market Value shall be deemed to be equal to the price per share at which the Common Stock is to be sold in the initial public offering
pursuant to the Underwriting Agreement. 
  
 (iv)
For purposes of any option grants made prior to the Underwriting Date, the Fair Market Value shall be determined by the Plan Administrator, taking into account such factors as it deems appropriate. 
  
 M. HOSTILE TAKE-OVER shall mean a change in ownership of the Corporation
effected through the direct or indirect acquisition by any person or related group of persons (other than the Corporation or a person that directly or indirectly controls, is controlled by, or is under common control with, the Corporation) of
beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Corporation’s outstanding securities pursuant to a tender or exchange
offer made directly to the Corporation’s stockholders which the Board does not recommend such stockholders to accept. 
  
 N. INCENTIVE OPTION shall mean an option which satisfies the requirements of Code Section 422. 
  
 O. INVOLUNTARY TERMINATION shall mean the termination of the Service of any
individual which occurs by reason of: 
  
 (i)
such individual’s involuntary dismissal or discharge by the Corporation for reasons other than Misconduct, or 
  
 (ii) such individual’s voluntary resignation following (A) a change in his or her position with the Corporation which materially
reduces his or her level of responsibility, (B) a reduction in his or her level of compensation (including base salary, fringe benefits and participation in corporate-performance based bonus or incentive programs) by more than fifteen percent
(15%) or (C) a relocation of such individual’s place of employment by more than fifty (50) miles, provided and only if such change, reduction or relocation is effected by the Corporation without the individual’s consent.

  
 P. MISCONDUCT shall mean the commission of any act of fraud,
embezzlement or dishonesty by the Optionee or Participant, any unauthorized use or disclosure by such person of confidential information or trade secrets of the Corporation (or any Parent or Subsidiary), or any other intentional misconduct by such
person adversely affecting the business or affairs of the Corporation (or any Parent or Subsidiary) in a material manner. The foregoing definition shall not be deemed to be inclusive of all the acts or omissions which the Corporation (or any Parent
or Subsidiary) may consider as grounds for the dismissal or discharge of any Optionee, Participant or other person in the Service of the Corporation (or any Parent or Subsidiary). 
  
 Q. 1934 ACT shall mean the Securities Exchange Act of 1934, as amended. 

 R. NON-STATUTORY OPTION shall mean an option not intended to satisfy the requirements of Code
Section 422. 
  
 S. OPTIONEE shall mean any person to whom an
option is granted under the Discretionary Option Grant or Automatic Option Grant Program. 
  
 T. PARENT shall mean any corporation (other than the Corporation) in an unbroken chain of corporations ending with the Corporation, provided each corporation in the unbroken chain (other than the Corporation) owns, at
the time of the determination, 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. 
  
 U. PARTICIPANT shall mean any person who is issued shares of Common Stock under the Stock Issuance Program. 
  
 V. PERMANENT DISABILITY OR PERMANENTLY DISABLED shall mean the inability of
the Optionee or the Participant to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment expected to result in death or to be of continuous duration of twelve (12) months or more.
However, solely for the purposes of the Automatic Option Grant Program, Permanent Disability or Permanently Disabled shall mean the inability of the non-employee Board member to perform his or her usual duties as a Board member by reason of any
medically determinable physical or mental impairment expected to result in death or to be of continuous duration of twelve (12) months or more. 
  
 W. PLAN shall mean the Corporation’s 1996 Stock Incentive Plan, as set forth in this document. 
  
 X. PLAN ADMINISTRATOR shall mean the particular entity, whether the Board,
the Primary Committee or the Secondary Committee, which is authorized to administer the Discretionary Option Grant and Stock Issuance Programs with respect to one or more classes of eligible persons, to the extent such entity is carrying out its
administrative functions under those programs with respect to the persons under its jurisdiction. 
  
 Y. PLAN EFFECTIVE DATE shall mean March 5, 1996, the date on which the Plan was adopted by the Board. 
  
 Z. PREDECESSOR PLAN shall mean the Corporation’s existing 1991 Stock
Option Plan. 
  
 AA. PRIMARY COMMITTEE shall mean the committee of
two (2) or more non-employee Board members appointed by the Board to administer the Discretionary Option Grant and Stock Issuance Programs with respect to Section 16 Insiders. 
  
 AB. SECONDARY COMMITTEE shall mean a committee of at least one (1) Board member appointed by the Board to administer
the Discretionary Option Grant and Stock Issuance Programs with respect to eligible persons other than Section 16 Insiders. 
  
 AC. SECTION 12(g) REGISTRATION DATE shall mean the date on which the Common Stock was first registered under Section 12(g) of the 1934 Act.

  
 AD. SECTION 16 INSIDER shall mean an officer or director of
the Corporation subject to the short-swing profit liabilities of Section 16 of the 1934 Act. 
  
 AE. SERVICE shall mean the provision of services to the Corporation (or any Parent or Subsidiary) by a person in the capacity of an Employee, a
non-employee member of the board of directors or a consultant or independent advisor, except to the extent otherwise specifically provided in the documents evidencing the option grant or stock issuance. 

 AF. STOCK EXCHANGE shall mean either the American Stock Exchange or the New York Stock Exchange.

  
 AG. STOCK ISSUANCE AGREEMENT shall mean the agreement entered
into by the Corporation and the Participant at the time of issuance of shares of Common Stock under the Stock Issuance Program. 
  
 AH. STOCK ISSUANCE PROGRAM shall mean the stock issuance program in effect under the Plan. 
  
 AI. SUBSIDIARY shall mean any corporation (other than the Corporation) in an unbroken chain of corporations beginning with
the Corporation, provided each corporation (other than the last corporation) in the unbroken chain owns, at the time of the determination, 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. 
  
 AJ. TAKE-OVER
PRICE shall mean the GREATER of (i) the Fair Market Value per share of Common Stock on the date the option is surrendered to the Corporation in connection with a Hostile Take-Over or (ii) the highest reported price per share of Common
Stock paid by the tender offeror in effecting such Hostile Take-Over. However, if the surrendered option is an Incentive Option, the Take-Over Price shall not exceed the clause (i) price per share. 
  
 AK. TAXES shall mean the Federal, state and local income and employment tax
liabilities incurred by the holder of Non-Statutory Options or unvested shares of Common Stock in connection with the exercise of those options or the vesting of those shares. 
  
 AL. 10% STOCKHOLDER shall mean the owner of stock (as determined under Code Section 424(d)) possessing more than ten
percent (10%) of the total combined voting power of all classes of stock of the Corporation (or any Parent or Subsidiary). 
  
 AM. UNDERWRITING AGREEMENT shall mean the agreement between the Corporation and the underwriter or underwriters managing the initial public offering of
the Common Stock. 
  
 AN. UNDERWRITING DATE shall mean
April 29, 1996, the date on which the Underwriting Agreement was executed and priced in connection with an initial public offering of the Common Stock.

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