EXHIBIT 10.21
InterTrust Technologies Corporation
2000 Supplemental Plan
(As Adopted December 5, 2000)
TABLE OF CONTENTS
Page
ARTICLE 1. INTRODUCTION............................................... 1
ARTICLE 2. ADMINISTRATION............................................. 1
2.1 Committee Composition........................................ 1
2.2 Committee Responsibilities................................... 1
ARTICLE 3. SHARES AVAILABLE FOR GRANTS................................ 1
3.1 Basic Limitation............................................. 1
3.2 Additional Shares............................................ 2
3.3 Dividend Equivalents......................................... 2
ARTICLE 4. ELIGIBILITY................................................ 2
ARTICLE 5. OPTIONS.................................................... 2
5.1 Stock Option Agreement....................................... 2
5.2 Number of Shares............................................. 2
5.3 Exercise Price............................................... 2
5.4 Exercisability and Term...................................... 2
5.5 Modification or Assumption of Options........................ 2
5.6 Buyout Provisions............................................ 3
ARTICLE 6. PAYMENT FOR OPTION SHARES.................................. 3
6.1 General Rule................................................. 3
6.2 Surrender of Stock........................................... 3
6.3 Exercise/Sale................................................ 3
6.4 Exercise/Pledge.............................................. 3
6.5 Promissory Note.............................................. 3
6.6 Other Forms of Payment....................................... 3
ARTICLE 7. RESTRICTED SHARES.......................................... 4
7.1 Restricted Stock Agreement................................... 4
7.2 Payment for Awards........................................... 4
7.3 Vesting Conditions........................................... 4
7.4 Voting and Dividend Rights................................... 4
ARTICLE 8. PROTECTION AGAINST DILUTION................................ 4
8.1 Adjustments.................................................. 4
8.2 Dissolution or Liquidation................................... 5
8.3 Reorganizations.............................................. 5
ARTICLE 9. CHANGE IN CONTROL.......................................... 5
ARTICLE 10. DEFERRAL OF AWARDS......................................... 5
ARTICLE 11. AWARDS UNDER OTHER PLANS................................... 6
ARTICLE 12. LIMITATION ON RIGHTS....................................... 6
12.1 Retention Rights............................................ 6
12.2 Stockholders' Rights........................................ 6
12.3 Regulatory Requirements..................................... 6
ARTICLE 13. WITHHOLDING TAXES.......................................... 7
13.1 General..................................................... 7
13.2 Share Withholding........................................... 7
ARTICLE 14. FUTURE OF THE PLAN......................................... 7
14.1 Term of the Plan............................................ 7
14.2 Amendment or Termination.................................... 7
ARTICLE 15. DEFINITIONS................................................ 7
15.1 Affiliate................................................... 7
15.2 Award....................................................... 7
15.3 Board....................................................... 7
15.4 Change in Control........................................... 7
15.5 Code........................................................ 8
15.6 Committee................................................... 8
15.7 Common Share................................................ 8
15.8 Company..................................................... 8
15.9 Consultant.................................................. 8
15.10 Employee.................................................... 8
15.11 Related Corporations........................................ 8
15.12 Exercise Price.............................................. 8
15.13 Fair Market Value........................................... 9
15.14 NSO......................................................... 9
15.15 Option...................................................... 9
15.16 Optionee.................................................... 9
15.17 Parent...................................................... 9
15.18 Participant................................................. 9
15.19 Plan........................................................ 9
15.20 Restricted Share............................................ 9
15.21 Restricted Stock Agreement.................................. 9
15.22 Stock Option Agreement...................................... 9
15.23 Subsidiary.................................................. 9
InterTrust Technologies Corporation
2000 Supplemental Plan
ARTICLE 1. INTRODUCTION.
The Plan was adopted by the Board on December 5, 2000 to be effective
as of the date adopted by the Board. The purpose of the Plan is to promote the
long-term success of the Company and the creation of stockholder value by (a)
encouraging Employees and Consultants to focus on critical long-range
objectives, (b) encouraging the attraction and retention of Employees, and
Consultants with exceptional qualifications and (c) linking Employees and
Consultants directly to stockholder interests through increased stock ownership.
The Plan seeks to achieve this purpose by providing for Awards in the form of
Restricted Shares and Options (which shall constitute nonstatutory stock
options).
The Plan shall be governed by, and construed in accordance with, the
laws of the State of Delaware (except their choice-of-law provisions).
ARTICLE 2. ADMINISTRATION.
2.1 Committee Composition. The Plan shall be administered by the
Committee. The Committee shall consist exclusively of one or more directors of
the Company, who shall be appointed by the Board. In addition, the composition
of the Committee shall satisfy:
(a) Such requirements as the Securities and Exchange Commission
may establish for administrators acting under plans intended to qualify for
exemption under Rule 16b-3 (or its successor) under the Exchange Act; and
(b) Such requirements as the Internal Revenue Service may
establish for outside directors acting under plans intended to qualify for
exemption under section 162(m)(4)(C) of the Code.
2.2 Committee Responsibilities. The Committee shall (a) select the
Employees and Consultants who are to receive Awards under the Plan, (b)
determine the type, number, vesting requirements and other features and
conditions of such Awards, (c) interpret the Plan and (d) make all other
decisions relating to the operation of the Plan. The Committee may adopt such
rules or guidelines as it deems appropriate to implement the Plan. The
Committee's determinations under the Plan shall be final and binding on all
persons.
ARTICLE 3. SHARES AVAILABLE FOR GRANTS.
3.1 Basic Limitation. Common Shares issued pursuant to the Plan may be
authorized but unissued shares or treasury shares. The aggregate number of
Options and Restricted Shares awarded under the Plan shall not exceed (a)
5,000,000 plus (b) the additional
Common Shares described in Sections 3.2 and 3.3. The limitations of this Section
3.1 and Section 3.2 shall be subject to adjustment pursuant to Article 8.
3.2 Additional Shares. If Restricted Shares or Common Shares issued upon
the exercise of Options are forfeited, then such Common Shares shall again
become available for Awards under the Plan. If Options are forfeited or
terminate for any other reason before being exercised, then the corresponding
Common Shares shall again become available for Awards under the Plan.
3.3 Dividend Equivalents. Any dividend equivalents paid or credited under
the Plan shall not be applied against the number of Restricted Shares or Options
available for Awards.
ARTICLE 4. ELIGIBILITY.
Only Employees and Consultants, who are neither officers of the
Company or members of the Board, shall be eligible for the grant of Options and
Restricted Shares.
ARTICLE 5. OPTIONS.
5.1 Stock Option Agreement. Each grant of an Option under the Plan shall
be evidenced by a Stock Option Agreement between the Optionee and the Company.
Such Option shall be subject to all applicable terms of the Plan and may be
subject to any other terms that are not inconsistent with the Plan. The Stock
Option Agreement shall specify that the Option is an NSO. The provisions of the
various Stock Option Agreements entered into under the Plan need not be
identical. Options may be granted in consideration of a reduction in the
Optionee's other compensation. A Stock Option Agreement may provide that a new
Option will be granted automatically to the Optionee when he or she exercises a
prior Option and pays the Exercise Price in the form described in Section 6.2.
5.2 Number of Shares. Each Stock Option Agreement shall specify the number
of Common Shares subject to the Option and shall provide for the adjustment of
such number in accordance with Article 8.
5.3 Exercise Price. Each Stock Option Agreement shall specify the Exercise
Price; provided that the Exercise Price shall in no event be less than 85% of
the Fair Market Value of a Common Share on the date of grant. A Stock Option
Agreement may specify an Exercise Price that varies in accordance with a
predetermined formula while the NSO is outstanding.
5.4 Exercisability and Term. Each Stock Option Agreement shall specify the
date or event when all or any installment of the Option is to become
exercisable. The Stock Option Agreement shall also specify the term of the
Option. A Stock Option Agreement may provide for accelerated exercisability in
the event of the Optionee's death, disability or retirement or other events and
may provide for expiration prior to the end of its term in the event of the
termination of the Optionee's service.
5.5 Modification or Assumption of Options. Within the limitations of the
Plan, the Committee may modify, extend or assume outstanding options or may
accept the cancellation of outstanding options (whether granted by the Company
or by another issuer) in return for the
grant of new options for the same or a different number of shares and at the
same or a different exercise price. The foregoing notwithstanding, no
modification of an Option shall, without the consent of the Optionee, alter or
impair his or her rights or obligations under such Option.
5.6 Buyout Provisions. The Committee may at any time (a) offer to buy out
for a payment in cash or cash equivalents an Option previously granted or (b)
authorize an Optionee to elect to cash out an Option previously granted, in
either case at such time and based upon such terms and conditions as the
Committee shall establish.
ARTICLE 6. PAYMENT FOR OPTION SHARES.
6.1 General Rule. The entire Exercise Price of Common Shares issued upon
exercise of Options shall be payable in cash or cash equivalents at the time
when such Common Shares are purchased, except the Committee may at any time
accept payment in any form(s) described in this Article 6.
6.2 Surrender of Stock. To the extent that this Section 6.2 is applicable,
all or any part of the Exercise Price may be paid by surrendering, or attesting
to the ownership of, Common Shares that are already owned by the Optionee. Such
Common Shares shall be valued at their Fair Market Value on the date when the
new Common Shares are purchased under the Plan. The Optionee shall not
surrender, or attest to the ownership of, Common Shares in payment of the
Exercise Price if such action would cause the Company to recognize compensation
expense (or additional compensation expense) with respect to the Option for
financial reporting purposes.
6.3 Exercise/Sale. To the extent that this Section 6.3 is applicable, all
or any part of the Exercise Price and any withholding taxes may be paid by
delivering (on a form prescribed by the Company) an irrevocable direction to a
securities broker approved by the Company to sell all or part of the Common
Shares being purchased under the Plan and to deliver all or part of the sales
proceeds to the Company.
6.4 Exercise/Pledge. To the extent that this Section 6.4 is applicable,
all or any part of the Exercise Price and any withholding taxes may be paid by
delivering (on a form prescribed by the Company) an irrevocable direction to
pledge all or part of the Common Shares being purchased under the Plan to a
securities broker or lender approved by the Company, as security for a loan, and
to deliver all or part of the loan proceeds to the Company.
6.5 Promissory Note. To the extent that this Section 6.5 is applicable,
all or any part of the Exercise Price and any withholding taxes may be paid by
delivering (on a form prescribed by the Company) a full-recourse promissory
note. However, the par value of the Common Shares being purchased under the
Plan, if newly issued, shall be paid in cash or cash equivalents.
6.6 Other Forms of Payment. To the extent that this Section 6.6 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid in any other form that is consistent with applicable laws, regulations
and rules.
ARTICLE 7. RESTRICTED SHARES.
7.1 Restricted Stock Agreement. Each grant of Restricted Shares under the
Plan shall be evidenced by a Restricted Stock Agreement between the recipient
and the Company. Such Restricted Shares shall be subject to all applicable terms
of the Plan and may be subject to any other terms that are not inconsistent with
the Plan. The provisions of the various Restricted Stock Agreements entered into
under the Plan need not be identical.
7.2 Payment for Awards. Subject to the following sentence, Restricted
Shares may be sold or awarded under the Plan for such consideration as the
Committee may determine, including (without limitation) cash, cash equivalents,
full-recourse promissory notes, past services and future services. To the extent
that an Award consists of newly issued Restricted Shares, the consideration
shall consist exclusively of cash, cash equivalents or past services rendered to
the Company (or a Parent or Subsidiary) or, for the amount in excess of the par
value of such newly issued Restricted Shares, full-recourse promissory notes, as
the Committee may determine.
7.3 Vesting Conditions. Each Award of Restricted Shares may or may not be
subject to vesting. Vesting shall occur, in full or in installments, upon
satisfaction of the conditions specified in the Restricted Stock Agreement. A
Restricted Stock Agreement may provide for accelerated vesting in the event of
the Participant's death, disability or retirement or other events.
7.4 Voting and Dividend Rights. The holders of Restricted Shares awarded
under the Plan shall have the same voting, dividend and other rights as the
Company's other stockholders. A Restricted Stock Agreement, however, may require
that the holders of Restricted Shares invest any cash dividends received in
additional Restricted Shares. Such additional Restricted Shares shall be subject
to the same conditions and restrictions as the Award with respect to which the
dividends were paid.
ARTICLE 8. PROTECTION AGAINST DILUTION.
8.1 Adjustments. In the event of a subdivision of the outstanding Common
Shares, a declaration of a dividend payable in Common Shares, a declaration of a
dividend payable in a form other than Common Shares in an amount that has a
material effect on the price of Common Shares, a combination or consolidation of
the outstanding Common Shares (by reclassification or otherwise) into a lesser
number of Common Shares, a recapitalization, a spin-off or a similar occurrence,
the Committee shall make such adjustments as it, in its sole discretion, deems
appropriate in one or more of:
(a) The number of Options and Restricted Shares available for
future Awards under Article 3;
(b) The number of Common Shares covered by each outstanding
Option;
(c) The Exercise Price under each outstanding Option.
Except as provided in this Article 8, a Participant shall have no rights by
reason of any issue by the Company of stock of any class or securities
convertible into stock of any class, any subdivision or consolidation of shares
of stock of any class, the payment of any stock dividend or any other increase
or decrease in the number of shares of stock of any class.
8.2 Dissolution or Liquidation. To the extent not previously exercised or
settled, Options, shall terminate immediately prior to the dissolution or
liquidation of the Company.
8.3 Reorganizations. In the event that the Company is a party to a merger
or other reorganization, outstanding Awards shall be subject to the agreement of
merger or reorganization. Such agreement shall provide for (a) the continuation
of the outstanding Awards by the Company, if the Company is a surviving
corporation, (b) the assumption of the outstanding Awards by the surviving
corporation or its parent or subsidiary, (c) the substitution by the surviving
corporation or its parent or subsidiary of its own awards for the outstanding
Awards, (d) full exercisability or vesting and accelerated expiration of the
outstanding Awards or (e) settlement of the full value of the outstanding Awards
in cash or cash equivalents followed by cancellation of such Awards.
ARTICLE 9. CHANGE IN CONTROL.
Unless the applicable agreement evidencing the Award provides
otherwise, in the event of any Change in Control, the vesting and exercisability
of each outstanding Award shall automatically accelerate so that each such Award
shall, immediately prior to the effective date of the Change in Control, become
fully exercisable for all of the Common Shares at the time subject to such Award
and may be exercised for any or all of those shares as fully-vested Common
Shares. However, the vesting and exercisability of an outstanding Award shall
not so accelerate if and to the extent such Award, in connection with the Change
in Control, remains outstanding, or is assumed by the surviving corporation (or
parent thereof) or substituted with an award with substantially the same terms
by the surviving corporation (or parent thereof). The determination of whether a
substituted award has substantially the same terms as an Award shall be made by
the Committee, and its determination shall be final, binding and conclusive.
If the Company and the other party to the transaction constituting a
Change in Control agree that such transaction is to be treated as a "pooling of
interests" for financial reporting purposes, and if such transaction in fact is
so treated, then the acceleration of vesting and exercisability shall not occur
to the extent that the Company's independent accountants and such other party's
independent accountants separately determine in good faith that such
acceleration would preclude the use of "pooling of interests" accounting.
ARTICLE 10. DEFERRAL OF AWARDS.
The Committee (in its sole discretion) may permit or require a
Participant to:
(a) Have Common Shares that otherwise would be delivered to such
Participant as a result of the exercise of an Option converted into an
equal number of Stock Units; or
(b) Have Common Shares that otherwise would be delivered to such
Participant as a result of the exercise of an Option converted into amounts
credited to a deferred compensation account established for such
Participant by the Committee as an entry on the Company's books. Such
amounts shall be determined by reference to the Fair Market Value of such
Common Shares as of the date when they otherwise would have been delivered
to such Participant.
A deferred compensation account established under this Article 10 may be
credited with interest or other forms of investment return, as determined by the
Committee. A Participant for whom such an account is established shall have no
rights other than those of a general creditor of the Company. Such an account
shall represent an unfunded and unsecured obligation of the Company and shall be
subject to the terms and conditions of the applicable agreement between such
Participant and the Company. If the deferral or conversion of Awards is
permitted or required, the Committee (in its sole discretion) may establish
rules, procedures and forms pertaining to such Awards, including (without
limitation) the settlement of deferred compensation accounts established under
this Article 10.
ARTICLE 11. AWARDS UNDER OTHER PLANS.
The Company may grant awards under other plans or programs. Such
awards may be settled in the form of Common Shares issued under this Plan. Such
Common Shares shall be treated for all purposes under the Plan like Common
Shares issued in settlement of stock units and shall, when issued, reduce the
number of Common Shares available under Article 3.
ARTICLE 12. LIMITATION ON RIGHTS.
12.1 Retention Rights. Neither the Plan nor any Award granted under the
Plan shall be deemed to give any individual a right to remain an Employee or
Consultant. The Company and its Parents, Subsidiaries and Affiliates reserve the
right to terminate the service of any Employee or Consultant at any time, with
or without cause, subject to applicable laws, the Company's certificate of
incorporation and by-laws and a written employment agreement (if any).
12.2 Stockholders' Rights. A Participant shall have no dividend rights,
voting rights or other rights as a stockholder with respect to any Common Shares
covered by his or her Award prior to the time when a stock certificate for such
Common Shares is issued or, if applicable, the time when he or she becomes
entitled to receive such Common Shares by filing any required notice of exercise
and paying any required Exercise Price. No adjustment shall be made for cash
dividends or other rights for which the record date is prior to such time,
except as expressly provided in the Plan.
12.3 Regulatory Requirements. Any other provision of the Plan
notwithstanding, the obligation of the Company to issue Common Shares under the
Plan shall be subject to all applicable laws, rules and regulations and such
approval by any regulatory body as may be required. The Company reserves the
right to restrict, in whole or in part, the delivery of Common Shares pursuant
to any Award prior to the satisfaction of all legal requirements relating
to the issuance of such Common Shares, to their registration, qualification or
listing or to an exemption from registration, qualification or listing.
ARTICLE 13. WITHHOLDING TAXES.
13.1 General. To the extent required by applicable federal, state, local
or foreign law, a Participant or his or her successor shall make arrangements
satisfactory to the Company for the satisfaction of any withholding tax
obligations that arise in connection with the Plan. The Company shall not be
required to issue any Common Shares or make any cash payment under the Plan
until such obligations are satisfied.
13.2 Share Withholding. The Committee may permit a Participant to satisfy
all or part of his or her withholding or income tax obligations by having the
Company withhold all or a portion of any Common Shares that otherwise would be
issued to him or her or by surrendering all or a portion of any Common Shares
that he or she previously acquired. Such Common Shares shall be valued at their
Fair Market Value on the date when they are withheld or surrendered.
ARTICLE 14. FUTURE OF THE PLAN.
14.1 Term of the Plan. The Plan, as set forth herein, shall become
effective as of the adoption date. The Plan shall remain in effect until it is
terminated under Section 14.2.
14.2 Amendment or Termination. The Board may, at any time and for any
reason, amend or terminate the Plan. An amendment of the Plan shall be subject
to the approval of the Company's stockholders only to the extent required by
applicable laws, regulations or rules. No Awards shall be granted under the Plan
after the termination thereof. The termination of the Plan, or any amendment
thereof, shall not affect any Award previously granted under the Plan.
ARTICLE 15. DEFINITIONS.
15.1 "Affiliate" means any entity other than a Subsidiary, if the Company
and/or one or more Subsidiaries own not less than 50% of such entity.
15.2 "Award" means any award of an Option or a Restricted Share.
15.3 "Board" means the Company's Board of Directors, as constituted from
time to time.
15.4 "Change in Control" shall mean:
(a) The consummation of a merger or consolidation of the Company
with or into another entity or any other corporate reorganization, if
persons who were not stockholders of the Company immediately prior to such
merger, consolidation or other reorganization own immediately after such
merger, consolidation or other reorganization 50% or more of the voting
power of the outstanding securities of each of (i) the continuing or
surviving entity and (ii) any direct or indirect parent corporation of such
continuing or surviving entity;
(b) The sale, transfer or other disposition of all or
substantially all of the Company's assets;
(c) A change in the composition of the Board, as a result of
which fewer than 50% of the incumbent directors are directors who either
(i) had been directors of the Company on the date 24 months prior to the
date of the event that may constitute a Change in Control (the "original
directors") or (ii) were elected, or nominated for election, to the Board
with the affirmative votes of at least a majority of the aggregate of the
original directors who were still in office at the time of the election or
nomination and the directors whose election or nomination was previously so
approved; or
(d) Any transaction as a result of which any person is the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing at least
50% of the total voting power represented by the Company's then outstanding
voting securities. For purposes of this Paragraph (d), the term "person"
shall have the same meaning as when used in sections 13(d) and 14(d) of the
Exchange Act but shall exclude (i) a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or of a Parent or
Subsidiary and (ii) a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as their
ownership of the common stock of the Company.
A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.
15.5 "Code" means the Internal Revenue Code of 1986, as amended.
15.6 "Committee" means a committee of the Board, as described in Article
2.
15.7 "Common Share" means one share of the class A voting common stock of
the Company.
15.8 "Company" means InterTrust Technologies Corporation, a Delaware
corporation.
15.9 "Consultant" means a consultant or adviser who provides bona fide
services to the Company, a Parent, a Subsidiary or an Affiliate as an
independent contractor. Service as a Consultant shall be considered employment
for all purposes of the Plan.
15.10 "Employee" means a common-law employee of the Company, a Parent, a
Subsidiary or an Affiliate.
15.11 "Exchange Act" means the Securities Exchange Act of 1934, as amended.
15.12 "Exercise Price" means the amount for which one Common Share may be
purchased upon exercise of such Option, as specified in the applicable Stock
Option Agreement.
15.13 "Fair Market Value" means the market price of Common Shares,
determined by the Committee in good faith on such basis as it deems appropriate.
Whenever possible, the determination of Fair Market Value by the Committee shall
be based on the prices reported in The Wall Street Journal. Such determination
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shall be conclusive and binding on all persons.
15.14 "NSO" means a stock option not described in sections 422 or 423 of
the Code.
15.15 "Option" means an NSO granted under the Plan and entitling the holder
to purchase Common Shares.
15.16 "Optionee" means an individual or estate who holds an Option or SAR.
15.17 "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain. A corporation that attains the status of a Parent on
a date after the adoption of the Plan shall be considered a Parent commencing as
of such date.
15.18 "Participant" means an individual or estate who holds an Award.
15.19 "Plan" means this InterTrust Technologies Corporation 2000
Supplemental Plan, as amended from time to time.
15.20 "Restricted Share" means a Common Share awarded under the Plan.
15.21 "Restricted Stock Agreement" means the agreement between the Company
and the recipient of a Restricted Share which contains the terms, conditions and
restrictions pertaining to such Restricted Share.
15.22 "Stock Option Agreement" means the agreement between the Company and
an Optionee that contains the terms, conditions and restrictions pertaining to
his or her Option.
15.23 "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company, if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain. A corporation that attains
the status of a Subsidiary on a date after the adoption of the Plan shall be
considered a Subsidiary commencing as of such date.