0001104659-04-023671.txt : 20040810 0001104659-04-023671.hdr.sgml : 20040810 20040810165957 ACCESSION NUMBER: 0001104659-04-023671 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20040810 EFFECTIVENESS DATE: 20040810 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ADAPTEC INC CENTRAL INDEX KEY: 0000709804 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER COMMUNICATIONS EQUIPMENT [3576] IRS NUMBER: 942748530 STATE OF INCORPORATION: DE FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 333-118090 FILM NUMBER: 04965002 BUSINESS ADDRESS: STREET 1: 691 S MILPITAS BLVD STREET 2: M/S25 CITY: MILPITAS STATE: CA ZIP: 95035 BUSINESS PHONE: 4089458600 MAIL ADDRESS: STREET 1: 691 SOUTH MILPITAS BLVD STREET 2: M/S25 CITY: MILPITAS STATE: CA ZIP: 95035 S-8 1 a04-9182_1s8.htm S-8

As filed with the Securities and Exchange Commission on August 10, 2004

Registration No. 333-

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM S-8

REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933

ADAPTEC, INC.

(Exact Name of registrant as specified in its charter)

Delaware		94-2748530
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

691 S. Milpitas Blvd., Milpitas, California		95035
(Address of Principal Executive Offices)		(Zip Code)

Stock options granted pursuant to
The Broadband Storage, Inc. 2001 Stock Option and Restricted Stock Purchase Plan and
the Snap Appliance, Inc. 2002 Stock Option and Restricted Stock Purchase Plan

(Full titles of the plans)

Robert N. Stephens
President and Chief Executive Officer
Adaptec, Inc.
691 S. Milpitas Blvd.
Milpitas, California 95035
408-945-8600

(Name, address and telephone number, including area code, of agent for service)

Copies to:

Daniel J. Winnike, Esq.

R. Gregory Roussel, Esq.

Eugene Chung, Esq.

Fenwick & West LLP

Silicon Valley Center

801 California Street

Mountain View, California 94041

(Counsel to the Registrant)

CALCULATION OF REGISTRATION FEE

Title of each class of securities to be registered	Amount to be Registered (1)		Proposed maximum offering price per share			Proposed maximum aggregate offering price		Amount of registration fee
Common Stock, $0.001 par value	1,232,491	(2)	$	1.50	(3)	$	1,844,197	$	234

(1) Pursuant to Rule 416(a) this registrations statement also covers any additional securities that may be offered or issued as part of any stock split, stock dividend or similar transaction.

(2) Represents the number of shares of the Registrant’s common stock subject to outstanding options granted pursuant to the Broadband Storage, Inc. 2001 Stock Option and Restricted Stock Purchase Plan and the Snap Appliance, Inc. 2002 Stock Option and Restricted Stock Purchase Plan that were assumed in connection with the Registrant’s acquisition of Snap Appliance, Inc. on July 23, 2004.

(3) Estimated in accordance with Rule 457(h) under the Securities Act of 1933 (the “Securities Act”) solely for the purpose of calculating the registration fee, based on the weighted average exercise price per share of the outstanding options assumed by Registrant.

Adaptec, Inc.

REGISTRATION STATEMENT ON FORM S-8

PART I

INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

Item 1. Plan Information. (1)

Item 2. Registrant Information and Employee Plan Annual Information. (1)

(1) Information required by Part I to be contained in the Section 10(a) prospectus is omitted from the Registration Statement in accordance with Rule 428 under the Securities Act and the Note to Part I of Form S-8.

PART II

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3. Incorporation of Documents by Reference.

The following documents filed with the Securities and Exchange Commission (the “Commission”) are incorporated herein by reference:

(a) the Registrant’s latest annual report on Form 10-K for the fiscal year ended March 31, 2004, filed pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”), which contains audited financial statements for the Registrant’s latest fiscal year;

(b) all other reports filed pursuant to Sections 13(a) or 15(d) of the Exchange Act since the end of the fiscal year covered by the Registrant’s Annual Report referred to in (a) above; and

(c) Items 1 and 2 of the Registrant’s registration statement on Form 8-A filed July 20, 1992 pursuant to the Exchange Act and Exhibit No. 1 to Amendment No. 4 of the Registrant’s registration statement on Form 8-A filed January 14, 1997 amending its Form 8-A filed May 11, 1989.

All documents subsequently filed by the Registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act, prior to the filing of a post-effective amendment which indicates that all securities registered hereby have been sold or which deregisters all securities then remaining unsold, shall be deemed incorporated by reference herein and to be a part hereof from the date of the filing of such documents.

Item 4. Description of Securities.

Not applicable.

Item 5. Interests of Named Experts and Counsel.

Not applicable.

Item 6. Indemnification of Directors and Officers.

The Registrant’s Certificate of Incorporation limits the liability of directors to the maximum extent permitted by Delaware law. Delaware law provides that directors of a corporation will not be personally liable for monetary damages for a breach of their fiduciary duties as directors, except for liability (i) for any breach of their duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, (iii) for unlawful payments of dividends or unlawful stock repurchases or redemptions

as provided in Section 174 of the Delaware General Corporation Law, or (iv) for any transaction from which the director derived an improper personal benefit

The Registrant’s Amended and Restated Bylaws provide that the Registrant shall indemnify its directors and officers and may indemnify its employees and other agents to the fullest extent permitted by law. The Registrant’s Amended and Restated Bylaws also permit the Registrant to secure insurance on behalf of any officer, director, employee or other agent for any liability arising out of his or her actions in such capacity, regardless of whether the Registrant would have the power to indemnify him or her against such liability under the General Corporation Law of the State of Delaware. The Registrant currently has secured such insurance on behalf of its officers and directors.

The Registrant has entered into agreements to indemnify its directors and officers, in addition to indemnification provided for in the Registrant’s Amended and Restated Bylaws. Subject to certain conditions, these agreements, among other things, indemnify the Registrant’s directors and officers for certain expenses (including attorneys’ fees), judgments, fines and settlement amounts incurred by any such person in any action or proceeding, including any action by or in the right of the Registrant, arising out of such person’s services as a director or officer of the Registrant, any subsidiary of the Registrant or any other company or enterprise to which the person provides services at the request of the Registrant.

Item 7. Exemption From Registration Claimed.

Not applicable

Item 8. Exhibits.

Exhibit Number		Exhibit Description

4.01		Certificate of Incorporation of Registrant filed with the Delaware Secretary of State (incorporated by reference to Exhibit 3.1 to the Registrant’s Annual Report on Form 10-K for the year ended March 31, 1998).
4.02		Bylaws of Registrant, as amended (incorporated by reference to Exhibit 3.02 to the Registrant’s Annual Report on Form 10-K for the year ended March 31, 2004).
4.03		Broadband Storage, Inc. 2001 Stock Option and Restricted Stock Purchase Plan (and related forms of Option Agreements and Option Exercise Agreements).
4.04		Snap Appliance, Inc. 2002 Stock Option and Restricted Stock Purchase Plan (and related forms of Option Agreements and Option Exercise Agreements).

5.01		Opinion of Fenwick & West LLP.

23.01		Consent of Fenwick & West LLP (included in Exhibit 5.01).

23.02		Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm.

24.01		Power of Attorney (see signature page to this registration statement).

Item 9. Undertakings.

The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:

(i) To include any prospectus required by Section 10(a)(3) of the Securities Act;

(ii) To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in

the Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;

(iii) To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement.

provided, however, that paragraphs (1)(i) and (1)(ii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered that remain unsold at the termination of the offering.

The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant’s annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to Item 6, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Milpitas, State of California, on this 10^th day of August, 2004.

	ADAPTEC, INC.

	By:	/s/ Robert N. Stephens
		Robert N. Stephens
		President and Chief Executive Officer

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Robert N. Stephens and Marshall Mohr, and each of them acting individually, as his or her attorney-in- fact, each with full power of substitution, for him or her in any and all capacities, to sign any and all amendments to this Registration Statement on Form S-8, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or any substitute, may do or cause to be done by virtue hereof. This Power of Attorney may be executed in any number of counterparts, each of which when so executed and delivered shall be deemed an original, and such counterparts shall together constitute one and the same instrument.

Pursuant to the requirements of the Securities Act, this registration statement has been signed by the following persons in the capacities indicated on this 10^th day of August, 2004:

Signature		Title

Principal Executive Officer:

/s/ Robert N. Stephens		Chief Executive Officer and Director
Robert N. Stephens

Principal Accounting Officer:

/s/ Marshall Mohr		Chief Financial Officer
Marshall Mohr

Other Directors:

/s/ Carl J. Conti		Chairman of the Board of Directors
Carl J. Conti

/s/ Victoria L. Cotten		Director
Victoria L. Cotten

/s/ Lucie Fjeldstad		Director
Lucie Fjeldstad

/s/ Joseph S. Kennedy		Director
Joseph S. Kennedy

/s/ Ilene Lang		Director
Ilene Lang


/s/ Robert Loarie		Director
Robert Loarie

/s/ D. Scott Mercer		Director
D. Scott Mercer

/s/ Robert N. Stephens		Director
Robert N. Stephens

/s/ Douglas Van Houweling		Director
Douglas Van Houweling

EXHIBIT INDEX

Exhibit Number		Exhibit Description

4.01		Certificate of Incorporation of Registrant filed with the Delaware Secretary of State (incorporated by reference to Exhibit 3.1 to the Registrant’s Annual Report on Form 10-K for the year ended March 31, 1998).
4.02		Bylaws of Registrant, as amended (incorporated by reference to Exhibit 3.02 to the Registrant’s Annual Report on Form 10-K for the year ended March 31, 2004).
4.03		Broadband Storage, Inc. 2001 Stock Option and Restricted Stock Purchase Plan (and related forms of Option Agreements and Option Exercise Agreements).
4.04		Snap Appliance, Inc. 2002 Stock Option and Restricted Stock Purchase Plan (and related forms of Option Agreements and Option Exercise Agreements).

5.01		Opinion of Fenwick & West LLP.

23.01		Consent of Fenwick & West LLP (included in Exhibit 5.01).

23.02		Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm.

24.01		Power of Attorney (see signature page to this registration statement).

EX-4.03 2 a04-9182_1ex4d03.htm EX-4.03

Exhibit 4.03

BROADBAND STORAGE, INC.

2001 STOCK OPTION AND RESTRICTED STOCK PURCHASE PLAN

1. PURPOSE. The Broadband Storage, Inc. 2001 Stock Option and Restricted Stock Purchase Plan (the “Plan”) is intended to provide incentive to key employees, members of the Board of Directors (the “Board”) and consultants of Broadband Storage, Inc. a Delaware corporation (the “Company”), to encourage proprietary interest in the Company, to encourage such key employees and members of the Board to remain in the employ of the Company or such key consultants to remain in the service of the Company, and to attract new employees, managers and consultants with outstanding qualifications.

2. DEFINITIONS. Unless otherwise defined herein or the context otherwise requires, the capitalized terms used herein shall have the following meanings:

a. “Administrator” shall mean the Board or the Committee, whichever shall be administering the Plan from time to time in the discretion of the Board, as described in Section 4 of the Plan.

b. “Board” shall mean the Board of Directors of the Company.

c. “Cause” shall mean, as used in the context of termination of employment, that the Company (or its successor) (the “Employer”) has exercised its right to terminate an individual’s employment with the Employer for one or more of the following reasons: (1) engaging in any fraudulent act that is harmful to the Employer; (2) engaging in gross, willful or intentional misconduct that is harmful to the Employer; (3) willful failure to perform his/her duties; (4) habitual drunkenness at the office; (5) narcotics drug addiction, (6) any conviction of or a plea of “guilty” or “no contest” to a felony that is harmful to the Employer or (7) gross neglect of his/her duties.

d. “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

e. “Commission” shall mean the Securities and Exchange Commission.

f. “Committee” shall mean the committee, if any, appointed by the Board in accordance with Section 4 of the Plan.

g. “Company” shall mean Broadband Storage, Inc., a Delaware corporation.

h. “Corporate Transaction” shall mean a sale of all or substantially all of the Company’s assets, a merger into, consolidation with or any other reorganization in which the Company is not the surviving entity, or if the Company is the surviving entity, a change in the ultimate ownership of the outstanding equity securities of the Company following the transaction by fifty percent (50%) or more as a result of such transaction.

i. “Disability” shall mean a medically determinable physical or mental impairment which has made an individual incapable of performing his or her duties, as determined in good faith by the Administrator. A condition shall be considered a Disability if (i) it can be expected to result in death or has lasted or can be expected to last for a continuous period of not less than twelve (12) months, and (ii) the Administrator, based upon medical evidence, has expressly determined that a Disability exists.

j. “Employee” shall mean an individual who is employed (within the meaning of Section 3401 of the Code and the regulations thereunder) by the Company.

k. “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.

l. “Exercise Price” shall mean the price per Share, as determined by the Administrator, at which an Option may be exercised.

m. “Fair Market Value” shall mean the value of one (1) Share, determined as follows:

(i) If the Shares are (A) listed on an exchange, the closing price as reported for composite transactions on the business day immediately prior to the date of valuation or, if no sale occurred on that date, then the mean between the closing bid and asked prices on such exchange on such date, or (B) traded over-the-counter on the National Market System (the “NMS”) of the National Association of Securities Dealers, Inc. Automated Quotation System (“NASDAQ”), the last sale price on the business day immediately prior to the date of valuation or, if no sale occurred on such date, then the mean between the highest bid and lowest asked prices as of the close of business on the business day immediately prior to the date of valuation, as reported in NASDAQ;

(ii) If the Shares are not traded on an exchange or the NMS but are otherwise traded over-the-counter, the mean between the highest bid and lowest asked prices quoted in NASDAQ as of the close of business on the business day immediately prior to the date of valuation or, if on such day such Shares are not quoted in NASDAQ, the mean between the representative bid and asked prices on such date in the

domestic over-the-counter market as reported by the National Quotation Bureau, Inc., or any similar successor organization; or

(iii) If neither clause (i) nor (ii) above applies, the fair market value as determined by the Administrator in good faith. Such determination shall be conclusive and binding on all persons.

n. “Incentive Option” shall mean any Option which is intended to qualify under Section 422 of the Code as an “incentive stock option”.

o. “Incentive Option Agreement” shall mean a written option agreement evidencing a grant of an Incentive Option.

p. “Nonstatutory Option” shall mean any Option which is not intended to qualify under Section 422 of the Code as an “incentive stock option”.

q. “Nonstatutory Option Agreement” shall mean a written option agreement evidencing a grant of a Nonstatutory Option.

r. “Option” shall mean any Incentive Option or Nonstatutory Option granted pursuant to the Plan. An Option shall be granted as of the date the Administrator takes the necessary action to approve the grant. However, if the minutes or appropriate resolutions of the Administrator provide that an Option is to be granted as of a date in the future, the date of grant shall be that future date.

s. “Option Agreement” shall mean an Incentive Option Agreement or Nonstatutory Option Agreement.

t. “Option Purchase Price” shall mean the Exercise Price multiplied by the number of Shares with respect to which an Option is exercised.

u. “Optionee” shall mean a Participant who has received an Option.

v. “Participant” shall have the meaning assigned to it in Section 5(a) hereof.

w. “Parent” shall mean any corporation (other than the Company) in an unbroken chain of corporations ending with the Company, provided each corporation in the unbroken chain (other than the Company) 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.

x. “Plan” shall mean this Broadband Storage, Inc. 2001 Stock Option and Restricted Stock Purchase Plan, as it may be amended from time to time.

y. “Restricted Shares” shall mean restricted Shares purchased under and having the terms and conditions set forth in the Plan.

z. “Restricted Share Purchase Price” shall mean the purchase price per Restricted Share to be issued under the Plan, subject to adjustment for stock splits, stock combinations and the like.

aa. “Restricted Stock Agreement” shall mean a written restricted stock agreement evidencing the purchase of Restricted Shares.

bb. “Retirement” shall mean the voluntary cessation of employment by an Employee upon the attainment of age sixty-five (65) or thereafter and the completion of not less than three (3) years of service with the Company.

cc. “Securities Act” shall mean the Securities Act of 1933, as amended from time to time.

dd. “Shares” shall mean shares of common stock, par value $.001 per share, of the Company.

ee. “Subsidiary” shall mean any corporation (other than the Company) in an unbroken chain of corporations beginning with the Company, 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.

ff. “10% Shareholder” 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 Company (or any Parent or Subsidiary).

3. EFFECTIVE DATE. The Plan was adopted by the Board effective March 9, 2001 (the “Effective Date”).

4. ADMINISTRATION.

a. Administrator. The Plan shall be administered, in the discretion of the Board from time to time, by the Board or a Committee which shall be appointed by the Board. The Board may from time to time remove members from, or add members to, the Committee. Vacancies on the Committee, however caused, shall be filled by the persons already serving as members of the Board. The Board shall appoint one of the members of the Committee as Chairman. The Administrator shall hold meetings at such times and places as it may determine. Acts of a majority of the Administrator at which a quorum is present, or acts reduced to or approved in writing by

the unanimous consent of the members of the Administrator, shall be the valid acts of the Administrator.

b. Powers of Administrator. The Administrator shall from time to time at its discretion select the Employees, members of the Board and consultants who are to be granted Options or issued Restricted Shares and determine the number of Shares to be subject to Options to be granted to each Optionee or the number of Restricted Shares to be received. A Committee or Board member shall in no event participate in any determination relating to Options held by or to be granted, or Restricted Shares to be issued, to such Committee or Board member. The interpretation and construction by the Administrator of any provision of the Plan or of any Option Agreement or Restricted Stock Agreement shall be final. No member of the Administrator shall be liable for any action or determination made in good faith with respect to the Plan or any Options or Restricted Shares granted or issued thereunder.

5. PARTICIPATION.

a. Eligibility. The persons eligible to receive Options or purchase Restricted Shares shall be such persons (collectively, “Participants”; individually, a “Participant”) as the Administrator may select from among the following classes of persons, subject to the terms and conditions of Section 7 below:

(i) in the case of Nonstatutory Options and Restricted Shares, all officers (including officers who are members of the Board), other Employees, non-Employee directors and non-Employee consultants (including non-Employee consultants who are members of the Board) of the Company or any of its Subsidiaries or Parents; and

(ii) in the case of Incentive Options, all officers (including officers who are members of the Board) and other Employees of the Company or any of its Subsidiaries or Parents.

b. 10% Shareholders. To the extent required by the Code, a 10% Shareholder shall not be eligible to receive an Incentive Option unless (i) the Option Exercise Price of the shares subject to such Incentive Option is at least one hundred ten percent (110%) of the Fair Market Value on the date of grant, and (ii) such Incentive Option by its terms is not exercisable after the expiration of five (5) years from the date of grant.

6. SHARES. The Shares subject to Options and Restricted Shares purchased under the Plan shall be the Company’s unissued or reacquired Shares. The aggregate number of Shares which may be issued under the Plan shall not exceed One Million (1,000,000) Shares. The number of Shares subject to Options and available for purchase as Restricted Shares outstanding at any time shall not exceed the number of Shares remaining available for issuance under the Plan. Notwithstanding the foregoing,

at no time shall the total number of Shares issuable upon exercise of all outstanding Options and the total number of Shares provided for under any stock bonus or similar plan of the Company exceed a number of Shares equal to thirty percent (30%) of the then outstanding Shares (including Shares issuable upon the conversion of the Company’s convertible preferred stock), based on the shares which are outstanding at the time the calculation is made, unless approved by at least two-thirds of the outstanding shares of the Company entitled to vote. In the event any outstanding Option under the Plan for any reason expires or is canceled or terminated, or in the event that any Restricted Shares purchased under the Plan for any reason are reacquired by the Company, the Shares allocable to the unexercised portion of such Option, or the Restricted Shares so reacquired, may again be subjected to grant or issuance under the Plan. The Shares shall be subject to adjustment in the manner provided in Section 9 hereof upon the occurrence of an event specified in Section 9.

7. TERMS AND CONDITIONS OF OPTIONS AND RESTRICTED SHARES.

a. Options. Options granted under the Plan may be (i) Incentive Options, (ii) Nonstatutory Options, and (iii) combinations of the foregoing.

b. Option Agreements; Restricted Stock Agreements. Each Option and purchase of Restricted Shares shall be evidenced by a written Incentive Option Agreement, Nonstatutory Option Agreement or Restricted Stock Agreement, as the case may be, substantially in the form of Annex A, Annex B and Annex C, respectively, to this Plan, or in such other form as the Administrator shall from time to time determine. Such agreements need not be identical but shall comply with and be subject to the terms and conditions set forth in this Section 7.

c. Number of Shares. Each Option Agreement and Restricted Stock Agreement shall state the number of Shares or Restricted Shares, respectively, to which it pertains and shall provide that the adjustment thereof shall be subject to the provisions of Section 9 hereof.

d. Vesting of Options. Each Option shall become exercisable in one or more installments at such time or times and subject to such conditions, including, without limitation, the achievement of specified performance goals or objectives, as shall be determined by the Administrator and set forth in the applicable Incentive Option Agreement or Nonstatutory Option Agreement, as the case may be. Notwithstanding the foregoing, any Options granted under the Plan shall become exercisable at a minimum of twenty percent (20%) per year, unless earlier terminated.

which Incentive Options granted under this Plan become exercisable for the first time by an Optionee during any calendar year, shall not exceed $100,000.

f. Option Exercise Price. Each Option shall state the Option Exercise Price. In the case of a Nonstatutory Option, the Option Exercise Price shall not be less than eighty-five percent (85%) of the Fair Market Value on the date of grant. In the case of an Incentive Option, the Option Exercise Price shall not be less than the Fair Market Value on the date of grant. Notwithstanding the foregoing, the Option Exercise Price of any Incentive Option or Nonstatutory Option shall not be less than one hundred ten percent (110%) of the Fair Market Value if the Optionee is a 10% Shareholder.

g. Restricted Share Purchase Price. Each Restricted Stock Agreement shall state the Restricted Share Purchase Price. The Restricted Share Purchase Price shall not be less than eighty-five percent (85%) of the Fair Market Value, calculated on the date of purchase of the Restricted Shares; provided, however, that the Restricted Share Purchase Price shall not be less than one hundred ten percent (110%) of the Fair Market Value if the Participant is a 10% Shareholder.

h. Medium and Time of Payment; Notice. Upon the exercise of the Option or the issuance of Restricted Shares, the Option Purchase Price and the Restricted Share Purchase Price, as the case may be, shall be payable in full in United States dollars or, if permitted by the Administrator, by the issuance of a promissory note in a form acceptable to the Administrator.

In the event the Company determines that it is required to withhold state or Federal income tax as a result of the exercise of an Option or issuance of Restricted Shares, as a condition to the exercise or issuance thereof, a Participant must make arrangements satisfactory to the Company to enable it to satisfy such withholding requirements before the Participant shall be permitted to exercise the Option or purchase the Restricted Shares, as the case may be.

The Optionee shall exercise an Option by completing and delivering to the Company, concurrently with the payment of the Option Purchase Price in the manner described above, an exercise notice in such other form as the Administrator shall from time to time determine.

i. Term and Non-Transferability of Options. Subject to the acceleration provisions set forth in Section 9 or elsewhere in this Plan or in the applicable Option Agreement, each Option shall state the time or times when all or part thereof becomes exercisable. No Option shall be exercisable after the expiration of ten (10) years from the date it was granted; provided, however, to the extent required by the Code, no Incentive Option granted to a 10% Shareholder shall be exercisable after the expiration of five (5) years from the date it was granted. During the lifetime of the Optionee, the Option shall be exercisable only by the Optionee or the Optionee’s guardian or legal representative and shall not be assignable or transferable except by will

or by the laws of descent and distribution. Any other attempted alienation, assignment, pledge, hypothecation, attachment, execution or similar process, whether voluntary or involuntary, with respect to all or any part of any Option or right thereunder, shall be null and void and, at the Company’s option, shall cause all of the Optionee’s rights under the Option to terminate.

j. Vesting and Non-Transferability of Restricted Shares. Subject to the acceleration provisions set forth in Section 9 or elsewhere in this Plan or in the applicable Restricted Stock Agreement, each Restricted Stock Agreement shall state the time or times of vesting of Restricted Shares purchased thereunder. Until they become vested pursuant to the terms of the applicable Restricted Stock Agreement, a Participant shall not sell, transfer (including a transfer by operation of law), assign or pledge any or all of the Restricted Shares, and any sale, transfer, assignment or pledge of the Restricted Shares shall be void without the prior written consent of the Company, which may be withheld in the Company’s sole and absolute discretion. The Company shall not (A) transfer on its books any Restricted Shares which shall have been sold, transferred, assigned or pledged in violation of any of the provisions of this Agreement, or (B) treat as owner of such Restricted Shares or to accord the right to vote as such owner any transferee to whom such Restricted Shares shall have been so sold, transferred, assigned or pledged in violation of this Agreement. No Restricted Stock Agreement shall be assignable or transferable by the person receiving same except by will or the laws of descent and distribution. Any other attempted alienation, assignment, pledge, hypothecation, attachment, execution or similar process, whether voluntary or involuntary, with respect to all or any rights thereunder, shall be null and void and, at the Company’s option, shall cause all of the Participant’s rights thereunder to terminate.

k. Cessation of Employment (Except by Death, Disability or Retirement). If an Optionee ceases to be an Employee for any reason other than his or her death, Disability or Retirement, such Optionee shall have the right, subject to the restrictions referred to in Sections 7(d) and 7(i) above, to exercise its Option at any time within three (3) months after cessation of employment, but, except as otherwise provided in the applicable Option Agreement or in Sections 9 or 13 of this Plan, only to the extent that, at the date of cessation of employment, the Optionee’s right to exercise such Option had accrued pursuant to the terms of the applicable Option Agreement and/or this Plan and had not previously been exercised.

For purposes of this Section 7(k), the employment relationship shall be treated as continuing intact while the Participant is on military leave, sick leave or other bona fide leave of absence (to be determined in the sole discretion of the Administrator).

7(i) above, at any time within twelve (12) months after the Optionee’s death by the executor or administrator of his or her estate or by any person or persons who have acquired the Option directly from the Optionee by bequest or inheritance, but, except as otherwise provided in the applicable Option Agreement, only to the extent that, at the date of death, the Optionee’s right to exercise such Option had accrued and had not been forfeited pursuant to the terms of the applicable Option Agreement and had not previously been exercised.

m. Disability of Optionee. If an Optionee ceases to be an Employee by reason of Disability, such Optionee shall have the right, subject to the restrictions referred to in Sections 7(d) and 7(i) above, to exercise the Option at any time within twelve (12) months after such cessation of employment, but, except as provided in the applicable Option Agreement, only to the extent that, at the date of such cessation of employment, the Optionee’s right to exercise such Option had accrued pursuant to the terms of the applicable Option Agreement and had not previously been exercised.

n. Retirement of Optionee. If an Optionee ceases to be an Employee by reason of Retirement, such Optionee shall have the right, subject to the restrictions referred to in Sections 7(d) and 7(i) above, to exercise the Option at any time within three (3) months after such cessation of employment, but only to the extent that, at the date of such cessation of employment, the Optionee’s right to exercise such Option had accrued pursuant to the terms of the applicable Option Agreement and had not previously been exercised.

o. Rights as a Shareholder. No one shall have rights as a shareholder of the Company with respect to any Shares or Restricted Shares until the date of the issuance of a share certificate for such Shares or Restricted Shares. No adjustment shall be made for distributions (ordinary or extraordinary, whether in cash, securities or other property) or other rights for which the record date is prior to the date such certificate is issued, except as expressly provided in Section 9 hereof.

p. Other Provisions. An Option Agreement or Restricted Stock Agreement authorized under the Plan may contain such other provisions not inconsistent with the terms of the Plan (including, without limitation, restrictions upon the exercise of the Option and vesting of Restricted Shares) as the Administrator shall deem advisable.

Administrator may in its sole discretion take any action that it deems to be equitable under the circumstances or in the best interests of the Company, including without limitation, waiving or modifying any limitation or requirement, including accelerating the right to exercise, with respect to such Options, and accelerating the vesting with respect to such Restricted Shares, issued under this Plan.

8. TERM OF PLAN. The Plan shall be effective on the Effective Date and, unless earlier terminated in accordance with the terms hereof, shall terminate on March 9, 2011.

9. EFFECT OF CERTAIN EVENTS.

a. Reclassification of Shares. Except as set forth in Section 9(b) below, in the event that the outstanding Shares are hereafter increased or decreased or changed into or exchanged for a different number or kind of Shares or other securities of the Company by reason of merger, consolidation or reorganization in which the Company is the surviving entity or of a recapitalization, stock split, stock combination, reclassification, reincorporation, stock dividend or other change in the corporate structure of the Company (including, without limitation, the incorporation of the Company), appropriate adjustments shall be made by the Administrator in the aggregate number and kind of Shares subject to this Plan, and the number and kind of Shares and the price per share subject to outstanding Option and Restricted Stock Agreements in order to preserve, but not to increase, the benefits to persons then holding the Options and/or Restricted Shares.

b. Corporate Transaction. In the event of a Corporate Transaction, the following shall occur:

(i) Assumed/Substituted Plan. In the event of a Corporate Transaction, the surviving entity may elect to (x) continue the Plan, Options and unvested Restricted Shares or (y) substitute for the Options and unvested Restricted Shares new options and unvested securities, with appropriate adjustments as to the number and purchase price of such securities in order to preserve, but not to increase, the benefits to persons then holding the Options and/or Restricted Shares; provided, however, that the accrual of exercisability and/or vesting, as the case may be, shall continue in the manner set forth herein and/or in the applicable original Option Agreement or Restricted Stock Agreement except to the extent that such exercisability and/or vesting has been accelerated by the Administrator pursuant to this Section 9(b). Notwithstanding the foregoing, the Administrator, in such Administrator’s sole and absolute discretion, shall have the right to provide that the exercisability of any or all Options or vesting of any or all Restricted Shares shall be accelerated to accrue and/or vest upon the effective date of such Corporate Transaction. In any event, any continued Plan, Options and unvested Restricted Shares, or any substituted options or unvested securities, shall provide for full acceleration of vesting in the manner set forth below in Section 9(b)(iii) in the event that, on or after the occurrence of such Corporate Transaction, the Company (or its successor)

(A) terminates the employment of the Participant without Cause, or (B) substantially and without the Participant’s consent, reduces the base cash compensation received by the Participant in the course of such employment (unless all similarly situated employees are treated in the like manner).

(ii) Plan Not Assumed or Substituted. If provision is not made in a Corporate Transaction for the continuance of the Plan and the assumption of Options and Restricted Shares, or the substitution for such Options and Restricted Shares of new options and equity securities of a successor entity, then the Administrator shall cause written notice of such Corporate Transaction and the acceleration described herein (including the expiration of all unexercised Options following the closing of the Corporate Transaction) to be given to the persons holding Options and Restricted Shares not less than 10 days prior to the anticipated effective date of such Corporate Transaction. Immediately prior to the consummation of such Corporate Transaction, the exercisability of all Options and vesting of all Restricted Shares shall be accelerated in full and such persons shall have the right to exercise all or any portion of their Options at such time and/or shall hold entirely vested Restricted Shares. Upon the closing of such a Corporate Transaction, any unexercised Options shall expire.

(iii) Termination Without Cause. Notwithstanding anything to the contrary contained in this Plan and/or in the applicable Option Agreement or Restricted Stock Agreement, in the event that a Participant is terminated without Cause by the Employer on or after a Corporate Transaction, the exercisability and/or vesting of all such Participant’s Options and/or Restricted Shares shall be accelerated to accrue and/or vest, as applicable, in full immediately upon such date of termination without any additional action required on the part of the Administrator or the Employer.

c. Adjustment Determination. To the extent that the foregoing adjustments relate to securities of the Company, such adjustments shall be made by the Administrator, whose determination shall be conclusive and binding on all persons.

d. Limitation on Rights. Except as expressly provided in this Section 9, the Participant shall have no rights to the payment of any distribution in the form of Shares or any other increase or decrease in the number of Shares of any class or by reason of any dissolution, liquidation, merger or consolidation or spinoff of assets or stock of the Company. No adjustment by reason of any of the foregoing shall be made with respect to the number or Exercise Price of Shares subject to an Option Agreement or the number or Restricted Share Purchase Price of Restricted Shares subject to a Restricted Stock Agreement. The grant of an Option or issuance of Restricted Shares pursuant to the Plan shall not affect in any way the right or power of the Company to make adjustments, reclassifications, reorganizations or changes of its capital or business structure, to merge or consolidate or to dissolve, liquidate, sell or transfer all or any part of its business or assets.

10. SECURITIES LAW REQUIREMENTS.

a. Legality of Issuance. No Shares or Restricted Shares shall be issued under the Plan unless and until the Company has determined that:

(i) it and the Participant, as the case may be, have taken all actions required to register the offer and sale of the Shares or Restricted Shares under the Securities Act, or to perfect an exemption from the registration requirements thereof;

(ii) any applicable listing requirement of any stock exchange on which the Shares are listed has been satisfied; and

(iii) any other applicable provision of state or Federal law has been satisfied.

b. Restrictions on Transfer; Representations of Participant; Legends. Regardless of whether the offering and sale of Shares or Restricted Shares under the Plan has been registered under the Securities Act or has been registered or qualified under the securities laws of any state, the Company may impose restrictions upon the sale, pledge or other transfer of such Shares or Restricted Shares (including the placement of appropriate legends on certificates) if, in the judgment of the Company and its counsel, such restrictions are necessary or desirable in order to achieve compliance with the provisions of the Securities Act, the securities laws of any state or any other law. In the event that the issuance of Shares or Restricted Shares under the Plan is not registered under the Securities Act but an exemption is available which requires an investment representation or other representation, each Participant shall be required to represent that such Shares or Restricted Shares, as the case may be, are being acquired for investment, and not with a view to the sale or distribution thereof, and to make such other representations as are deemed necessary or appropriate by the Company and its counsel. Certificates evidencing Shares or Restricted Shares granted or acquired under the Plan pursuant to an unregistered transaction shall bear the following restrictive legend and such other restrictive legends as are required or deemed advisable under the provisions of any applicable law or agreement:

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR REGISTERED OR QUALIFIED UNDER ANY STATE SECURITIES LAW. ACCORDINGLY, THESE SECURITIES MAY NOT BE SOLD, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED UNLESS THEY HAVE FIRST BEEN REGISTERED UNDER THE SECURITIES ACT AND REGISTERED OR QUALIFIED UNDER ANY APPLICABLE STATE SECURITIES LAW OR UNLESS THE ISSUER, AFTER CONSULTATION WITH ITS COUNSEL, APPROVES SUCH TRANSACTION ON THE GROUNDS THAT REGISTRATION UNDER THE SECURITIES ACT AND REGISTRATION OR QUALIFICATION UNDER ANY APPLICABLE STATE SECURITIES LAW IS NOT REQUIRED. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF THE COMPANY’S 2001 STOCK OPTION AND RESTRICTED STOCK PURCHASE PLAN, DATED MARCH 9, 2001, COPIES OF WHICH ARE ON FILE WITH THE COMPANY.

c. Interpretation. Any determination by the Company and its counsel in connection with any of the matters set forth in this Section 10 shall be conclusive and binding on all persons.

d. Registration or Qualification of Securities. The Company may, but shall not be obligated to, register or qualify the sale of Shares or Restricted Shares under the Securities Act or any other applicable law. The Company shall not be obligated to take any affirmative action in order to cause the issuance of Shares or Restricted Shares under the Plan to comply with any law.

e. Exchange of Certificates. If, in the opinion of the Company and its counsel, any legend placed on a certificate representing Shares or Restricted Shares issued under the Plan is no longer required, the holder of such certificate shall be entitled to exchange such certificate for a certificate representing the same number of Shares or Restricted Shares but without such legend.

11. APPROVAL OF SHAREHOLDERS. The Plan must be approved on or before the one year anniversary of the Effective Date by the affirmative vote of the holders of a majority of the total combined voting power of all classes of stock of the Company. If such shareholder approval is not so obtained, (i) any Option exercised and any Restricted Shares purchased before such shareholder approval is obtained automatically shall be rescinded, and (ii) the Plan and all Options granted thereunder automatically shall be terminated.

12. FINANCIAL STATEMENTS. The Company shall provide Optionees, shareholders, and holders of Restricted Shares with financial statements, which may or may not be audited, at least annually.

13. REPURCHASE OPTION.

a. If the Participant’s service with the Company ceases due to a voluntary termination by Participant or termination by the Company for Cause, the Company shall have the unconditional right and option (the “Company Repurchase Option”) to repurchase all or any portion of the Shares and/or Restricted Shares acquired by the Participant under the Plan at a purchase price equal to (i) with respect to all Shares acquired upon the exercise of the Options and all vested Restricted Shares, the higher of (a) the purchase price paid by the Participant for such Shares or Restricted Shares or (b) the Fair Market Value, as of the date of such determination, of the Shares or Restricted shares, as the case may be, and (ii) with respect to all unvested Restricted Shares, at the applicable Restricted Shares Purchase Price (each, the “Repurchase Price”), which Repurchase Price shall be binding upon the Participant. The Company Repurchase Option must be exercised, if at all, (x) with respect to all Shares acquired on or before the date of such cessation upon the exercise of the Options and all Restricted Shares, within sixty (60) days after the date of such termination, and (y) with respect to all Shares acquired after the date of such cessation upon the exercise of the Options, within sixty (60) days after such exercise.

b. If the Company waives or fails to exercise the Company Repurchase Option with respect to any of the Shares and/or Restricted Shares acquired under the Plan within the period specified in subsection (a) of this Section 13, the Company Repurchase Option shall expire with respect to such Shares and/or Restricted Shares.

c. The Company Repurchase Option shall be exercised by giving written notice signed by an officer of the Company to the Participant in accordance with the provisions for giving notices in the applicable Option Agreement or Restricted Stock Agreement. Amounts due to the Participant from the Company as a result of the exercise of the Company Repurchase Option shall be payable, in the discretion of the Company, by cancellation of all or a portion of any outstanding purchase money indebtedness of the Participant to the Company or by check.

d. Nothing in this Section 13 or anything else in the Plan shall affect in any manner whatsoever the right or power of the Company (or a parent or subsidiary of the Company), which the Participant acknowledges is absolute and unconditional, to terminate the Participant’s service with the Company for any reason or no reason, with or without cause or prior notice.

e. Any other provision of this Section 13 notwithstanding, in the event that the Shares and/or Restricted Shares shall become listed on an established stock exchange or quoted on NASDAQ, the Company Repurchase Option shall terminate and no longer be in effect.

f. Notwithstanding the foregoing and provided that the Participant has remained in the Company’s service, (i) the Repurchase Option shall immediately terminate, and the Option shall accelerate and be immediately exercisable in full and the Restricted Shares shall immediately vest in full, immediately prior to the closing of a Corporate Transaction, unless (i) surviving entity desires that the Participant remain in the surviving entity’s service after the Corporate Transaction and (ii) the surviving entity continues the Plan and the Participant’s vesting and/or exercisability schedule thereunder or exchanges the Participant’s Options and unvested Restricted Shares for comparable options or unvested equity securities in the surviving entity’s stock option/restricted stock plan. To the extent the Repurchase Option remains in effect following a Corporate Transaction, such right shall apply to any new securities or other property (including any cash payments) received in exchange for the Shares in consummation of the Corporate Transaction. Appropriate adjustments shall be made to the price per share payable upon exercise of the Repurchase Option to reflect the effect of the Corporate Transaction upon the Company’s capital structure; provided, however, that the aggregate purchase price shall remain the same.

14. AMENDMENT AND TERMINATION OF THE PLAN. The Administrator may alter, amend, suspend or terminate the Plan in such respects as it deems advisable; provided, however, that no such alteration, amendment, suspension, or termination shall be made without the consent of the Participant if it substantially impairs any rights or obligations under any applicable Option Agreement or Restricted Stock Agreement.

15. GOVERNING LAW. This Plan, the Option Agreements and the Restricted Stock Agreements shall be governed by, and enforced and construed in accordance with the internal substantive laws (and not the laws of conflicts of laws) of the State of California.

	BROADBAND STORAGE, INC.


	/s/ John R. Staub
	Name: John R. Staub
	Title: President & CEO

ANNEX A

FORM OF INCENTIVE OPTION AGREEMENT

ANNEX B

FORM OF NONSTATUTORY OPTION AGREEMENT

ANNEX C

FORM OF RESTRICTED STOCK AGREEMENT

EX-4.04 3 a04-9182_1ex4d04.htm EX-4.04

Exhibit 4.04

SNAP APPLIANCE, INC.

2002 STOCK OPTION AND RESTRICTED STOCK PURCHASE PLAN

1. PURPOSE. The Snap Appliance, Inc. 2002 Stock Option and Restricted Stock Purchase Plan (the “Plan”) is intended to provide incentive to key employees, members of the Board of Directors (the “Board”) and consultants of Snap Appliance, Inc. a Delaware corporation (the “Company”), to encourage proprietary interest in the Company, to encourage such key employees and members of the Board to remain in the employ of the Company or such key consultants to remain in the service of the Company, and to attract new employees, managers and consultants with outstanding qualifications.

2. DEFINITIONS. Unless otherwise defined herein or the context otherwise requires, the capitalized terms used herein shall have the following meanings:

a. “Administrator” shall mean the Board or the Committee, whichever shall be administering the Plan from time to time in the discretion of the Board, as described in Section 4 of the Plan.

b. “Board” shall mean the Board of Directors of the Company.

d. “Code” shall mean the Internal Revenue Code of 1986, as amended from time to time.

e. “Commission” shall mean the Securities and Exchange Commission.

f. “Committee” shall mean the committee, if any, appointed by the Board in accordance with Section 4 of the Plan.

g. “Company” shall mean Snap Appliance, Inc., a Delaware corporation.

j. “Employee” shall mean an individual who is employed (within the meaning of Section 3401 of the Code and the regulations thereunder) by the Company.

k. “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.

l. “Exercise Price” shall mean the price per Share, as determined by the Administrator, at which an Option may be exercised.

m. “Fair Market Value” shall mean the value of one (1) Share, determined as follows:

domestic over-the-counter market as reported by the National Quotation Bureau, Inc., or any similar successor organization; or

(iii) If neither clause (i) nor (ii) above applies, the fair market value as determined by the Administrator in good faith. Such determination shall be conclusive and binding on all persons.

n. “Incentive Option” shall mean any Option which is intended to qualify under Section 422 of the Code as an “incentive stock option.”

o. “Incentive Option Agreement” shall mean a written option agreement evidencing a grant of an Incentive Option.

p. “Nonstatutory Option” shall mean any Option which is not intended to qualify under Section 422 of the Code as an “incentive stock option.”

q. “Nonstatutory Option Agreement” shall mean a written option agreement evidencing a grant of a Nonstatutory Option.

s. “Option Agreement” shall mean an Incentive Option Agreement or Nonstatutory Option Agreement.

t. “Option Purchase Price” shall mean the Exercise Price multiplied by the number of Shares with respect to which an Option is exercised.

u. “Optionee” shall mean a Participant who has received an Option.

v. “Participant” shall have the meaning assigned to it in Section 5(a) hereof.

x. “Plan” shall mean this Snap Appliance, Inc. 2002 Stock Option and Restricted Stock Purchase Plan, as it may be amended from time to time.

y. “Restricted Shares” shall mean restricted Shares purchased under and having the terms and conditions set forth in the Plan.

z. “Restricted Share Purchase Price” shall mean the purchase price per Restricted Share to be issued under the Plan, subject to adjustment for stock splits, stock combinations and the like.

aa. “Restricted Stock Agreement” shall mean a written restricted stock agreement evidencing the purchase of Restricted Shares.

cc. “Securities Act” shall mean the Securities Act of 1933, as amended from time to time.

dd. “Shares” shall mean shares of common stock, par value $.001 per share, of the Company.

3. EFFECTIVE DATE. The Plan was adopted by the Board effective November 14, 2002 (the “Effective Date”).

4. ADMINISTRATION.

the unanimous consent of the members of the Administrator, shall be the valid acts of the Administrator.

5. PARTICIPATION.

(ii) in the case of Incentive Options, all officers (including officers who are members of the Board) and other Employees of the Company or any of its Subsidiaries or Parents.

9,533,005(1) Shares. The number of Shares subject to Options and available for purchase as Restricted Shares outstanding at any time shall not exceed the number of Shares remaining available for issuance under the Plan. Notwithstanding the foregoing, at no time shall the total number of Shares issuable upon exercise of all outstanding Options and the total number of Shares provided for under any stock bonus or similar plan of the Company exceed a number of Shares equal to thirty percent (30%) of the then outstanding Shares (including Shares issuable upon the conversion of the Company’s convertible preferred stock), based on the shares which are outstanding at the time the calculation is made, unless approved by at least two-thirds of the outstanding shares of the Company entitled to vote. In the event any outstanding Option under the Plan for any reason expires or is canceled or terminated, or in the event that any Restricted Shares purchased under the Plan for any reason are reacquired by the Company, the Shares allocable to the unexercised portion of such Option, or the Restricted Shares so reacquired, may again be subjected to grant or issuance under the Plan. The Shares shall be subject to adjustment in the manner provided in Section 9 hereof upon the occurrence of an event specified in Section 9.

7. TERMS AND CONDITIONS OF OPTIONS AND RESTRICTED SHARES.

a. Options. Options granted under the Plan may be (i) Incentive Options, (ii) Nonstatutory Options, and (iii) combinations of the foregoing.

(1) Number of shares approved by Board of Directors and stockholders in June, 2003.

Notwithstanding the foregoing, any Options granted under the Plan shall become exercisable at a minimum of twenty percent (20%) per year, unless earlier terminated.

e. Annual Limit on Incentive Options. To the extent required for “incentive stock option” treatment under Section 422 of the Code, the aggregate Fair Market Value (determined as of the date of grant) of the common stock, with respect to which Incentive Options granted under this Plan become exercisable for the first time by an Optionee during any calendar year, shall not exceed $100,000.

becomes exercisable. No Option shall be exercisable after the expiration of ten (10) years from the date it was granted; provided, however, to the extent required by the Code, no Incentive Option granted to a 10% Shareholder shall be exercisable after the expiration of five (5) years from the date it was granted. During the lifetime of the Optionee, the Option shall be exercisable only by the Optionee or the Optionee’s guardian or legal representative and shall not be assignable or transferable except by will or by the laws of descent and distribution. Any other attempted alienation, assignment, pledge, hypothecation, attachment, execution or similar process, whether voluntary or involuntary, with respect to all or any part of any Option or right thereunder, shall be null and void and, at the Company’s option, shall cause all of the Optionee’s rights under the Option to terminate.

l. Death of Optionee. If an Optionee dies while a Participant, or after ceasing to be a Participant but during the period in which he or she could have exercised the Option under this Section 7, and has not fully exercised the Option, then the Option may be exercised in full, subject to the restrictions referred to in Sections 7(d) and 7(i) above, at any time within twelve (12) months after the Optionee’s death by the executor or administrator of his or her estate or by any person or persons who have acquired the Option directly from the Optionee by bequest or inheritance, but, except as otherwise provided in the applicable Option Agreement, only to the extent that, at the date of death, the Optionee’s right to exercise such Option had accrued and had not been forfeited pursuant to the terms of the applicable Option Agreement and had not previously been exercised.

q. Certain Terminations of Employment, Hardship and Approved Leaves of Absence. Notwithstanding any other provision of this Plan to the contrary, in the event of termination of employment by reason of death, disability, normal retirement, early retirement with the consent of the Company, termination of employment to enter public service with the consent of the Company, termination without cause or leave of absence approved by the Company, or in the event of hardship or other special circumstances, of an officer, manager or consultant of the Company who holds an Option that is not immediately and fully exercisable or unvested Restricted Shares, the Administrator may in its sole discretion take any action that it deems to be equitable under the circumstances or in the best interests of the Company, including without limitation, waiving or modifying any limitation or requirement, including accelerating the right to exercise, with respect to such Options, and accelerating the vesting with respect to such Restricted Shares, issued under this Plan.

8. TERM OF PLAN. The Plan shall be effective on the Effective Date and, unless earlier terminated in accordance with the terms hereof, shall terminate on November 14, 2012.

9. EFFECT OF CERTAIN EVENTS.

b. Corporate Transaction. In the event of a Corporate Transaction, the following shall occur:

accelerated by the Administrator pursuant to this Section 9(b). Notwithstanding the foregoing, the Administrator, in such Administrator’s sole and absolute discretion, shall have the right to provide that the exercisability of any or all Options or vesting of any or all Restricted Shares shall be accelerated to accrue and/or vest upon the effective date of such Corporate Transaction. In any event, any continued Plan, Options and unvested Restricted Shares, or any substituted options or unvested securities, shall provide for full acceleration of vesting in the manner set forth below in Section 9(b)(iii) in the event that, on or after the occurrence of such Corporate Transaction, the Company (or its successor) (A) terminates the employment of the Participant without Cause, or (B) substantially and without the Participant’s consent, reduces the base cash compensation received by the Participant in the course of such employment (unless all similarly situated employees are treated in the like manner).

(ii) Plan Not Assumed or Substituted. If provision is not made in a Corporate Transaction for the continuance of the Plan and the assumption of Options and Restricted Shares, or the substitution for such Options and Restricted Shares of new options and equity securities of a successor entity, then the Plan and each Option outstanding under the Plan at the time of the Corporate Transaction shall terminate and cease to be outstanding; provided, however, that immediately prior to the consummation of such Corporate Transaction, the exercisability of all Options and vesting of all Restricted Shares shall be accelerated in full and each person holding Options and Restricted Shares shall have the right to exercise all or any portion of their Options at such time and/or shall hold entirely vested Restricted Shares. Upon the closing of such a Corporate Transaction, any unexercised Options shall expire.

the number or Restricted Share Purchase Price of Restricted Shares subject to a Restricted Stock Agreement. The grant of an Option or issuance of Restricted Shares pursuant to the Plan shall not affect in any way the right or power of the Company to make adjustments, reclassifications, reorganizations or changes of its capital or business structure, to merge or consolidate or to dissolve, liquidate, sell or transfer all or any part of its business or assets.

10. SECURITIES LAW REQUIREMENTS.

a. Legality of Issuance. No Shares or Restricted Shares shall be issued under the Plan unless and until the Company has determined that:

(ii) any applicable listing requirement of any stock exchange on which the Shares are listed has been satisfied; and

(iii) any other applicable provision of state or Federal law has been satisfied.

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR REGISTERED OR QUALIFIED UNDER ANY STATE

SECURITIES LAW. ACCORDINGLY, THESE SECURITIES MAY NOT BE SOLD, PLEDGED, HYPOTHECATED, OR OTHERWISE TRANSFERRED UNLESS THEY HAVE FIRST BEEN REGISTERED UNDER THE SECURITIES ACT AND REGISTERED OR QUALIFIED UNDER ANY APPLICABLE STATE SECURITIES LAW OR UNLESS THE ISSUER, AFTER CONSULTATION WITH ITS COUNSEL, APPROVES SUCH TRANSACTION ON THE GROUNDS THAT REGISTRATION UNDER THE SECURITIES ACT AND REGISTRATION OR QUALIFICATION UNDER ANY APPLICABLE STATE SECURITIES LAW IS NOT REQUIRED. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE TERMS AND CONDITIONS OF THE COMPANY’S 2002 STOCK OPTION AND RESTRICTED STOCK PURCHASE PLAN, DATED MARCH 9, 2002, COPIES OF WHICH ARE ON FILE WITH THE COMPANY.

c. Interpretation. Any determination by the Company and its counsel in connection with any of the matters set forth in this Section 10 shall be conclusive and binding on all persons.

12. FINANCIAL STATEMENTS. The Company shall provide Optionees and holders of Restricted Shares with financial statements, which may or may not be audited, at least annually.

13. REPURCHASE OPTION.

a. If the Participant’s service with the Company ceases due to a voluntary termination by Participant or termination by the Company for Cause, the

Company shall have the unconditional right and option (the “Company Repurchase Option”) to repurchase all or any portion of the Shares and/or Restricted Shares acquired by the Participant under the Plan at a purchase price equal to (i) with respect to all Shares acquired upon the exercise of the Options and all vested Restricted Shares, the higher of (a) the purchase price paid by the Participant for such Shares or Restricted Shares or (b) the Fair Market Value, as of the date of such determination, of the Shares or Restricted shares, as the case may be, and (ii) with respect to all unvested Restricted Shares, at the applicable Restricted Shares Purchase Price (each, the “Repurchase Price”), which Repurchase Price shall be binding upon the Participant. The Company Repurchase Option must be exercised, if at all, (x) with respect to all Shares acquired on or before the date of such cessation upon the exercise of the Options and all Restricted Shares, within sixty (60) days after the date of such termination, and (y) with respect to all Shares acquired after the date of such cessation upon the exercise of the Options, within sixty (60) days after such exercise.

remain in the surviving entity’s service after the Corporate Transaction and (ii) the surviving entity continues the Plan and the Participant’s vesting and/or exercisability schedule thereunder or exchanges the Participant’s Options and unvested Restricted Shares for comparable options or unvested equity securities in the surviving entity’s stock option/restricted stock plan. To the extent the Repurchase Option remains in effect following a Corporate Transaction, such right shall apply to any new securities or other property (including any cash payments) received in exchange for the Shares in consummation of the Corporate Transaction. Appropriate adjustments shall be made to the price per share payable upon exercise of the Repurchase Option to reflect the effect of the Corporate Transaction upon the Company’s capital structure; provided, however, that the aggregate purchase price shall remain the same.

	SNAP APPLIANCE, INC.


	By:	/s/ Eric Kelly
	Name: Eric Kelly
	Title: President & CEO

EX-5.01 4 a04-9182_1ex5d01.htm EX-5.01

EXHIBIT 5.01

August 9, 2004

Adaptec, Inc.

691 South Milpitas Blvd.

Milpitas, California 95053

Gentlemen/Ladies:

At your request, we have examined the Registration Statement on Form S-8 (the “Registration Statement”) to be filed by Adaptec, Inc., a Delaware corporation (the “Company”), with the Securities and Exchange Commission (the “Commission”) on or about August 10, 2004 in connection with the registration under the Securities Act of 1933, as amended, of an aggregate of 1,232,491 shares of the Company’s Common Stock (the “Stock”). The shares of Stock consist of: 1,232,491 shares of common stock subject to issuance by the Company upon the exercise of stock options (the “Options”) assumed by the Company under the Broadband Storage, Inc. 2001 Stock Option Plan and Restricted Stock Purchase Plan and the Snap Appliance, Inc. 2002 Stock Option and Restricted Stock Purchase Plan (the “Stock Plans”) in accordance with the terms of the Agreement and Plan of Merger dated July 13, 2004 by and between the Company and Snap Appliance, Inc. (the “Merger Agreement”). In rendering this opinion, we have examined such matters of fact as we have deemed necessary in order to render the opinion set forth herein, which included examination of the following.

(1) the Company’s Certificate of Incorporation, certified by the Delaware Secretary of State on July 23, 2004;

(2) the Company’s Bylaws, represented by you to be true and complete as of July 23, 2004;

(3) the Registration Statement, together with the Exhibits filed as a part thereof or incorporated therein by reference.

(4) the Prospectuses prepared in connection with the Registration Statement.

(5) Resolutions adopted by the Board of Directors on June 9, 2004 funished to us by the Company.

(6) the stock records that the Company has provided to us (consisting of a certificate from the Company’s transfer agent of even date herewith verifying the number of the Company’s issued and outstanding shares of capital stock as of the date hereof and the number of shares reserved for issuance in connection with the Stock Plan and any other rights to purchase capital stock), and a list of option and warrant holders respecting the Company’s capital and of any other rights to purchase capital stock that was prepared by the Company and dated as of August 3, 2004 verifying the number of such issued and outstanding securities.

(7) a Management Certificate addressed to us and dated of even date herewith executed by the Company containing certain factual representations (the “Management Certificate”).

In our examination of documents for purposes of this opinion, we have assumed, and express no opinion as to, the genuineness of all signatures on original documents, the authenticity and completeness of all documents submitted to us as originals, the conformity to originals and completeness of all documents submitted to us as copies, the legal capacity of all persons or entities executing the same. We have also assumed that the certificates representing the Stock have been, or will be when issued, properly signed by authorized officers of the Company or their agents.

As to matters of fact relevant to this opinion, we have relied solely upon our examination of the documents referred to above and have assumed the current accuracy and completeness of the information obtained from the documents referred to above and the representations and warranties made by representatives of the Company to us, including but not limited to those set forth in the Management Certificate. We have made no independent investigation or other attempt to verify the accuracy of any of such information or to determine the existence or non-existence of any other factual matters; however, we are not aware of any facts that would cause us to believe that the opinion expressed herein is not accurate.

We are admitted to practice law in the State of California, and we render this opinion only with respect to, and express no opinion herein concerning the application or effect of the laws of any jurisdiction other than, the existing laws of the United States of America, of the State of California, and with respect to the validity of corporate action and the requirements for the issuance of stock, the State of Delaware.

Based upon the foregoing, it is our opinion that the 1,232,491 shares of Stock that may be issued and sold by the Company upon the exercise of (a) stock options and purchase rights granted under the Stock Plans, when issued, sold and delivered in accordance with the applicable plan and purchase agreements to be entered into thereunder and in the manner and for the consideration stated in the Registration Statement and Prospectus, will be validly issued, fully paid and nonassessable.

We consent to the use of this opinion as an exhibit to the Registration Statement and further consent to all references to us, if any, in the Registration Statement, the Prospectus constituting a part thereof and any amendments thereto. This opinion is intended solely for use in connection with issuance and sale of shares subject to the Registration Statement and is not to be relied upon for any other purpose. We assume no obligation to advise you of any fact, circumstance, event or change in the law or the facts that may hereafter be brought to our attention whether or not such occurrence would affect or modify the opinions expressed herein.

	Very truly yours,

	/s/ FENWICK & WEST LLP

	FENWICK & WEST LLP

EX-23.02 5 a04-9182_1ex23d02.htm EX-23.02

EXHIBIT 23.02

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the incorporation by reference in this Registration Statement on Form S-8 of our report dated June 10, 2004 relating to the financial statements and financial statement schedule of Adaptec, Inc., which appears in Adaptec, Inc.’s Annual Report on Form 10-K for the year ended March 31, 2004.

/s/ PricewaterhouseCoopers LLP

San Jose, California

August 6, 2004