exv10w13
Exhibit 10.13
eBay
Inc.
2001 Equity Incentive
Plan, As Amended
Initial
Stockholder Approval on May 25, 2001
Amendment Adopted by the Board of Directors on March 14,
2002
Stockholder Approval of Amendment on June 5, 2002
Amendment Adopted by the Compensation Committee as of
March 18, 2003
Stockholder Approval of Amendment on June 26, 2003
Amendment Adopted by the Compensation Committee on
March 18, 2004
Stockholder Approval of Amendment on June 24, 2004
Amendment Adopted By the Compensation Committee on
March 21, 2006
Stockholder Approval of Amendment on June 13, 2006
Amendment Adopted By the Compensation Committee on
January 10, 2007
Termination
Date: March 21, 2011
1. Purposes.
(a) Eligible Option Recipients. The
persons eligible to receive Options are the Employees, Directors
and Consultants of the Company and its Affiliates.
(b) Available Options. The purpose of the
Plan is to provide a means by which eligible recipients of
Options may be given an opportunity to benefit from increases in
value of the Common Stock through the granting of
(i) Incentive Stock Options and (ii) Nonstatutory
Stock Options.
(c) General Purpose. The Company, by
means of the Plan, seeks to retain the services of the group of
persons eligible to receive Options, to secure and retain the
services of new members of this group and to provide incentives
for such persons to exert maximum efforts for the success of the
Company and its Affiliates.
2. Definitions.
(a) “Affiliate” means any parent
corporation or subsidiary corporation of the Company, whether
now or hereafter existing, as those terms are defined in
Sections 424(e) and (f), respectively, of the Code, and any
other entity which is controlled, directly or indirectly, by the
Company.
(b) “Board” means the Board of Directors
of the Company.
(c) “Code” means the United States
Internal Revenue Code of 1986, as amended.
(d) “Committee” means a committee of one
or more members of the Board appointed by the Board in
accordance with subsection 3(c).
(e) “Common Stock” means the common stock
of the Company.
(f) “Company” means eBay Inc., a Delaware
corporation.
(g) “Consultant” means any natural person,
including an advisor, (i) engaged by the Company or an
Affiliate to render consulting or advisory services and who is
compensated for such services, or (ii) who is a member of
the Board of Directors or comparable governing body of an
Affiliate and who is compensated for such services. However, the
term “Consultant” shall not include Directors who are
not compensated by the Company for their services as Directors.
In addition, the payment of a director’s fee by the Company
for services as a Director shall not cause a Director to be
considered a “Consultant” for purposes of the Plan.
(h) “Continuous Service” means that the
Optionholder’s service with the Company or an Affiliate,
whether as an Employee, Director or Consultant, is not
interrupted or terminated. The Optionholder’s Continuous
Service shall not be deemed to have terminated merely because of
a change in the capacity in which the Optionholder renders
service to the Company or an Affiliate as an Employee,
Consultant or Director or a change in the entity for which the
Optionholder renders such service, provided that there is no
interruption or termination of the Optionholder’s service
with the Company or an Affiliate. For example, a change in
status from an Employee of the Company to a Consultant of an
Affiliate or a Director will not constitute an interruption of
Continuous Service. The Board or the chief executive officer of
the Company, in that party’s sole discretion, may determine
whether Continuous Service shall be considered interrupted in
the case of any leave of absence approved by that party,
including sick leave, military leave or any other personal leave.
(i) “Covered Employee” means the chief
executive officer and the four (4) other highest
compensated officers of the Company for whom total compensation
is required to be reported to stockholders under the Exchange
Act, as determined for purposes of Section 162(m) of the
Code.
(j) “Director” means a member of the Board
of Directors of the Company.
(k) “Disability” means the inability of a
natural person to continue to perform services for the Company
or any Affiliate of the type previously performed prior to the
occurrence of such Disability, whether as a result of physical
and/or
mental illness or injury, as determined by a physician
acceptable to the Company, for a period that is expected to be
of a duration of no less than six (6) months.
(l) “Employee” means any person employed
for tax purposes by the Company or an Affiliate. Mere service as
a Director or payment of a director’s fee by the Company or
an Affiliate shall not be sufficient to constitute
“employment” by the Company or an Affiliate.
(m) “Equity Restructuring” means a
non-reciprocal transaction (i.e. a transaction in which the
Company does not receive consideration or other resources in
respect of the transaction approximately equal to and in
exchange for the consideration or resources the Company is
relinquishing in such transaction) between the Company and its
stockholders, such as a stock split, spin-off, rights offering,
nonrecurring stock dividend or recapitalization through a large,
nonrecurring cash dividend, that affects the shares of Common
Stock (or other securities of the Company) or the share price of
Common Stock (or other securities) and causes a change in the
per share value of the Common Stock underlying outstanding
Options.
(n) “Exchange Act” means the United States
Securities Exchange Act of 1934, as amended.
(o) “Fair Market Value” means, as of any
date, the value of the Common Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or traded on the Nasdaq National Market or the Nasdaq
SmallCap Market, the Fair Market Value of a share of Common
Stock shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the greatest
volume of trading in the Common Stock) on the last market
trading day prior to the day of determination, as reported in
The Wall Street Journal or such other source as the Board
deems reliable.
(ii) In the absence of such markets for the Common Stock,
the Fair Market Value shall be determined in good faith by the
Board.
(p) “Incentive Stock Option” means an
Option intended to qualify as an incentive stock option within
the meaning of Section 422 of the Code and the regulations
promulgated thereunder.
(q) “Non-Employee Director” means a
Director who either (i) is not a current Employee or
Officer of the Company or its parent or a subsidiary, does not
receive compensation (directly or indirectly) from the Company
or its parent or a subsidiary for services rendered as a
consultant or in any capacity other than as a Director (except
for an amount as to which disclosure would not be required under
Item 404(a) of
Regulation S-K
promulgated pursuant to the Securities Act
(“Regulation S-K”)),
does not possess an interest in any other transaction as to
which disclosure would be required under Item 404(a) of
Regulation S-K
and is not engaged in a business relationship as to which
disclosure would be required under Item 404(b) of
Regulation S-K;
or (ii) is otherwise considered a “non-employee
director” for purposes of
Rule 16b-3.
(r) “Nonstatutory Stock Option” means an
Option not intended to qualify as an Incentive Stock Option.
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(s) “Officer” means a person who is an
officer of the Company within the meaning of Section 16 of
the Exchange Act and the rules and regulations promulgated
thereunder.
(t) “Option” means an Incentive Stock
Option or a Nonstatutory Stock Option granted pursuant to
Section 6 of the Plan.
(u) “Option Agreement” means a written
agreement between the Company and an Optionholder evidencing the
terms and conditions of an individual Option grant. Each Option
Agreement shall be subject to the terms and conditions of the
Plan.
(v) “Optionholder” means a person to whom
an Option is granted pursuant to the Plan or, if applicable,
such other person who holds an outstanding Option.
(w) “Outside Director” means a Director
who either (i) is not a current employee of the Company or
an “affiliated corporation” (within the meaning of
Treasury Regulations promulgated under Section 162(m) of
the Code), is not a former employee of the Company or an
“affiliated corporation” receiving compensation for
prior services (other than benefits under a tax qualified
pension plan), was not an officer of the Company or an
“affiliated corporation” at any time and is not
currently receiving direct or indirect remuneration from the
Company or an “affiliated corporation” for services in
any capacity other than as a Director or (ii) is otherwise
considered an “outside director” for purposes of
Section 162(m) of the Code.
(x) “Plan” means this eBay Inc. 2001
Equity Incentive Plan, as amended.
(y) “Rule 16b-3”
means
Rule 16b-3
promulgated under the Exchange Act or any successor to
Rule 16b-3,
as in effect from time to time.
(z) “Securities Act” means the United
States Securities Act of 1933, as amended.
(aa) “Ten Percent Stockholder” means a
person who owns (or is deemed to own pursuant to
Section 424(d) of the Code) stock possessing more than ten
percent (10%) of the total combined voting power of all classes
of stock of the Company or of any of its Affiliates.
3. Administration.
(a) Administration by Board. The Board
shall administer the Plan unless and until the Board delegates
administration to a Committee, as provided in
subsection 3(c).
(b) Powers of Board. The Board shall have
the power, subject to, and within the limitations of, the
express provisions of the Plan:
(i) To determine from time to time which of the persons
eligible under the Plan shall be granted Options; when and how
each Option shall be granted; what type or combination of types
of Option shall be granted; the provisions of each Option
granted (which need not be identical), including the time or
times when a person shall be permitted to receive Common Stock
pursuant to an Option; and the number of shares of Common Stock
with respect to which an Option shall be granted to each such
person.
(ii) To construe and interpret the Plan and Options granted
under it, and to establish, amend and revoke rules and
regulations for its administration. The Board, in the exercise
of this power, may correct any defect, omission or inconsistency
in the Plan or in any Option Agreement, in a manner and to the
extent it shall deem necessary or expedient to make the Plan
fully effective.
(iii) To amend the Plan or an Option as provided in
Section 11.
(iv) To terminate or suspend the Plan as provided in
Section 12.
(v) Generally, to exercise such powers and to perform such
acts as the Board deems necessary or expedient in its sole
discretion to promote the best interests of the Company and its
stockholders that are not in conflict with the provisions of the
Plan.
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(c) Delegation to Committee.
(i) General. The Board may delegate
administration of the Plan to a Committee or Committees of one
(1) or more members of the Board, and the term
“Committee” shall apply to any person or persons to
whom such authority has been delegated. If administration is
delegated to a Committee, the Committee shall have, in
connection with the administration of the Plan, the powers
theretofore possessed by the Board, including the power to
delegate to a subcommittee of one (1) or more members of
the Board any of the administrative powers the Committee is
authorized to exercise (and references in this Plan to the Board
shall thereafter be to the Committee or subcommittee), subject,
however, to such resolutions, not inconsistent with the
provisions of the Plan, as may be adopted from time to time by
the Board. The Board may abolish the Committee at any time and
revest in the Board the administration of the Plan.
(ii) Committee Composition when Common Stock is Publicly
Traded. At such time as the Common Stock is
publicly traded, in the discretion of the Board, a Committee may
consist solely of two (2) or more Outside Directors, in
accordance with Section 162(m) of the Code,
and/or
solely of two or more Non-Employee Directors, in accordance with
Rule 16b-3.
Within the scope of such authority, the Board or the Committee
may (1) delegate to a committee of one or more members of
the Board who are not Outside Directors the authority to grant
Options to eligible persons who are either (a) not then
Covered Employees and are not expected to be Covered Employees
at the time of recognition of income resulting from such Option
or (b) not persons with respect to whom the Company wishes
to comply with Section 162(m) of the Code
and/or
(2) delegate to a committee of one or more members of the
Board who are not Non-Employee Directors the authority to grant
Options to eligible persons who are not then subject to
Section 16 of the Exchange Act.
(d) Effect of Board’s Decision. All
determinations, interpretations and constructions made by the
Board in good faith shall not be subject to review by anyone and
shall be final, binding and conclusive on all Optionholders and
any other person having an interest in such determination,
interpretation or construction.
4. Shares Subject
to the Plan.
(a) Share Reserve. Subject to the
provisions of Section 10 relating to adjustments upon
changes in Common Stock, the Common Stock that may be issued
pursuant to Options shall not exceed in the aggregate Two
Hundred Twenty Two Million
(222,000,000)1
shares of Common Stock.
(b) Reversion of Shares to the Share
Reserve. If any Option shall for any reason
expire or otherwise terminate, in whole or in part, without
having been exercised in full, the shares of Common Stock not
acquired under such Option shall revert to and again become
available for issuance under the Plan.
(c) Source of Shares. The shares of
Common Stock subject to the Plan may be unissued shares or
reacquired shares, bought on the market or otherwise.
5. Eligibility.
(a) Eligibility for Specific
Options. Incentive Stock Options may be granted
only to Employees. Nonstatutory Stock Options may be granted to
Employees, Directors and Consultants.
(b) Non-Employee
Directors. Notwithstanding the provisions of
subsection 5(a) hereof, a Director who is not an Employee
only may be granted nondiscretionary Options that the
Stockholders have approved as to the following option
provisions: Number of shares, date of automatic grant, term,
exercise price, consideration, vesting schedule, exercise
schedule, and the post-termination exercise periods.
(c) Ten Percent
Stockholders. Notwithstanding the provisions of
subsection 5(a) hereof, a Ten Percent Stockholder shall not
be granted an Incentive Stock Option unless the exercise price
of such Option is at least one hundred ten percent (110%) of the
Fair Market Value of the Common Stock at the date of grant and
the Option is not exercisable after the expiration of five
(5) years from the date of grant.
1 Denotes
that such share number reflects the stock split of eBay’s
common stock occurring in 8/03 and 2/05.
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(d) Section 162(m)
Limitation. Notwithstanding the provisions of
subsection 5(a) hereof and subject to the provisions of
Section 10 relating to adjustments upon changes in the
shares of Common Stock, no Employee shall be eligible to be
granted Options covering more than Four Million
(4,000,000)1
shares of Common Stock during any calendar year.
(e) Consultants. Notwithstanding the
provisions of subsection 5(a) hereof, a Consultant shall
not be eligible for the grant of an Option if, at the time of
grant, a
Form S-8
Registration Statement under the Securities Act
(“Form S-8”)
is not available to register either the offer or the sale of the
Company’s securities to such Consultant because of the
nature of the services that the Consultant is providing to the
Company, or because the Consultant is not a natural person, or
as otherwise provided by the rules governing the use of
Form S-8.
6. Option
Provisions.
Each Option shall be in such form and shall contain such terms
and conditions as the Board shall deem appropriate. All Options
shall be separately designated Incentive Stock Options or
Nonstatutory Stock Options at the time of grant, and, if
certificates are issued, a separate certificate or certificates
will be issued for shares of Common Stock purchased on exercise
of each type of Option. The provisions of separate Options need
not be identical, but each Option shall include (through
incorporation of provisions hereof by reference in the Option or
otherwise) the substance of each of the following provisions:
(a) Term. Subject to the provisions of
subsection 5(c) regarding Ten Percent Stockholders, no
Option shall be exercisable after the expiration of ten
(10) years from the date it was granted.
(b) Exercise Price.
(i) Subject to the provisions of subsection 5(c)
regarding Ten Percent Stockholders and subsection 6(b)(ii)
below, the exercise price of each Option shall be not less than
one hundred percent (100%) of the Fair Market Value of the
Common Stock subject to the Option on the date the Option is
granted.
(ii) An Option may be granted with an exercise price lower
than that set forth in subsection 6(b)(i) above if such
Option is granted pursuant to an assumption or substitution for
another option in a manner satisfying the provisions of
Section 424(a) of the Code.
(c) Consideration.
(i) The purchase price of Common Stock acquired pursuant to
an Option shall be paid, to the extent permitted by applicable
statutes and regulations, either (i) in cash at the time
the Option is exercised or (ii) at the discretion of the
Board at the time of the grant of the Option (or subsequently in
the case of a Nonstatutory Stock Option) (1) by delivery to
the Company, or attestation to the Company of ownership, of
other Common Stock or (2) in any other form of legal
consideration that may be acceptable to the Board.
(ii) Unless otherwise specifically provided, the purchase
price of Common Stock acquired pursuant to an Option that is
paid by delivery to the Company, or attestation to the Company
of ownership, of other Common Stock shall be paid only by shares
of the Common Stock of the Company that have been held for more
than six (6) months (or such longer or shorter period of
time required to avoid a charge to earnings for financial
accounting purposes).
(d) Transferability of an Incentive Stock
Option. An Incentive Stock Option shall not be
transferable except by will or by the laws of descent and
distribution and shall be exercisable during the lifetime of the
Optionholder only by the Optionholder. Notwithstanding the
foregoing, the Optionholder may, by delivering written notice to
the Company, in a form satisfactory to the Company, designate a
third party who, in the event of the death of the Optionholder,
shall thereafter be entitled to exercise the Option.
(e) Transferability of a Nonstatutory Stock
Option. A Nonstatutory Stock Option shall be
transferable to the extent provided in the Option Agreement. If
the Nonstatutory Stock Option does not provide for
1 Denotes
that such share number reflects the stock split of eBay’s
common stock occurring in 8/03 and 2/05.
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transferability, then the Nonstatutory Stock Option shall not be
transferable except by will or by the laws of descent and
distribution and shall be exercisable during the lifetime of the
Optionholder only by the Optionholder. Notwithstanding the
foregoing, the Optionholder may, by delivering written notice to
the Company, in a form satisfactory to the Company, designate a
third party who, in the event of the death of the Optionholder,
shall thereafter be entitled to exercise the Option.
(f) Vesting Generally. The total number
of shares of Common Stock subject to an Option may, but need
not, vest and therefore become exercisable in periodic
installments that may, but need not, be equal. The Option may be
subject to such other terms and conditions on the time or times
when it may be exercised (which may be based on performance or
other criteria) as the Board may deem appropriate. The vesting
provisions of individual Options may vary. The provisions of
this subsection 6(f) are subject to any Option provisions
governing the minimum number of shares of Common Stock as to
which an Option may be exercised.
(g) Termination of Continuous Service. In
the event an Optionholder’s Continuous Service terminates
(other than upon the Optionholder’s death or Disability),
the Optionholder may exercise his or her Option (to the extent
that the Optionholder was entitled to exercise such Option as of
the date of termination) but only within such period of time
ending on the earlier of (i) the date three (3) months
following the termination of the Optionholder’s Continuous
Service (or such longer or shorter period specified in the
Option Agreement), or (ii) the expiration of the term of
the Option as set forth in the Option Agreement. If, after
termination, the Optionholder does not exercise his or her
Option within the time specified in the Option Agreement, the
Option shall terminate.
(h) Extension of Termination Date. An
Optionholder’s Option Agreement may also provide that if
the exercise of the Option following the termination of the
Optionholder’s Continuous Service (other than upon the
Optionholder’s death or Disability) would be prohibited at
any time solely because the issuance of shares of Common Stock
would violate the registration requirements under the Securities
Act, then the Option shall terminate on the earlier of
(i) the expiration of the term of the Option or
(ii) the expiration of a period of three (3) months
after the termination of the Optionholder’s Continuous
Service during which the exercise of the Option would not be in
violation of such registration requirements.
(i) Disability of Optionholder. In the
event that an Optionholder’s Continuous Service terminates
as a result of the Optionholder’s Disability, the
Optionholder may exercise his or her Option (to the extent that
the Optionholder was entitled to exercise such Option as of the
date of termination), but only within such period of time ending
on the earlier of (i) the date twelve (12) months
following such termination (or such longer or shorter period
specified in the Option Agreement), or (ii) the expiration
of the term of the Option as set forth in the Option Agreement.
If, after termination, the Optionholder does not exercise his or
her Option within the time specified herein, the Option shall
terminate.
(j) Death of Optionholder. In the event
(i) an Optionholder’s Continuous Service terminates as
a result of the Optionholder’s death or (ii) the
Optionholder dies within the period (if any) specified in the
Option Agreement after the termination of the
Optionholder’s Continuous Service for a reason other than
death, then the Option may be exercised (to the extent the
Optionholder was entitled to exercise such Option as of the date
of death) by the Optionholder’s estate, by a person who
acquired the right to exercise the Option by bequest or
inheritance or by a person designated to exercise the option
upon the Optionholder’s death, but only within the period
ending on the earlier of (1) the date eighteen
(18) months following the date of death (or such longer or
shorter period specified in the Option Agreement) or
(2) the expiration of the term of such Option as set forth
in the Option Agreement. If, after death, the Option is not
exercised within the time specified herein, the Option shall
terminate.
7. Covenants
of the Company.
(a) Availability of Shares. During the
terms of the Options, the Company shall keep available at all
times the number of shares of Common Stock required to satisfy
such Options.
(b) Securities Law Compliance. The
Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may
be required to grant Options and to issue and sell
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shares of Common Stock upon exercise of the Options; provided,
however, that this undertaking shall not require the Company to
register under the Securities Act the Plan, any Option or any
Common Stock issued or issuable pursuant to any such Option. If,
after reasonable efforts, the Company is unable to obtain from
any such regulatory commission or agency the authority which
counsel for the Company deems necessary for the lawful issuance
and sale of Common Stock under the Plan, the Company shall be
relieved from any liability for failure to issue and sell Common
Stock upon exercise of such Options unless and until such
authority is obtained.
8. Use
of Proceeds from Stock.
Proceeds from the sale of Common Stock pursuant to Options shall
constitute general funds of the Company.
9. Miscellaneous.
(a) Stockholder Rights. No Optionholder
shall be deemed to be the holder of, or to have any of the
rights of a holder with respect to, any shares of Common Stock
subject to such Option unless and until such Optionholder has
satisfied all requirements for exercise of the Option pursuant
to its terms.
(b) No Employment or other Service
Rights. Nothing in the Plan or any instrument
executed or Option granted pursuant thereto shall confer upon
any Optionholder any right to continue to serve the Company or
an Affiliate in the capacity in effect at the time the Option
was granted or shall affect the right of the Company or an
Affiliate to terminate (i) the employment of an Employee
with or without notice and with or without cause, for any reason
or no reason, (ii) the service of a Consultant pursuant to
the terms of such Consultant’s agreement with the Company
or an Affiliate or (iii) the service of a Director pursuant
to the Bylaws of the Company or an Affiliate, and any applicable
provisions of the corporate law of the jurisdiction in which the
Company or the Affiliate is incorporated, as the case may be.
(c) Incentive Stock Option $100,000
Limitation. To the extent that the aggregate Fair
Market Value (determined at the time of grant) of Common Stock
with respect to which Incentive Stock Options are exercisable
for the first time by any Optionholder during any calendar year
(under all plans of the Company and its Affiliates) exceeds one
hundred thousand dollars ($100,000), the Options or portions
thereof which exceed such limit (according to the order in which
they were granted) shall be treated as Nonstatutory Stock
Options.
(d) Investment Assurances. The Company
may require an Optionholder, as a condition of exercising an
Option or acquiring Common Stock under any Option, (i) to
give written assurances satisfactory to the Company as to the
Optionholder’s knowledge and experience in financial and
business matters
and/or to
employ a purchaser representative reasonably satisfactory to the
Company who is knowledgeable and experienced in financial and
business matters and that he or she is capable of evaluating,
alone or together with the purchaser representative, the merits
and risks of exercising the Option; (ii) to give written
assurances satisfactory to the Company stating that the
Optionholder is acquiring Common Stock subject to the Option for
the Optionholder’s own account and not with any present
intention of selling or otherwise distributing the Common Stock;
and/or
(iii) to give such other written assurances as the Company
shall determine are necessary, desirable or appropriate to
comply with applicable securities regulation and other governing
law. The Company may, upon advice of counsel to the Company,
place legends on stock certificates issued under the Plan as
such counsel deems necessary or appropriate in order to comply
with applicable securities laws, including, but not limited to,
legends restricting the transfer of the Common Stock.
(e) Withholding Obligations. To the
extent provided by the terms of an Option Agreement, the
Optionholder may satisfy any tax withholding obligation arising
under the laws or regulations of any country, state or local
jurisdiction relating to the exercise or acquisition of Common
Stock under an Option by any of the following means (in addition
to the Company’s right to withhold from any compensation
paid to the Optionholder by the Company) or by a combination of
such means: (i) tendering a cash payment;
(ii) authorizing the Company to withhold shares of Common
Stock from the shares of Common Stock otherwise issuable to the
Optionholder as a result of the exercise or acquisition of
Common Stock under the Option; provided, however, that no shares
of Common Stock are withheld with a value exceeding the minimum
amount of tax required to be withheld by law (or such lesser
amount as may be required to avoid variable award accounting);
or (iii) delivering to the Company owned and unencumbered
shares of Common Stock.
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10. Adjustments
upon Changes in Stock.
(a) Capitalization Adjustments. In the
event that any dividend or other distribution, reorganization,
merger, consolidation, combination, repurchase, or exchange of
Common Stock or other securities of the Company, or other change
in the corporate structure of the Company affecting the Common
Stock (other than an Equity Restructuring) occurs 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
Common Stock which may be delivered under the Plan, the exercise
price per share and the number of shares covered by each Option
which has not been exercised, and the numerical limits of
Sections 4(a) and 5(d).
(b) Dissolution or Liquidation. In the
event of a dissolution or liquidation of the Company, then all
outstanding Options shall terminate immediately prior to such
event.
(c) Corporate Transaction. In the event
of (i) a sale, lease or other disposition of all or
substantially all of the assets of the Company, (ii) a
merger or consolidation in which the Company is not the
surviving corporation, or (iii) a reverse merger in which
the Company is the surviving corporation but the shares of
Common Stock outstanding immediately preceding the merger are
converted by virtue of the merger into other property, whether
in the form of securities, cash or otherwise, then any surviving
corporation or acquiring corporation shall assume or continue
any Options outstanding under the Plan or shall substitute
similar stock awards (including an award to acquire the same
consideration paid to the stockholders in the transaction
described in this subsection 10(c)) for those outstanding
under the Plan. In the event any surviving corporation or
acquiring corporation refuses to assume or continue such Options
or to substitute similar stock awards for those outstanding
under the Plan, then with respect to Options held by
Optionholders whose Continuous Service has not terminated, the
vesting of such Options (and, if applicable, the time during
which such Options may be exercised) shall be accelerated in
full, and the Options shall terminate if not exercised (if
applicable) at or prior to such event. With respect to any other
Options outstanding under the Plan, such Options shall terminate
if not exercised (if applicable) at or prior to such event.
(d) Equity Restructuring Adjustments. In
connection with the occurrence of any Equity Restructuring, and
notwithstanding anything to the contrary in Section 10(a)
and 10(c) the number and type of securities subject to each
outstanding Option and the exercise price thereof will be
equitably adjusted by the Committee. The adjustments provided
under this Section 10(d) shall be nondiscretionary and
shall be final and binding on the affected Optionholder and the
Company.
11. Amendment
of the Plan and Options.
(a) Amendment of Plan. The Board at any
time, and from time to time, may amend the Plan. However, except
as provided in Section 10 relating to adjustments upon
changes in Common Stock, no amendment shall be effective unless
approved by the stockholders of the Company to the extent
stockholder approval is necessary under applicable laws or
regulations or to the extent that such amendment constitutes a
material amendment of the Plan.
(b) Stockholder Approval. The Board may,
in its sole discretion, submit any other amendment to the Plan
for stockholder approval, including, but not limited to,
amendments to the Plan intended to satisfy the requirements of
Section 162(m) of the Code and the regulations thereunder
regarding the exclusion of performance-based compensation from
the limit on corporate deductibility of compensation paid to
certain executive officers. Notwithstanding any other provision
of the Plan to the contrary, the Board shall not, without prior
stockholder approval, (A) reduce the exercise price of any
outstanding Option under the Plan, (B) cancel any
outstanding Option under the Plan and grant in substitution
therefor, on either an immediate or delayed basis, a new Option
under the Plan covering the same or a different number of shares
of Common Stock or cash, or (C) take any other action with
respect to any outstanding Option under the Plan that is treated
as a repricing of such Option pursuant to generally accepted
accounting principles.
(c) Contemplated Amendments. It is
expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide
eligible Employees with the maximum benefits provided or to be
provided under the provisions of the Code and the regulations
promulgated thereunder relating to Incentive Stock Options
and/or to
bring the Plan
and/or
Incentive Stock Options granted under it into compliance
therewith.
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(d) No Impairment of Rights. Rights under
any Option granted before amendment of the Plan shall not be
impaired by any amendment of the Plan unless (i) the
Company requests the consent of the Optionholder and
(ii) the Optionholder consents in writing.
(e) Amendment of Options. The Board at
any time, and from time to time, may amend the terms of any one
or more Options; provided, however, that the rights under any
Option shall not be impaired by any such amendment unless
(i) the Company requests the consent of the Optionholder
and (ii) the Optionholder consents in writing.
12. Termination
or Suspension of the Plan.
(a) Plan Term. The Board may suspend or
terminate the Plan at any time. Unless sooner terminated, the
Plan shall terminate on the day before the tenth (10th)
anniversary of the date the Plan is adopted by the Board or
approved by the stockholders of the Company, whichever is
earlier. No Options may be granted under the Plan while the Plan
is suspended or after it is terminated.
(b) No Impairment of Rights. Suspension
or termination of the Plan shall not impair rights and
obligations under any Option granted while the Plan is in effect
except with the written consent of the Optionholder.
13. Effective
Date of Plan.
The Plan shall become effective as determined by the Board, but
no Option shall be exercised unless and until the Plan has been
approved by the stockholders of the Company, which approval
shall be within twelve (12) months before or after the date
the Plan is adopted by the Board.
14. Choice
of Law.
The law of the State of Delaware shall govern all questions
concerning the construction, validity and interpretation of this
Plan, without regard to such state’s conflict of laws rules.
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