LeapFrog 2005 Annual Report Download - page 195

(iv) Additional Restrictions. At the time of the grant of a Restricted Stock Unit Award, the Board,
as it deems appropriate, may impose such restrictions or conditions that delay the delivery of the shares of
Class A Common Stock (or their cash equivalent) subject to a Restricted Stock Unit Award to a time after
the vesting of such Restricted Stock Unit Award.
(v) Dividend Equivalents. Dividend equivalents may be credited in respect of shares of Class A
Common Stock covered by a Restricted Stock Unit Award, as determined by the Board and contained in the
Restricted Stock Unit Award Agreement. At the sole discretion of the Board, such dividend equivalents may
be converted into additional shares of Class A Common Stock covered by the Restricted Stock Unit Award
in such manner as determined by the Board. Any additional shares covered by the Restricted Stock Unit
Award credited by reason of such dividend equivalents will be subject to all the terms and conditions of the
underlying Restricted Stock Unit Award Agreement to which they relate.
(vi) Termination of Participant’s Continuous Service. Except as otherwise provided in the
applicable Restricted Stock Unit Award Agreement, such portion of the Restricted Stock Unit Award that
has not vested will be forfeited upon the Participant’s termination of Continuous Service.
(vii) Compliance with Section 409A of the Code. Notwithstanding anything to the contrary set forth
herein, any Restricted Stock Unit Award granted under the Plan that is not exempt from the requirements of
Section 409A of the Code shall contain such provisions so that such Restricted Stock Unit Award will
comply with the requirements of Section 409A of the Code. Such restrictions, if any, shall be determined by
the Board and contained in the Restricted Stock Unit Award Agreement evidencing such Restricted Stock
Unit Award. For example, such restrictions may include, without limitation, a requirement that any Class A
Common Stock that is to be issued in a year following the year in which the Restricted Stock Unit Award
vests must be issued in accordance with a fixed pre-determined schedule.
(d) Stock Appreciation Rights. Each Stock Appreciation Right Agreement shall be in such form and
shall contain such terms and conditions as the Board shall deem appropriate. Stock Appreciation Rights may be
granted as stand-alone Stock Awards or in tandem with other Stock Awards. The terms and conditions of Stock
Appreciation Right Agreements may change from time to time, and the terms and conditions of separate Stock
Appreciation Right Agreements need not be identical; provided, however, that each Stock Appreciation Right
Agreement shall include (through incorporation of the provisions hereof by reference in the Agreement or
otherwise) the substance of each of the following provisions:
(i) Term. No Stock Appreciation Right shall be exercisable after the expiration of ten (10) years from
the date of its grant or such shorter period specified in the Stock Appreciation Right Agreement.
(ii) Strike Price. Each Stock Appreciation Right will be denominated in shares of Class A Common
Stock equivalents. The strike price of each Stock Appreciation Right shall not be less than one hundred
percent (100%) of the Fair Market Value of the Class A Common Stock equivalents subject to the Stock
Appreciation Right on the date of grant.
(iii) Calculation of Appreciation. The appreciation distribution payable on the exercise of a Stock
Appreciation Right will be not greater than an amount equal to the excess of (A) the aggregate Fair Market
Value (on the date of the exercise of the Stock Appreciation Right) of a number of shares of Class A
Common Stock equal to the number of shares of Class A Common Stock equivalents in which the
Participant is vested under such Stock Appreciation Right, and with respect to which the Participant is
exercising the Stock Appreciation Right on such date, over (B) the strike price that will be determined by
the Board at the time of grant of the Stock Appreciation Right.
(iv) Vesting. At the time of the grant of a Stock Appreciation Right, the Board may impose such
restrictions or conditions to the vesting of such Stock Appreciation Right as it, in its sole discretion, deems
appropriate.
(v) Exercise. To exercise any outstanding Stock Appreciation Right, the Participant must provide
written notice of exercise to the Company in compliance with the provisions of the Stock Appreciation
Right Agreement evidencing such Stock Appreciation Right.
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