AVID TECHNOLOGY INC (Form: 8-K, Received: 07/08/2008 06:00:50)

Avid Technology, Inc.

Incentive Stock Option Grant

Terms and Conditions

1. Grant of Option . The Company shall grant to the Optionee an option, subject to these terms and conditions, the attached Notice and the Plan, to purchase the number of Shares of Common Stock identified in the Notice at the price per Share set forth in the Notice. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed in the Notice.

It is intended that the option evidenced hereby shall be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder (the “Code”). Except as otherwise indicated by the context, the term “Optionee,” as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms. Except where the context otherwise requires, the term “Company” shall include any of the Company’s present or future parent or subsidiary corporations as defined in Sections 424(e) and 424(f) of the Code.

2. Vesting Schedule . Except as otherwise provided herein, this option may be exercised in whole or in part prior to the seventh anniversary (the “Final Exercise Date”) of the Grant Date, subject to the vesting schedule provided in the Notice. The right of exercise shall be cumulative so that to the extent the option is not exercised in any period to the maximum extent permissible it shall continue to be exercisable, in whole or in part, with respect to all Shares for which it is vested until the earlier of the Final Exercise Date or the termination of this option under Section 3 or the Plan.

3.	Exercise of Option .

(a) Form of Exercise . Each election to exercise this option shall be in a manner as determined by the Company from time to time and shall be accompanied by payment in full in accordance with Section 4. The Optionee may purchase less than the number of Shares covered hereby, provided that no partial exercise of this option may be for any fractional Share or for fewer than ten whole Shares.

(b) Continuous Relationship with the Company Required . Except as otherwise provided in this Section 3, this option may not be exercised unless the Optionee, at the time he or she exercises this option, is, and has been at all times since the Grant Date, an employee, officer or director of, or consultant or advisor to, the Company (an “Eligible Optionee”).

(c) Termination of Relationship with the Company . If the Optionee ceases to be an Eligible Optionee for any reason, then, except as provided in Sections 3(d) and (e), the right to exercise this option shall terminate three months after such cessation (but in no event after the Final Exercise Date), provided that this option shall be exercisable only to the extent that the Optionee was entitled to exercise this option on the date of such cessation. Notwithstanding anything to the contrary in these terms and conditions, the Notice or the Plan, if the Optionee’s employment with the Company is terminated, then this option shall be subject to any applicable,

superseding vesting and exercise terms as set forth in the Optionee’s then-effective employment agreement, offer letter or other similar agreement with the Company, if any.

(d) Exercise Period Upon Death, Disability or Retirement . If the Optionee dies, becomes disabled (within the meaning of Section 22(e)(3) of the Code) or retires prior to the Final Exercise Date while he or she is an Eligible Optionee and the Company has not terminated such relationship for “Cause” as defined in Section 3(e), this option shall be exercisable, within the period of one year following the date of death, disability or retirement of the Optionee, by the Optionee (or, in the case of death, by an authorized transferee), provided that this option shall be exercisable only to the extent that this option was exercisable by the Optionee on the date of his or her death, disability or retirement, and further provided that this option shall not be exercisable after the Final Exercise Date.

For purposes of this Section 3, “retirement” shall mean the cessation of employment with the Company for any reason other than “Cause” as defined in Section 3(e), by an Optionee who is at least 60 years of age and who has been employed continuously by the Company for the seven years immediately preceding the date of cessation of employment.

(e) Discharge for Cause . If the Optionee, prior to the Final Exercise Date, is discharged by the Company for “Cause” (as defined below), the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Optionee or willful failure by the Optionee to perform his or her responsibilities to the Company (including, without limitation, breach by the Optionee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Optionee and the Company), as determined by the Company, which determination shall be conclusive. Notwithstanding the foregoing, if the Optionee is party to an employment agreement, offer letter or other similar agreement with the Company that contains a definition of “cause” for termination of employment, “Cause” shall have the meaning ascribed to such term in such agreement. The Optionee shall be considered to have been discharged for “Cause” if the Company determines, within 30 days after the Optionee’s resignation, that discharge for Cause was warranted.

(f) Effect of Breach of Covenants . Notwithstanding anything to the contrary in Sections 3(c) and (d), if the Optionee, prior to the Final Exercise Date, breaches (as determined by the Company in its sole discretion) the non-competition, non-solicitation or confidentiality provisions of any employment or nondisclosure agreement or other similar agreement between the Optionee and the Company, the right to exercise this option shall terminate immediately upon such violation.

4. Payment of Purchase Price . Common Stock purchased upon the exercise of this option shall be paid for as follows:

(a) in cash or by check, payable to the order of the Company;

required tax withholding or (ii) delivery by the Optionee to the Company of a copy of irrevocable and unconditional instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price and any required tax withholding;

(c) if the Common Stock is registered under the Securities Exchange Act of 1934, by delivery of shares of Common Stock owned by the Optionee valued at their Fair Market Value (as defined in Section 5(h)(3) of the Plan), provided (i) such method of payment is then permitted under applicable law, (ii) such shares, if acquired directly from the Company, were owned by the Optionee for such minimum period of time, if any, as may be established by the Board in its discretion, and (iii) such shares are not subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements;

(d) to the extent permitted by applicable law and by the Board, by payment of such other lawful consideration as the Board may determine; or

(e) by any combination of the above permitted forms of payment.

5. Tax Matters .

(a) Withholding . No Shares will be issued pursuant to the exercise of this option unless and until the Optionee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option. In the Board’s discretion, and subject to such conditions as the Board may establish, such tax obligations may be paid in whole or in part in shares of Common Stock, including Shares retained from the option creating the tax obligation, valued at their Fair Market Value. The Company may, to the extent permitted by law, deduct any such tax obligations from any payment of any kind otherwise due to the Optionee.

(b) Disqualifying Disposition . If the Optionee disposes of Shares acquired upon exercise of this option within two years from the Grant Date or one year after such Shares were acquired pursuant to exercise of this option, the Optionee shall notify the Company’s Stock Plan Manager by post or inter-office mail at Avid Technology, Inc., Building One, Mail Stop #5, One Park West, Tewksbury, MA 01876 of such disposition.

(c) Termination of Employment . If the Optionee’s employment with the Company is terminated but such Optionee remains an Eligible Optionee, such Eligible Optionee must exercise this option (to the extent it is exercisable on the date of such termination) within three months following the Eligible Optionee’s termination in order for the option to receive incentive stock option treatment under Section 422 of the Code. After such three-month period, the option, to the extent exercisable, will convert to a nonstatutory stock option.

6. Nontransferability of Option . This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Optionee, either voluntarily or by operation of law, except by will or the laws of descent and distribution, and, during the lifetime of the Optionee, this option shall be exercisable only by the Optionee.

7.	Miscellaneous .

(a) Governing Law . These terms and conditions shall be governed by and construed in accordance with the laws of the State of Delaware without regard to any choice or conflict of law provision.

(b) Severability . The invalidity or unenforceability of any provision hereof shall not affect the validity or enforceability of any other provision hereof, and each such other provision shall be severable and enforceable to the extent permitted by law.

(c) Binding Effect . These terms and conditions shall be binding upon and inure to the benefit of the Company and the Optionee and their respective heirs, executors, administrators, legal representatives, successors and assigns, subject to the restrictions on transfer set forth in Section 6.

(d) Entire Agreement . These terms and conditions, the Notice and the Plan constitute the entire agreement between the parties, and supersede all prior agreements and understandings, relating to the subject matter hereof.

(e) Amendment . These terms and conditions may only be amended or modified in accordance with the Plan.

Exhibit 10.2

Avid Technology, Inc.

Notice of Grant of Nonstatutory Stock Option under Amended and Restated 2005 Stock Incentive Plan

[NAME]

Employee ID: _____

Dear ___________,

This notice (the “Notice”) evidences the grant by Avid Technology, Inc. (the “Company”) on _____________ (the “Grant Date”) to you (the “Optionee”) of a nonstatutory stock option to purchase ______ shares (the “Shares”) of common stock, $0.01 par value per share, of the Company (the “Common Stock”) pursuant to the Company’s Amended and Restated 2005 Stock Incentive Plan (as amended from time to time, the “Plan”) at an exercise price of $____ per Share. The Optionee may obtain electronic copies of the Plan and the related Plan Prospectus from the same webpage that he or she obtained this Notice and the attached terms and conditions. The Notice, the attached terms and conditions, and the Plan, together constitute the complete agreement between the Optionee and the Company regarding this nonstatutory stock option and the Shares.

The Shares will vest as set forth in the following schedule, and will become fully vested on the last date shown.

Number of Shares	Vest Type	Full Vest	Expiration

AVID TECHNOLOGY, INC.

By _______________________________

Date _______________________

Name:

Title:

Address:

Avid Technology, Inc.

Nonstatutory Stock Option Grant

Terms and Conditions

It is intended that the option evidenced hereby shall not be an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended, and any regulations promulgated thereunder (the “Code”). Except as otherwise indicated by the context, the term “Optionee,” as used in this option, shall be deemed to include any person who acquires the right to exercise this option validly under its terms. Except where the context otherwise requires, the term “Company” shall include any of the Company’s present or future parent or subsidiary corporations as defined in Sections 424(e) and 424(f) of the Code.

3.	Exercise of Option .

superseding vesting and exercise terms as set forth in the Optionee’s then-effective employment agreement, offer letter or other similar agreement with the Company, if any.

4. Payment of Purchase Price . Common Stock purchased upon the exercise of this option shall be paid for as follows:

(a) in cash or by check, payable to the order of the Company;

(d) to the extent permitted by applicable law and by the Board, by payment of such other lawful consideration as the Board may determine; or

(e) by any combination of the above permitted forms of payment.

5. Tax Matters . No Shares will be issued pursuant to the exercise of this option unless and until the Optionee pays to the Company, or makes provision satisfactory to the Company for payment of, any federal, state or local withholding taxes required by law to be withheld in respect of this option. In the Board’s discretion, and subject to such conditions as the Board may establish, such tax obligations may be paid in whole or in part in shares of Common Stock, including Shares retained from the option creating the tax obligation, valued at their Fair Market Value. The Company may, to the extent permitted by law, deduct any such tax obligations from any payment of any kind otherwise due to the Optionee.

6. Nontransferability of Option . This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Optionee, either voluntarily or by operation of law, except by will or the laws of descent and distribution or pursuant to a qualified domestic relations order, and, during the lifetime of the Optionee, this option shall be exercisable only by the Optionee.

7.	Miscellaneous .

(a) Governing Law . These terms and conditions shall be governed by and construed in accordance with the laws of the State of Delaware without regard to any choice or conflict of law provision.

(e) Amendment . These terms and conditions may only be amended or modified in accordance with the Plan.

Exhibit 10.3

Avid Technology, Inc.

Notice of Grant of Nonstatutory Stock Option to Outside Directors under Amended and Restated 2005 Stock Incentive Plan

[NAME]

Dear ___________,

The Shares will vest as set forth in the following schedule, and will become fully vested on the last date shown.

Number of Shares	Vest Type	Full Vest	Expiration

AVID TECHNOLOGY, INC.

By _______________________________

Date _______________________

Name:

Title:

Address:

Avid Technology, Inc.

Nonstatutory Stock Option Grant to Outside Directors

Terms and Conditions

2. Vesting Schedule . Except as otherwise provided herein, this option may be exercised in whole or in part prior to the seventh anniversary (the “Final Exercise Date”) of the Grant Date, subject to the vesting schedule provided in the Notice. The right of exercise shall be cumulative so that to the extent the option is not exercised in any period to the maximum extent permissible, it shall continue to be exercisable, in whole or in part, with respect to all Shares for which it is vested until the earlier of the Final Exercise Date or the termination of this option under Section 3 or the Plan.

3.	Exercise of Option .

(b) Continuous Relationship with the Company Required . Except as otherwise provided in this Section 3, this option may not be exercised unless the Optionee, at the time he or she exercises this option, is, and has been at all times since the Grant Date, a director, officer or employee of, or consultant or advisor to, the Company (an “Eligible Optionee”).

(c) Termination of Relationship with the Company . If the Optionee ceases to be an Eligible Optionee for any reason, then, except as provided in Sections 3(e) and (f), the right to exercise this option shall terminate one year after such cessation (but in no event after the Final

Exercise Date), provided that this option shall be exercisable only to the extent that the Optionee was entitled to exercise this option on the date of such cessation.

(d) Acceleration . This option shall become exercisable in full if, while the Optionee is an Eligible Optionee and the Company has not terminated such relationship for “Cause” as defined in Section 3(e), the Optionee dies, becomes disabled (within the meaning of Section 22(e)(3) of the Code), retires following at least 10 years of service as a member of the Company’s Board of Directors (the “Board”) or reaches mandatory retirement age, provided that this option shall not be exercisable after the Final Exercise Date. For purposes of this Section 3(d), “mandatory retirement age” shall mean the age of the Optionee at the time the Optionee is no longer eligible to stand for re-election to the Board as set forth in the Company’s Corporate Governance Guidelines.

(e) Discharge for Cause . If the Optionee, prior to the Final Exercise Date, is discharged by the Company for “Cause,” the right to exercise this option shall terminate immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Optionee or willful failure by the Optionee to perform his or her responsibilities to the Company (including, without limitation, breach by the Optionee of any provision of any nondisclosure, non-competition, non-solicitation or other similar agreement between the Optionee and the Company), as determined by the Company, which determination shall be conclusive. The Optionee shall be considered to have been discharged for “Cause” if the Company determines, within 30 days after the Optionee’s resignation, that discharge for Cause was warranted.

(f) Effect of Breach of Covenants . Notwithstanding anything to the contrary in Sections 3(c) and (d), if the Optionee, prior to the Final Exercise Date, breaches (as determined by the Company in its sole discretion) his or her confidentiality obligations to the Company, the right to exercise this option shall terminate immediately upon such violation.

4. Payment of Purchase Price . Common Stock purchased upon the exercise of this option shall be paid for as follows:

(a) in cash or by check, payable to the order of the Company;

(b) with the prior consent of the Company (which may be withheld in its sole discretion), by (i) delivery of an irrevocable and unconditional undertaking by a creditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise price and any required tax withholding or (ii) delivery by the Optionee to the Company of a copy of irrevocable and unconditional instructions to a creditworthy broker to deliver promptly to the Company cash or a check sufficient to pay the exercise price and any required tax withholding;

owned by the Optionee for such minimum period of time, if any, as may be established by the Board in its discretion and (iii) such shares are not subject to any repurchase, forfeiture, unfulfilled vesting or other similar requirements;

(d) to the extent permitted by applicable law and by the Board, by payment of such other lawful consideration as the Board may determine; or

(e) by any combination of the above permitted forms of payment.

5. Tax Matters . The Optionee shall be solely responsible for the payment of any federal, state or local taxes required by law to be paid in connection with this option.

6. Nontransferability of Option . This option may not be sold, assigned, transferred, pledged or otherwise encumbered by the Optionee, either voluntarily or by operation of law, except by will or the laws of descent and distribution or pursuant to a qualified domestic relations order, and, during the lifetime of the Optionee, this option shall be exercisable only by the Optionee.

7.	Miscellaneous .

(a) Governing Law . These terms and conditions shall be governed by and construed in accordance with the laws of the State of Delaware without regard to any choice or conflict of law provision.

(e) Amendment . These terms and conditions may only be amended or modified in accordance with the Plan.

Exhibit 10.4

Avid Technology, Inc.

Notice of Award of Restricted Stock under Amended and Restated 2005 Stock Incentive Plan

[NAME]

Employee ID: _____

Dear ___________,

This notice (the “Notice”) evidences the award by Avid Technology, Inc. (the “Company”) on _____________ (the “Grant Date”) to you (the “Participant”) of ________ shares of restricted common stock, $0.01 par value per share, of the Company (the “Shares”) at a purchase price of $.01 per Share under the Company’s Amended and Restated 2005 Stock Incentive Plan (as amended from time to time, the “Plan”). The total price of the Shares is $_______. The Shares are subject to the attached terms and conditions and the Plan. The Participant may obtain electronic copies of the Plan and the related Plan Prospectus from the same webpage that he or she obtained this Notice and the terms and conditions. The Notice, the terms and conditions, and the Plan, together constitute the complete agreement between the Participant and the Company regarding the Shares.

Pursuant to Section 2 of the terms and conditions, upon termination of the Participant’s employment, the Company has an option to repurchase any Shares awarded to the Participant that are not then vested at a price of $.01 per share, except as otherwise provided in Sections 2(b) and (c) of such terms and conditions.

The Shares will vest as set forth in the following schedule, and will become fully vested on the last date shown.

Vested Shares

Vesting Date

AVID TECHNOLOGY, INC.

By _______________________________

Date _______________________

Name:

Title:

Address:

Avid Technology, Inc .

Restricted Stock Award

Terms and Conditions

1. Purchase of Shares . The Company shall issue and sell to the Participant, and the Participant shall purchase from the Company, subject to theses terms and conditions, the attached Notice and the Plan, the number of Shares identified in the Notice at a purchase price per Share identified in the Notice. The aggregate purchase price for the Shares shall be paid by the Participant by check payable to the order of the Company or such other method as may be acceptable to the Company. The Company shall record on its books the issuance to the Participant of that number of Shares purchased by the Participant. The Participant agrees that the Shares shall be subject to the Purchase Option set forth in Section 2 and the restrictions on transfer set forth in Section 4. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed in the Notice.

Purchase Option .

(a) The Shares shall vest as set forth in the Notice. Except as provided in Sections 2(b) and (c), in the event that the Participant ceases to be employed by the Company (as an employee or officer of, or an advisor or consultant to, the Company) for any reason or no reason, with or without Cause (as defined in Section 2(c)), prior to the final vesting date of the Shares, vesting shall cease and the Company shall have the right and option (the “Purchase Option”) to purchase from the Participant, for a price per Share specified in the Notice (the “Option Price”), some or all of the Shares that are not then vested. Notwithstanding anything to the contrary in these terms and conditions, the Notice or the Plan, if the Participant’s employment with the Company is terminated, then this restricted stock award shall be subject to any applicable, superseding vesting terms as set forth in the Participant’s then-effective employment agreement, offer letter or other similar agreement with the Company, if any.

(b) In the event that the Participant’s employment with the Company is terminated by reason of death or disability (within the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”)) prior to the final vesting date of the Shares, the Participant’s Shares that vest solely based on the passage of time (“Time-Based Shares”) shall vest with respect to an additional number of Time-Based Shares that would have vested during the one-year period following the termination of the Participant’s employment with the Company.

(c) If the Participant retires prior to the final vesting date of the Shares, then the Time-Based Shares shall continue to vest through the final vesting date, notwithstanding that the Participant ceases to be employed by the Company; provided, however, if the Participant, prior to such final vesting date, breaches (as determined by the Company in its sole discretion) the non-competition, non-solicitation or confidentiality provisions of any employment or nondisclosure agreement or other similar agreement between the Participant and the Company, vesting shall immediately cease and the Company shall have the right to exercise the Purchase Option with respect to all of the Shares that are not vested on the date of the breach.

For purposes of this Section 2(c), “retirement” shall mean the cessation of employment with the Company for any reason other than “Cause” by a Participant who is at least 60 years of age and who has been employed continuously by the Company for the seven years immediately preceding the date of cessation of employment. “Cause” shall mean willful misconduct by the Participant or willful failure by the Participant to perform his or her responsibilities to the Company (including, without limitation, breach by the Participant of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Participant and the Company), as determined by the Company, which determination shall be conclusive. Notwithstanding the foregoing, if the Participant is party to an employment agreement, offer letter or other similar agreement with the Company that contains a definition of “cause” for termination of employment, “Cause” shall have the meaning ascribed to such term in such agreement. The Participant shall be considered to have been discharged for “Cause” if the Company determines, within 30 days after the Participant’s resignation, that discharge for Cause was warranted.

(d) For purposes of these terms and conditions, employment with the Company shall include employment with any of the Company’s present or future parent or subsidiary corporations as defined in Sections 424(e) and 424(f) of the Code.

Exercise of Purchase Option and Closing .

(a) The Company may exercise the Purchase Option by delivering or mailing to the Participant, within 90 days after the termination of the employment of the Participant with the Company, a written notice of exercise of the Purchase Option. Such notice shall specify the number of Shares to be purchased. If and to the extent the Purchase Option is not so exercised by the giving of such a notice within such 90-day period, the Purchase Option shall automatically expire and terminate effective upon the expiration of such 90-day period.

(b) Within 10 days after delivery to the Participant of the Company’s notice of the exercise of the Purchase Option pursuant to Section 3(a), the Company shall cause to be transferred to the Company on its books that number of Shares that the Company has elected to purchase in accordance with the terms herein. In the event a certificate or certificates representing the Shares have been issued to the Participant, the Participant shall tender to the Company at its principal offices the certificate or certificates representing the Shares that the Company has elected to purchase in accordance with the terms herein, duly endorsed in blank or with duly endorsed stock powers attached thereto, all in form suitable for the transfer of such Shares to the Company. Upon such transfer, the Company shall deliver or mail to the Participant a check in the amount of the aggregate Option Price for such Shares (provided that any delay in making such payment shall not invalidate the Company’s exercise of the Purchase Option with respect to such Shares).

(c) After the time at which any Shares are transferred to the Company pursuant to Section 3(b), the Company shall not pay any dividend to the Participant on account of such Shares or permit the Participant to exercise any of the privileges or rights of a stockholder with respect to such Shares, but shall, in so far as permitted by law, treat the Company as the owner of such Shares.

(d) The Option Price may be payable, at the option of the Company, in cancellation of all or a portion of any outstanding indebtedness of the Participant to the Company or in cash (by check) or both.

(e) The Company shall not purchase any fraction of a Share upon exercise of the Purchase Option, and any fraction of a Share resulting from a computation made pursuant to Section 2 shall be rounded to the nearest whole Share (with any one-half Share being rounded upward).

(f) The Company may assign its Purchase Option to one or more persons or entities.

Restrictions on Transfer; Effect of Prohibited Transfer .

(a) The Participant shall not sell, assign, transfer, pledge, hypothecate or otherwise dispose of, by operation of law or otherwise (collectively, “transfer”) any unvested Shares, or any interest therein, except by will or the laws of descent and distribution, or pursuant to a qualified domestic relations order, provided that such Shares shall remain subject to these terms and conditions (including without limitation the restrictions on transfer set forth in this Section 4, and the Purchase Option) and such permitted transferee shall, as a condition to such transfer, deliver to the Company a written instrument confirming that such transferee shall be bound by all of the terms and conditions herein.

(b) The Company shall not be required (i) to transfer on its books any of the Shares which shall have been sold or transferred in violation of any of the provisions set forth herein, or (ii) to treat as owner of such Shares or to pay dividends to any transferee to whom any such Shares shall have been so sold or transferred.

5. Restrictive Legend . The book entry account reflecting the issuance of the Shares in the name of the Participant shall bear a legend or other notation upon substantially the following terms:

“These shares of stock are subject to restrictions on transfer and an option to purchase set forth in that certain Restricted Stock Award Terms and Conditions, and a copy of such Restricted Stock Award Terms and Conditions is available for inspection without charge at the office of the Secretary of the corporation.”

Withholding Taxes; Section 83(b) Election .

(a) The Participant acknowledges and agrees that to satisfy any federal, state or local withholding tax obligation required by law to be withheld or paid in respect of this award, the Company shall deduct and retain from the Shares no longer subject to the Purchase Option under Section 2 such number of Shares as is equal in value to the Company’s minimum statutory withholding obligations with respect to the income recognized by the Participant upon the lapse of the Purchase Option (based on minimum statutory withholding rates for federal and

state tax purposes, including payroll taxes, that are applicable to such income), based on the closing price of the Company’s common stock on the vesting date of the Shares. The Participant represents to the Company that, as of the date hereof, he or she is not aware of any material nonpublic information about the Company or the Company’s common stock. The Participant and the Company have structured these terms and conditions to constitute a “binding contract” relating to the sale of the Company’s common stock pursuant to this Section 6, consistent with the affirmative defense to liability under Section 10(b) of the Securities Exchange Act of 1934 under Rule 10b5-1(c) promulgated under such Act.

(b) The Participant acknowledges that he or she is responsible for obtaining the advice of the Participant’s own tax advisors with respect to the acquisition of the Shares and the Participant is relying solely on such advisors and not on any statements or representations of the Company or any of its agents with respect to the tax consequences relating to the Shares. The Participant understands that the Participant (and not the Company) shall be responsible for the Participant’s tax liability that may arise in connection with the acquisition, vesting and/or disposition of the Shares. The Participant acknowledges that he or she has been informed of the availability of making an election under Section 83(b) of the Internal Revenue Code, as amended, with respect to the issuance of the Shares and that the Participant had decided not to file a Section 83(b) election.

Miscellaneous .

(a) Governing Law . These terms and conditions shall be governed by and construed in accordance with the laws of the State of Delaware without regard to any choice or conflict of law provision.

(c) Binding Effect . These terms and conditions shall be binding upon and inure to the benefit of the Company and the Participant and their respective heirs, executors, administrators, legal representatives, successors and assigns, subject to the restrictions on transfer set forth in Section 4.

(d) Notice . All notices required or permitted hereunder shall be in writing and deemed effectively given upon personal delivery or five days after deposit in the United States Post Office by registered or certified mail, postage prepaid, addressed to the other party hereto at the address shown on the attached Notice, or at such other address or addresses as either party shall designate to the other in accordance with this Section 7(d).

(e) Waiver . Any provision for the benefit of the Company contained in these terms and conditions may be waived, either generally or in any particular instance, by the Board of Directors of the Company or a duly authorized committee thereof.

(f) Entire Agreement . These terms and conditions, the Notice and the Plan constitute the entire agreement between the parties, and supersede all prior agreements and understandings, relating to the subject matter hereof.

(g) Amendment . These terms and conditions may only be amended or modified in accordance with the Plan.

Exhibit 10.5

Avid Technology, Inc.

Notice of Award of Restricted Stock to Outside Directors under Amended and Restated 2005 Stock Incentive Plan

[NAME]

Dear ___________,

Pursuant to Section 2 of the terms and conditions, upon cessation of the Participant’s service as a member of the Company’s Board of Directors (the “Board”), the Company has an option to repurchase any Shares awarded to the Participant that are not then vested at a price of $.01 per share, except as otherwise provided in Section 2(b) of such terms and conditions.

The Shares will vest as set forth in the following schedule, and will become fully vested on the last date shown.

Vested Shares

Vesting Date

AVID TECHNOLOGY, INC.

By _______________________________

Date _______________________

Name:

Title:

Address:

Avid Technology, Inc .

Restricted Stock Award

Terms and Conditions

1. Purchase of Shares . The Company shall issue and sell to the Participant, and the Participant shall purchase from the Company, subject to these terms and conditions, the attached Notice and the Plan, the number of Shares identified in the Notice at a purchase price per Share identified in the Notice. The aggregate purchase price for the Shares shall be paid by the Participant by check payable to the order of the Company or such other method as may be acceptable to the Company. The Company shall record on its books the issuance to the Participant of that number of Shares purchased by the Participant. The Participant agrees that the Shares shall be subject to the Purchase Option set forth in Section 2 and the restrictions on transfer set forth in Section 4. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed in the Notice.

Purchase Option .

(a) The Shares shall vest as set forth in the Notice. Except as provided in Sections 2(b) and (c), in the event that the Participant ceases to serve as a director, officer or employee of, or consultant or advisor to, the Company for any reason or no reason prior to the final vesting date of the Shares, vesting shall cease and the Company shall have the right and option (the “Purchase Option”) to purchase from the Participant, for a price per Share specified in the Notice (the “Option Price”), some or all of the Shares that are not then vested.

(b) If, prior to the final vesting date of the Shares, the Participant dies, becomes disabled (within the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”)), retires following at least 10 years of service as a member of the Board or reaches mandatory retirement age, then the Shares shall continue to vest through the final vesting date, notwithstanding that the Participant ceases to serve as a director, officer or employee of, or consultant or advisor to, the Company. For purposes of this Section 2(b), “mandatory retirement age” shall mean the age of the Participant at the time the Participant is no longer eligible to stand for re-election to the Board as set forth in the Company’s Corporate Governance Guidelines. Notwithstanding the above, if the Participant, prior to such final vesting date, breaches (as determined by the Company in its sole discretion) his or her confidentiality obligations to the Company, vesting shall immediately cease and the Company shall have the right to exercise the Purchase Option with respect to all of the Shares that are not vested on the date of the breach.

Exercise of Purchase Option and Closing .

(a) The Company may exercise the Purchase Option by delivering or mailing to the Participant, within 90 days after the cessation of service on the Board by the Participant, a written notice of exercise of the Purchase Option. Such notice shall specify the number of Shares to be purchased. If and to the extent the Purchase Option is not so exercised by the giving

of such a notice within such 90-day period, the Purchase Option shall automatically expire and terminate effective upon the expiration of such 90-day period.

(d) The Option Price may be payable, at the option of the Company, in cancellation of all or a portion of any outstanding indebtedness of the Participant to the Company or in cash (by check) or both.

(f) The Company may assign its Purchase Option to one or more persons or entities.

Restrictions on Transfer; Effect of Prohibited Transfer .

5. Restrictive Legend . The book entry account reflecting the issuance of the Shares in the name of the Participant shall bear a legend or other notation upon substantially the following terms:

Tax Matters; Section 83(b) Election .

(a) The Participant acknowledges and agrees that he or she will satisfy any federal, state or local tax obligation required by law to be paid with respect to the vesting of the Shares by making a cash payment to the Company.

Miscellaneous .

(a) Governing Law . These terms and conditions shall be governed by and construed in accordance with the laws of the State of Delaware without regard to any conflict or choice of law provision.

(e) Waiver . Any provision for the benefit of the Company contained in these terms and conditions may be waived, either generally or in any particular instance, by the Board.

(g) Amendment . These terms and conditions may only be amended or modified in accordance with the Plan.

Exhibit 10.6

Avid Technology, Inc.

Notice of Grant of Restricted Stock Units under Amended and Restated 2005 Stock Incentive Plan

[NAME]

Employee ID: _____

Dear ___________,

This notice (the “Notice”) evidences the grant by Avid Technology, Inc. (the “Company”) on _________________ (the “Grant Date”) to you (the “Participant”) of ________ restricted stock units of the Company (“RSUs”). Each RSU represents the right to receive one share of common stock, $0.01 par value per share, of the Company (“Common Stock”) under the Company’s Amended and Restated 2005 Stock Incentive Plan (as amended from time to time, the “Plan”). The shares of Common Stock that are issuable upon vesting of the RSUs are referred to herein as “Shares.” The RSUs and the Shares are subject to the attached terms and conditions and the Plan. The Participant may obtain electronic copies of the Plan and the related Plan Prospectus from the same webpage that he or she obtained this Notice and the terms and conditions. The Notice, the terms and conditions, and the Plan, together constitute the complete agreement between the Participant and the Company regarding the RSUs and the Shares.

The RSUs will vest as set forth in the following schedule, and will become fully vested on the last date shown.

RSUs

Vesting Date

AVID TECHNOLOGY, INC.

By _______________________________

Date _______________________

Name:

Title:

Address:

Avid Technology, Inc.

Grant of Restricted Stock Units

Terms and Conditions

1. Grant of Restricted Stock Units . The Company shall grant to the Participant, subject to these terms and conditions, the attached Notice and the Plan, the number of RSUs identified in the Notice. Each RSU represents the right to receive one share of Common Stock. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed in the Notice.

Vesting; Forfeiture .

(a) The RSUs shall vest as set forth in the Notice. Except as provided in Sections 2(b) and (c), in the event that the Participant ceases to be employed by the Company (as an employee or officer of, or an advisor or consultant to, the Company) for any reason or no reason, with or without Cause (as defined Section 2(c)), prior to the final vesting date of the RSUs, vesting shall cease and the Participant will have no rights with respect to any RSUs that have not then vested. Notwithstanding anything to the contrary in these terms and conditions, the Notice or the Plan, if the Participant’s employment with the Company is terminated, then this option shall be subject to any applicable, superseding vesting terms as set forth in the Participant’s then-effective employment agreement, offer letter or other similar agreement with the Company, if any.

(b) In the event that the Participant’s employment with the Company is terminated by reason of death or disability (within the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”)) prior to the final vesting date of the RSUs, the Participant’s RSUs that vest solely based on the passage of time (“Time-Based RSUs”), if any, shall vest with respect to an additional number of Time-Based RSUs that would have vested during the one-year period following the termination of the Participant’s employment with the Company.

(c) If the Participant retires prior to the final vesting date of the RSUs, then the Time-Based RSUs shall continue to vest through the final vesting date notwithstanding that the Participant ceases to be employed by the Company; provided, however, if the Participant, prior to such final vesting date, breaches (as determined by the Company in its sole discretion) the non-competition, non-solicitation or confidentiality provisions of any employment or nondisclosure agreement or other similar agreement between the Participant and the Company, vesting shall immediately cease and the Participant will have no rights with respect to any RSUs that have not vested as of the date of the breach.

Company (including, without limitation, breach by the Participant of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Participant and the Company), as determined by the Company, which determination shall be conclusive. Notwithstanding the foregoing, if the Participant is party to an employment agreement, offer letter or other similar agreement with the Company that contains a definition of “cause” for termination of employment, “Cause” shall have the meaning ascribed to such term in such agreement. The Participant shall be considered to have been discharged for “Cause” if the Company determines, within 30 days after the Participant’s resignation, that discharge for Cause was warranted.

3. Distribution of Shares . The Company shall not be obligated to issue to the Participant any Shares upon the vesting of any RSU (or otherwise) unless the issuance and delivery of such Shares shall comply with all relevant provisions of law and other legal requirements including, without limitation, any applicable federal or state securities and tax laws and the requirements of any stock exchange upon which the Shares may then be listed. Each Share distribution date is hereinafter referred to as a “Settlement Date.”

4. Restrictions on Transfer . The Participant shall not sell, assign, transfer, pledge, hypothecate or otherwise dispose of, by operation of law or otherwise (collectively, “transfer”) any RSUs, or any interest therein, except by will or the laws of descent and distribution.

5. Dividend and Other Shareholder Rights . Except as set forth in the Plan, neither the Participant nor any person claiming under or through the Participant shall be, or have any rights or privileges of, a stockholder of the Company in respect of the Shares issuable pursuant to the RSUs granted hereunder until the Shares have been delivered to the Participant.

Withholding Taxes; Section 83(b) Election .

(a) No Shares will be delivered pursuant to the vesting of an RSU unless and until the Participant satisfies any federal, state or local withholding tax obligation required by law to be withheld or paid in respect of this award. The Participant acknowledges and agrees that to satisfy any such tax obligation, the Company shall deduct and retain from the Shares to be distributed upon the Settlement Date such number of Shares as is equal in value to the Company’s minimum statutory withholding obligations with respect to the income recognized by the Participant upon the vesting of an RSU (based on minimum statutory withholding rates for federal and state tax purposes, including payroll taxes, that are applicable to such income), based on the closing price of the Common Stock on the Settlement Date. The Participant represents to the Company that, as of the date hereof, he or she is not aware of any material nonpublic information about the Company or the Common Stock. The Participant and the Company have structured these terms and conditions to constitute a “binding contract” relating to the sale of Common Stock pursuant to this Section 6, consistent with the affirmative defense to liability

under Section 10(b) of the Securities Exchange Act of 1934 under Rule 10b5-1(c) promulgated under such Act.

(b) The Participant acknowledges that no election under Section 83(b) of the Code may be filed with respect to this award.

Miscellaneous .

(a) Governing Law . These terms and conditions shall be governed by and construed in accordance with the laws of the State of Delaware without regard to any choice or conflict of law provision.

(d) Waiver . Any provision for the benefit of the Company contained in these terms and conditions may be waived, either generally or in any particular instance, by the Board of Directors of the Company or a duly authorized committee thereof.

(e) Entire Agreement . These terms and conditions, the Notice and the Plan constitute the entire agreement between the parties, and supersede all prior agreements and understandings, relating to the subject matter hereof.

(f) Amendment . These terms and conditions may only be amended or modified in accordance with the Plan.

Exhibit 10.7

Avid Technology, Inc.

Notice of Grant of Restricted Stock Units to Outside Directors under Amended and Restated 2005 Stock Incentive Plan

[NAME]

Dear ___________,

This notice (the “Notice”) evidences the grant by Avid Technology, Inc. (the “Company”) on _________________ (the “Grant Date”) to you (the “Participant”) of ________ restricted stock units of the Company (the “RSUs”) under the Company’s Amended and Restated 2005 Stock Incentive Plan (as amended from time to time, the “Plan”). Each RSU represents the right to receive one share of common stock, $0.01 par value per share of the Company (“Common Stock”). The shares of Common Stock that are issuable upon vesting of the RSUs are referred to herein as “Shares.” The RSUs and the Shares are subject to the attached terms and conditions and the Plan. The Participant may obtain electronic copies of the Plan and the related Plan Prospectus from the same webpage that he or she obtained this Notice and the terms and conditions. The Notice, the terms and conditions, and the Plan, together constitute the complete agreement between the Participant and the Company regarding the RSUs and the Shares.

The RSUs will vest as set forth in the following schedule, and will become fully vested on the last date shown.

RSUs

Vesting Date

AVID TECHNOLOGY, INC.

By _______________________________

Date _______________________

Name:

Title:

Address:

Avid Technology, Inc.

Grant of Restricted Stock Units

Terms and Conditions

2. Vesting; Forfeiture .

(a) The RSUs shall vest as set forth in the Notice. Except as provided in Section 2(b), in the event that the Participant ceases to serve as a director, officer or employee of, or consultant or advisor to, the Company for any reason or no reason prior to the final vesting date of the RSUs, vesting shall cease and the Participant will have no rights with respect to any RSUs that have not then vested.

(b) If, prior to the final vesting date of the RSUs, the Participant dies, becomes disabled (within the meaning of Section 22(e)(3) of the Internal Revenue Code of 1986, as amended (the “Code”)), retires following at least 10 years of service as a member of the Company’s Board of Directors (the “Board”) or reaches mandatory retirement age, then the RSUs shall continue to vest through the final vesting date notwithstanding that the Participant ceases to serve as a director, officer, or employee of, or consultant or advisor to, the Company. For purposes of this Section 2(b), “mandatory retirement age” shall mean the age of the Participant at the time the Participant is no longer eligible to stand for re-election to the Board as set forth in the Company’s Corporate Governance Guidelines. Notwithstanding the above, if the Participant, prior to such final vesting date, breaches (as determined by the Company in its sole discretion) his or her confidentiality obligations to the Company, vesting shall immediately cease and the Participant will have no rights with respect to any RSUs that have not vested as of the date of the breach.

5. Dividend and Other Shareholder Rights . Except as set forth in the Plan, neither the Participant nor any person claiming under or through the Participant shall be, or have any

rights or privileges of, a stockholder of the Company in respect of the Shares issuable pursuant to the RSUs granted hereunder until the Shares have been delivered to the Participant.

Tax Matters .

(a) No Shares will be delivered pursuant to the vesting of an RSU unless and until the Participant satisfies any federal, state or local tax obligation required by law to be paid with respect to this award.

(b) The Participant acknowledges that no election under Section 83(b) of the Code may be filed with respect to this award.

Miscellaneous .

(a) Governing Law . These terms and conditions shall be governed by and construed in accordance with the laws of the State of Delaware without regard to any choice or conflict of law provision.

(d) Waiver . Any provision for the benefit of the Company contained in these terms and conditions may be waived, either generally or in any particular instance, by the Board.

(f) Amendment . These terms and conditions may only be amended or modified in accordance with the Plan.

Exhibit 10.8

Avid Technology, Inc.

Notice of Grant of Stock Option under HMRC Approved Sub-Plan for UK Employees

Avid Technology, Inc.

ID: 04-2977748

Avid Technology Park

One Park West

Tewksbury, MA 01876

Notice of Grant of Stock Option

and Option Agreement

Grant Number:

ID:

Plan:

This notice (the “Notice”) evidences the grant by Avid Technology, Inc. (the “Company”) on _____________ (the “Grant Date”) to you (the “Optionee”) of a stock option to purchase ______ shares (the “Shares”) of common stock, $0.01 par value per share of the Company (the “Common Stock”) pursuant to the HMRC Approved Sub-Plan for UK Employees (the “UK Sub-Plan”) at an exercise price of $____ per share. The Optionee may obtain electronic copies of the UK Sub-Plan, the Company’s Amended and Restated 2005 Stock Incentive Plan (as amended from time to time, the “Plan”) and the related Plan Prospectus from the same webpage that he or she obtained this Notice and the attached terms and conditions. The Notice, the attached terms and conditions and the UK Sub-Plan, together constitute the complete agreement between the Optionee and the Company regarding this stock option and the Shares.

The Shares will vest as set forth in the following schedule, and will become fully vested on the last date shown.

NUMBER OF SHARES

VEST TYPE

FULL VEST DATE

EXPIRATION DATE

* These shares will vest in forty-two (42) equal monthly installments beginning on the date that is seven (7) months after the Grant Date.

AVID TECHNOLOGY, INC.

By: _______________________________________

Date:

Avid Technology, Inc.

Stock Option Grant under HMRC Approved Sub-Plan for UK Employees

Terms and Conditions

1. Grant of Option . The Company has adopted the Plan and has granted to the Optionee an option pursuant to the UK Sub-Plan to purchase the number of Shares identified in the Notice at the price per share and subject to these terms and conditions, the Notice and the UK Sub-Plan. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed in the Notice.

2. Vesting Schedule . Except as otherwise provided herein, this option may be exercised in whole or in part prior to the seventh anniversary (the “Final Exercise Date”) of the Grant Date, subject to the vesting schedule provided in the Notice. The right of exercise shall be cumulative so that to the extent the option is not exercised in any period to the maximum extent permissible it shall continue to be exercisable, in whole or in part, with respect to all shares for which it is vested until the earlier of the Final Exercise Date or the termination of this option under Section 3 or the UK Sub-Plan.

3. Exercise of Option .

(c) Termination of Relationship with the Company . If the Optionee ceases to be an Eligible Employee for any reason, then, except as provided in Sections 3(d) and (e), the right to exercise this option shall terminate and the option shall lapse three months after such cessation (but in no event after the Final Exercise Date), provided that this option shall be exercisable only to the extent that the Optionee was entitled to exercise this option on the date of such cessation. Notwithstanding anything to the contrary in these terms and conditions, the Notice or the UK

Sub-Plan, if the Optionee’s employment with the Company is terminated, then this option shall be subject to any applicable, superseding vesting and exercise terms as set forth in the Optionee’s then-effective employment agreement, offer letter or other similar agreement with the Company, if any.

(d) Exercise Period Upon Retirement, Death or Disability . If the Optionee retires, dies or becomes disabled (within the meaning of Section 22(e)(3) of the Code) prior to the Final Exercise Date while he or she is an Eligible Optionee and the Company has not terminated such relationship for “Cause” as defined in Section 3(e), this option shall be exercisable, within the period of one year following the date of retirement, death or disability of the Optionee (on the expiry of which period the option shall lapse), by the Optionee (o, in the case of death, by his or her personal representatives), provided that this option shall be exercisable only to the extent that this option was exercisable by the Optionee on the date of his or her retirement, death or disability, and further provided that this option shall not be exercisable after the Final Exercise Date. For purposes of this Section 3, “retirement” shall mean the cessation of employment with the Company for any reason other than “Cause” as defined in Section 3(e), by an Optionee who is at least 60 years of age and who has been employed continuously by the Company for the seven years immediately preceding the date of cessation of employment.

(e) Discharge for Cause . If the Optionee, prior to the Final Exercise Date, is discharged by the Company for “Cause” (as defined below), the right to exercise this option shall terminate and the option will lapse immediately upon the effective date of such discharge. “Cause” shall mean willful misconduct by the Optionee or willful failure by the Optionee to perform his or her responsibilities to the Company (including, without limitation, breach by the Optionee of any provision of any employment, consulting, advisory, nondisclosure, non-competition or other similar agreement between the Optionee and the Company), as determined by the Company, which determination shall be conclusive. Notwithstanding the foregoing, if the Optionee is party to an employment agreement, offer letter or other similar agreement with the Company that contains a definition of “cause” for termination of employment, “Cause” shall have the meaning ascribed to such term in such agreement. The Optionee shall be considered to have been discharged for “Cause” if the Company determines, within 30 days after the Optionee’s resignation, that discharge for Cause was warranted.

4. Payment of Purchase Price . Common Stock purchased upon the exercise of this option shall be paid for in cash or by cheque or banker’s draft, payable to the order of the Company or may be paid out of funds provided on loan by a bank, broker or other person.

5. Adjustment Provisions for Recapitalizations and Related Transactions . In the event of (a) any stock split, reverse stock split, recapitalization, combination of shares or other similar change in capitalization, (b) the outstanding shares of Common Stock are increased, decreased or

exchanged for a different number or kind of shares or other securities of the Company, or (c) additional shares or new or different shares or other securities of the Company are distributed with respect to such shares of Common Stock or other securities, the Board of Directors of the Company may, with the prior approval of the HMRC, make an appropriate and proportionate adjustment in the number of Shares and price of the Shares subject to this option, without changing the aggregate purchase price as to which this option remains exercisable.

6. Change of Control . Rule 26 of the UK Sub-Plan sets out the circumstances upon a change of control under which options may be substituted for new options in the acquiring company and retain their tax approved status. If the provisions of this Rule are not met, the Board of Directors of the Company, will give written notice to Optionees and any outstanding option will be exercisable in accordance with Section 10(b)(2)(ii) of the Plan.

7.	No Right to Employment, Etc .

(a) The grant of options under the UK Sub-Plan is made at the discretion of the Company and the UK Sub-Plan may be suspended or terminated by the Company at any time. The grant of an option in one year or at one time does not in any way entitle the Optionee to an option grant in the future. The UK Sub-Plan is wholly discretionary and is not to be considered part of the Optionee’s normal or expected compensation subject to severance, resignation, redundancy or similar compensation. The value of the option is an extraordinary item of compensation which is outside the scope of the Optionee’s employment contract (if any).

(b) Nothing in these terms and conditions or the UK Sub-Plan shall confer upon the Optionee any right to continue in service for any period of specific duration or interfere with or otherwise restrict in any way the rights of the Company (or any company employing or retaining the Optionee) or of the Optionee, which rights are hereby expressly reserved by each, to terminate the Optionee’s service.

(c) The rights and obligations of the Optionee under the terms of the Optionee’s office or employment with the Company, any past or present subsidiary, or associated or affiliate company of the Company shall not be affected by the Optionee’s participation in the UK Sub-Plan or the grant of this option or any right which the Optionee may have to participate therein, and the Optionee hereby waives all and any rights to compensation or damages in consequence of the termination of the Optionee’s office or employment with any such company for any reasons whatsoever (whether lawful or unlawful and including, without prejudice to the generality of the foregoing, in circumstances giving rise to a claim for wrongful dismissal) insofar as those rights arise or may arise from the Optionee’s ceasing to have rights under or being entitled to exercise this option as a result of such termination, or from the loss or diminution in value of such rights or entitlements.

8. Data Protection . The Optionee agrees to the receipt, holding and processing of information in connection with the grant, vesting, exercise, taxation and general administration of the UK Sub-Plan and this option by the Company or any subsidiary of the Company and any of their advisers or agents and to the transmission of such information outside of the European Economic Area for this purpose.

9. Nontransferability of Option . This option is personal and no rights granted hereunder may be transferred, assigned, pledged or hypothecated in any way (whether by operation of law or otherwise) nor shall any such rights be subject to execution, attachment or similar process. Upon any attempt to transfer, assign, pledge, hypothecate or otherwise dispose of this option or of such rights contrary to the provisions hereof, or upon the levy of any attachment or similar process upon this option or such rights, this option and such rights shall, at the election of the Company, become null and void.

10.	UK Tax Matters .

10.1 Depending on the circumstances, on exercise of the option the Optionee may have an income tax liability under PAYE and may be required to pay national insurance contributions (“NICs”). If so, then:

(a) the Company or the company which employs the Optionee may require the Optionee to pay amounts in respect of PAYE and NICs liability in cash;

(b) the Optionee may be required to:

(i)

pay;

(ii)

enter into a joint election to transfer; or

(iii)

enter into an arrangement or agreement for the payment of,

some or all of the Optionee’s employer’s secondary class 1 NICs liability arising from exercise of the option; and

(c) in some circumstances, the Company may withhold the number of Shares required to meet the liabilities in respect of PAYE, primary (employee) class 1 NICs and secondary (employer) class 1 NICs.

10.2	The option may only be exercised if the Optionee:

(a) confirms (in writing) that the Optionee agrees to the requirements of the UK Sub-Plan relating to PAYE and NICs (Rule 22). This may be done at the time of exercise; and

(b) makes any arrangements, or enter into any agreements, that may be required under Rule 22.

11. Provisions of the Plan and Schedule 4 . This option is subject to the provisions of the UK Sub-Plan, a copy of which is furnished to the Optionee with this option, and Schedule 4 to the Income Tax (Earnings and Pensions) Act 2003.