Shutterfly 2011 Annual Report Download - page 79

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4. ADMINISTRATION .
4.1 Committee Authority
. This Plan will be administered by the Committee or by the Board acting as the
Committee. Except for Awards made to Outside Directors pursuant to Section 6 hereof, and subject to the general purposes, terms and
conditions of this Plan, and to the direction of the Board, the Committee will have full power to implement and carry out this Plan. Except for
Awards made to Outside Directors pursuant to Section 6 hereof, the Committee will have the authority to:
(a) construe and interpret this Plan, any Award Agreement and any other agreement or document executed
pursuant to this Plan;
(b) prescribe, amend and rescind rules and regulations relating to this Plan or any Award;
(c) select persons to receive Awards;
(d) determine the form and terms of Awards;
(e) determine the number of Shares or other consideration subject to Awards;
(f) determine whether Awards will be granted singly, in combination with, in tandem with, in replacement of,
or as alternatives to, other Awards under this Plan or any other incentive or compensation plan of the Company or any Parent or Subsidiary of
the Company;
(g) grant waivers of Plan or Award conditions;
(h) determine the vesting, exercisability and payment of Awards;
(i) correct any defect, supply any omission or reconcile any inconsistency in this Plan, any Award or any Award
Agreement;
(j) determine whether an Award has been earned;
(k) adjust performance goals based on Performance Factors to take into account changes in law and accounting
or tax rules and to make such adjustments as the Committee deems necessary or appropriate to reflect the impact of extraordinary or unusual
items, events or circumstances to avoid windfalls or hardships provided that such adjustments are consistent with the regulations promulgated
under Section 162(m) of the Code with respect to persons whose compensation is subject to Section 162(m) of the Code; and
(l) make all other determinations necessary or advisable for the administration of this Plan.
4.2 Committee Discretion
. Except for Awards made to Outside Directors pursuant to Section 6 hereof, any
determination made by the Committee with respect to any Award will be made in its sole discretion at the time of grant of the Award or, unless
in contravention of any express term of this Plan or the Award, at any later time, and such determination will be final and binding on the
Company and on all persons having an interest in any Award under this Plan. The Committee may delegate to two or more directors of the
Company the authority to grant an Award under this Plan to Participants who are not Insiders of the Company. Notwithstanding any provision
of the Plan to the contrary, administration of the Plan shall at all times be limited by the requirement that any administrative action or exercise of
discretion shall be void (or suitably modified when possible) if necessary to avoid the application to any Participant of taxation under Section
409A of the Code.