2002 Stock Plan - Orbitz Inc.
AMENDED AND RESTATED
ORBITZ, INC.
2002 STOCK PLAN1
1. PURPOSES OF THE PLAN. The purposes of this Stock Plan are to attract
and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Employees, Directors and
Consultants and to promote the success of the Company's business. Options
granted under the Plan may be Incentive Stock Options or Nonstatutory Stock
Options, as determined by the Administrator at the time of grant. Stock
Appreciation Rights, Restricted Stock Awards and Stock Purchase Rights may also
be granted under the Plan.
2. DEFINITIONS. As used herein, the following definitions shall apply:
(a) "ADMINISTRATOR" means the Board or any of its Committees as
shall be administering the Plan in accordance with Section 4 hereof.
(b) "APPLICABLE LAWS" means the requirements relating to the
administration of equity compensation plans under U.S. state corporate laws,
U.S. federal and state securities laws, the Code, any stock exchange or
quotation system on which the Shares are listed or quoted and the applicable
laws of any other country or jurisdiction where Option, Stock Purchase Rights,
SARs or Restricted Stock Awards are granted under the Plan.
(c) "AWARD AGREEMENT" means one or more written or electronic
agreements between the Company and a recipient of an award (other than an
Option) under the Plan evidencing the terms and conditions of such award. The
Award Agreement is subject to the terms and conditions of the Plan.
(d) "BOARD" means the Board of Directors of the Company.
(e) "CODE" means the Internal Revenue Code of 1986, as amended.
(f) "COMMITTEE" means a committee of Directors appointed by the
Board in accordance with Section 4 hereof.
(g) "COMMON STOCK" means the Class C Common Stock par value $0.001
per share of the Company.
(h) "COMPANY" means Orbitz, Inc., a Delaware corporation and any
successor thereto.
(i) "CONSULTANT" means any person who is engaged by the Company or
any Parent or Subsidiary of the Company to render consulting or advisory
services to such entity. On the date that any Parent or Subsidiary which engages
a Consultant ceases to be a Parent or Subsidiary of the Company such person
shall cease to be a Consultant and will be
---------------------------
1 Amended and restated to reflect amendments to the 2002 Stock Plan adopted May
15, 2002.
<Page>
deemed to have terminated as a Service Provider, unless otherwise provided in
Section 14(c) hereof.
(j) "DIRECTOR" means a member of the Board.
(k) "DISABILITY" means total and permanent disability as defined in
Section 22(e)(3) of the Code.
(l) "EMPLOYEE" means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. A
person shall not cease to be an Employee in the case of (i) any leave of absence
approved by the Company, or any Parent or Subsidiary of the Company, as
applicable or (ii) transfers between locations of the Company or between the
Company, any Parent and any Subsidiary of the Company, or any successor of the
Company. For purposes of Incentive Stock Options, no such leave may exceed
ninety days, unless reemployment upon expiration of such leave is guaranteed by
statute or contract. If reemployment upon expiration of a leave of absence
approved by the Company is not so guaranteed, then three (3) months following
the 90th day of such leave, any Incentive Stock Option held by the Optionee
shall cease to be treated as an Incentive Stock Option and shall be treated for
tax purposes as a Nonstatutory Stock Option. Neither service as a Director nor
payment of a director's fee by the Company shall be sufficient to constitute
"employment" by the Company. On the date that any Parent or Subsidiary which
employs an Employee ceases to be a Parent or Subsidiary of the Company such
person shall cease to be an Employee and will be deemed to have terminated as a
Service Provider, unless otherwise provided in Section 14(c) hereof.
(m) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
(n) "FAIR MARKET VALUE" means, as of any date, the value of Common
Stock determined as follows:
(i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the
Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq
Stock Market, its Fair Market Value shall be the closing sales price
for such stock (or the closing bid, if no sales were reported) as
quoted on such exchange or system for the last market trading day prior
to the time of determination, as reported in The Wall Street Journal or
such other source as the Administrator deems reliable;
(ii) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market
Value shall be the mean between the high bid and low asked prices for
the Common Stock on the last market trading day prior to the day of
determination; or
(iii) If neither of paragraphs (i) or (ii) above are applicable,
the Fair Market Value thereof shall be determined in good faith by the
Administrator.
2
<Page>
(o) "INCENTIVE STOCK OPTION" means an Option intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code.
(p) "INVESTORS" means the holders of each series of Class B Common
Stock $.0001 par value per share of the Company on the relevant date.
(q) "NONSTATUTORY STOCK OPTION" means an Option not intended to
qualify as an Incentive Stock Option.
(r) "OFFICER" means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
(s) "OPTION" means a stock option granted pursuant to the Plan.
(t) "OPTION AGREEMENT" means one or more written or electronic
agreements between the Company and an Optionee evidencing the terms and
conditions of an individual Option grant. The Option Agreement is subject to the
terms and conditions of the Plan.
(u) "OPTION EXCHANGE PROGRAM" means a program whereby outstanding
Options are exchanged for Options with a lower exercise price.
(v) "OPTIONED STOCK" means the Common Stock subject to an Option or
a Stock Purchase Right.
(w) "OPTIONEE" means the holder of an outstanding Option, Stock
Purchase Right, SAR or Restricted Stock Award granted under the Plan.
(x) "PARENT" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.
(y) "PLAN" means this Orbitz, Inc. 2002 Stock Plan.
(z) "PUBLIC TRADING DATE" means the first date upon which the Common
Stock of the Company is listed (or approved for listing ) upon notice of
issuance on any securities exchange or designated (or approved for designation)
upon notice of issuance as a national market security on an interdealer
quotation system.
(aa) "RESTRICTED STOCK" means shares of Common Sock acquired
pursuant to a grant of a Stock Purchase Right under Section 13 below or pursuant
to the grant of a Restricted Stock Award under Section 10 below.
(bb) "RESTRICTED STOCK AWARD" means a grant under Section 10 below.
(cc) "STOCK APPRECIATION RIGHT" or "SAR" means an award issued
pursuant to Section 11 below.
3
<Page>
(dd) "SERVICE PROVIDER" means an Employee, Director or Consultant.
(ee) "SHARE" means a share of the Common Stock, as adjusted in
accordance with Section 14 below.
(ff) "STOCK PURCHASE RIGHT" means a right to purchase Common Stock
pursuant to Section 13 below.
(gg) "SUBSIDIARY" means Orbitz, LLC, a Delaware limited liability
company and other "subsidiary corporation," whether now or hereafter existing,
as defined in Section 424(f) of the Code.
3. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Section 14
of the Plan, the maximum aggregate number of Shares that may be subject to
options and other awards and issued under the Plan is 16,340,747 Shares;
provided, however, only 12,663,747 Shares may be subject to options and other
awards and issued under the Plan, subject to the provisions below, prior to the
Public Trading Date. The Shares may be authorized but unissued, or reacquired
Common Stock.
If an Option, Stock Purchase Right, SAR or Restricted Stock Award
granted under this Plan or under the Orbitz, Inc. 2000 Stock Plan ("Orbitz
Plan") expires or becomes unexercisable without having been exercised in full,
or is surrendered pursuant to an Option Exchange Program, or, with respect to a
Restricted Stock Award, is forfeited back to the Company, the unpurchased Shares
(or for Restricted Stock Awards, the forfeited Shares) which were subject
thereto shall become available for future grant or sale under the Plan (unless
the Plan has terminated). However, Shares that have actually been issued under
the Plan, upon exercise of either an Option, Stock Purchase Right, SAR or
Restricted Stock Award shall not be returned to the Plan and shall not become
available for future distribution under the Plan, except that if Shares of
Restricted Stock granted under this Plan or the Orbitz Plan are repurchased by
the Company at their original purchase price or forfeited to the Company, such
Shares shall become available for future grant under the Plan.
4. ADMINISTRATION OF THE PLAN.
(a) ADMINISTRATOR. The Plan shall be administered by the Board or a
Committee appointed by the Board, which Committee shall be constituted to comply
with Applicable Laws. If administration of the Plan is delegated to a Committee,
then after the Public Trading Date and upon expiration of the transition period
set forth in Treasury Regulation ss. 1.162-27(f) such Committee shall consist
solely of two or more Directors each of whom is both an "outside director,"
within the meaning of Section 162(m) of the Code, and a "non-employee director"
within the meaning of Rule 16b-3 of the Exchange Act.
(b) POWERS OF THE ADMINISTRATOR. Subject to the provisions of the
Plan and, in the case of a Committee, the specific duties delegated by the Board
to such Committee, and subject to the approval of any relevant authorities, the
Administrator shall have the authority in its discretion:
(i) to determine the Fair Market Value;
4
<Page>
(ii) to select the Service Providers to whom Options, Stock
Purchase Rights, SARs and Restricted Stock Awards may from time to time
be granted hereunder;
(iii) to determine the number of Shares to be covered by each
such award granted hereunder;
(iv) to approve forms of agreement for use under the Plan;
(v) to determine the terms and conditions, of any Option, Stock
Purchase Right, SAR or Restricted Stock Award granted hereunder. Such
terms and conditions include, but are not limited to, the exercise
price, the time or times when Options, Stock Purchase Rights, SARs or
Restricted Stock Awards may be exercised (which may be based on
performance criteria), any vesting acceleration or waiver of forfeiture
restrictions, and any restriction or limitation regarding any Option,
Stock Purchase Right, SAR or Restricted Stock Award or the Common Stock
relating thereto, based in each case on such factors as the
Administrator, in its sole discretion, shall determine;
(vi) to determine whether and under what circumstances an Option
may be bought out in cash under subsection 9(e);
(vii) to reduce the exercise price of any Option, Stock Purchase
Right or SAR to the then current Fair Market Value if the Fair Market
Value of the Common Stock covered by such Option, Stock Purchase Right
or SAR has declined since the date the Option, Stock Purchase Right or
SAR was granted;
(viii) to initiate an Option Exchange Program;
(ix) 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 qualifying for preferred tax
treatment under foreign tax laws;
(x) 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, Stock Purchase Right or SAR that number of
Shares having a Fair Market Value equal to the 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;
(xi) to construe and interpret the terms of the Plan and awards
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
<Page>
5. ELIGIBILITY.
(a) Nonstatutory Stock Options, Stock Purchase Rights, SARs and
Restricted Stock Awards may be granted to Service Providers. Incentive Stock
Options may be granted only to Employees.
(b) 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 5(b), 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.
(c) Neither the Plan nor any Option, Stock Purchase Right, SAR or
Restricted Stock Award 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.
6. TERM OF PLAN. The Plan shall become effective upon its adoption by
the Board. It shall continue in effect for a term of ten (10) years unless
sooner terminated under Section 14 of the Plan.
7. 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 of the Company, 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.
8. OPTION EXERCISE PRICE AND CONSIDERATION.
(a) 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 of the Company, the exercise price shall be no less than
110% of the Fair Market Value per Share on the date of grant.
6
<Page>
(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, the per Share
exercise price shall be determined by the Administrator.
(iii) Notwithstanding the foregoing, Options may be granted with
a per Share exercise price other than as required above pursuant to a
merger or other corporate transaction.
(b) The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Administrator (and, in the case of an Incentive Stock Option, shall be
determined at the time of grant). Such consideration may consist of (1) cash,
(2) check, (3) promissory note, (4) other Shares which (x) in the case of Shares
acquired upon exercise of an Option, have been owned by the Optionee for more
than six months on the date of surrender, and (y) have a Fair Market Value on
the date of surrender equal to the aggregate exercise price of the Shares as to
which such Option shall be exercised, (5) consideration received by the Company
under a cashless exercise program implemented by the Company in connection with
the Plan, or (6) any combination of the foregoing methods of payment. In making
its determination as to the type of consideration to accept, the Administrator
shall consider if acceptance of such consideration may be reasonably expected to
benefit the Company.
9. EXERCISE OF OPTION.
(a) PROCEDURE FOR EXERCISE; RIGHTS AS A STOCKHOLDER. Any Option
granted hereunder shall be exercisable according to the terms hereof at such
times and under such conditions as determined by the Administrator and set forth
in the Option Agreement. Unless the Administrator provides otherwise, vesting of
Options granted hereunder shall be suspended during any unpaid leave of absence.
An Option may not be exercised for a fraction of a Share.
Subject to Sections 17 and 18 below, an Option shall be deemed
exercised when the Company receives (i) written or electronic notice of exercise
(in accordance with the Option Agreement) from the person entitled to exercise
the Option, and (ii) full payment for the Shares with respect to which the
Option is exercised. Full payment may consist of any consideration and method of
payment authorized by the Administrator and permitted by the Option Agreement
and the Plan. Shares issued upon exercise of an Option shall be issued in the
name of the Optionee or, if requested by the Optionee, in the name of the
Optionee and his or her spouse. Until the Shares are issued (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company), no right to vote or receive dividends or any other rights
as a stockholder shall exist with respect to the Shares, notwithstanding the
exercise of the Option. The Company shall issue (or cause to be issued) such
Shares promptly after the Option is exercised. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the
Shares are issued, except as provided in Section 14 of the Plan.
7
<Page>
Exercise of an Option in any manner shall result in a decrease in the
number of Shares thereafter available, both for purposes of the Plan and for
sale under the Option, by the number of Shares as to which the Option is
exercised.
(b) TERMINATION OF RELATIONSHIP AS A SERVICE PROVIDER. If an
Optionee ceases to be a Service Provider, such Optionee may exercise his or her
Option within such period of time as is specified in the Option Agreement to the
extent that the Option is vested on the date of termination (but in no event
later than the expiration of the term of the Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for three (3) months following the Optionee's
termination. If, on the date of termination, the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option shall revert to the Plan. If, after termination, the Optionee does not
exercise his or her Option within the time set forth above, or within the time
specified by the Administrator, if later, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.
(c) DISABILITY OF OPTIONEE. If an Optionee ceases to be a Service
Provider as a result of the Optionee's Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option Agreement
to the extent the Option is vested on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for twelve (12) months following the Optionee's
termination. If, on the date of termination, the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option shall revert to the Plan. If, after termination, the Optionee does not
exercise his or her Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.
(d) DEATH OF OPTIONEE. If an Optionee dies while a Service Provider,
the Option may be exercised within such period of time as is specified in the
Option Agreement to the extent that the Option is vested on the date of death
(but in no event later than the expiration of the term of such Option as set
forth in the Option Agreement) by the Optionee's estate or by a person who
acquires the right to exercise the Option by bequest or inheritance. In the
absence of a specified time in the Option Agreement, the Option shall remain
exercisable for twelve (12) months following the Optionee's termination. If, at
the time of death, the Optionee is not vested as to the entire Option, the
Shares covered by the unvested portion of the Option shall immediately revert to
the Plan. If the Option is not so exercised within the time specified herein,
the Option shall terminate, and the Shares covered by such Option shall revert
to the Plan.
(e) BUYOUT PROVISIONS. The Administrator may at any time offer to
buy out for a payment in cash or Shares, an Option previously granted, based on
such terms and conditions as the Administrator shall establish and communicate
to the Optionee at the time that such offer is made.
10. RESTRICTED STOCK AWARDS. Restricted Stock Awards shall be subject
to the terms, conditions, and restrictions determined by the Administrator at
the time the Restricted
8
<Page>
Stock is awarded and set forth in the applicable Award Agreement, if any. The
Administrator may require the recipient to sign an Award Agreement as a
condition of the award, but may not require the recipient to pay any money
consideration (other than any applicable tax withholding amount). The agreement
may contain such terms, conditions, representations and warranties as the
Administrator may require. The certificates representing the shares of Stock
awarded shall bear such legends as shall be determined by the Administrator.
11. STOCK APPRECIATION RIGHTS.
(a) GRANT OF SARS. Subject to the terms and conditions of the Plan,
SARs may be granted to Service Providers at any time and from time to time as
shall be determined by the Administrator, in its sole discretion. The
Administrator shall have complete discretion to determine the number of SARs
granted to any Participant.
(b) EXERCISE PRICE AND OTHER TERMS. The Administrator, subject to
the provisions of the Plan, shall have complete discretion to determine the
terms and conditions of SARs granted under the Plan. However, the exercise price
of an SAR shall be not less than one hundred percent (100%) of the Fair Market
Value of a Share on the grant date.
(c) SAR AGREEMENT. Each SAR grant shall be evidenced by an award
agreement that shall specify the exercise price, the term of the SAR, the
conditions of exercise, and such other terms and conditions as the
Administrator, in its sole discretion, shall determine.
(d) EXPIRATION OF SARS. A SAR granted under the Plan shall expire
upon the date determined by the Administrator, in its sole discretion, and set
forth in the Award Agreements.
(e) PAYMENT OF SAR AMOUNT. Upon exercise of a SAR, a Participant
shall be entitled to receive payment from the Company in an amount determined by
multiplying:
(i) The difference between the Fair Market Value of a Share on
the date of exercise over the exercise price; times
(ii) The number of Shares with respect to which the SAR is
exercised.
(f) PAYMENT UPON EXERCISE OF SAR. At the discretion of the
Administrator, payment for a SAR may be in cash, Shares with a Fair Market Value
equal to the amount determined in paragraph (e) above or a combination thereof.
(g) CASH SETTLEMENTS AND PLAN SHARE ALLOCATION. Cash payments of
Stock Appreciation Rights as well as Common Stock issued upon exercise of Stock
Appreciation Rights shall be applied against the maximum number of shares of
Common Stock that may be issued pursuant to the Plan, The number of shares to be
applied against such maximum number of shares in such circumstances shall be the
number of shares equal to the amount of the cash payment divided by the Fair
Market Value of a Share on the date the Stock Appreciation Right is granted.
9
<Page>
12. NON-TRANSFERABILITY OF OPTIONS, STOCK PURCHASE RIGHTS, SARS AND
RESTRICTED STOCK Awards. Unless determined otherwise by the Administrator, the
Options, Stock Purchase Rights, SARs and Restricted Stock Awards may not be
sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner
other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Optionee, only by the Optionee. Any
transferee by will or by the laws of descent or distribution shall be required
to acknowledge and agree that such transferee is subject to all of the terms of
the Plan and the applicable Award Agreement as if such transferee had received
the applicable award.
13. STOCK PURCHASE RIGHTS.
(a) RIGHTS TO PURCHASE. Stock Purchase Rights may be issued either
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan. After the Administrator determines
that it will offer Stock Purchase Rights under the Plan, it shall advise the
offeree in writing or electronically of the terms, conditions and restrictions
related to the offer, including the number of Shares that such person shall be
entitled to purchase, the price to be paid, and the time within which such
person must accept such offer. The offer shall be accepted by execution of an
Award Agreement in the form determined by the Administrator.
(b) REPURCHASE OPTION. Unless the Administrator determines
otherwise, the Award Agreement shall grant the Company a repurchase option
exercisable upon the voluntary or involuntary termination of the purchaser's
service with the Company for any reason (including death or disability). Unless
the Administrator determines otherwise, the purchase price for Shares
repurchased pursuant to the Restricted Stock purchase agreement shall be the
original price paid by the purchaser and may be paid by cancellation of any
indebtedness of the purchaser to the Company. The repurchase option shall lapse
at such rate as the Administrator may determine.
(c) OTHER PROVISIONS. The Award Agreement shall contain such other
terms, provisions and conditions not inconsistent with the Plan
as may be determined by the Administrator in its sole discretion.
(d) RIGHTS AS A STOCKHOLDER. Subject to Sections 17 and 18 below,
once the Stock Purchase Right is exercised, the purchaser shall have rights
equivalent to those of a stockholder and shall be a stockholder when his or her
purchase is entered upon the records of the duly authorized transfer agent of
the Company. No adjustment shall be made for a dividend or other right for which
the record date is prior to the date the Stock Purchase Right is exercised,
except as provided in Section 14 of the Plan.
14. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, MERGER OR ASSET SALE.
(a) Changes in Capitalization. Subject to any required approval of
the stockholders of the Company, and except as provided in (b) and (c) below, in
the event that the Administrator determines that any dividend or other
distribution (whether in the form of cash, Common Stock, other securities, or
other property), recapitalization, reclassification, stock split, reverse stock
split, reorganization, consolidation, split-up, spin-off, combination,
repurchase, or
10
<Page>
exchange of Common Stock or other securities of the Company, issuance of
warrants or other rights to purchase Common Stock or other securities of the
Company, or other similar corporate transaction or event, effected without the
receipt of consideration by the Company in the Administrator's sole discretion,
affects the Common Stock such that an adjustment is determined by the
Administrator to be appropriate in order to prevent dilution or enlargement of
the benefits or potential benefits intended by the Company to be made available
under the Plan or with respect to any Option, Stock Purchase Right or SAR then
the Administrator shall, in such manner as it may deem equitable, adjust any or
all of:
(i) the number and kind of shares of Common Stock (or other
securities or property) with respect to which Options, Stock Purchase
Rights or SARs may be granted or awarded (including, but not limited
to, adjustments of the limitations in Section 3 on the maximum number
of shares which may be issued);
(ii) the number and kind of shares of Common Stock (or other
securities or property) subject to outstanding Options, Stock Purchase
Rights or SARs; and
(iii) the grant or exercise price with respect to any Option,
Stock Purchase Right or SAR.
The conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Administrator, whose determination in that
respect shall be final, binding and conclusive. Except as expressly provided
herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price
of shares of Stock subject to an Option, Stock Purchase Right, SAR or Restricted
Stock Award.
(b) DISSOLUTION OR LIQUIDATION. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option, Stock Purchase Right or SAR until
fifteen (15) days prior to such transaction as to all of the Optioned Stock
covered thereby, including Shares as to which the Option, Stock Purchase Right
or SAR would not otherwise be exercisable. In addition, the Administrator may
provide that any Company repurchase option applicable to any Shares purchased
upon exercise of an Option, Stock Purchase Right or SAR shall lapse as to all
such Shares, provided the proposed dissolution or liquidation takes place at the
time and in the manner contemplated. To the extent it has not been previously
exercised, an Option, Stock Purchase Right or SAR will terminate immediately
prior to the consummation of such proposed transaction.
(c) MERGER OR ASSET SALE. In the event of a merger of the Company
with or into another corporation, or the sale of substantially all of the assets
of the Company, except as otherwise provided in this paragraph (c), each
outstanding Option and Stock Purchase Right shall be assumed or an equivalent
option or right substituted by the successor corporation or a Parent or
Subsidiary of the successor corporation. In the event that the successor
11
<Page>
corporation or its Parent or Subsidiary does not assume or substitute equivalent
options or rights, then to the extent not already vested or otherwise provided
in the Option Agreement each Optionee shall fully vest in and have the right to
exercise his or her Options, Restricted Stock or SARs as to all of the Optioned
Stock, including Shares as to which he or she would not otherwise be vested in
or exercisable. If an Option, Stock Purchase Right or SAR becomes fully vested
and exercisable in the event of a merger or sale of assets pursuant to the
foregoing sentence, then the Administrator shall notify the Optionee in writing
or electronically that such Option, Stock Purchase Right or SAR shall be fully
exercisable for a period of not less than fifteen (15) days from the date of
such notice, and the Option, Stock Purchase Right or SAR shall terminate upon
the expiration of such period. For the purposes of this paragraph, the Option,
Stock Purchase Right or SAR shall be considered assumed if, following the merger
or sale of assets, the option or right confers the right to purchase or receive,
for each Share of Optioned Stock subject to the Option, Stock Purchase Right or
SAR immediately prior to the merger or sale of assets, the consideration
(whether stock, cash, or other securities or property) received in the merger or
sale of assets by holders of Common Stock for each Share held on the effective
date of the transaction (and if holders were offered a choice of consideration,
the type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the merger or
sale of assets is not solely stock of the successor corporation or its Parent or
Subsidiary, the Administrator may, provide for the consideration to be received
upon the exercise of the Option, Stock Purchase Right or SAR, for each Share of
Optioned Stock subject to the Option, Stock Purchase Right or SAR, to be solely
stock of the successor corporation or its Parent or Subsidiary equal in fair
market value to the per share consideration received by holders of Shares in the
merger or sale of assets. An Option Agreement may provide for vesting and
exercisability in full of an Option, Restricted Stock, Stock Purchase Right or
SAR upon a merger or sale of assets regardless of whether a successor or any
Parent or Subsidiary thereof assumes such Option Stock Purchase Right or SAR. In
such event , the vesting and exercisability of such Option, Restricted Stock,
Stock Purchase Right or SAR shall be governed by the terms and conditions of
such Option Agreement, notwithstanding the terms set forth above in this Section
14(c).
15. TIME OF GRANTING OPTIONS, STOCK PURCHASE RIGHTS, SARS AND
RESTRICTED STOCK. The date of grant of an Option, Stock Purchase Right, SAR or
Restricted Stock Award shall, for all purposes, be the date on which the
Administrator makes the determination granting such Option, Stock Purchase
Right, SAR or Restricted Stock Award, or such other date as is determined by the
Administrator. Notice of the determination shall be given to each Service
Provider to whom an Option, Stock Purchase Right, SAR or Restricted Stock Award
is so granted within a reasonable time after the date of such grant.
16. AMENDMENT AND TERMINATION OF THE PLAN.
(a) AMENDMENT AND TERMINATION. The Board may at any time amend,
alter, suspend or terminate the Plan.
(b) STOCKHOLDER APPROVAL. The Board shall obtain stockholder
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws.
12
<Page>
(c) EFFECT OF AMENDMENT OR TERMINATION. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to Options granted under the
Plan prior to the date of such termination.
17. CONDITIONS UPON ISSUANCE OF SHARES.
(a) LEGAL COMPLIANCE. Shares shall not be issued pursuant to the
exercise of an Option, Stock Purchase Right or SAR unless the exercise of such
Option, Stock Purchase Right or SAR and the issuance and delivery of such Shares
shall comply with Applicable Laws and shall be further subject to the approval
of counsel for the Company with respect to such compliance.
(b) INVESTMENT REPRESENTATIONS. As a condition to the exercise of an
Option, Stock Purchase Right or SAR, the Administrator may require the person
exercising such Option, Stock Purchase Right or SAR to represent and warrant at
the time of any such exercise that the Shares are being purchased only for
investment and without any present intention to sell or distribute such Shares
if, in the opinion of counsel for the Company, such a representation is
required.
18. INABILITY TO OBTAIN AUTHORITY. The Company shall use commercially
reasonable efforts to obtain authority from any regulatory body having
jurisdiction, which authority is deemed by the Company's counsel to be necessary
to the lawful issuance and sale of any Shares hereunder. The inability of the
Company to obtain such authority shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.
19. RESERVATION OF SHARES. The Company, during the term of this Plan,
shall at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
20. STOCKHOLDER APPROVAL. The Plan shall be subject to approval by the
stockholders of the Company within twelve (12) months after the date the Plan is
adopted. Such stockholder approval shall be obtained in the degree and manner
required under Applicable Laws.
21. RIGHTS AND RESTRICTIONS ON SHARES. The Shares acquired upon
exercise of an Option or Stock Purchase Right granted under the Plan shall be
subject to such terms and conditions as the Administrator shall determine in its
sole discretion, including, without limitation, the following rights and
restrictions:
(a) COMPANY'S RIGHT OF FIRST REFUSAL. Subject to subsection
(b) below, before any Shares held by an Optionee or any permitted transferee
(each, a "Holder") may be sold, pledged, assigned, hypothecated, transferred, or
otherwise disposed of (each, a "Transfer"), the Company or its assignee(s) shall
have a right of first refusal to purchase the Shares on the terms and conditions
set forth in this Section (the "Right of First Refusal"). Such
13
<Page>
Right of First Refusal shall terminate as to all Shares upon the first to occur
of (i) the Public Trading Date or (ii) a merger or sale of the Company with a
publicly traded company as described in Section 14(c).
(b) NOTICE OF PROPOSED TRANSFER. The Holder of the Shares shall
deliver to the Company at least sixty (60) days prior to making a Transfer a
written notice (the "Transfer Notice") stating: (A) the Holder's bona fide
intention to sell or otherwise Transfer such Shares; (B) the name of each
proposed purchaser or other transferee ("Proposed Transferee"); (C) the proposed
sale price and (D) the number of Shares to be Transferred to each Proposed
Transferee, and the Holder shall offer the Shares at the then Fair Market Value
to the Company or its assignee(s).
(c) EXERCISE OF RIGHT OF FIRST REFUSAL. During the thirty (30) days
after receipt of the Transfer Notice, the Company may elect in writing to
purchase all, but not less than all, of the Shares proposed to be Transferred to
any one or more of the Proposed Transferees. If the Company does not elect to
purchase all of the Shares proposed to be Transferred within such thirty (30)
day period, the Investors may elect to purchase all, but not less than all, of
the Shares proposed to be Transferred by delivering a written notice of such
election to the Holder within sixty (60) days after the receipt of the Transfer
Notice by the Company. If more than one Investor elects to purchase such Shares,
the number of Shares to be purchased by the electing Investors shall be
allocated among them pro rata on the basis of the number of shares of the
Company's Class B Common Stock on an "As Converted Ownership" (as defined in the
Company's Certificate of Incorporation) basis by them. The purchase price will
be determined in accordance with clause (iii) below.
(d) PURCHASE PRICE. The purchase price ("Purchase Price") for the
Shares repurchased under this Section shall be the then Fair Market Value.
(e) PAYMENT. Payment of the purchase price shall be made, at the
option of the Company or its assignee(s), in cash (by check), by cancellation of
all or a portion of any outstanding indebtedness of the Holder to the Company
(or, in the case of repurchase by an assignee, to the assignee), or by any
combination thereof within thirty (30) days after receipt of the Transfer Notice
or in the manner and at the times set forth in the Transfer Notice.
(f) HOLDER'S RIGHT TO TRANSFER. If all of the Shares proposed in the
Transfer Notice to be transferred to a given Proposed Transferee are not
purchased by the Company and/or its assignee(s) as provided in this Section,
then the Holder may sell or otherwise transfer such Shares to that Proposed
Transferee at the then Fair Market Value or at the sale price set forth in the
Transfer Notice, provided that (A) such sale or other Transfer is consummated
within one hundred twenty (120) days after the date of the Transfer Notice, (B)
any such sale or other Transfer is effected in accordance with any applicable
securities laws, (C) the Proposed Transferee agrees in writing that the
provisions of this Section shall continue to apply to the Shares in the hands of
such Proposed Transferee, and (D) prior to making any Transfer, the Holder shall
use reasonable efforts to ascertain whether the Proposed Transferee(s) or any
person or entity affiliated with the Proposed Transferee(s) is a competitor of
the Company and if Holder has reason to believe that the Proposed Transferee is
or is affiliated with or acting on behalf of such a competitor, the Holder shall
not transfer any Shares to the Proposed Transferee. If the
14
<Page>
Shares described in the Transfer Notice are not Transferred to the Proposed
Transferee within such 120 day period, a new Transfer Notice shall be given to
the Company, and the Company and/or its assignees shall again be offered the
Right of First Refusal as provided herein before any Shares held by the Holder
may be sold or otherwise Transferred.
(g) EXCEPTION FOR CERTAIN FAMILY TRANSFERS. Notwithstanding any
provision in the Plan to the contrary, the Transfer of any or all of the Shares
during the Holder's lifetime to a Family Member (as defined below) or the
Transfer on the Holder's death by will or intestacy to anyone shall be exempt
from the Right of First Refusal; PROVIDED, HOWEVER, that any Transfer by the
Holder during the Holder's lifetime to the Holder's Family Member shall be
without payment of any consideration whatsoever and must be approved in advance
by the Administrator. In such case, the transferee or other recipient shall
receive and hold the Shares so Transferred subject to the provisions of this
Section 21, and there shall be no further Transfer of such Shares except in
accordance with the terms of this Section 21. "FAMILY MEMBER" means, and is
limited to, any child, stepchild, grandchild, parent, stepparent, grandparent,
spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, or sister-in-law, including
adoptive relationships, any person sharing the Holder's household (other than a
tenant or employee), a trust in which these persons have more than fifty percent
of the beneficial interest, a foundation in which these persons (or the Holder)
control the management of assets, and any other entity in which these persons
(or the Holder) own more than fifty percent of the voting interests.
22. GOVERNING LAW. The validity and enforceability of this Plan
shall be governed by and construed in accordance with the laws of the State of
Delaware without regard to otherwise governing principles of conflicts of law.
Adopted by and approved by the shareholders
of Orbitz, Inc. on April 10, 2002