AXCELIS TECHNOLOGIES INC
EXHIBIT 10.2; EMPLOYEE STOCK PURCHASE PLAN
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<DESCRIPTION>EXHIBIT 10.2; EMPLOYEE STOCK PURCHASE PLAN
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<center><b>AXCELIS TECHNOLOGIES, INC.</b>
<p><b><u>EMPLOYEE STOCK PURCHASE PLAN</u></b></center>

<p><br>
<br>
<p><b>1.&nbsp;&nbsp;&nbsp;&nbsp; <u>PURPOSE</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The purpose of this Plan
is to provide an opportunity for Employees of Axcelis Technologies, Inc.
(the "Corporation") and its Designated Subsidiaries, to purchase Common
Stock of the Corporation and thereby to have an additional incentive to
contribute to the prosperity of the Corporation. It is the intention of
the Corporation that the Plan qualifies as an "Employee Stock Purchase
Plan" under Section 423 of the Internal Revenue Code of 1986, as amended.
<p><b>2.&nbsp;&nbsp;&nbsp;&nbsp; <u>DEFINITIONS</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (a)&nbsp;&nbsp;&nbsp;&nbsp;<b>
"<u>Board</u>"</b> shall mean the Board of Directors of the Corporation.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (b)<b>&nbsp;&nbsp;&nbsp;&nbsp;
"<u>Code</u>"</b> shall mean the Internal Revenue Code of 1986, as amended.
Any reference to a section of the Code herein shall be a reference to any&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
successor or amended section of the Code.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (c)<b>&nbsp;&nbsp;&nbsp;&nbsp;
"<u>Committee</u>"</b> shall mean the committee appointed by the Board
in accordance with Section 14 of the Plan.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (d)&nbsp;&nbsp;&nbsp;&nbsp;<b>
"<u>Common Stock</u>"</b> shall mean the Common Stock of the Corporation,
or any stock into which such Common Stock may be converted.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (e)<b>&nbsp;&nbsp;&nbsp;&nbsp;
"<u>Compensation</u>"</b> shall mean base pay, including pay under any
system which measures earnings by quantity and quality of production, variable
pay, including without limitation, bonuses and incentive payments (but
excluding sign-on bonuses and bonuses paid under the Executive Incentive
Compensation Plan, the Executive Strategic Compensation Plan, the Senior
Operating Managers Plan, and any successors to such plans and any other
similar management bonuses or incentive payments), shift premium and overtime
pay, but excluding severance pay in a single lump sum and not as salary
continuation, pay in lieu of vacation, cost-of-living allowance, retainers,
fees, and any other special remuneration, with any modifications determined
by the Committee. The Committee shall have the authority to determine and
approve all forms of pay to be included in the definition of Compensation
and may change the definition on a prospective basis.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (f)<b>&nbsp;&nbsp;&nbsp;&nbsp;
"<u>Corporation</u>"</b> shall mean Axcelis Technologies, Inc., a Delaware
corporation.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (g)<b>&nbsp;&nbsp;&nbsp;&nbsp;
"<u>Designated Subsidiary</u>"</b> shall mean a Subsidiary that has been
designated by the Committee as eligible to participate in the Plan with
respect to its Employees.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (h)<b>&nbsp;&nbsp;&nbsp;&nbsp;
"<u>Employee</u>"</b> shall mean an individual classified as an employee
(within the meaning of Code Section 3401(c) and the regulations thereunder)
by the Corporation or a Designated Subsidiary on the Corporation's or such
Designated Subsidiary's payroll records during the relevant participation
period. Employees shall not include individuals classified as independent
contractors.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (i)<b>&nbsp;&nbsp;&nbsp;&nbsp;
"<u>Entry Date</u>"</b> shall mean the first Trading Day of the Offering
Period or, for any Employee who became a Participant after such date, the
first Trading Day of the first Purchase Period commencing after the date
on which such Employee became a Participant.<b></b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (j)&nbsp;&nbsp;&nbsp; <b>"<u>Fair
Market Value</u>"</b> shall be the closing sales price for the Common Stock
(or the closing bid, if no sales were reported) as quoted on the NASDAQ
National Market, or other principal securities market on which the Common
Stock is traded, on the date of determination if that date is a Trading
Day, or if the date of determination is not a Trading Day, the last market
Trading Day prior to the date of determination, as reported in <i>The Wall
Street Journal</i> or such other source as the Committee deems reliable.
"Fair Market Value" on the effective date of the Plan shall be the offering
price of the Common Stock specified in the Registration Statement on Form
S-1.<b></b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (k)&nbsp;&nbsp;&nbsp; <b>"<u>Offering
Period</u>" </b>shall mean the period of twenty-four (24) months commencing
on the first Trading Day on or about July 1 of every other year and terminating
on the last Trading Day in the period ending twenty-four (24) months later.
The first offering period shall commence on the beginning of the effective
date of the Registration Statement on Form S-1 for the initial public offering
of the Company's Common Stock (the "IPO Date") and continue until June
30, 2002, subject to the limitation set forth in Section 4.4. The duration
and timing of Offering Periods may be changed or modified by the Committee.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (l)&nbsp;&nbsp;&nbsp; <b>"<u>Participant</u>"</b>
shall mean a participant in the Plan as described in Section 5 of the Plan.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (m)&nbsp;&nbsp;&nbsp; <b>"<u>Plan</u>"</b>
shall mean the Axcelis Technologies, Inc. Employee Stock Purchase Plan.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (n)&nbsp;&nbsp;&nbsp; <b>"<u>Purchase
Date</u>"</b> shall mean the last Trading Day of each Purchase Period.<b></b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (o)&nbsp;&nbsp;&nbsp; <b>"<u>Purchase
Period</u>" </b>shall mean the period of six (6) months commencing after
one Purchase Date and ending with the next Purchase Date, except that the
first Purchase Period shall commence on the Plan's effective date. For
those Employees who are eligible and become Participants in the Plan as
of the effective date of the Plan (the first Entry Date), the initial Purchase
Period will begin on the Plan's effective date and end on June 30, 2001.
For those Employees who are eligible and become Participants on the Plan's
second Entry Date (January 1, 2001), the initial Purchase Period for such
participants will begin on January 1, 2001 and end on June 30, 2001. Subsequent
Purchase Periods, if any, shall run consecutively after the termination
of the preceding Purchase Period.<b></b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (p)&nbsp;&nbsp;&nbsp; <b>"<u>Purchase
Price</u>"</b> shall mean 85% of the Fair Market Value of a share of Common
Stock on the Entry Date or on the Purchase Date, whichever is lower; provided
however, that the Purchase Price may be adjusted by the Committee pursuant
to Section 7.4.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (q)&nbsp;&nbsp;&nbsp; <b>"<u>Shareholder</u>"</b>
shall mean a record holder of shares entitled to vote shares of Common
Stock under the Corporation's by-laws.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (r)&nbsp;&nbsp;&nbsp; <b>"<u>Subsidiary</u>"</b>
shall mean any corporation (other than the Corporation) in an unbroken
chain of corporations beginning with the Corporation, as described in Code
Section 424(f).
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; (s)&nbsp;&nbsp;&nbsp; <b>"<u>Trading
Day</u>" </b>shall mean a day on which U.S. national stock exchanges and
the NASDAQ System are open for trading.
<p><b>3.&nbsp;&nbsp;&nbsp;&nbsp; <u>ELIGIBILITY</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3.1&nbsp;&nbsp;&nbsp; Any
Employee regularly employed on a full-time or part-time basis by the Corporation
or by any Designated Subsidiary on an Entry Date shall be eligible to participate
in the Plan with respect to the Purchase Period commencing on such Entry
Date, provided that the Committee may establish administrative rules requiring
that employment commence some minimum period (e.g., one pay period) prior
to an Entry Date to be eligible to participate with respect to the Purchase
Period beginning on that Entry Date.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3.2&nbsp;&nbsp;&nbsp; The
Committee may also determine that a designated group of highly compensated
Employees are ineligible to participate in the Plan so long as the excluded
category fits within the definition of "highly compensated employee" in
Code Section 414(q). No Employee may participate in the Plan if immediately
after an option is granted the Employee owns or is considered to own (within
the meaning of Code Section 424(d)), shares of stock, including stock which
the Employee may purchase by conversion of convertible securities or under
outstanding options granted by the Corporation, possessing five percent
(5%) or more of the total combined voting power or value of all classes
of stock of the Corporation or of any of its Subsidiaries.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 3.3&nbsp;&nbsp;&nbsp; All
Employees who participate in the Plan shall have the same rights and privileges
under the Plan except for differences which may be mandated by local law
and which are consistent with Code Section 423(b)(5); provided, however,
that any affiliate of the Corporation whose Employees are not granted options
under this Plan may adopt a separate "sub-plan" in accordance with the
provisions of Section 15 which is not designed to qualify under Code section
423 and the Employees participating thereunder need not have the same rights
and privileges as Employees participating in the Code section 423 Plan.
The Board may impose restrictions on eligibility and participation of Employees
who are officers and directors to facilitate compliance with federal or
state securities laws or foreign laws.<b><u></u></b>
<p><b>4.&nbsp;&nbsp;&nbsp; <u>OFFERING PERIODS</u></b>.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4.1&nbsp;&nbsp;&nbsp; The
Plan shall be implemented by consecutive Offering Periods with a new Offering
Period commencing on the first Trading Day on or after the date twenty-four
(24) months from the first date of the immediately preceding Offering Period,
or on such other date as the Committee shall determine, and continuing
thereafter for twenty-four (24) months or until terminated pursuant to
Section 13 hereof. A Participant whose Entry Date is after the beginning
of a 24-month Offering Period shall have a truncated Offering Period of
eighteen (18), twelve (12), or six (6) months.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4.2&nbsp;&nbsp;&nbsp; The
first offering period shall commence on the beginning of the effective
date of the Registration Statement on Form S-1 for the initial public offering
of the Company's Common Stock (the "IPO Date") and continue until June
30, 2002.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4.3&nbsp;&nbsp;&nbsp; The
Committee shall have the authority to change the duration of Offering Periods
(including the commencement dates thereof) with respect to future offerings
without Shareholder approval if such change is announced at least five
(5) days prior to the scheduled beginning of the first Offering Period
to be affected thereafter.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 4.4&nbsp;&nbsp;&nbsp; Notwithstanding
any other provision of this Plan to the contrary, no purchase under this
Plan shall be consummated if the effect of such purchase would cause Eaton
Corporation not to be in control of the Company for purposes of Section
368(c) of the Code or prevent Eaton Corporation from filing a consolidated
federal income tax return with the Company for the period covering such
purchase. All offers to sell Company Common Stock and all order to purchase
shares of Common Stock shall be subject to and condition by this limitation.
If Eaton Corporation disposes of all or substantially all of its ownership
interest in the Company, the limitation set forth in this Section 4.4 shall
be without force and effect.
<p><b>5.&nbsp;&nbsp;&nbsp;&nbsp; <u>PARTICIPATION</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5.1&nbsp;&nbsp;&nbsp; An
Employee who is eligible to participate in the Plan in accordance with
Section 3 may become a Participant by completing and submitting, on a date
prescribed by the Committee prior to an applicable Entry Date (unless a
later date is set by the Committee), a completed payroll deduction authorization
and Plan enrollment form provided by the Corporation or by following an
electronic or other enrollment process as prescribed by the Committee.
An eligible Employee may authorize payroll deductions at the rate of any
whole percentage of the Employee's Compensation, not to exceed ten percent
(10%) of the Employee's Compensation. As determined by the Committee, payroll
deductions may begin at a date after the effective date of the Plan. All
payroll deductions may be held by the Corporation and commingled with its
other corporate funds where administratively appropriate. No interest shall
be paid or credited to the Participant with respect to such payroll deductions.
The Corporation shall maintain a separate bookkeeping account for each
Participant under the Plan and the amount of each Participant's payroll
deductions shall be credited to such account. A Participant may not make
any additional payments into such account.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5.2&nbsp;&nbsp;&nbsp; Under
procedures established by the Committee, a Participant may withdraw from
the Plan during a Purchase Period, by completing and filing a new payroll
deduction authorization and Plan enrollment form with the Corporation or
by following electronic or other procedures prescribed by the Committee,
prior to a date set by the Committee that precedes the Purchase Date. If
a Participant withdraws from the Plan during a Purchase Period, his or
her accumulated payroll deductions will be refunded to the Participant
without interest. The Committee may establish rules limiting the frequency
with which Participants may withdraw and re-enroll in the Plan and may
impose a waiting period on Participants wishing to re-enroll following
withdrawal.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 5.3&nbsp;&nbsp;&nbsp; A Participant
may change his or her rate of contribution through payroll deductions during
the periods specified by the Committee by filing a new payroll deduction
authorization and Plan enrollment form or by following electronic or other
procedures prescribed by the Committee. If a Participant has not followed
such procedures to change the rate of contribution, the rate of contribution
shall continue at the originally elected rate throughout the Purchase Period
and future Purchase Periods (including Purchase Periods of subsequent Offering
Periods). In accordance with Section 423(b)(8) of the Code, the Committee
may reduce a Participant's payroll deductions to zero percent (0%) at any
time during a Purchase Period.
<p><b>6.&nbsp;&nbsp;&nbsp;&nbsp; <u>TERMINATION OF EMPLOYMENT</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; In the event any Participant
terminates employment with the Corporation or any of its Designated Subsidiaries
for any reason (including death) prior to the expiration of a Purchase
Period, the Participant's participation in the Plan shall terminate and
all amounts credited to the Participant's account shall be paid to the
Participant or, in the case of death, to the Participant's heirs or estate,
without interest. Whether a termination of employment has occurred shall
be determined by the Committee. The Committee may also establish rules
regarding when leaves of absence or changes of employment status will be
considered to be a termination of employment, including rules regarding
transfer of employment among Designated Subsidiaries, Subsidiaries and
the Corporation, and the Committee may establish termination of employment
procedures for this Plan which are independent of similar rules established
under other benefit plans of the Corporation and its Subsidiaries.
<p><b>7.&nbsp;&nbsp;&nbsp;&nbsp; <u>OFFERING</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7.1&nbsp;&nbsp;&nbsp; Subject
to adjustment as set forth in Section 10, the maximum number of shares
of Common Stock which may be issued pursuant to the Plan shall be 2.5 million
shares, plus an annual increase to be added on the last day of each fiscal
year of the Corporation beginning in 2001, equal to one percent (1%) of
the outstanding shares of the Corporation on such date or a lesser amount
determined by the Committee, provided that the maximum number of shares
of Common Stock that may be issued pursuant to the Plan shall be 7.5 million
shares. If, on a given Purchase Date, the number of shares with respect
to which options are to be exercised exceeds the number of shares then
available under the Plan, the Corporation shall make a pro rata allocation
of the shares remaining available for purchase in as uniform a manner as
shall be practicable and as it shall determine to be equitable.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7.2&nbsp;&nbsp;&nbsp; Each
Purchase Period shall be determined by the Committee. For those Employees
who are eligible and become Participants in the Plan as of the effective
date of the Plan (the first Entry Date), the initial Purchase Period will
begin on the Plan's effective date and end on June 30, 2001. For those
Employees who are eligible and become Participants on the Plan's second
Entry Date (January 1, 2001), the initial Purchase Period for such participants
will begin on January 1, 2001 and end on June 30, 2001. Unless otherwise
determined by the Committee, the Plan will operate with successive six
(6) month Purchase Periods commencing at July 1 and January 1. The Committee
shall have the power to change the duration of future Purchase Periods,
without Shareholder approval, and without regard to the expectations of
any Participants.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7.3&nbsp;&nbsp;&nbsp; With
respect to any Offering Period, each eligible Employee who has elected
to participate as provided in Section 5.1 shall be granted, as of such
Employee's Entry Date, an option for each Purchase Period within the Offering
Period to purchase that number of whole shares of Common Stock (not to
exceed 1,500 shares) which may be purchased with the payroll deductions
accumulated on behalf of such Employee during each such Purchase Period
at the purchase price specified in Section 7.4 below, subject to the additional
limitation that no Employee participating in the Section 423 Plan shall
be granted an option to purchase Common Stock under the Plan at a rate
which exceeds U.S. twenty-five thousand dollars (U.S. $25,000) of the Fair
Market Value of such Common Stock (determined at the time such option is
granted) for each calendar year in which such option is outstanding at
any time. The foregoing sentence shall be interpreted so as to comply with
Code Section 423(b)(8).
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 7.4&nbsp;&nbsp;&nbsp; The
purchase price under each option shall be the lower of: (i) a percentage
(not less than eighty-five percent (85%)) established by the Committee
("Designated Percentage") of the Fair Market Value of the Common Stock
on the Entry Date on which an option is granted, or (ii) the Designated
Percentage of the Fair Market Value on the Purchase Date on which the Common
Stock is purchased. The Committee may change the Designated Percentage
with respect to any future Offering Period, but not below eighty-five percent
(85%), and the Committee may determine with respect to any prospective
Offering Period that the option price shall be the Designated Percentage
of the Fair Market Value of the Common Stock on the Purchase Date.
<p><b>8.&nbsp;&nbsp;&nbsp;&nbsp; <u>PURCHASE OF STOCK</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Upon the expiration of each
Purchase Period, a Participant's option shall be exercised automatically
for the purchase of that number of whole shares of Common Stock which the
accumulated payroll deductions credited to the Participant's account at
that time shall purchase at the applicable price specified in Section 7.4.
Notwithstanding the foregoing, the Corporation or its designee may make
such provisions and take such action as it deems necessary or appropriate
for the withholding of taxes and/or social insurance which the Corporation
or its Designated Subsidiary is required by law or regulation of any governmental
authority to withhold. Each Participant, however, shall be responsible
for payment of all individual tax liabilities arising under the Plan.
<p><b>9.&nbsp;&nbsp;&nbsp;&nbsp; <u>PAYMENT AND DELIVERY</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; As soon as practicable after
the exercise of an option, the Corporation shall deliver to the Participant
a record of the Common Stock purchased and the balance of any amount of
payroll deductions credited to the Participant's account not used for the
purchase, except as specified below. The Committee may permit or require
that shares be deposited directly with a broker designated by the Committee
or to a designated agent of the Corporation, and the Committee may utilize
electronic or automated methods of share transfer. The Committee may require
that shares be retained with such broker or agent for a designated period
of time and/or may establish other procedures to permit tracking of disqualifying
dispositions of such shares. The Corporation shall retain the amount of
payroll deductions used to purchase Common Stock as full payment for the
Common Stock and the Common Stock shall then be fully paid and non-assessable.
No Participant shall have any voting, dividend, or other Shareholder rights
with respect to shares subject to any option granted under the Plan until
the shares subject to the option have been purchased and delivered to the
Participant as provided in this Section 9.
<p><b>10.&nbsp;&nbsp;&nbsp;&nbsp; <u>RECAPITALIZATION</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; If after the grant of an
option, but prior to the purchase of Common Stock under the option, there
is any increase or decrease in the number of outstanding shares of Common
Stock because of a stock split, stock dividend, combination or recapitalization
of shares subject to options, the number of shares to be purchased pursuant
to an option, the price per share of Common Stock covered by an option
and the maximum number of shares specified in Section 7.1 may be appropriately
adjusted by the Board, and the Board shall take any further actions which,
in the exercise of its discretion, may be necessary or appropriate under
the circumstances.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The Board's determinations
under this Section 10 shall be conclusive and binding on all parties.
<p><b>11.&nbsp;&nbsp;&nbsp; <u>MERGER, LIQUIDATION, OTHER CORPORATION TRANSACTIONS</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; In the event of shareholder
approval of a liquidation or dissolution of the Corporation, the Offering
Period will terminate immediately, unless otherwise provided by the Board
in its sole discretion, and all outstanding options shall automatically
terminate and the amounts of all payroll deductions will be refunded without
interest to the Participants.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; In the event of a sale of
all or substantially all of the assets of the Corporation, the acquisition
by a person (including any entity or group) of beneficial ownership of
a majority of the Corporation's outstanding capital stock (based on voting
power, but excluding any acquisition by the Corporation, its affiliate,
employee benefit plans of the Corporation or its affiliate, and any underwriter
holding securities temporarily pursuant to an offering), or the merger
or consolidation of the Corporation with or into another corporation, then
in the sole discretion of the Board, (1) each option shall be assumed or
an equivalent option shall be substituted by the successor corporation
or parent or subsidiary of such successor corporation, (2) a date established
by the Board on or before the date of consummation of such merger, consolidation
or sale shall be treated as a Purchase Date, and all outstanding options
shall be exercised on such date, or (3) all outstanding options shall terminate
and the accumulated payroll deductions will be refunded without interest
to the Participants.
<p><b>12.&nbsp;&nbsp;&nbsp; <u>TRANSFERABILITY</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Options granted to Participants
may not be voluntarily or involuntarily assigned, transferred, pledged,
or otherwise disposed of in any way, and any attempted assignment, transfer,
pledge, or other disposition shall be null and void and without effect.
If a Participant in any manner attempts to transfer, assign or otherwise
encumber his or her rights or interests under the Plan, other than as permitted
by the Code, such act shall be treated as an election by the Participant
to discontinue participation in the Plan pursuant to Section 5.2.
<p><b>13.&nbsp;&nbsp;&nbsp; <u>AMENDMENT OR TERMINATION OF THE PLAN</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13.1&nbsp;&nbsp;&nbsp; The
Plan shall continue until June 30, 2020 unless otherwise terminated in
accordance with Section 13.2.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; 13.2&nbsp;&nbsp;&nbsp; The
Board may, in its sole discretion, insofar as permitted by law, terminate
or suspend the Plan, or revise or amend it in any respect whatsoever, except
that, without approval of the Shareholders, no such revision or amendment
shall materially increase the number of shares subject to the Plan, other
than an adjustment under Section 10 of the Plan.
<p><b>14.&nbsp;&nbsp;&nbsp; <u>ADMINISTRATION</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The Board shall appoint a
Committee consisting of at least two members who will serve for such period
of time as the Board may specify and whom the Board may remove at any time.
The Committee will have the authority and responsibility for the day-to-day
administration of the Plan, the authority and responsibility specifically
provided in this Plan and any additional duty, responsibility and authority
delegated to the Committee by the Board, which may include any of the functions
assigned to the Board in this Plan. The Committee may delegate to one or
more individuals the day-to-day administration of the Plan. The Committee
shall have full power and authority to promulgate any rules and regulations
which it deems necessary for the proper administration of the Plan, to
interpret the provisions and supervise the administration of the Plan,
to make factual determinations relevant to Plan entitlements and to take
all action in connection with administration of the Plan as it deems necessary
or advisable, consistent with the delegation from the Board. Decisions
of the Board and the Committee shall be final and binding upon all participants.
Any decision reduced to writing and signed by a majority of the members
of the Committee shall be fully effective as if it had been made at a meeting
of the Committee duly held. The Corporation shall pay all expenses incurred
in the administration of the Plan. No Board or Committee member shall be
liable for any action or determination made in good faith with respect
to the Plan or any option granted hereunder.
<p><b>15.&nbsp;&nbsp;&nbsp; <u>COMMITTEE RULES FOR FOREIGN JURISDICTIONS</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The Committee may adopt rules
or procedures relating to the operation and administration of the Plan
to accommodate the specific requirements of local laws and procedures.
Without limiting the generality of the foregoing, the Committee is specifically
authorized to adopt rules and procedures regarding handling of payroll
deductions, payment of interest, conversion of local currency, payroll
tax, withholding procedures and handling of stock certificates which vary
with local requirements.
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The Committee may also adopt
"sub-plans" separate from this Plan for purposes of Code Section 423 applicable
to particular affiliates of the Corporation, which sub-plans may be designed
to be outside the scope of Code section 423. Notwithstanding the foregoing,
the shares of Common Stock issued under any sub-plan shall be aggregated
with the shares of Common Stock issued under this Plan and such aggregate
number of shares shall be subject to the maximum number set forth under
Section 7.1 hereof. The rules of such sub-plans may take precedence over
other provisions of this Plan, with the exception of Section 7.1, but unless
otherwise superseded by the terms of such sub-plan, the provisions of this
Plan shall govern the operation of such sub-plan.
<p><b>16.&nbsp;&nbsp;&nbsp; <u>SECURITIES LAWS REQUIREMENTS</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; The Corporation shall not
be under any obligation to issue Common Stock upon the exercise of any
option unless and until the Corporation has determined that: (i) it and
the Participant have taken all actions required to register the Common
Stock under the Securities Act of 1933, or to perfect an exemption from
the registration requirements thereof; (ii) any applicable listing requirement
of any stock exchange on which the Common Stock is listed has been satisfied;
and (iii) all other applicable provisions of state, federal and applicable
foreign law have been satisfied.
<p><b>17.&nbsp;&nbsp;&nbsp; <u>GOVERNMENTAL REGULATIONS</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; This Plan and the Corporation's
obligation to sell and deliver shares of its stock under the Plan shall
be subject to the approval of any governmental authority required in connection
with the Plan or the authorization, issuance, sale, or delivery of stock
hereunder.
<p><b>18.&nbsp;&nbsp;&nbsp; <u>NO ENLARGEMENT OF EMPLOYEE RIGHTS</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Nothing contained in this
Plan shall be deemed to give any Employee the right to be retained in the
employ of the Corporation or any Designated Subsidiary or to interfere
with the right of the Corporation or Designated Subsidiary to discharge
any Employee at any time.
<p><b>19.&nbsp;&nbsp;&nbsp; <u>GOVERNING LAW</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; This Plan shall be governed
by Delaware law, without regard to that State's choice of law rules.
<p><b>20.&nbsp;&nbsp;&nbsp; <u>EFFECTIVE DATE</u>.</b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; This Plan shall become effective
on the IPO Date, subject to approval of the Shareholders of the Corporation
within 12 months before or after its adoption by the Board.<b><u></u></b>
<p><b>21.&nbsp;&nbsp;&nbsp; <u>REPORTS</u>.</b><b></b>
<p>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Individual accounts shall
be maintained for each Participant in the Plan. Statements of account shall
be given to Participants at least annually, which statements shall set
forth the amounts of payroll deductions, the Purchase Price, the number
of shares purchased and the remaining cash balance, if any.
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