Attached files
file | filename |
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8-K - TRANSWITCH CORP /DE | v186068_8k.htm |
EX-4.1 - TRANSWITCH CORP /DE | v186068_ex4-1.htm |
EX-3.1 - TRANSWITCH CORP /DE | v186068_ex3-1.htm |
EX-99.1 - TRANSWITCH CORP /DE | v186068_ex99-1.htm |
Exhibit
4.2
TRANSWITCH
CORPORATION
2008
EQUITY INCENTIVE PLAN
[as
amended May, 2010]
1. Purpose and
Eligibility. The purpose of this 2008 Equity Incentive Plan
(the “Plan”) of TranSwitch Corporation, a
Delaware corporation (the “Company”), is to provide stock
options, stock issuances and other equity interests in the Company (each, an
“Award”) to (a)
employees, officers, directors, consultants and advisors of the Company and its
Subsidiaries or any future parent corporation, and (b) any other person who is
determined by the Board to have made (or is expected to make) contributions to
the Company. Any person to whom an Award has been granted under the
Plan is called a “Participant.” Additional
definitions are contained in Section
10.
2. Administration.
a. Administration by Board of
Directors. The Plan will be administered by the Board of
Directors of the Company (the “Board”). The Board,
in its sole discretion, shall have the authority to grant and amend Awards, to
adopt, amend and repeal rules relating to the Plan and to interpret and correct
the provisions of the Plan and any Award. The Board shall have
authority, subject to the express limitations of the Plan, (i) to construe
and determine the respective Stock Option Agreement (as defined below), Awards
and the Plan, (ii) to prescribe, amend and rescind rules and regulations
relating to the Plan and any Awards, (iii) to determine the terms and
provisions of the respective Stock Option Agreements and Awards, which need not
be identical, (iv) to create sub-plans hereunder necessary to comply with laws
and regulations of any foreign country in which the Company may seek to grant an
Award to a person eligible under Section 1, and
(v) to make all other determinations in the judgment of the Board of
Directors necessary or desirable for the administration and interpretation of
the Plan. The Board may correct any defect or supply any omission or
reconcile any inconsistency in the Plan or in any Stock Option Agreement or
Award in the manner and to the extent it shall deem expedient to carry the Plan,
any Stock Option Agreement or Award into effect and it shall be the sole and
final judge of such expediency. All decisions by the Board shall be
final and binding on all interested persons. Neither the Company nor
any member of the Board shall be liable for any action or determination relating
to the Plan.
b. Appointment of
Committee. 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”). If so
delegated, all references in the Plan to the “Board” shall mean such
Committee or the Board.
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 and exercise such other powers under the Plan as the Board may determine,
provided that the Board shall fix the maximum number of Awards to be granted and
the maximum number of shares issuable to any one Participant pursuant to Awards
granted by such executive officers.
d. Applicability of Section
Rule 16b-3. Notwithstanding anything to the contrary in the
foregoing if, or at such time as, the Common Stock is or becomes registered
under Section 12 of the Exchange Act of 1934, as amended (the “Exchange Act”), or any
successor statute, the Plan shall be administered in a manner consistent with
Rule 16b-3 promulgated thereunder, as it may be amended from time to time, or
any successor rules (“Rule
16b-3”), such that all subsequent grants of Awards hereunder to Reporting
Persons, as hereinafter defined, shall be exempt under such
rule. Those provisions of the Plan which make express reference to
Rule 16b-3 or which are required in order for certain option transactions to
qualify for exemption under Rule 16b-3 shall apply only to such persons as are
required to file reports under Section 16 (a) of the Exchange Act (a “Reporting
Person”).
3. Stock Available for
Awards.
a. Number of
Shares. Subject to adjustment under Section 3(c), the (i)
aggregate number of shares of Common Stock of the Company (the “Common Stock”) that may be
issued pursuant to the Plan is 5,196,250 (the “Available
Shares”). If an Award granted under the Plan is (i) canceled,
expires, forfeited, is settled in cash, settled by delivery of fewer shares of
Common Stock than the number of shares of Common Stock underlying the award or
option or otherwise is terminated without delivery of the shares of Common Stock
to the holder of such award or option or (ii) shares that were withheld from
such an Award or separately surrendered by the Participant in payment of an
exercise price or taxes relating to such an Award shall be deemed to constitute
shares not delivered and will be available under the Plan for subsequent
awards.
b. Per-Participant
Limit. Subject to adjustment under Section 3(c), no
Participant may be granted Awards during any one fiscal year to receive, acquire
or purchase more than 375,000 shares of Common Stock.
c. Adjustment to Common
Stock. Subject to Section 8, in the
event of any stock split, reverse stock split, stock dividend, extraordinary
cash dividend, recapitalization, reorganization, merger, consolidation,
combination, exchange of shares, liquidation, spin-off, split-up, or other
similar change in capitalization or similar event, (i) the number and class of
Available Shares and the per-Participant share limit, (ii) the number and class
of securities, vesting schedule and exercise price per share subject to each
outstanding Option (as defined below), (iii) the repurchase price per security
subject to repurchase, and (iv) the terms of each other outstanding Award shall
be adjusted by the Company (or substituted Awards may be made if applicable) to
the extent the Board shall determine, in good faith, that such an adjustment (or
substitution) is appropriate. Any such adjustment to outstanding
Awards will be effected in a manner that precludes the enlargement of rights and
benefits under such Awards.
4. Stock
Options.
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 and the shares of Common Stock issued upon the exercise
of each Option, including, but not limited to, vesting provisions, repurchase
provisions and restrictions relating to applicable federal or state securities
laws. Each Option will be evidenced by a Stock Option Agreement,
consisting of a Notice of Stock Option Award and a Stock Option Award
Agreement or such other form of documentation as may be approved by
the Board (collectively, a “Stock Option
Agreement”).
2
b. Incentive Stock
Options. An Option that the Board intends to be an incentive
stock option (an “Incentive
Stock Option”) as defined in Section 422 of the Code, as amended, or any
successor statute (“Section
422”), shall be granted only to an employee of the Company and shall be
subject to and shall be construed consistently with the requirements of Section
422 and regulations thereunder. The Board and the Company shall have
no liability if an Option or any part thereof that is intended to be an
Incentive Stock Option does not qualify as such. An Option or any
part thereof that does not qualify as an Incentive Stock Option is referred to
herein as a “Nonstatutory Stock
Option” or “Nonqualified
Stock Option.”
c. Dollar
Limitation. For so long as the Code shall so provide, Options
granted to any employee under the Plan (and any other incentive stock option
plans of the Company) which are intended to qualify as Incentive Stock Options
shall not qualify as Incentive Stock Options to the extent that such Options, in
the aggregate, become exercisable for the first time in any one calendar year
for shares of Common Stock with an aggregate Fair Market Value (as defined
below) (determined as of the respective date or dates of grant) of more than
$100,000. The amount of Incentive Stock Options which exceed such
$100,000 limitation shall be deemed to be Nonqualified Stock
Options. For the purpose of this limitation, unless otherwise
required by the Code or regulations of the Internal Revenue Service or
determined by the Board, Options shall be taken into account in the order
granted, and the Board may designate that portion of any Incentive Stock Option
that shall be treated as Nonqualified Option in the event that the provisions of
this paragraph apply to a portion of any Option. The designation
described in the preceding sentence may be made at such time as the Committee
considers appropriate, including after the issuance of the Option or at the time
of its exercise.
d. Exercise
Price. The Board shall establish the exercise price (or
determine the method by which the exercise price shall be determined) at the
time each Option is granted and specify the exercise price in the applicable
Stock Option Agreement, provided, however, in no event may the per share
exercise price of an Incentive Stock Option be less than 100% of the Fair Market
Value of the Common Stock on the date such Option is granted. In the
case of an Incentive Stock Option granted to a Participant who, at the time of
grant of such Option, owns stock representing more than ten percent (10%) of the
voting power of all classes of stock of the Company or any Subsidiary or future
parent corporation, then the exercise price shall be no less than 110% of the
Fair Market Value of the Common Stock on the date of grant. The Board
in its sole and absolute discretion may, with the consent of the Recipient, if
applicable, and subject to compliance with any legal, regulatory or other administrative requirements
applicable to the Plan amend or adjust the terms and conditions of
any Award, at any time or from time to time, including, but not limited to, to
either (1) reduce the exercise price of an outstanding Option or other Award or
(2) simultaneously cancel Options for which the exercise price exceeds the then
current Fair Market Value of the underlying Common Stock and grant a new Award
with an exercise price equal to or greater than the then current Fair Market
Value of the underlying Common Stock.
3
e. 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
Stock Option Agreement; provided, that the term of any Incentive Stock Option
may not be more than ten (10) years from the date of grant. In the
case of an Incentive Stock Option granted to a Participant who, at the time of
grant of such Option, owns stock representing more than ten percent (10%) of the
voting power of all classes of stock of the Company or any Subsidiary or future
parent corporation, the term of the Option shall be no longer than five (5)
years from the date of grant.
f. Payment Upon
Exercise. Common Stock purchased upon the exercise of an
Option shall be paid for by one or any combination of the following forms of
payment as permitted by the Board in its sole and absolute
discretion:
i. by
check payable to the order of the Company;
ii. only
if the Common Stock is then publicly traded, by delivery of an irrevocable and
unconditional undertaking by a creditworthy broker to deliver promptly to the
Company sufficient funds to pay the exercise price, or 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;
iii. to
the extent permitted in the applicable Stock Option Agreement, by delivery of
shares of Common Stock owned by the Participant; or
iv. payment
of such other lawful consideration as the Board may determine.
Except as
otherwise expressly set forth in a Stock Option Agreement, the Board shall have
no obligation to accept consideration other than cash. The fair
market value of any shares of the Company's Common Stock or other non-cash
consideration which may be delivered upon exercise of an Option shall be
determined in such manner as may be prescribed by the Board.
g. Determination of Fair Market
Value. If, at the time an Option is granted under the Plan,
the Company's Common Stock is publicly traded under the Exchange Act, “Fair Market Value” shall mean
(i) if the Common Stock is listed on any established stock exchange, its fair
market value shall be the closing price for such stock on that date or the
closing price as reported on NASDAQ; or (ii) if the Common Stock is traded in
the over-the-counter securities market, then the average of the high bid and low
bid quotations for the Common Stock as published in The Wall Street
Journal. In the absence of an established market for the
Common Stock, the fair market value thereof shall be determined in good faith by
the Board after taking into consideration all factors which it deems
appropriate.
5. Restricted
Stock.
a. Grants. The
Board may (i) grant Awards to a Participant of restricted shares of Common Stock
and shall determine the price, if any, to be paid by the Participant for each
restricted share of Common Stock and (ii) shall provide the right of the Company
to repurchase all or part of such shares at the issue price or other stated or
formula price from the Participant in the event that the 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
(each, a “Restricted Stock
Award”).
4
b. Terms and
Conditions. The Board shall determine the terms and conditions
of any such Restricted Stock Award. 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). After 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 by a Participant, in a manner determined by the
Board, 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.
6. Other Stock-Based
Awards. The Board shall have the right to grant other Awards
based upon the Common Stock having such terms and conditions as the Board may
determine, including, without limitation, the grant of shares based upon certain
conditions, the grant of securities convertible into Common Stock and the grant
of stock appreciation rights, phantom stock awards, performance stock, deferred
stock, restricted stock units, shares of Common Stock not subject to any
restrictions or stock units.
7. General Provisions
Applicable to Awards.
a. Transferability of
Awards. Except as the Board may otherwise determine or provide
in an Award, Awards shall not be sold, assigned, transferred, pledged or
otherwise encumbered by the person to whom they are granted, either voluntarily
or by operation of law, except by will or the laws of descent and distribution,
and, during the life of the Participant, shall be exercisable only by the
Participant; provided, however, except as the Board may otherwise determine or
provide in an Award, other than an Incentive Stock Option, may be transferred
pursuant to a qualified domestic relations order (as defined in Employee
Retirement Income Security Act of 1974, as amended) or to a grantor-retained
annuity trust or a similar estate-planning vehicle in which the trust is bound
by all provisions of the Stock Option Agreement and Restricted Stock Award,
which are applicable to the Participant. References to a Participant,
to the extent relevant in the context, shall include references to authorized
transferees.
b. Documentation. Each
Award under the Plan shall be evidenced by a written instrument in such form as
the Board shall determine or as executed by an officer of the Company pursuant
to authority delegated by the Board. Each Award may contain terms and
conditions in addition to those set forth in the Plan, provided that such terms
and conditions do not contravene the provisions of the Plan or applicable
law. Notice of a grant shall be given to each Participant to whom an
Award is so granted within a reasonable time after the determination has been
made.
c. Board
Discretion. The terms of each type of Award need not be
identical, and the Board need not treat Participants uniformly.
5
d. Additional Award
Provisions. The Board may, in its sole discretion, include
additional provisions in any Stock Option Agreement, Restricted Stock Award or
other Award granted under the Plan, including without limitation restrictions on
transfer, repurchase rights, commitments to pay cash bonuses, to make, arrange
for or guaranty loans or to transfer other property to Participants upon
exercise of Awards, or transfer other property to Participants upon exercise of
Awards, or such other provisions as shall be determined by the Board; provided
that such additional provisions shall not be inconsistent with any other term or
condition of the Plan or applicable law.
e. Termination of
Status. The Board shall determine the effect on an Award of
the disability (as defined in Code Section 22(e)(3)), death, retirement,
authorized leave of absence or other change in the employment or other status of
a Participant and the extent to which, and the period during which, the
Participant, or the Participant's legal representative, conservator, guardian or
Designated Beneficiary, may exercise rights under the Award, subject to
applicable law and the provisions of the Code related to Incentive Stock
Options.
f. Change of Control of the
Company.
i. Unless
otherwise expressly provided in the applicable Stock Option Agreement or
Restricted Stock Award or other Award, in connection with the occurrence of a
Change in Control (as defined below), the Board shall, in its sole discretion as
to any outstanding Award (including any portion thereof; on the same basis or on
different bases, as the Board shall specify), take one or any combination of the
following actions:
A. make
appropriate provision for the continuation of such Award by the Company or the
assumption of such Award by the surviving or acquiring entity and by
substituting on an equitable basis for the shares then subject to such Award
either (x) the consideration payable with respect to the outstanding shares of
Common Stock in connection with the Change of Control, (y) shares of stock of
the surviving or acquiring corporation, or (z) such other securities as the
Board deems appropriate, the Fair Market Value of which shall not materially
differ from the Fair Market Value of the shares of Common Stock subject to such
Award immediately preceding the Change of Control (as determined by the Board in
its sole discretion;
B. accelerate
the date of exercise or vesting of such Award;
C. permit
the exchange of such Award for the right to participate in any stock option or
other employee benefit plan of any successor corporation;
D. provide
for the repurchase of the Award for an amount equal to the difference of (i) the
consideration received per share for the securities underlying the Award in the
Change of Control minus (ii) the per share exercise price of such
securities. Such amount shall be payable in cash or the property
payable in respect of such securities in connection with the Change of
Control. The value of any such property shall be determined by the
Board in its discretion; or
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E. Solely
with respect to a transaction described in Section 7(f)(i)(F)(a)
below, provide for the termination of such Award immediately prior to the
consummation of the Change of Control; provided that no such termination shall
be effective unless the option holder is provided at least fifteen (15) business
days prior to the consummation of the Change of Control to exercise his/her
options.
F. For
the purpose of this Agreement, a “Change of Control” shall
mean:
(a) The
consummation of (i) a reorganization, merger or consolidation (any of the
foregoing, a “Merger”),
in each case, with respect to which the individuals and entities who were the
beneficial owners of the Voting Stock immediately prior to such Merger do not,
following such Merger, beneficially own, directly or indirectly, more than 50%
of the then outstanding shares of common stock of the corporation resulting from
the Merger (the Resulting
Corporation”) as a result of the individuals’ and entities’ shareholdings
in the Company immediately prior to the consummation of the Merger and without
regard to any of the individual’s and entities’ shareholdings in the Resulting
Corporation immediately prior to the consummation of the Merger, (ii) a complete
liquidation or dissolution of the Company, or (iii) the sale or other
disposition of all or substantially all of the assets of the Company, excluding
a sale or other disposition of assets to a subsidiary of the
Company.
g. Dissolution or
Liquidation. In the event of the proposed dissolution or
liquidation of the Company or termination of an Award under Section 7(f)(i)(E),
the Board shall notify each Participant as soon as practicable prior to the
effective date of such proposed transaction. The Board in its sole
discretion may provide for a Participant to have the right to exercise his or
her Award until fifteen (15) days prior to such transaction as to all of the
shares of Common Stock covered by the Option or Award, including shares as to
which the Option or Award would not otherwise be exercisable, which exercise may
in the sole discretion of the Board, be made subject to and conditioned upon the
consummation of such proposed transaction. In addition, the Board may
provide that any Company repurchase option applicable to any shares of Common
Stock purchased upon exercise of an Option or Award shall lapse as to all such
shares of Common Stock, provided the proposed dissolution and liquidation takes
place at the time and in the manner contemplated. To the extent it
has not been previously exercised, an Award will terminate upon the consummation
of such proposed action.
h. Assumption of Options Upon
Certain Events. 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 Awards under the Plan in substitution
for stock and stock-based awards issued by such entity or an affiliate
thereof. The substitute Awards shall be granted on such terms and
conditions as the Board considers appropriate in the circumstances.
7
i. Parachute Payments and
Parachute Awards. Notwithstanding the provisions of Section 7(f), if, in
connection with a Change of Control described therein, a tax under Section 4999 of the
Code would be imposed on the Participant (after taking into account the
exceptions set forth in Sections 280G(b)(4) and 280G(b)(5) of the Code) and not
otherwise paid for by the Company, then the number of Awards which shall become
exercisable, realizable or vested as provided in such Section shall be reduced
(or delayed), to the minimum extent necessary, so that no such tax would be
imposed on the Participant (the Awards not becoming so accelerated, realizable
or vested, the “Parachute
Awards”); provided, however, that if the “aggregate present value” of the
Parachute Awards would exceed the tax that, but for this sentence, would be
imposed on the Participant under Section 4999 of the Code in connection with the
Change of Control, then the Awards shall become immediately exercisable,
realizable and vested without regard to the provisions of this
sentence. For purposes of the preceding sentence, the “aggregate
present value” of an Award shall be calculated on an after-tax basis (other than
taxes imposed by Section 4999 of the Code) and shall be based on economic
principles rather than the principles set forth under Section 280G of the Code
and the regulations promulgated thereunder. All determinations
required to be made under this Section 7(i) shall be
made by the Company.
j. Amendment of
Awards. The Board may amend, modify or terminate any
outstanding Award including, but not limited to, substituting therefor another
Award of the same or a different type, changing the date of exercise or
realization, and converting an Incentive Stock Option to a Nonstatutory Stock
Option, provided that the Participant's consent to such action shall be required
unless the Board determines that the action, taking into account any related
action, would not materially and adversely affect the Participant.
k. Conditions on Delivery of
Stock. The Company will not be obligated to deliver any shares
of Common Stock pursuant to the Plan or to remove restrictions from shares
previously delivered under the Plan until (i) all conditions of the Award have
been met or removed to the satisfaction of the Company, (ii) in the opinion of
the Company's counsel, all other legal matters in connection with the issuance
and delivery of such shares have been satisfied, including any applicable
securities laws and any applicable stock exchange or stock market rules and
regulations, and (iii) the Participant has executed and delivered to the Company
such representations or agreements as the Company may consider appropriate to
satisfy the requirements of any applicable laws, rules, or
regulations.
l. Acceleration. The
Board may at any time provide that any Award shall become immediately
exercisable in full or in part, or that any other stock-based Awards may become
exercisable in full or in part or free of some or all restrictions or
conditions, or otherwise realizable in full or in part, as the case may be,
despite the fact that the foregoing actions may (i) cause the application of
Sections 280G and 4999 of the Code if a Change In Control of the Company occurs,
or (ii) disqualify all or part of the Option as an Incentive Stock
Option. In addition, the Board may, in its sole discretion, and in
all instances subject to any relevant tax and accounting considerations which
may adversely impact or impair the Company, extend the dates during which all or
any particular Options or Awards granted under the Plan may be
exercised.
m. Participation in Foreign
Countries. The Board shall have the authority to adopt such
modifications, procedures, and subplans as may be necessary or desirable to
comply with provisions of the laws of foreign countries in which the Company or
its Subsidiaries may operate to assure the viability of the benefits from Awards
granted to Participants performing services in such countries and to meet the
objectives of the Plan.
8
8. Withholding. The
Company shall have the right to deduct from payments of any kind otherwise due
to the optionee or recipient of an Award any federal, state, or local taxes of
any kind required by law to be withheld with respect to any shares issued upon
exercise of Options under the Plan or the purchase of shares subject to the
Award. Subject to the prior approval of the Company, which may be
withheld by the Company in its sole discretion, the optionee or recipient of an
Award may elect to satisfy such obligation, in whole or in part, (a) by causing
the Company to withhold shares of Common Stock otherwise issuable pursuant to
the exercise of an Option or the purchase of shares subject to an Award or (b)
by delivering to the Company shares of Common Stock already owned by the
optionee or Award recipient of an Award. The shares so delivered or
withheld shall have a fair market value of the shares used to satisfy such
withholding obligation as shall be determined by the Company as of the date that
the amount of tax to be withheld is to be determined. An optionee or
recipient of an Award who has made an election pursuant to this Section may only
satisfy his or her withholding obligation with shares of Common Stock which are
not subject to any repurchase, forfeiture, unfulfilled vesting, or other similar
requirements.
9. No Exercise of Option if
Engagement or Employment Terminated for Cause. If the
employment or engagement of any Participant is terminated “for Cause”, the Award
may terminate, upon a determination of the Board, on the date of such
termination and the Option shall thereupon not be exercisable to any extent
whatsoever and the Company shall have the right to repurchase any shares of
Common Stock subject to a Restricted Stock Award whether or not such shares have
vested. For purposes of this Section 9, “for Cause” shall be defined as
follows: (i) if the Participant has executed an employment agreement,
the definition of “cause” contained therein, if any, shall govern, or (ii) if
the Participant has not executed an employment agreement in which the definition
of “cause” is provided, conduct, as determined by the Board of Directors,
involving one or more of the following: (a) gross misconduct or inadequate
performance by the Participant which is injurious to the Company; or (b) the
commission of an act of embezzlement, fraud or theft, which results in economic
loss, damage or injury to the Company; or (c) the unauthorized disclosure of any
trade secret or confidential information of the Company (or any client,
customer, supplier, or other third party who has a business relationship with
the Company) or the violation of any noncompetition or nonsolicitation covenant
or assignment of inventions obligation with the Company; or (d) the commission
of an act which constitutes unfair competition with the Company or
which induces any customer or prospective customer of the Company to breach a
contract with the Company or to decline to do business with the Company (to the
extent such restriction is enforceable under applicable state law; or (e) the
indictment or conviction of the Participant for a felony or serious misdemeanor
offense, either in connection with the performance of his or her obligations to
the Company or which shall adversely affect the Participant's ability to perform
such obligations; or (f) the commission of an act of fraud or breach of
fiduciary duty which results in loss, damage or injury to the Company; or (g)
the failure of the Participant to perform in a material respect his or her
employment, consulting or advisory obligations without proper
cause. The Board may in its discretion waive or modify the provisions
of this Section at a meeting of the Board with respect to any individual
Participant with regard to the facts and circumstances of any particular
situation involving a determination under this Section.
9
10. Miscellaneous.
a. Definitions.
i. “Company”, for purposes of
eligibility under the Plan, shall include any present or future subsidiary
corporations of TranSwitch Corporation, as defined in Section 424(f) of the Code
(a “Subsidiary”), and
any present or future parent corporation of TranSwitch Corporation, as defined
in Section 424(e) of the Code. For purposes of Awards other than
Incentive Stock Options, the term “Company” shall include any other business
venture in which the Company has a direct or indirect significant interest, as
determined by the Board in its sole discretion.
ii. “Code” means the Internal
Revenue Code of 1986, as amended, and any regulations promulgated
thereunder.
iii. “Effective Date” means the date
the Plan is approved by the Company’s stockholders.
iv. “Employee” for purposes of
eligibility under the Plan shall include a person to whom an offer of employment
has been extended by the Company.
b. No Right To Employment or
Other Status. No person shall have any claim or right to be
granted an Award, and the grant of an Award shall not be construed as giving a
Participant the right to continued employment or any other relationship with the
Company. The Company expressly reserves the right at any time to
dismiss or otherwise terminate its relationship with a Participant free from any
liability or claim under the Plan. Except as specifically provided by
the Board in any particular case, the loss of existing or potential profit and
Awards granted under this Plan will not constitute an element of damages in the
event of termination of an employment relationship even if the termination is in
violation of an obligation of the Company to the Participant.
c. Compliance with
Law. The Company shall not be required to sell or issue any
shares of Common Stock under any Award if the sale or issuance of such shares
would constitute a violation by the Participant, any other individual exercising
an Option, or the Company of any provision of any law or regulation of any
governmental authority, including without limitation any federal or state
securities laws or regulation. If at any time the Company shall
determine, in its discretion, that the listing, registration or qualification of
any share subject to an Award up on any security exchange or under any
governmental regulatory body is necessary or desirable as a condition of, or in
connection with, the issuance or purchase of shares hereunder, no shares of
Common Stock may be issued or sold to the Participant or any other individual
exercising an Option pursuant to such Award unless such listing, registration,
qualification, consent, or approval shall have been effected or obtained free of
any conditions not acceptable to the Company, and any delay caused thereby shall
in no way effect the date of termination of the Award. Any
determination in connection with the preceding sentence by the Board shall be
final, binding and conclusive. The Company may, but shall in no event
be obligated to, register any securities covered hereby pursuant to the
Securities Act. The Company shall not be obligated to take any
affirmative action in order to cause the exercise of an Option or the issuance
of shares of Common Stock pursuant to the Plan to comply with any law or
regulation of any governmental authority. As to any jurisdiction that
expressly imposes that a Option shall not be exercised until the shares of
Common Stock covered by such Option are registered or exempt from registration,
the exercise of such Option (under circumstances in which the laws of such
jurisdiction apply) shall be deemed conditioned up on the effectiveness of such
registration or availability of such an exemption.
10
d. No Rights As
Stockholder. Subject to the provisions of the
applicable Award, no Participant or Designated Beneficiary shall have any rights
as a stockholder with respect to any shares of Common Stock to be distributed
with respect to an Award until becoming the record holder thereof.
e. Effective Date and Term of
Plan. The Plan shall become effective on the date on which it
is approved by the stockholders. No Awards shall be granted under the
Plan after the completion of ten years from the date on which the Plan was
approved by the stockholders, but Awards previously granted may extend beyond
that date.
f. Amendment of
Plan. The Board of Directors may, at any time, suspend or
terminate the Plan or revise or amend it in any respect
whatsoever. An Amendment shall be contingent on approval of the
Company’s stockholders to the extent stated by the Board, required by applicable
law or required by applicable stock exchange listing requirements.
g. Governing
Law. The provisions of the Plan and all Awards made hereunder
shall be governed by and interpreted in accordance with the laws of the State of
Delaware, without regard to any applicable conflicts of law
principles.
11
Approvals
Original
Plan
Adopted
by the Board of Directors on:
|
April
8, 2008
|
Approved
by the Stockholders on:
|
May
22, 2008
|
As
Amended to increase the authorized share number
Adopted
by the Board of Directors on:
|
April
7, 2009
|
Approved
by the Stockholders on:
|
May
21, 2009
|
As
Amended to increase the authorized share number
Adopted
by the Board of Directors on:
|
April
1, 2010
|
Approved
by the Stockholders on:
|
May
20, 2010
|
12