AMENDED AND RESTATED 2004
STOCK INCENTIVE PLAN
The purpose of
this Amended and Restated 2004 Stock Incentive Plan (the
“Plan”) of Blackboard Inc., a Delaware corporation (the
“Company”), is to advance the interests of the
Company’s stockholders by enhancing the Company’s
ability to attract, retain and motivate persons who make (or are
expected to make) important contributions to the Company by
providing such persons with equity ownership opportunities and
performance-based incentives and thereby better aligning the
interests of such persons with those of the Company’s
stockholders. Except where the context otherwise requires, the term
“Company” shall include any of the Company’s
present or future parent or subsidiary corporations as defined in
Sections 424(e) or (f) of the Internal Revenue Code of 1986,
as amended, and any regulations promulgated thereunder (the
“Code”) and any other business venture (including,
without limitation, joint venture or limited liability company) in
which the Company has a controlling interest, as determined by the
Board of Directors of the Company (the
“Board”).
All of the
Company’s employees, officers, directors, consultants and
advisors are eligible to receive options, stock appreciation
rights, restricted stock, restricted stock units and other
stock-based awards (each, an “Award”) under the Plan.
Each person who receives an Award under the Plan is deemed a
“Participant.”
3.
Administration and Delegation
(a)
Administration by Board of Directors . The Plan will be
administered by the Board. The Board shall have authority to grant
Awards and to adopt, amend and repeal such administrative rules,
guidelines and practices relating to the Plan as it shall deem
advisable. The Board may correct any defect, supply any omission or
reconcile any inconsistency in the Plan or any Award in the manner
and to the extent it shall deem expedient to carry the Plan into
effect and it shall be the sole and final judge of such expediency.
All decisions by the Board shall be made in the Board’s sole
discretion and shall be final and binding on all persons having or
claiming any interest in the Plan or in any Award. No director or
person acting pursuant to the authority delegated by the Board
shall be liable for any action or determination relating to or
under the Plan made in good faith. Discretionary grants to
non-employee directors shall be administered by a committee of
independent Board members, within the applicable definition of
independence under the applicable Nasdaq or stock exchange
rules.
(b)
Appointment of Committees . To the extent permitted by
applicable law, the Board may delegate any or all of its powers
under the Plan to one or more committees or subcommittees of the
Board (a “Committee”). All references in the Plan to
the “Board” shall mean the Board or a Committee of the
Board or the executive officers referred to in Section 3(c) to the
extent that the Board’s powers or authority under the Plan
have been delegated to such Committee or executive
officers.
(c) Delegation
to Executive Officers . To the extent permitted by applicable
law, the Board may delegate to one or more executive officers of
the Company the power to grant Awards to employees or officers of
the Company or any of its present or future subsidiary corporations
and to exercise such other powers under the Plan as the Board may
determine, provided that the Board shall fix the terms of the
Awards to be granted by such executive officers (including
the
exercise price
of such Awards, which may include a formula by which the exercise
price will be determined) and the maximum number of shares subject
to Awards that the executive officers may grant; provided further,
however, that no executive officer shall be authorized to grant
Awards to any “executive officer” of the Company (as
defined by Rule 3b-7 under the Securities Exchange Act of
1934, as amended (the “Exchange Act”)) or to any
“officer” of the Company (as defined by Rule 16a-1
under the Exchange Act).
4. Stock
Available for Awards
(a)
Number of Shares . Subject to adjustment under
Section 9, Awards may be made under the Plan for up to
10,500,000 shares of common stock, $0.01 par value per share, of
the Company (the “Common Stock”).
If any Award
expires or is terminated, surrendered or canceled without having
been fully exercised or is forfeited in whole or in part (including
as the result of shares of Common Stock subject to such Award being
repurchased by the Company at the original issuance price pursuant
to a contractual repurchase right) or results in any Common Stock
not being issued, the unused Common Stock covered by such Award
shall again be available for the grant of Awards under the Plan,
subject, however, in the case of Incentive Stock Options, to any
limitations under the Code. Upon exercise of a SAR (as hereinafter
defined), the Board may count such SAR against the Common Stock
available for grant under the Plan either (i) with respect to
the total number of shares subject to such SAR
(“Gross-Counted SARs”) or (ii) with respect only
to the number of shares actually issued pursuant to such exercise
(“Net-Counted SARs”), provided however that Net-Counted
SARs will also be counted against the sub-limit set forth in
Section 4(b)(2). Shares issued under the Plan may consist in
whole or in part of authorized but unissued shares or treasury
shares.
(b)
Sub-limits . Subject to adjustment under Section 9, the
following sub-limits on the number of shares subject to Awards
shall apply:
(1)
Section 162(m) Per-Participant Limit . The maximum
number of shares of Common Stock with respect to which Awards may
be granted to any Participant under the Plan shall be 471,923 per
calendar year. For purposes of the foregoing limit, the combination
of an Option in tandem with a SAR (as each is hereinafter defined)
shall be treated as a single Award. The per-Participant limit
described in this Section 4(b)(1) shall be construed and
applied consistently with Section 162(m) of the Code or any
successor provision thereto, and the regulations thereunder
(“Section 162(m)”).
(2)
Limit on Awards other than Options and SARs . The maximum
number of shares with respect to which Awards other than Options
and Gross-Counted SARs may be granted shall be 700,000.
(a)
General . The Board may grant options to purchase Common
Stock (each, an “Option”) and determine the number of
shares of Common Stock to be covered by each Option, the exercise
price of each Option and the conditions and limitations applicable
to the exercise of each Option, including conditions relating to
applicable federal or state securities laws, as it considers
necessary or advisable. An Option which is not intended to be an
Incentive Stock Option (as hereinafter defined) shall be designated
a “Nonstatutory Stock Option.”
(b)
Incentive Stock Options . An Option that the Board intends
to be an “incentive stock option” as defined in
Section 422 of the Code (an “Incentive Stock
Option”) shall only be granted to employees of Blackboard
Inc., any of Blackboard Inc.’s present or future parent or
subsidiary corporations as defined in Sections 424(e) or
(f) of the Code, and any other entities the employees of which
are eligible to receive Incentive Stock Options under the Code, and
shall be subject to and shall be construed consistently with the
requirements of Section 422 of the Code. The Company shall
have no liability to a Participant, or any other party, if an
Option (or any part thereof) that is intended to be an Incentive
Stock Option is not an Incentive Stock Option.
(c)
Exercise Price . The Board shall establish the exercise
price at the time each Option is granted and specify it in the
applicable option agreement. The exercise price per share shall not
be less than 100% of the market value on the date of grant. For
purposes of the Plan, “market value” shall mean the
last reported sale price as of the date of grant of the
Corporation’s common stock on the principal securities
exchange, inter-dealer quotation system or nationally recognized
trading system on which the stock is listed.
(d)
Duration of Options . Each Option shall be exercisable at
such times and subject to such terms and conditions as the Board
may specify in the applicable option agreement. Other than Options
granted prior to March 1, 2005, Options granted hereunder
shall expire no later than 8 years after the date of
grant.
(e)
Exercise of Option . Options may be exercised by delivery to
the Company of a written notice of exercise signed by the proper
person or by any other form of notice (including electronic notice)
approved by the Board together with payment in full as specified in
Section 5(f) for the number of shares for which the Option is
exercised.
(f)
Payment Upon Exercise. Common Stock purchased upon the
exercise of an Option granted under the Plan shall be paid for as
follows:
(1) in
cash or by check, payable to the order of the Company;
(2) except
as the Board may, in its sole discretion, otherwise provide in an
option agreement, by (i) delivery of an irrevocable and
unconditional undertaking by a creditworthy broker to deliver
promptly to the Company sufficient funds to pay the exercise price
and any required tax withholding or (ii) delivery by the
Participant to the Company of a copy of irrevocable and
unconditional instructions to a creditworthy broker to deliver
promptly to the Company cash or a check sufficient to pay the
exercise price and any required tax withholding;
(3) when
the Common Stock is registered under the Exchange Act and listed on
a national securities exchange, the NASDAQ National Market or
another nationally recognized trading system, by delivery of shares
of Common Stock owned by the Participant valued at the average of
the high and low reported sale prices per share of Common Stock
thereon on the trading day immediately preceding the date of
exercise (or, if no such price is reported on such day, the shares
of Common Stock shall be valued at their fair market value as
determined by, or in a manner approved by, the Board in good
faith), provided (i) such method of payment is then permitted
under applicable law and (ii) such Common Stock, if acquired
directly from the Company, was owned by the Participant at least
six months prior to such delivery;
(4) to
the extent permitted by applicable law and by the Board, in its
sole discretion by (i) delivery of a promissory note of the
Participant to the Company on terms
determined by
the Board, or (ii) payment of such other lawful consideration
as the Board may determine; or
(5) by
any combination of the above permitted forms of payment.
(g)
Substitute Options . In connection with a merger or
consolidation of an entity with the Company or the acquisition by
the Company of property or stock of an entity, the Board may grant
Options in substitution for any options or other stock or
stock-based awards granted by such entity or an affiliate thereof
(“Substitute Options”). Substitute Options may be
granted on such terms as the Board deems appropriate in the
circumstances, notwithstanding any limitations on Options contained
in the other sections of this Section 5 or in Section 2.
Substitute Options shall not count against the overall share limit
set forth in Section 4(a), except as may be required by reason
of Section 422 and related provisions of the Code.
(h)
Limitation . Other than adjustments pursuant to
Section 9 or actions approved by the Company’s
stockholders, outstanding Options shall not be amended to reduce
the exercise price per Share thereof and the Company shall not
implement an option exchange program pursuant to which an Option
could be exchanged for a new Option with a lower exercise price per
Share.
6. Stock
Appreciation Rights.
(a)
General . A Stock Appreciation Right, or SAR, is an Award
entitling the holder, upon exercise, to receive an amount in Common
Stock determined by reference to appreciation, from and after the
date of grant, in the fair market value of a share of Common Stock.
The base price from which such appreciation is measured shall not
be less than 100% of the market value on the date of grant, as
defined in Section 5(c). The date as of which such
appreciation or other measure is determined shall be the exercise
date. Stock Appreciation Rights granted hereunder shall expire no
later than 8 years after the date of grant.
(b)
Grants . Stock Appreciation Rights may be granted in tandem
with, or independently of, Options granted under the
Plan.
(1)
Tandem Awards . When Stock Appreciation Rights are
expressly granted in tandem with Options, (i) the Stock
Appreciation Right will be exercisable only at such time or times,
and to the extent, that the related Option is exercisable (except
to the extent designated by the Board in connection with a
Reorganization Event or a Change in Control Event) and will be
exercisable in accordance with the procedure required for exercise
of the related Option; (ii) the Stock Appreciation Right will
terminate and no longer be exercisable upon the termination or
exercise of the related Option, except to the extent designated by
the Board in connection with a Reorganization Event or a Change in
Control Event and except that a Stock Appreciation Right granted
with respect to less than the full number of shares covered by an
Option will not be reduced until the number of shares as to which
the related Option has been exercised or has terminated exceeds the
number of shares not covered by the Stock Appreciation Right;
(iii) the Option will terminate and no longer be exercisable
upon the exercise of the related Stock Appreciation Right; and
(iv) the Stock Appreciation Right will be transferable only
with the related Option.
(2)
Independent SARs . A Stock Appreciation Right not
expressly granted in tandem with an Option will become exercisable
at such time or times, and on such conditions, as the Board may
specify in the SAR Award.
(c)
Exercise . Stock Appreciation Rights may be exercised by
delivery to the Company of a written notice of exercise signed by
the proper person or by any other form of notice (including
electronic notice) approved by the Board, together with any other
documents required by the Board.
7. Restricted
Stock; Restricted Stock Units.
(a)
General . The Board may grant Awards entitling recipients to
acquire shares of Common Stock (“Restricted Stock”),
subject to the right of the Company to repurchase all or part of
such shares at their issue price or other stated or formula price
(or to require forfeiture of such shares if issued at no cost) from
the recipient in the event that conditions specified by the Board
in the applicable Award are not satisfied prior to the end of the
applicable restriction period or periods established by the Board
for such Award. Instead of granting Awards for Restricted Stock,
the Board may grant Awards entitling the recipient to receive
shares of Common Stock to be delivered at the time such shares of
Common Stock vest (“Restricted Stock Units”)
(Restricted Stock and Restricted Stock Units are each referred to
herein as a “Restricted Stock Award”).
(b) Terms
and Conditions . The Board shall determine the terms and
conditions of a Restricted Stock Award, including the conditions
for repurchase (or forfeiture) and the issue price, if
any.
(c) Stock
Certificates . Any stock certificates issued in respect of a
Restricted Stock Award shall be registered in the name of the
Participant and, unless otherwise determined by the Board,
deposited by the Participant, together with a stock power endorsed
in blank, with the Company (or its designee). At the expiration of
the applicable restriction periods, the Company (or such designee)
shall deliver the certificates no longer subject to such
restrictions to the Participant or if the Participant has died, to
the beneficiary designated, in a manner determined by the Board, by
a Participant to receive amounts due or exercise rights of the
Participant in the event of the Participant’s death (the
“Designated Beneficiary”). In the absence of an
effective designation by a Participant, “Designated
Beneficiary” shall mean the Participant’s
estate.
(d) Limitations
on Vesting.
(1) Restricted
Stock Awards that vest based on the passage of time alone shall not
provide for vesting in full in less than a three-year period from
the date of grant. Restricted Stock Awards that vest upon the
passage of time and provide for accelerated vesting based on
performance shall not vest prior to the first anniversary of the
date of grant. This subsection (d)(1) shall not apply to
(A) Awards granted pursuant to Section 10(j) or (B) a
maximum of 100,000 shares of Common Stock with respect to which
Restricted Stock Awards may be granted.
(2) Notwithstanding
any other provision of this Plan, the Board may, in its discretion,
either at the time a Restricted Stock Award is made or at any time
thereafter, waive its right to repurchase shares of Common Stock
(or waive the forfeiture thereof) or remove or modify any part or
all of the restrictions applicable to the Restricted Stock Award,
provided that the Board may only exercise such rights in the event
of death, disability or retirement of the
Participant; or
a merger, consolidation, sale, reorganization, recapitalization, or
change in control of the Company.
8. Other
Stock-Based Awards.
Other Awards of
shares of Common Stock, and other Awards that are valued in whole
or in part by reference to, or are otherwise based on, shares of
Common Stock or other property, may be granted hereunder to
Participants (“Other Stock Unit Awards”), including
without limitation Awards entitling recipients to receive shares of
Common Stock to be delivered in the future. Such Other Stock Unit
Awards shall also be available as a form of payment in the
settlement of other Awards granted under the Plan or as payment in
lieu of compensation to which a Participant is otherwise entitled.
Other Stock Unit Awards may be paid in shares of Common Stock or
cash, as the Board shall determine. Subject to the provisions of
the Plan, the Board shall determine the conditions of each Other
Stock Unit Awards, including any purchase price applicable
thereto.
9. Adjustments
for Changes in Common Stock and Certain Other Events
(a)
Changes in Capitalization . In the event of any stock split,
reverse s
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