8x8 2002 Annual Report Download - page 85

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VI. to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating
to sub-plans established for the purpose of satisfying applicable foreign laws;
VII. to allow Optionees to satisfy withholding tax obligations by electing to have the Company withhold from the
Shares to be issued upon exercise of an Option that number of Shares having a Fair Market Value equal to the
minimum amount required to be withheld. The Fair Market Value of the Shares to be withheld shall be
determined on the date that the amount of tax to be withheld is to be determined. All elections by Optionees to
have Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator
may deem necessary or advisable; and
VIII. to construe and interpret the terms of the Plan and Options granted pursuant to the Plan.
C. Effect of Administrator's Decision . All decisions, determinations and interpretations of the Administrator shall be final
and binding on all Optionees.
5. Eligibility . Nonstatutory Stock Options may be granted to Service Providers. Incentive Stock Options may be granted only to
Employees.
6. Limitations .
A. Incentive Stock Option Limit . Each Option shall be designated in the Option Agreement as either an Incentive Stock
Option or a Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair
Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time by the
Optionee during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000,
such Options shall be treated as Nonstatutory Stock Options. For purposes of this Section 6(a), Incentive Stock Options
shall be taken into account in the order in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.
B. At-Will Employment . Neither the Plan nor any Option shall confer upon any Optionee any right with respect to
continuing the Optionee's relationship as a Service Provider with the Company, nor shall it interfere in any way with his
or her right or the Company's right to terminate such relationship at any time, with or without cause, and with or without
notice.
7. Term of Plan . Subject to shareholder approval in accordance with Section 18, the Plan shall become effective upon its adoption
by the Board. Unless sooner terminated under Section 14, it shall continue in effect for a term of ten (10) years from the later of
(i) the effective date of the Plan, or (ii) the date of the most recent Board approval of an increase in the number of shares
reserved for issuance under the Plan.
8. Term of Option . The term of each Option shall be stated in the Option Agreement; provided, however, that the term shall be no
more than ten (10) years from the date of grant thereof. In the case of an Incentive Stock Option granted to an Optionee who, at
the time the Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock
of the Company or any Parent or Subsidiary, the term of the Option shall be five (5) years from the date of grant or such shorter
term as may be provided in the Option Agreement.
9. Option Exercise Price and Consideration .
A. Exercise Price . The per share exercise price for the Shares to be issued upon exercise of an Option shall be such price as
is determined by the Administrator, but shall be subject to the following:
I. In the case of an Incentive Stock Option
A. granted to an Employee 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 Parent or Subsidiary, the
exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant.
B. granted to any other Employee, the per Share exercise price shall be no less than 100% of the Fair Market
Value per Share on the date of grant.
II. In the case of a Nonstatutory Stock Option
A.
granted to a Service Provider 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 Parent or Subsidiary,
the exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant.
B. granted to any other Service Provider, the per Share exercise price shall be no less than 85% of the Fair
Market Value per Share on the date of grant.