Onyx
Pharmaceuticals, Inc.
2005 Equity Incentive
Plan
Adopted
by the Board of Directors: April 18, 2005
Approved by the
Stockholders: June 1, 2005
Amended by the Board of
Directors: March 6, 2007
Approved by the
Stockholders: May 25, 2007
Amended by the Board of
Directors: May 25, 2007
Amended by the Board of
Directors: February 7, 2008
Amended by the Board of
Directors: March 21, 2008
Approved by the
Stockholders: May 14, 2008
Amended by the Board of
Directors: March 12, 2009
Approved by the
Stockholders: May 26, 2009
Termination Date:
April 17, 2015
(a) Successor and Continuation of Prior Plans. The Plan
is intended as the successor to and continuation of the Onyx
Pharmaceuticals, Inc. 1996 Equity Incentive Plan and the Onyx
Pharmaceuticals, Inc. 1996 Non-Employee Directors’ Stock
Option Plan (collectively, the “ Prior Plans
”). Following the effective date of this Plan, no additional
stock awards shall be granted under the Prior Plans. Any shares
remaining available for issuance pursuant to the exercise of
options or settlement of stock awards under the Prior Plans shall
be added to the share reserve of this Plan and available for
issuance pursuant to Stock Awards granted hereunder. All
outstanding stock awards granted under the Prior Plans shall remain
subject to the terms of the Prior Plans. Any shares subject to
outstanding stock awards granted under the Prior Plans that expire
or terminate for any reason prior to exercise or settlement shall
be added to the share reserve of this Plan and become available for
issuance pursuant to Stock Awards granted hereunder. All Stock
Awards granted subsequent to the effective date of this Plan shall
be subject to the terms of this Plan.
(b) Eligible Stock Award Recipients. The persons
eligible to receive discretionary Stock Awards are Employees,
Directors and Consultants. The persons eligible to receive
non-discretionary Stock Awards under the Non-Discretionary Grant
Program are Eligible Directors.
(c) Available Stock Awards. The Plan provides for the
grant of the following Stock Awards: (i) Incentive Stock
Options, (ii) Nonstatutory Stock Options, (iii) Stock
Purchase Awards, (iv) Stock Bonus Awards, (v) Stock
Appreciation Rights, (vi) Stock Unit Awards, and
(vii) Other Stock Awards.
(d) General Purpose. The Company, by means of the Plan,
seeks to secure and retain the services of the group of persons
eligible to receive Stock Awards as set forth in Section 1(b),
to provide incentives for such persons to exert maximum efforts for
the success of the Company and any Affiliate and to provide a means
by which such eligible recipients may be given an opportunity to
benefit from increases in value of the Common Stock through the
granting of Stock Awards.
1.
As used in the
Plan, the following definitions shall apply to the capitalized
terms indicated below:
(a)
“Accountant” means the independent
registered public accounting firm appointed by the
Company.
(b)
“Affiliate” means (i) 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, and (ii) 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. The Board shall have the
authority to determine (i) the time or times at which the
ownership tests are applied, and (ii) whether
“Affiliate” includes entities other than corporations
within the foregoing definition.
(c)
“Annual Awards” means Stock Awards granted
to each Eligible Director pursuant to Section 8(c)(ii).
(d)
“Annual Meeting” means the first meeting of
the Company’s stockholders held each calendar year at which
Directors of the Company are selected.
(e)
“Award” means a Stock Award or a Performance
Cash Award.
(f)
“Board” means the Board of Directors of the
Company.
(g)
“Capitalization Adjustment” has the meaning
ascribed to that term in Section 12(a).
(h)
“Change in Control” means the occurrence, in
a single transaction or in a series of related transactions, of any
one or more of the following events:
(i) any Exchange Act Person becomes the Owner,
directly or indirectly, of securities of the Company representing
more than fifty percent (50%) of the combined voting power of the
Company’s then outstanding securities other than by virtue of
a merger, consolidation or similar transaction. Notwithstanding the
foregoing, a Change in Control shall not be deemed to occur
(A) on account of the acquisition of securities of the Company
by an investor, any affiliate thereof or any other Exchange Act
Person from the Company in a transaction or series of related
transactions the primary purpose of which is to obtain financing
for the Company through the issuance of equity securities or
(B) solely because the level of Ownership held by any Exchange
Act Person (the “ Subject Person ”)
exceeds the designated percentage threshold of the outstanding
voting securities as a result of a repurchase or other acquisition
of voting securities by the Company reducing the number of shares
outstanding, provided that if a Change in Control would occur (but
for the operation of this sentence) as a
2.
result of the
acquisition of voting securities by the Company, and after such
share acquisition, the Subject Person becomes the Owner of any
additional voting securities that, assuming the repurchase or other
acquisition had not occurred, increases the percentage of the then
outstanding voting securities Owned by the Subject Person over the
designated percentage threshold, then a Change in Control shall be
deemed to occur;
(ii) there is consummated a merger, consolidation or
similar transaction involving (directly or indirectly) the Company
and, immediately after the consummation of such merger,
consolidation or similar transaction, the stockholders of the
Company immediately prior thereto do not Own, directly or
indirectly, either (A) outstanding voting securities
representing more than fifty percent (50%) of the combined
outstanding voting power of the surviving Entity in such merger,
consolidation or similar transaction or (B) more than fifty
percent (50%) of the combined outstanding voting power of the
parent of the surviving Entity in such merger, consolidation or
similar transaction, in each case in substantially the same
proportions as their Ownership of the outstanding voting securities
of the Company immediately prior to such transaction;
(iii) the stockholders of the Company approve or the
Board approves a plan of complete dissolution or liquidation of the
Company, or a complete dissolution or liquidation of the Company
shall otherwise occur;
(iv) there is consummated a sale, lease, exclusive
license or other disposition of all or substantially all of the
consolidated assets of the Company and its Subsidiaries, other than
a sale, lease, license or other disposition of all or substantially
all of the consolidated assets of the Company and its Subsidiaries
to an Entity, more than fifty percent (50%) of the combined voting
power of the voting securities of which are Owned by stockholders
of the Company in substantially the same proportions as their
Ownership of the outstanding voting securities of the Company
immediately prior to such sale, lease, license or other
disposition; or
(v) individuals who, on the date this Plan is adopted
by the Board, are members of the Board (the “ Incumbent
Board ”) cease for any reason to constitute at least
a majority of the members of the Board; provided, however,
that if the appointment or election (or nomination for election) of
any new Board member was approved or recommended by a majority vote
of the members of the Incumbent Board then still in office, such
new member shall, for purposes of this Plan, be considered as a
member of the Incumbent Board.
The term Change in
Control shall not include a sale of assets, merger or other
transaction effected exclusively for the purpose of changing the
domicile of the Company.
Notwithstanding
the foregoing or any other provision of this Plan, the definition
of Change in Control (or any analogous term) in an individual
written agreement between the Company or any Affiliate and the
Participant shall supersede the foregoing definition with respect
to Stock Awards subject to such agreement; provided,
however, that if no definition of Change in Control or any
analogous term is set forth in such an individual written
agreement, the foregoing definition shall apply.
(i)
“Code” means the Internal Revenue Code of
1986, as amended.
3.
(j)
“Committee” means a committee of one
(1) or more members of the Board to whom authority has been
delegated by the Board in accordance with
Section 3(d).
(k)
“Common Stock” means the common stock of the
Company.
(l)
“Company” means Onyx Pharmaceuticals, Inc.,
a Delaware corporation.
(m)
“Consultant” means any person, including an
advisor, who is (i) engaged by the Company or an Affiliate to
render consulting or advisory services and is compensated for such
services, or (ii) serving as a member of the Board of
Directors of an Affiliate and is compensated for such services.
However, service solely as a Director, or payment of a fee for such
service, shall not cause a Director to be considered a
“Consultant” for purposes of the Plan.
(n)
“Continuous Service” means that the
Participant’s service with the Company or an Affiliate,
whether as an Employee, Director or Consultant, is not interrupted
or terminated. A change in the capacity in which the Participant
renders service to the Company or an Affiliate as an Employee,
Consultant or Director or a change in the entity for which the
Participant renders such service, provided that there is no
interruption or termination of the Participant’s service with
the Company or an Affiliate, shall not terminate a
Participant’s Continuous Service; provided, however ,
if the Entity for which a Participant is rendering services ceases
to qualify as an “Affiliate,” as determined by the
Board in its sole discretion, such Participant’s Continuous
Service shall be considered to have terminated on the date such
Entity ceases to qualify as an Affiliate. For example, a change in
status from an employee of the Company to a consultant of an
Affiliate or to a Director shall not constitute an interruption of
Continuous Service. To the extent permitted by law, the Board or
the chief executive officer of the Company, in that party’s
sole discretion, may determine whether Continuous Service shall be
considered interrupted in the case of any leave of absence approved
by that party, including sick leave, military leave or any other
personal leave. Notwithstanding the foregoing, a leave of absence
shall be treated as Continuous Service for purposes of vesting in a
Stock Award only to such extent as may be provided in the
Company’s leave of absence policy or in the written terms of
the Participant’s leave of absence.
(o)
“Corporate Transaction” means the
occurrence, in a single transaction or in a series of related
transactions, of any one or more of the following
events:
(i) a sale or other disposition of all or
substantially all, as determined by the Board in its sole
discretion, of the consolidated assets of the Company and its
Subsidiaries;
(ii) a sale or other disposition of at least ninety
percent (90% ) of the outstanding securities of the
Company;
(iii) the consummation of a merger, consolidation or
similar transaction following which the Company is not the
surviving corporation; or
(iv) the consummation of a merger, consolidation or
similar transaction following which the Company is the surviving
corporation but the shares of Common Stock outstanding immediately
preceding the merger, consolidation or similar transaction are
converted
4.
or exchanged by
virtue of the merger, consolidation or similar transaction into
other property, whether in the form of securities, cash or
otherwise.
(p) “Covered Employee” means the
Company’s principal executive officer and the three
(3) other highest compensated officers of the Company,
excluding the Company’s principal financial officer, for whom
total compensation is required to be reported to shareholders under
the Exchange Act, as determined for purposes of Section 162(m) of
the Code.
(q) “Director” means a member of
the Board.
(r) “Disability” means the
permanent and total disability of a person within the meaning of
Section 22(e)(3) of the Code.
(s) “Eligible Director” means a
Director who is not an Employee and is eligible to participate in
the Non-Discretionary Grant Program.
(t) “Employee” means any person
employed by the Company or an Affiliate. However, service solely as
a Director, or payment of a fee for such services, shall not cause
a Director to be considered an “Employee” for purposes
of the Plan.
(u) “Entity” means a corporation,
partnership, limited liability company, or other entity.
(v) “Exchange Act” means the
Securities Exchange Act of 1934, as amended.
(w) “Exchange Act Person” means any
natural person, Entity or “group” (within the meaning
of Section 13(d) or 14(d) of the Exchange Act), except that
“Exchange Act Person” shall not include (i) the
Company or any Subsidiary of the Company, (ii) any employee
benefit plan of the Company or any Subsidiary of the Company or any
trustee or other fiduciary holding securities under an employee
benefit plan of the Company or any Subsidiary of the Company,
(iii) an underwriter temporarily holding securities pursuant
to an offering of such securities, (iv) an Entity Owned,
directly or indirectly, by the stockholders of the Company in
substantially the same proportions as their Ownership of stock of
the Company; or (v) any natural person, Entity or
“group” (within the meaning of Section 13(d) or 14(d)
of the Exchange Act) that, as of the effective date of the Plan as
set forth in Section 15, is the Owner, directly or indirectly,
of securities of the Company representing more than fifty percent
(50%) of the combined voting power of the Company’s then
outstanding securities.
(x) “Fair Market Value” means, as
of any date, the value of the Common Stock determined as
follows:
(i) If the Common Stock is listed on any established
stock exchange or traded on the Nasdaq Global Select Market, Nasdaq
Global Market, or the Nasdaq Capital Market, the Fair Market Value
of a share of Common Stock shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as
quoted on such exchange or market (or the exchange or market with
the greatest volume of trading in the Common Stock) on the date of
determination, as reported in The Wall Street Journal or
such other source as the Board deems reliable. Unless otherwise
provided by the Board, if there is no closing sales price (or
closing
5.
bid if no sales
were reported) for the Common Stock on the date of determination,
then the Fair Market Value shall be the closing selling price (or
closing bid if no sales were reported) on the last preceding date
for which such quotation exists.
(ii) In the absence of such markets for the Common
Stock, the Fair Market Value shall be determined by the Board in
good faith.
(y) “Incentive Stock Option” means
an Option intended to qualify as an incentive stock option within
the meaning of Section 422 of the Code and the regulations
promulgated thereunder.
(z) “Initial Award” means an Option
granted to an Eligible Director who meets the specified criteria
pursuant to Section 8(c)(i).
(aa) “Non-Discretionary Grant
Program” means the non-discretionary grant program in
effect under Section 8 of the Plan.
(bb) “Non-Employee Director” means
a Director who either (i) is not a current employee or officer
of the Company or an Affiliate, does not receive compensation,
either directly or indirectly, from the Company or an Affiliate for
services rendered as a consultant or in any capacity other than as
a Director (except for an amount as to which disclosure would not
be required under Item 404(a) of Regulation S-K promulgated
pursuant to the Securities Act (“
Regulation S-K ”)), does not possess an
interest in any other transaction for which disclosure would be
required under Item 404(a) of Regulation S-K, and is not
engaged in a business relationship for which disclosure would be
required pursuant to Item 404(b) of Regulation S-K; or
(ii) is otherwise considered a “non-employee
director” for purposes of Rule 16b-3.
(cc) “Nonstatutory Stock Option”
means an Option not intended to qualify as an Incentive Stock
Option.
(dd) “Officer” means a person who
is an officer of the Company within the meaning of Section 16 of
the Exchange Act and the rules and regulations promulgated
thereunder.
(ee) “Option” means an Incentive
Stock Option or a Nonstatutory Stock Option to purchase shares of
Common Stock granted pursuant to the Plan.
(ff) “Option Agreement” means a
written agreement between the Company and an Optionholder
evidencing the terms and conditions of an Option grant. Each Option
Agreement shall be subject to the terms and conditions of the
Plan.
(gg) “Optionholder” means a person
to whom an Option is granted pursuant to the Plan or, if
applicable, such other person who holds an outstanding
Option.
(hh) “Other Stock Award” means an
award based in whole or in part by reference to the Common Stock
which is granted pursuant to the terms and conditions of
Section 7(e).
(ii) “Other Stock Award Agreement”
means a written agreement between the Company and a holder of an
Other Stock Award evidencing the terms and conditions of an
Other
6.
Stock Award
grant. Each Other Stock Award Agreement shall be subject to the
terms and conditions of the Plan.
(jj) “Outside Director” means a
Director who either (i) is not a current employee of the
Company or an “affiliated corporation” (within the
meaning of Treasury Regulations promulgated under Section 162(m) of
the Code), is not a former employee of the Company or an
“affiliated corporation” who receives compensation for
prior services (other than benefits under a tax-qualified
retirement plan) during the taxable year, has not been an officer
of the Company or an “affiliated corporation,” and does
not receive remuneration from the Company or an “affiliated
corporation,” either directly or indirectly, in any capacity
other than as a Director, or (ii) is otherwise considered an
“outside director” for purposes of Section 162(m) of
the Code.
(kk) “Own,” “Owned,”
“Owner,” “Ownership” A person or
Entity shall be deemed to “Own,” to have
“Owned,” to be the “Owner” of, or to have
acquired “Ownership” of securities if such person or
Entity, directly or indirectly, through any contract, arrangement,
understanding, relationship or otherwise, has or shares voting
power, which includes the power to vote or to direct the voting,
with respect to such securities.
(ll) “Participant” means a person
to whom an Award is granted pursuant to the Plan or, if applicable,
such other person who holds an outstanding Award.
(mm) “Performance Cash Award” means
an award of cash granted pursuant to the terms and conditions of
Section 11(h)(ii).
(nn) “Performance Criteria” means
the one or more criteria that the Board shall select for purposes
of establishing the Performance Goals for a Performance Period. The
Performance Criteria that shall be used to establish such
Performance Goals may be based on any one of, or combination of,
the following: (i) earnings per share; (ii) earnings
before interest, taxes and depreciation; (iii) earnings before
interest, taxes, depreciation and amortization (EBITDA);
(iv) net earnings; (v) return on equity; (vi) return
on assets, investment, or capital employed; (vii) operating
margin; (viii) gross margin; (ix) operating income;
(x) net income (before or after taxes); (xi) net operating
income; (xii) net operating income after tax; (xiii) pre-
and after-tax income; (xiv) pre-tax profit; (xv) operating
cash flow; (xvi) sales or revenue targets;
(xvii) increases in revenue or product revenue;
(xvii) expenses and cost reduction goals;
(xix) improvement in or attainment of expense levels;
(xx) improvement in or attainment of working capital levels;
(xxi) economic value added; (xxii) market share;
(xxiii) cash flow; (xxiv) cash flow per share; (xxv)
share price performance; (xxvi) debt reduction;
(xxvii) implementation or completion of projects or processes;
(xxviii) customer satisfaction; (xxix) total stockholder
return; (xxx) stockholders’ equity; and
(xxxi) other measures of performance selected by the Board.
Partial achievement of the specified criteria may result in the
payment or vesting corresponding to the degree of achievement as
specified in the Stock Award Agreement or the written terms of a
Performance Cash Award. The Board shall, in its sole discretion,
define the manner of calculating the Performance Criteria it
selects to use for a Performance Period.
(oo) “Performance Goals” means, for
a Performance Period, the one or more goals established by the
Board for the Performance Period based upon the Performance
Criteria. Performance Goals may be based on a Company-wide basis,
with respect to one or more
7.
business units,
divisions, Affiliates, or business segments, and in either absolute
terms or relative to the performance of one or more comparable
companies or a relevant index. The Board is authorized to make
adjustments in the method of calculating the attainment of
Performance Goals for a Performance Period as follows: (i) to
exclude restructuring and/or other nonrecurring charges;
(ii) to exclude exchange rate effects, as applicable, for
non-U.S. dollar denominated net sales and operating earnings;
(iii) to exclude the effects of changes to generally accepted
accounting standards required by the Financial Accounting Standards
Board; (iv) to exclude the effects of any statutory
adjustments to corporate tax rates; and (v) to exclude the
effects of any “extraordinary items” as determined
under generally accepted accounting principles. The Board also
retains the discretion to reduce or eliminate the compensation or
economic benefit due upon attainment of Performance
Goals.
(pp) “Performance Period” means the
one or more periods of time, which may be of varying and
overlapping durations, as the Committee may select, over which the
attainment of one or more Performance Goals will be measured for
the purpose of determining a Participant’s right to and the
payment of a Stock Award or a Performance Cash Award.
(qq) “Performance Stock Award”
means a Stock Award granted under the terms and conditions of
Section 11(h)(i).
(rr) “Plan” means this Onyx
Pharmaceuticals, Inc. 2005 Equity Incentive Plan.
(ss) “Prior Plans” means the
Company’s 1996 Equity Incentive Plan and 1996 Non-Employee
Directors’ Stock Option Plan as in effect immediately prior
to the effective date of the Plan.
(tt) “Rule 16b-3” means
Rule 16b-3 promulgated under the Exchange Act or any successor
to Rule 16b-3, as in effect from time to time.
(uu) “Securities Act” means the
Securities Act of 1933, as amended.
(vv) “Stock Appreciation Right”
means a right to receive the appreciation on Common Stock that is
granted pursuant to the terms and conditions of
Section 7(d).
(ww) “Stock Appreciation Right
Agreement” means a written agreement between the
Company and a holder of a Stock Appreciation Right evidencing the
terms and conditions of a Stock Appreciation Right grant. Each
Stock Appreciation Right Agreement shall be subject to the terms
and conditions of the Plan.
(xx) “Stock Award” means any right
granted under the Plan, including an Option, a Stock Purchase
Award, Stock Bonus Award, a Stock Appreciation Right, a Stock Unit
Award, an Other Stock Award, or a Performance Stock
Award.
(yy) “Stock Award Agreement” means
a written agreement between the Company and a Participant
evidencing the terms and conditions of a Stock Award grant. Each
Stock Award Agreement shall be subject to the terms and conditions
of the Plan.
8.
(zz) “Stock Bonus Award” means an
award of shares of Common Stock which is granted pursuant to the
terms and conditions of Sections 7(b), 8(c)(ii)(2), and
8(c)(ii)(3).
(aaa) “Stock Bonus Award Agreement” means
a written agreement between the Company and a holder of a Stock
Bonus Award evidencing the terms and conditions of a Stock Bonus
Award grant. Each Stock Bonus Award Agreement shall be subject to
the terms and conditions of the Plan.
(bbb) “Stock Purchase Award” means an
award of shares of Common Stock which is granted pursuant to the
terms and conditions of Section 7(a).
(ccc) “Stock Purchase Award
Agreement” means a written agreement between the
Company and a holder of a Stock Purchase Award evidencing the terms
and conditions of a Stock Purchase Award grant. Each Stock Purchase
Award Agreement shall be subject to the terms and conditions of the
Plan.
(ddd) “Stock Unit Award” means a right to
receive shares of Common Stock which is granted pursuant to the
terms and conditions of Section 7(c).
(eee) “Stock Unit Award Agreement” means
a written agreement between the Company and a holder of a Stock
Unit Award evidencing the terms and conditions of a Stock Unit
Award grant. Each Stock Unit Award Agreement shall be subject to
the terms and conditions of the Plan.
(fff) “Subsidiary” means, with respect to
the Company, (i) any corporation of which more than fifty
percent (50%) of the outstanding capital stock having ordinary
voting power to elect a majority of the board of directors of such
corporation (irrespective of whether, at the time, stock of any
other class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at
the time, directly or indirectly, Owned by the Company, and
(ii) any partnership in which the Company has a direct or
indirect interest (whether in the form of voting or participation
in profits or capital contribution) of more than fifty percent
(50%).
(ggg) “Ten Percent Stockholder” means a
person who Owns (or is deemed to Own pursuant to Section 424(d) of
the Code) stock possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or any
Affiliate.
(a) Administration by Board. The Board shall administer
the Plan unless and until the Board delegates administration of the
Plan to a Committee, as provided in Section 3(d). However, the
Board may not delegate administration of the Non-Discretionary
Grant Program. Any discretionary Award granted to a Director under
Sections 6, 7, or 11(h) shall be administered by a committee
consisting solely of Non-Employee Directors; provided,
however , that such Non-Employee Directors sitting on the
committee may administer and grant discretionary Awards to
themselves.
9.
(b) Powers of Board. Except with respect to the
Non-Discretionary Grant Program, the Board shall have the power,
subject to, and within the limitations of, the express provisions
of the Plan:
(i) To determine from time to time (1) which of
the persons eligible under the Plan shall be granted Awards;
(2) when and how each Award shall be granted; (3) what
type or combination of types of Award shall be granted;
(4) the provisions of each Award granted (which need not be
identical), including the time or times when a person shall be
permitted to receive cash or Common Stock pursuant to an Award; and
(5) the number of shares of Common Stock with respect to which
a Stock Award shall be granted to each such person.
(ii) To construe and interpret the Plan and Awards
granted under it, and to establish, amend and revoke rules and
regulations for its administration. The Board, in the exercise of
this power, may correct any defect, omission or inconsistency in
the Plan or in any Stock Award Agreement or in the written terms of
a Performance Cash Award, in a manner and to the extent it shall
deem necessary or expedient to make the Plan fully
effective.
(iii) To amend the Plan or an Award as provided in
Section 13.
(iv) To terminate or suspend the Plan as provided in
Section 14.
(v) Generally, to exercise such powers and to perform
such acts as the Board deems necessary or expedient to promote the
best interests of the Company and that are not in conflict with the
provisions of the Plan.
(vi) To adopt such procedures and sub-plans as are
necessary or appropriate to permit participation in the Plan by
individuals who are foreign nationals or employed outside the
United States.
(c) Administration of Non-Discretionary Grant Program .
The Board shall have the power, subject to and within the
limitations of, the express provisions of the Non-Discretionary
Grant Program:
(i) To determine the provisions of each Stock Award to
the extent not specified in the Non-Discretionary Grant
Program.
(ii) To construe and interpret the Non-Discretionary
Grant Program and the Stock Awards granted under it, and to
establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may
correct any defect, omission or inconsistency in the
Non-Discretionary Grant Program or in any Stock Award Agreement, in
a manner and to the extent it shall deem necessary or expedient to
make the Non-Discretionary Grant Program fully
effective.
(iii) To amend the Non-Discretionary Grant Program or
a Stock Award thereunder as provided in Section 13.
10.
(iv) Generally, to exercise such powers and to perform
such acts as the Board deems necessary or expedient to promote the
best interests of the Company and that are not in conflict with the
provisions of the Non-Discretionary Grant Program.
(d) Delegation to Committee.
(i) General. The Board may delegate some or all of the
administration of the Plan (except the Non-Discretionary Grant
Program) to a Committee or Committees. If administration is
delegated to a Committee, the Committee shall have, in connection
with the administration of the Plan, the powers theretofore
possessed by the Board that have been delegated to the Committee,
including the power to delegate to a subcommittee any of the
administrative powers the Committee is authorized to exercise (and
references in this Plan to the Board shall thereafter be to the
Committee or subcommittee), subject, however, to such resolutions,
not inconsistent with the provisions of the Plan, as may be adopted
from time to time by the Board. The Board may retain the authority
to concurrently administer the Plan with the Committee and may, at
any time, revest in the Board some or all of the powers previously
delegated. Any Committee administering or granting a discretionary
Award to a Director under Sections 6, 7, or 11(h) shall
consist solely of Non-Employee Directors; provided, however
, that such Committee may administer and grant discretionary Awards
to members of such Committee.
(ii) Section 162(m) and Rule 16b-3
Compliance. In the sole discretion of the Board, the Committee
may consist solely of two or more Outside Directors, in accordance
with Section 162(m) of the Code, and/or solely of two or more
Non-Employee Directors, in accordance with Rule 16b-3. In
addition, the Board or the Committee, in its sole discretion, may
(1) delegate to a committee of one or more members of the
Board who need not be Outside Directors the authority to grant
Awards to eligible persons who are either (a) not then Covered
Employees and are not expected to be Covered Employees at the time
of recognition of income resulting from such Award, or (b) not
persons with respect to whom the Company wishes to comply with
Section 162(m) of the Code, and/or (2) delegate to a committee
of one or more members of the Board who need not be Non-Employee
Directors the authority to grant Stock Awards to eligible persons
who are not then subject to Section 16 of the Exchange
Act.
(e) Delegation to an Officer. The Board may delegate to
one or more Officers of the Company the authority to do one or both
of the following (i) designate Officers and Employees of the
Company or any of its Subsidiaries to be recipients of Options
(and, to the extent permitted by Delaware law, other Stock Awards)
and the terms thereof, and (ii) determine the number of shares
of Common Stock to be subject to such Stock Awards granted to such
Officers and Employees of the Company; provided, however,
that the Board resolutions regarding such delegation shall specify
the total number of shares of Common Stock that may be subject to
the Stock Awards granted by such Officer and that such Officer may
not grant a Stock Award to himself or herself. Notwithstanding
anything to the contrary in this Section 3(e), the Board may
not delegate to an Officer authority to determine the Fair Market
Value of the Common Stock pursuant to Section 2(x)(ii)
above.
(f) Effect of Board’s Decision. All
determinations, interpretations and constructions made by the Board
in good faith shall not be subject to review by any person and
shall be final, binding and conclusive on all persons.
11.
(g) Cancellation and Re-Grant of Stock Awards . Neither
the Board nor any Committee shall have the authority to:
(i) reprice any outstanding Stock Awards under the Plan, or
(ii) cancel and re-grant any outstanding Stock Awards under the
Plan, unless the stockholders of the Company have approved such an
action within twelve (12) months prior to such an
event.
4.
Shares Subject to the
Plan.
(a) Share
Reserve. Subject to the provisions of Section 12(a) relating to
Capitalization Adjustments, the number of shares of Common Stock
that may be issued pursuant to Stock Awards shall not exceed, in
the aggregate, Fourteen Million Two Hundred Sixty Thousand
Forty-Five (14,260,045) shares of Common Stock. Such number of
shares reserved for issuance consists of (i) the number of
shares remaining available for issuance under the Prior Plans,
including shares subject to outstanding stock awards under the
Prior Plans, (ii) an additional 3,990,000 shares approved by
the stockholders at the 2005 Annual Meeting as part of the approval
of this Plan, (iii) an additional 1,600,000 shares approved by
the stockholders at the 2007 Annual Meeting, (iv) an
additional 3,100,000 approved by the stockholders at the 2008
Annual Meeting, plus (v) an additional 2,000,000 shares
approved by the stockholders at the 2009 Annual Meeting. Subject to
Section 4(b), the number of shares available for issuance
under the Plan shall be reduced by: (i) one (1) share for
each share of stock issued pursuant to (A) an Option granted
under Section 6 or 8, or (B) a Stock Appreciation Right
granted under Section 7(d) with respect to which the strike price
is at least one hundred percent (100%) of the Fair Market Value of
the underlying Common Stock on the date of grant; (ii) for
awards granted prior to the date of the 2009 Annual Meeting, one
and three tenths (1.3) shares for each share of Common Stock issued
pursuant to (A) a Stock Purchase Award, Stock Bonus Award,
Stock Unit Award, or Other Stock Award granted under Section 7
or 8, or (B) a Stock Appreciation Right granted under Section
7(d) with respect to which the strike price is less than one
hundred percent (100%) of the Fair Market Value of the underlying
Common Stock on the date of grant; and (iii) for awards
granted on or after the date of the 2009 Annual Meeting, one and
six tenths (1.6) shares for each share of Common Stock issued
pursuant to (A) a Stock Purchase Award, Stock Bonus Award,
Stock Unit Award, or Other Stock Award granted under Section 7
or 8, or (B) a Stock Appreciation Right granted under Section
7(d) with respect to which the strike price is less than one
hundred percent (100%) of the Fair Market Value of the underlying
Common Stock on the date of grant. Shares may be issued in
connection with a merger or acquisition as permitted by NASD
Rule 4350(i)(1)(A)(iii) or, if applicable, NYSE Listed Company
Manual Section 303A(8) and such issuance shall not reduce the
number of shares available for issuance under the Plan.
(b) Reversion of Shares to the Share Reserve
.
(i) Shares Available For Subsequent Issuance . If any
(i) Stock Award shall for any reason expire or otherwise
terminate, in whole or in part, without having been exercised in
full, (ii) shares of Common Stock issued to a Participant pursuant
to a Stock Award (including the Stock Awards transferred from the
Prior Plans on the effective date of this Plan) are forfeited to or
repurchased by the Company at their original exercise or purchase
price pursuant to the Company’s reacquisition or repurchase
rights under the Plan, including any forfeiture or repurchase
caused by the failure to meet a contingency or condition required
for the vesting of such shares, or (iii) Stock Award is settled in
cash, then the shares of Common Stock
12.
not issued
under such Stock Award, or forfeited to or repurchased by the
Company, shall revert to and again become available for issuance
under the Plan. To the extent there is issued a share of Common
Stock pursuant to a Stock Award that counted as more than one share
against the number of shares available for issuance under the Plan
pursuant to Section 4(a) and such share of Common Stock again
becomes available for issuance under the Plan pursuant to this
Section 4(b)(i), then the number of shares of Common Stock
available for issuance under the Plan shall increase by (i) one and
three tenths (1.3) shares for shares returning prior to the date of
the 2009 Annual Meeting and (ii) one and six tenths (1.6)
shares for shares returning on or after the date of the 2009 Annual
Meeting.
(ii) Shares Not Available for Subsequent Issuance . If
any shares subject to a Stock Award are not delivered to a
Participant because the Stock Award is exercised through a
reduction of shares subject to the Stock Award ( i.e. ,
“net exercised”) or an appreciation distribution in
respect of a Stock Appreciation Right is paid in shares of Common
Stock, the number of shares subject to the Stock Award that are not
delivered to the Participant shall not remain available for
subsequent issuance under the Plan. If any shares subject to a
Stock Award are not delivered to a Participant because such shares
are withheld in satisfaction of the withholding of taxes incurred
in connection with the exercise of an Option, Stock Appreciation
Right, or the issuance of shares under a Stock Purchase Award,
Stock Bonus Award, or Stock Unit Award, the number of shares that
are not delivered to the Participant shall not remain available for
subsequent issuance under the Plan. If the exercise price of any
Stock Award is satisfied by tendering shares of Common Stock held
by the Participant (either by actual delivery or attestation), then
the number of shares so tendered shall not remain available for
subsequent issuance under the Plan.
(iii) Incentive Stock Option Limit . Notwithstanding
anything to the contrary in this Section 4(b), subject to the
provisions of Section 12(a) relating to Capitalization Adjustments
the aggregate maximum number of shares of Common Stock that may be
issued pursuant to the exercise of Incentive Stock Options shall be
the same as the maximum number of shares of Common Stock that may
be issued pursuant to Stock Awards under
Section 4(a).
(c) Source of Shares. The stock issuable under the Plan
shall be shares of authorized but unissued or reacquired Common
Stock, including shares repurchased by the Company on the open
market.
(a) Eligibility for Specific Stock Awards . Incentive
Stock Options may be granted only to Employees. Stock Awards other
than Incentive Stock Options may be granted to Employees, Directors
and Consultants. Non-discretionary Stock Awards granted under the
Non-Discretionary Grant Program in Section 8 may be granted
only to Eligible Directors.
(b) Ten
Percent Stockholders. A Ten Percent Stockholder shall not be
granted an Incentive Stock Option unless the exercise price of such
Option is at least one hundred ten percent (110%) of the Fair
Market Value of the Common Stock on the date of grant and the
Option is not exercisable after the expiration of five
(5) years from the date of grant.
13.
(c) Section 162(m) Limitation . Subject to the
provisions of Section 12(a) relating to Capitalization Adjustments,
at such time as the Company may be subject to the applicable
provisions of Section 162(m) of the Code, no Employee shall be
eligible to be granted during any calendar year Stock Awards whose
value is determined by reference to an increase over an exercise or
strike price of at least one hundred percent (100%) of the Fair
Market Value of the Common Stock on the date the Stock Award is
granted covering more than one million (1,000,000) shares of Common
Stock.
(d) Consultants. A Consultant shall not be eligible for
the grant of a Stock Award if, at the time of grant, a Form S-8
Registration Statement under the Securities Act (
“Form S-8" ) is not available to register
either the offer or the sale of the Company’s securities to
such Consultant because of the nature of the services that the
Consultant is providing to the Company, because the Consultant is
not a natural person, or because of any other rule governing the
use of Form S-8.
(e) Limited Exception to Minimum Vesting Restrictions.
Up to ten percent (10%) of the total number of shares of Common
Stock subject to the Plan pursuant to Section 4(a) may be issued as
Stock Awards that are not subject to the
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