ADOBE SYSTEMS INC (Form: 8-K, Received: 12/20/2010 16:20:18)

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (date of earliest event reported): December 20, 2010

Adobe Systems Incorporated

(Exact name of Registrant as specified in its charter)

Delaware
(State or other jurisdiction of incorporation)

0-15175
(Commission File Number)

77-0019522
(I.R.S. Employer Identification No.)

345 Park Avenue
San Jose, California 95110-2704
(Address of principal executive offices and zip code)

Registrant’s telephone number, including area code: (408) 536-6000

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Section 2 — Financial Information

Item 2.02. Results of Operations and Financial Condition.

On December 20, 2010, Adobe issued a press release announcing its financial results for its fourth fiscal quarter and fiscal year ended December 3, 2010. A copy of this press release is furnished and attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information in this report and the exhibit attached hereto are being furnished and shall not be deemed filed for purposes of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, except as shall be expressly stated by specific reference in such filing.

The attached press release includes non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, non-GAAP operating expenses, non-GAAP tax rate and non-GAAP diluted earnings per share, and forecasted non-GAAP operating margin, non-GAAP tax rate and non-GAAP diluted earnings per share.

These non-GAAP measures are not in accordance with, or an alternative for, generally accepted accounting principles and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. We believe that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP measures.

For our internal budgeting and resource allocation process, we use non-GAAP financial measures, net of the related tax impacts, which exclude: (A) stock-based and deferred compensation expenses; (B) restructuring charges; (C) amortization of purchased intangibles and incomplete technology; (D) resolution of an income tax audit, (E) investment gains and losses; (F) the R&D tax benefit; and (G) the income tax effect of the non-GAAP pre-tax adjustments from the provision for income taxes. We use these non-GAAP financial measures in making operating decisions because we believe the measures provide meaningful supplemental information regarding our operational performance and give us a better understanding of how we should invest in research and development and fund infrastructure and go-to-market strategies. We use these measures to help us make budgeting decisions, for example, as between product development expenses and research and development, sales and marketing and general and administrative expenses. In addition, these non-GAAP financial measures facilitate our internal comparisons to our historical operating results and comparisons to competitors’ operating results.

As described above, we exclude the following items from one or more of our non-GAAP measures:

A. Stock-based and deferred compensation expenses and related tax impact . Stock-based compensation expense consists of charges for employee stock options, restricted stock units, performance shares and employee stock purchases in accordance with current GAAP related to stock-based compensation including expense associated with stock-based compensation related to unvested options and restricted stock units assumed in connection with our acquisitions. As we apply current stock-based compensation standards, we believe that it is useful to investors to understand the impact of the application of these standards to our operational performance, liquidity and our ability to invest in research and development and fund acquisitions and capital expenditures. Although stock-based compensation expense is calculated in accordance with current GAAP and constitutes an ongoing and recurring expense, such expense is excluded from non-GAAP results because it is not an expense that typically requires or will require cash settlement by us and because such expense is not used by us to assess the core profitability of our business operations. Deferred compensation expense consists of charges associated with movements in our liability related to our deferred compensation plan. Although deferred compensation expense constitutes an ongoing and recurring expense, such expense is excluded from non-GAAP results because it is not an expense that typically requires current cash settlement by us and because such expense is not used by us to assess the core profitability of our business operations. We further believe these measures are useful to investors in that they allow for greater transparency to certain line items in our financial statements. In addition, excluding these items from various non-GAAP measures facilitate comparisons to our competitors’ operating results.

B. Restructuring charges and related tax impact . In November 2009, we initiated restructuring activities to align our costs in connection with our fiscal 2010 operating plan. As a result, we recognized costs related to termination benefits for former Adobe employees whose positions were eliminated and the consolidation of leased facilities. In November 2008, we initiated restructuring actions associated with realigning our business strategies based on then-current economic conditions. In connection with these restructuring actions, we recognized costs related to termination benefits for former Adobe employees whose positions were eliminated and the consolidation of leased facilities. We also incurred restructuring charges associated with realigning our business upon the acquisition of Macromedia in December 2005 (the “Macromedia Restructuring”). The actions in the Macromedia Restructuring were taken to eliminate certain duplicative activities, focus our resources on future growth opportunities and reduce our cost structure. In connection with the Macromedia Restructuring, we recognized costs related to termination benefits for former Adobe employees whose positions were eliminated, the closure of Adobe facilities and the cancellation of certain contracts held by us. We exclude these charges because these expenses are not reflective of ongoing operating results in the current period.

C. Amortization of purchased intangibles and incomplete technology and related tax impact .

We incur amortization of purchased intangibles in connection with our acquisitions. Purchased intangibles include (i) purchased technology, (ii) trademarks, (iii) customer contracts and relationships and (iv) other intangibles. We expect to amortize for accounting purposes the fair value of the purchased intangibles based on the pattern in which the economic benefits of the intangible assets will be consumed as revenue is generated. Although the intangible assets generate revenue for us, we exclude this item because this expense is non-cash in nature and because we believe the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding our operational performance, liquidity and our ability to invest in research and development and fund acquisitions and capital expenditures. In addition, excluding this item from various non-GAAP measures facilitates our internal comparisons to our historical operating results and comparisons to our competitors’ operating results. We exclude these items because these expenses are not reflective of ongoing operating results in the current period. Further, prior to our adoption of new business combination accounting at the beginning of fiscal 2010, we incurred charges related to in-process research and development in connection with certain of our acquisitions. We expensed this upon acquisition as it represented incomplete research and development projects that had not reached technological feasibility and had no alternative future use as of the date of the acquisition.

D . R esolution of an income tax audit and related tax impact. During the fiscal year ended December 3, 2010, we realized a one-time tax benefit as a result of the resolution of an income tax audit for fiscal years 2005 through 2007. We have excluded this item because this tax benefit is unrelated to our ongoing business and operating results.

E . Investment gains and losses and related tax impact . We incur investment gains and losses principally from realized gains or losses from the sale and exchange of marketable equity investments, other-than-temporary declines in the value of marketable and non-marketable equity securities, unrealized holding gains and losses associated with our deferred compensation plan assets (classified as trading securities) and gains and losses on the sale of equity securities held indirectly through investment partnerships. We do not actively trade publicly held securities nor do we rely on these securities positions for funding our ongoing operations. We exclude gains and losses and the related tax impact on these equity securities because these items are unrelated to our ongoing business and operating results.

F. Impact of the R&D Tax Benefit . In the first quarter of fiscal 2011, Adobe anticpates a one time tax benefit due to the reenactment of the Federal Research and Development tax credit, which was retroactively extended to January 1, 2010. The impact of this law change will be reflected in our first quarter fiscal year 2011 tax provision as a discrete item related to the tax credit for fiscal year 2010. Adobe has excluded this item because this tax benefit is not reflective of ongoing results and has no direct correlation to the operation of Adobe's business.

G. Income tax effect of the non-GAAP pre-tax adjustments from the provision for income taxes . Excluding the income tax effect of the non-GAAP pre-tax adjustments from the provision for income taxes assists investors in understanding the tax provision associated with those adjustments and the effective tax rate related to our ongoing operations.

We believe that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with our financial results as determined in accordance with GAAP and that these measures should only be used to evaluate our financial results in conjunction with the corresponding GAAP measures and that is why we qualify the use of non-GAAP financial information in a statement when non-GAAP information is presented.

Section 9 — Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

99.1 Press release issued on December 20, 2010 entitled “Adobe Reports First Billion Dollar Quarter”

99.2 Form of Restricted Stock Unit Award Agreement used in connection with the 1994 Performance and Restricted Stock Plan*

99.3 Form of Restricted Stock Unit Award Agreement used in connection with the 2003 Equity Incentive Plan*

99.4 Form of Stock Option Agreement used in connection with the 2003 Equity Incentive Plan*

99.5 Form of Performance Share Award Agreement used in connection with the 2003 Equity Incentive Plan*

99.6 Form of Director Initial Grant Restricted Stock Unit Award Agreement used in connection with the 2003 Equity Incentive Plan*

99.7 Form of Director Annual Grant Restricted Stock Unit Award Agreement used in connection with the 2003 Equity Incentive Plan*

99.8 Form of Director Annual Grant Stock Option Agreement used in connection with the 2003 Equity Incentive Plan*

99.9 Form of Restricted Stock Unit Award Agreement used in connection with the 2005 Equity Incentive Assumption Plan*

99.10 Form of Stock Option Agreement used in connection with the 2005 Equity Incentive Assumption Plan*

* Compensatory plan or arrangement

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	ADOBE SYSTEMS INCORPORATED

Date: December 20, 2010	By:	/s/ MARK GARRETT
		Mark Garrett
		Executive Vice President and Chief Financial Officer

EXHIBIT INDEX

Exhibit No.		Description
99.1		Press release issued on December 20, 2010 entitled “Adobe Reports First Billion Dollar Quarter”

99.2		Form of Restricted Stock Unit Award Agreement used in connection with the 1994 Performance and Restricted Stock Plan*

99.3		Form of Restricted Stock Unit Award Agreement used in connection with the 2003 Equity Incentive Plan*

99.4		Form of Stock Option Agreement used in connection with the 2003 Equity Incentive Plan*

99.5		Form of Performance Share Award Agreement used in connection with the 2003 Equity Incentive Plan*

99.6		Form of Director Initial Grant Restricted Stock Unit Award Agreement used in connection with the 2003 Equity Incentive Plan*

99.7		Form of Director Annual Grant Restricted Stock Unit Award Agreement used in connection with the 2003 Equity Incentive Plan*

99.8		Form of Director Annual Grant Stock Option Agreement used in connection with the 2003 Equity Incentive Plan*

99.9		Form of Restricted Stock Unit Award Agreement used in connection with the 2005 Equity Incentive Assumption Plan*

99.10		Form of Stock Option Agreement used in connection with the 2005 Equity Incentive Assumption Plan*

* Compensatory plan or arrangement

Exhibit 99.1

Investor Relations Contact

Mike Saviage

Adobe Systems Incorporated

408-536-4416
ir@adobe.com

Public Relations Contact

Holly Campbell

Adobe Systems Incorporated

408-536-6401

campbell@adobe.com

FOR IMMEDIATE RELEASE

Adobe Reports First Billion Dollar Quarter

Strong Momentum Across Major Businesses Drives Record Quarterly and Fiscal Year Revenue

SAN JOSE, Calif. — Dec. 20, 2010 — Adobe Systems Incorporated (Nasdaq:ADBE) today reported financial results for its fourth quarter and fiscal year ended Dec. 3, 2010.

In the fourth quarter of fiscal 2010, Adobe achieved record revenue of $1.008 billion, compared to $757.3 million reported for the fourth quarter of fiscal 2009 and $990.3 million reported in the third quarter of fiscal 2010. This represents 33 percent year-over-year revenue growth. Adobe’s fourth quarter revenue target range was $950 million to $1 billion.

The Company also reported record revenue of $3.800 billion in fiscal year 2010, compared to $2.946 billion in fiscal 2009. This represents 29 percent year-over-year revenue growth.

“We posted our first billion dollar quarter and record annual revenue in 2010, driven by outstanding performance across all of our major businesses,” said Shantanu Narayen, president and CEO of Adobe. “Adobe is transforming how the world is creating, measuring and delivering digital experiences. We are one of the most diversified software companies in the world and are entering 2011 with strong momentum.”

Fourth Quarter Fiscal 2010 GAAP Results

Adobe’s GAAP diluted earnings per share for the fourth quarter of fiscal 2010 were $0.53, based on 511.9 million weighted average shares. This compares with GAAP diluted loss per share of $0.06 reported in the fourth quarter of fiscal 2009 based on 532.0 million weighted average shares, and GAAP diluted earnings per share of $0.44 reported in the third quarter of fiscal 2010 based on 523.2 million weighted average shares.

GAAP operating income was $286.9 million in the fourth quarter of fiscal 2010, compared to $153.6 million in the fourth quarter of fiscal 2009 and $302.0 million in the third quarter of fiscal 2010. As a percent of revenue, GAAP operating income in the fourth quarter of fiscal 2010 was 28.5 percent, compared to 20.3 percent in the fourth quarter of fiscal 2009 and 30.5 percent in the third quarter of fiscal 2010.

GAAP net income was $268.9 million for the fourth quarter of fiscal 2010, compared to a GAAP net loss of $32.0 million reported in the fourth quarter of fiscal 2009 and GAAP net income of $230.1 million in the third quarter of fiscal 2010.

Fourth Quarter Fiscal 2010 Non-GAAP Results

Adobe’s non-GAAP diluted earnings per share for the fourth quarter of fiscal 2010 were $0.56. This compares with non-GAAP diluted earnings per share of $0.39 reported in the fourth quarter of fiscal 2009 and non-GAAP diluted earnings per share of $0.54 reported in the third quarter of fiscal 2010.

Adobe’s non-GAAP operating income was $384.0 million in the fourth quarter of fiscal 2010, compared to $265.2 million in the fourth quarter of fiscal 2009 and $384.9 million in the third quarter of fiscal 2010. As a percent of revenue, non-GAAP operating income in the fourth quarter of fiscal 2010 was 38.1 percent, compared to 35.0 percent in the fourth quarter of fiscal 2009 and 38.9 percent in the third quarter of fiscal 2010.

Non-GAAP net income was $285.7 million for the fourth quarter of fiscal 2010, compared to $206.8 million in the fourth quarter of fiscal 2009 and $284.0 million in the third quarter of fiscal 2010.

Reconciliation between GAAP and non-GAAP results is provided at the end of this press release.

Fiscal Year 2010 Results

In fiscal year 2010, Adobe achieved annual revenue of $3.800 billion, compared to $2.946 billion in fiscal 2009. This represents 29 percent year-over-year revenue growth.

Adobe’s annual GAAP operating income in fiscal 2010 was $993.1 million, compared to $690.5 million in fiscal 2009. The annual GAAP operating margin was 26.1 percent in fiscal 2010, compared to 23.4 percent in fiscal 2009. Adobe’s annual non-GAAP operating income in fiscal 2010 was $1.393 billion, compared to $1.035 billion in fiscal 2009. The annual non-GAAP operating margin was 36.6 percent in fiscal 2010, compared to 35.1 percent in fiscal 2009.

The Company’s annual GAAP net income was $774.7 million in fiscal 2010, compared to $386.5 million in fiscal 2009. Adobe’s annual non-GAAP net income was $1.016 billion in fiscal 2010, compared to $814.7 million in fiscal 2009.

Adobe’s annual GAAP diluted earnings per share for fiscal 2010 were $1.47, compared to $0.73 in fiscal 2009. Non-GAAP diluted earnings per share for fiscal 2010 were $1.93, compared to $1.54 in fiscal 2009.

Reconciliation between GAAP and non-GAAP results is provided at the end of this press release.

First Quarter Fiscal 2011 Financial Targets

For the first quarter of fiscal 2011, Adobe is targeting revenue of $1 billion to $1.05 billion. The Company’s operating margin is targeted to be 28 percent to 29.5 percent on a GAAP basis, and 37 percent to 38 percent on a non-GAAP basis. In addition, the Company is targeting its share count to be between 508 million and 510 million shares, and it is targeting non-operating expense between $16 million and $20 million. Adobe's GAAP and non-GAAP tax rates are expected to be approximately 15 percent and 22 percent, respectively.

These targets lead to a first quarter diluted earnings per share target range of $0.43 to $0.49 on a GAAP basis, and an earnings per share target range of $0.54 to $0.59 on a non-GAAP basis.

Reconciliation between these GAAP and non-GAAP financial targets is provided at the end of this press release.

Forward-Looking Statements Disclosure

This press release contains forward-looking statements, including those related to revenue, operating margin, non-operating expense, tax rate, share count, earnings per share and business momentum, which involve risks and uncertainties that could cause actual results to differ materially. Factors that might cause or contribute to such differences include, but are not limited to: failure to develop, market and distribute new products and services or upgrades or enhancements to existing products and services that meet customer requirements, introduction of new products, services and business models by existing and new competitors, failure to successfully manage transitions to new business models and markets, continued uncertainty in economic conditions and the financial markets and other adverse changes in general political conditions in any of the major countries in which Adobe does business, difficulty in predicting revenue from new businesses, failure to realize the anticipated benefits of past or future acquisitions, and difficulty in integrating such acquisitions, costs related to intellectual property acquisitions, disputes and litigation, inability to protect Adobe’s intellectual property from third-party infringers, or unauthorized copying, use or disclosure, security vulnerabilities in our products and systems, interruptions or delays in our service or service from third-party service providers that host or deliver services, security or privacy breaches, or failure in data collection, failure to manage Adobe’s sales and distribution channels and third-party customer service and technical support providers effectively, disruption of Adobe’s business due to catastrophic events, risks associated with global operations, currency fluctuations, risks associated with our debt service obligations, changes in, or interpretations of, accounting principles, impairment of Adobe’s goodwill or amortizable intangible assets, changes in, or interpretations of, tax rules and regulations, Adobe’s inability to attract and retain key personnel, impairment of Adobe’s investment portfolio due to deterioration of the capital markets, and market risks associated with Adobe’s equity investments. For further discussion of these and other risks and uncertainties, individuals should refer to Adobe’s SEC filings.

The financial information set forth in this press release reflects estimates based on information available at this time. These amounts could differ from actual reported amounts stated in Adobe’s Annual Report on Form 10-K for our fiscal year ended Dec. 3, 2010, which Adobe expects to file in Jan. 2011. Adobe does not undertake an obligation to update forward-looking statements.

About Adobe Systems Incorporated

Adobe is changing the world through digital experiences. For more information, visit www.adobe.com.

###

© 2010 Adobe Systems Incorporated. All rights reserved. Adobe and the Adobe logo are either registered trademarks or trademarks of Adobe Systems Incorporated in the United States and/or other countries. All other trademarks are the property of their respective owners.

Condensed Consolidated Statements of Income
(In thousands, except per share data; unaudited)

	Three Months Ended						Year Ended
	December 3, 2010			November 27, 2009			December 3, 2010			November 27, 2009

Revenue:
Products	$	830,867		$	670,397		$	3,159,161		$	2,684,789
Subscription	100,387			36,875			386,805			74,602
Services and support	76,692			50,011			254,034			186,462
Total revenue	1,007,946			757,283			3,800,000			2,945,853

Cost of revenue:
Products	35,151			40,744			127,453			180,611
Subscription	49,187			24,112			195,595			48,286
Services and support	22,879			17,468			80,454			67,835
Total cost of revenue	107,217			82,324			403,502			296,732

Gross profit	900,729			674,959			3,396,498			2,649,121

Operating expenses:
Research and development	170,378			137,852			680,332			565,141
Sales and marketing	322,708			257,883			1,244,197			981,903
General and administrative	100,323			74,287			383,499			298,749
Restructuring charges	2,193			25,394			23,266			41,260
Amortization of purchased intangibles and incomplete technology	18,184			25,901			72,130			71,555
Total operating expenses	613,786			521,317			2,403,424			1,958,608

Operating income	286,943			153,642			993,074			690,513

Non-operating income (expense):
Interest and other income, net	11,234			6,627			13,139			31,380
Interest expense	(16,786		)	(1,535		)	(56,952		)	(3,407		)
Investment gains (losses), net	4,620			1,478			(6,110		)	(16,966		)
Total non-operating income (expense), net	(932		)	6,570			(49,923		)	11,007
Income before income taxes	286,011			160,212			943,151			701,520
Provision for income taxes	17,161			192,255			168,471			315,012

Net income (loss)	$	268,850		$	(32,043	)	$	774,680		$	386,508

Basic net income (loss) per share	$	0.53		$	(0.06	)	$	1.49		$	0.74

Shares used to compute basic net income (loss) per share	506,752			523,530			519,045			524,470

Diluted net income (loss) per share	$	0.53		$	(0.06	)	$	1.47		$	0.73

Shares used to compute diluted net income (loss) per share	511,923			531,961			525,824			530,610

Condensed Consolidated Balance Sheets

(In thousands, except par value; unaudited)

	December 3,			November 27,
	2010			2009

ASSETS

Current assets:
Cash and cash equivalents	$	749,891		$	999,487
Short-term investments	1,718,124			904,986
Trade receivables, net of allowances for doubtful accounts of $15,233 and $15,225 respectively	554,328			410,879
Deferred income taxes	83,247			77,417
Prepaid expenses and other current assets	110,460			80,855
Total current assets	3,216,050			2,473,624

Property and equipment, net	448,881			388,132
Goodwill	3,641,844			3,494,589
Purchased and other intangibles, net	457,263			527,388
Investment in lease receivable	207,239			207,239
Other assets	169,871			191,265
Total assets	$	8,141,148		$	7,282,237

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:
Trade payables	$	52,432		$	58,904
Accrued expenses	564,275			419,646
Current portion of capital lease obligation	8,799			—
Accrued restructuring	8,119			37,793
Income taxes payable	53,715			46,634
Deferred revenue	380,748			281,576
Total current liabilities	1,068,088			844,553

Long-term liabilities:
Debt and non-current portion of capital lease obligation	1,513,662			1,000,000
Deferred revenue	48,929			36,717
Accrued restructuring	8,254			6,921
Income taxes payable	164,713			223,528
Deferred income taxes	103,098			252,486
Other liabilities	42,017			27,464
Total liabilities	2,948,761			2,391,669

Stockholders’ equity:
Preferred stock, $0.0001 par value; 2,000 shares authorized	—			—
Common stock, $0.0001 par value	61			61
Additional paid-in-capital	2,458,278			2,390,061
Retained earnings	5,980,914			5,299,914
Accumulated other comprehensive income	17,428			24,446
Treasury stock, at cost (98,937 and 78,177 shares, respectively), net of reissuances	(3,264,294		)	(2,823,914		)
Total stockholders’ equity	5,192,387			4,890,568
Total liabilities and stockholders’ equity	$	8,141,148		$	7,282,237

Condensed Consolidated Statements of Cash Flows

(In thousands; unaudited)

	Three Months Ended
	December 3, 2010			November 27, 2009
Cash flows from operating activities:
Net income (loss)	$	268,850		$	(32,043	)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and accretion	76,097			85,037
Stock-based compensation expense, net of tax	23,703			71,124
Unrealized investment losses (gains)	2,751			(1,685		)
Changes in deferred revenue	5,590			11,984
Changes in operating assets and liabilities	(66,370		)	119,424

Net cash provided by operating activities	310,621			253,841

Cash flows from investing activities:
Sales and maturities of short-term investments, net of purchases	34,326			517,679
Purchases of property and equipment	(55,427		)	(34,933		)
Sales of long-term investments and other assets, net of purchases	11,378			8,035
Acquisitions, net of cash acquired	(193,281		)	(1,582,669		)

Net cash used for investing activities	(203,004		)	(1,091,888		)

Cash flows from financing activities:
Purchases of treasury stock	(200,000		)	—
Reissuance of treasury stock	9,628			57,347
Proceeds from borrowings under line of credit	—			650,000
Repayment of debt	(2,148		)	(13,897		)
Excess tax benefits from stock-based compensation	6,258			11,896

Net cash (used for) provided by financing activities	(186,262		)	705,346

Effect of exchange rate changes on cash and cash equivalents	14,387			44
Net decrease in cash and cash equivalents	(64,258		)	(132,657		)
Cash and cash equivalents at beginning of period	814,149			1,132,144
Cash and cash equivalents at end of period	$	749,891		$	999,487

Non-GAAP Results

(In thousands, except per share data)

The following tables show Adobe’s GAAP results reconciled to non-GAAP results included in this release.

	Three Months Ended									Year Ended
	December 3,			November 27,			September 3,			December 3,			November 27,
	2010			2009			2010			2010			2009

Operating income:

GAAP operating income	$	286,943		$	153,642		$	302,013		$	993,074		$	690,513
Stock-based and deferred compensation expense	59,736			41,689			50,058			234,311			170,506
Restructuring charges	2,193			25,394			(2,090		)	23,266			41,260
Amortization of purchased intangibles and incomplete technology	35,082			44,461			34,936			142,020			132,667
Non-GAAP operating income	$	383,954		$	265,186		$	384,917		$	1,392,671		$	1,034,946

Net income:

GAAP net income (loss)	$	268,850		$	(32,043	)	$	230,065		$	774,680		$	386,508
Stock-based and deferred compensation expense	59,736			41,689			50,058			234,311			170,506
Restructuring charges	2,193			25,394			(2,090		)	23,266			41,260
Amortization of purchased intangibles and incomplete technology	35,082			44,461			34,936			142,020			132,667
Resolution of an income tax audit	(39,574		)	—			—			(39,574		)	—
Investment (gains) losses	(4,620		)	(1,478		)	(3,527		)	6,110			16,966
Income tax adjustments	(35,973		)	128,740			(25,464		)	(125,276		)	66,764
Non-GAAP net income	$	285,694		$	206,763		$	283,978		$	1,015,537		$	814,671

Diluted net income per share:

GAAP diluted net income (loss) per share	$	0.53		$	(0.06	)	$	0.44		$	1.47		$	0.73
Stock-based and deferred compensation expense	0.12			0.08			0.10			0.45			0.32
Restructuring charges	—			0.05			—			0.04			0.08
Amortization of purchased intangibles and incomplete technology	0.07			0.08			0.07			0.27			0.25
Resolution of an income tax audit	(0.08		)	—			—			(0.08		)	—
Investment (gains) losses	(0.01		)	—			(0.01		)	0.01			0.03
Income tax adjustments	(0.07		)	0.24			(0.06		)	(0.23		)	0.13
Non-GAAP diluted net income per share	$	0.56		$	0.39		$	0.54		$	1.93		$	1.54

Shares used in computing diluted net income per share	511,923			531,961			523,179			525,824			530,610

Non-GAAP Results (continued)

(In thousands, except percentages)

	Three Months Ended									Year Ended
	December 3, 2010			November 27, 2009			September 3, 2010			December 3, 2010			November 27, 2009

Operating expenses:

GAAP operating expenses	$	613,786		$	521,317		$	589,222		$	2,403,424		$	1,958,608
Stock-based and deferred compensation expense	(58,373		)	(41,266		)	(48,985		)	(229,308		)	(167,961		)
Restructuring charges	(2,193		)	(25,394		)	2,090			(23,266		)	(41,260		)
Amortization of purchased intangibles and incomplete technology	(18,184		)	(25,901		)	(17,620		)	(72,130		)	(71,555		)
Non-GAAP operating expenses	$	535,036		$	428,756		$	524,707		$	2,078,720		$	1,677,832

	Three Months Ended									Year Ended
	December 3, 2010			November 27, 2009			September 3, 2010			December 3, 2010			November 27, 2009

GAAP operating margin	28.5		%	20.3		%	30.5		%	26.1		%	23.4		%
Stock-based and deferred compensation expense	5.9			5.5			5.1			6.2			5.8
Restructuring charges	0.2			3.4			(0.2		)	0.6			1.4
Amortization of purchased intangibles and incomplete technology	3.5			5.8			3.5			3.7			4.5
Non-GAAP operating margin	38.1		%	35.0		%	38.9		%	36.6		%	35.1		%

	Three Months Ended
	December 3, 2010
Effective income tax rate:

GAAP effective income tax rate	6.0	%
Stock-based and deferred compensation expense	8.4
Restructuring charges	0.3
Investment gains	(0.6	)
Amortization of purchased intangibles	4.9
Resolution of an income tax audit	5.5
Non-GAAP effective income tax rate	24.5	%

First Quarter Non-GAAP Financial Targets

(In millions, except per share data and percentages)

The following tables show Adobe’s first quarter fiscal year 2011 GAAP financial targets reconciled to non-GAAP financial targets included in this release.

	First Quarter Fiscal 2011
	Low		High
Operating margin:

GAAP operating margin	28.0	%	29.5	%
Stock-based and deferred compensation expense	6.0		5.6
Restructuring charges	0.4		0.4
Amortization of purchased intangibles	2.6		2.5
Non-GAAP operating margin	37.0	%	38.0	%

	First Quarter Fiscal 2011
	Low			High
Diluted net income per share:

GAAP diluted net income per share	$	0.43		$	0.49
Stock-based and deferred compensation expense	0.13			0.12
Restructuring charges	0.01			0.01
Amortization of purchased intangibles	0.05			0.05
Income tax adjustments	(0.08		)	(0.08		)
Non-GAAP diluted net income per share	$	0.54		$	0.59

Shares used to compute diluted net income per share	510.0			508.0

	First Quarter
	Fiscal 2011
Effective income tax rate:

GAAP effective income tax rate	15.0	%
Impacts of retroactive application to FY2010 of the R&D tax credit	7.0
Non-GAAP effective income tax rate	22.0	%

Adobe continues to provide all information required in accordance with GAAP, but believes evaluating its ongoing operating results may not be as useful if an investor is limited to reviewing only GAAP financial measures. Accordingly, Adobe uses non-GAAP financial information to evaluate its ongoing operations and for internal planning and forecasting purposes. Adobe’s management does not itself, nor does it suggest that investors should, consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Adobe presents such non-GAAP financial measures in reporting its financial results to provide investors with an additional tool to evaluate Adobe’s operating results in a manner that focuses on what Adobe believes to be its ongoing business operations. Adobe’s management believes it is useful for itself and investors to review, as applicable, both GAAP information that includes the stock-based and deferred compensation expenses, restructuring charges, amortization of purchased intangibles and incomplete technology, the resolution of an income tax audit, investment gains and losses, the R&D tax benefit, and the related tax impact of all of these items, the income tax effect of the non-GAAP pre-tax adjustments from the provision for income taxes, and the non-GAAP measures that exclude such information in order to assess the performance of Adobe’s business and for planning and forecasting in subsequent periods. Whenever Adobe uses such a non-GAAP financial measure, it provides a reconciliation of the non-GAAP financial measure to the most closely applicable GAAP financial measure. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measure as detailed above.

EXHIBIT 99.2

ADOBE SYSTEMS INCORPORATED

AMENDED 1994 PERFORMANCE AND RESTRICTED STOCK PLAN
RESTRICTED STOCK UNIT GRANT NOTICE

Adobe Systems Incorporated (the “Company” ), pursuant to its Amended 1994 Performance and Restricted Stock Plan (the “Plan” ), hereby awards to Participant the Restricted Stock Unit Award (the “ Award ”) covering the number of Restricted Stock Units set forth below. This Award is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Unit Award Agreement (the “ Award Agreement ”) and the Plan, each of which are attached hereto and incorporated herein in their entirety. Unless otherwise defined herein, capitalized terms shall have the meanings set forth in the Plan or the Program, as applicable.

Participant:	%%FIRST_NAME%-% %%LAST_NAME%-%
Date of Grant:	%%OPTION_DATE,’Month DD, YYYY’%-%
Vesting Commencement Date:	%%VEST_BASE_DATE,’Month DD, YYYY%-%
Number of Restricted Stock Units:	%%TOTAL_SHARES_GRANTED%-%
Payment for Stock:	Participant’s services to the Company (to the greatest extent permitted by applicable law)

Vesting Schedule : This Award shall vest as to [ ] percent of the Restricted Stock Units on the [ ] anniversary of the Vesting Commencement Date[, and the remaining [ ] percent of the Restricted Stock Units shall vest [ ] percent annually on each anniversary of the Vesting Commencement Date thereafter, so that the Restricted Stock Units are fully vested on the [ ] anniversary of the Vesting Commencement Date]; provided, however, that the Participant’s Service has not terminated prior to [each] such vesting date.

Delivery Schedule : Except as otherwise provided in Section 5 of the Award Agreement, the Company shall deliver on [each] [the] vesting date one share of Stock for each Restricted Stock Unit [that vests on such date], less any shares to be withheld pursuant to Section 11 of the Award Agreement.

Additional Terms/Acknowledgements: The Participant acknowledges receipt of, and understands and agrees to, this Grant Notice, the Award Agreement, and the Plan. Participant further acknowledges that as of the Date of Grant, this Grant Notice, the Award Agreement, and the Plan set forth the entire understanding between Participant and the Company regarding the Award and supersede all prior oral and written agreements on that subject with the exception of the Adobe Systems Incorporated Executive Severance Plan in the Event of a Change of Control and/or an individual written retention agreement or severance provision, in effect on the Date of Grant between the Company, or a subsidiary of the Company, and the Participant, to the extent applicable to the Participant.

ADOBE SYSTEMS INCORPORATED:


By:

Title:

ADOBE SYSTEMS INCORPORATED

AMENDED 1994 PERFORMANCE AND RESTRICTED STOCK PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

Pursuant to the Grant Notice ( “Grant Notice” ) and this Award Agreement ( “Award Agreement” ), Adobe Systems Incorporated (the “Company” ) has awarded you, pursuant to its Amended 1994 Performance and Restricted Stock Plan (the “Plan” ), a Restricted Stock Unit Award for that number of Restricted Stock Units as indicated in the Grant Notice. Unless otherwise defined herein or the Grant Notice, capitalized terms shall have the meanings set forth in the Plan. Subject to adjustment and the terms and conditions as provided herein and in the Plan, each Restricted Stock Unit shall represent the right to receive one (1) share of Stock.

The details of your Award, in addition to those set forth in the Grant Notice, are as follows.

1. NUMBER OF STOCK UNITS AND SHARES OF STOCK.

(a) The number of Restricted Stock Units subject to your Award and the number of shares of Stock deliverable with respect to such Restricted Stock Units will be adjusted from time to time for capitalization adjustments as described in the Plan. You shall receive no benefit or adjustment to your Award with respect to any cash dividend or other distribution that does not result in a capitalization adjustment pursuant to the Plan; provided, however, that this sentence shall not apply with respect to any shares of Stock that are subject to your Award after such shares have been delivered to you.

(b) Any additional Restricted Stock Units, shares of Stock, cash or other property that become subject to the Award pursuant to this Section 1 shall be subject, in a manner determined by the Board, to the same forfeiture restrictions, restrictions on transferability, and time and manner of delivery as applicable to the other Restricted Stock Units and shares of Stock covered by your Award.

(c) Notwithstanding the provisions of this Section 1, no fractional Restricted Stock Units or rights for fractional shares of Stock shall be created pursuant to this Section 1. The Board shall, in its discretion, determine an equivalent benefit for any fractional Restricted Stock Units or fractional shares that might be created by the adjustments referred to in this Section 1.

2. PAYMENT BY YOU. Except as otherwise provided in the Grant Notice, this Award has been granted in consideration of your services to the Company (or any other Participating Company, as applicable). Subject to Section 11 below, and except as otherwise provided in the Grant Notice, you will not be required to make any payment to the Company (other than your past and future services with the Company (or any other Participating Company, as applicable)) with respect to your receipt of the Award, the vesting of the Restricted Stock Units, or the delivery of the shares of Stock underlying the Restricted Stock Units.

3. VESTING .

(a) The Restricted Stock Units shall vest, if at all, as provided in the Vesting Schedule set forth in your Grant Notice, this Award Agreement, and the Plan, provided that vesting shall cease upon the termination of your service, except as otherwise set forth herein.

(b) If your service with the Company terminates because of your death or Disability, then you will be given credit for an additional twelve (12) months of continuous service; provided, however, that in no event shall such applicable vesting exceed 100% vesting of your Award. For purposes of this provision, (i) your service shall be deemed to have terminated on account of death if your death

occurs within three (3) months after your termination of Service, and (ii) “ Disability ” shall mean your permanent and total disability within the meaning of Section 22(e)(3) of the U.S. Internal Revenue Code of 1986, as amended (the “ Code ”), and any applicable regulations promulgated thereunder to the extent not inconsistent with the regulations under Section 409A of the Code.

(c) The determination that your service was terminated shall be made by the Company (or any Participating Company, as applicable) in its sole discretion. Any such determination by the Company (or any Participating Company, as applicable) for the purposes of this Award Agreement shall have no effect upon any determination of the rights or obligations of you or the Company (or any Participating Company, as applicable) for any other purpose.

4. DISTRIBUTION OF SHARES OF STOCK . Subject to the provisions of this Award Agreement (including Sections 5 and 11 below) and the Plan, the Company shall deliver to you on the applicable vesting date one (1) share of Stock for each Restricted Stock Unit that vests on such date. Absent a proper deferral election pursuant to Section 5 below, this Award is intended to be exempt from Code Section 409A pursuant to Treasury Regulation Section 1.409A-1(b)(4) and will be construed in accordance therewith to the greatest extent permitted under applicable law, with vested shares issued hereunder not later than the 15th day of the third month following the end of the tax year (the Company’s or the Participant’s, whichever is later) in which such shares are no longer subject to a substantial risk of forfeiture. To the extent this Award is not so exempt and must comply with Code Section 409A, and absent a proper deferral election, vested shares will be issued not later than December 31st of the year of vesting, or, if later, the 15th day of the third calendar month after the applicable vesting date.

5. DEFERRAL ELECTION. If permitted by the Company to do so, you may elect to defer receipt of the shares of Stock that would otherwise be issued pursuant to the vesting of your Award in accordance with the terms and conditions, including the applicable eligibility requirements, of the Company’s Deferred Compensation Plan. The Board (or an appropriate committee thereof) will, in its sole discretion, establish the rules and procedures for such deferrals.

6. SECURITIES LAW COMPLIANCE . The grant of your Award and the issuance of any shares of Stock thereunder shall be subject to compliance with all applicable requirements of federal, state or foreign law with respect to such securities. You may not be issued any shares of Stock if such issuance would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, you may not be issued any shares of Stock unless (i) a registration statement under the Securities Act shall at the time of issuance be in effect with respect to the shares or (ii) in the opinion of legal counsel to the Company, the shares may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. YOU ARE CAUTIONED THAT THE SHARES MAY NOT BE ISSUED UNLESS THE FOREGOING CONDITIONS ARE SATISFIED. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance and sale of any shares of Stock 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. As a condition to the issuance of any shares of Stock pursuant to this Award, the Company may require you to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company.

7. RESTRICTIVE LEGENDS. The shares of Stock issued pursuant to this Award shall be endorsed with appropriate legends, if any, determined by the Company.

8. TRANSFER RESTRICTIONS. Prior to the time that shares of Stock have been delivered to you pursuant to this Award, you may not transfer, pledge, sell or otherwise dispose of such shares. For example, you may not use shares that may be issued in respect of your Restricted Stock Units as security for a loan, nor may you transfer, pledge, sell or otherwise dispose of such shares. This restriction on transfer will lapse upon delivery to you of shares in respect of your vested Restricted Stock Units. Your Award is not transferable, except by will or by the laws of descent and distribution, unless otherwise required by applicable law. Notwithstanding the foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you may designate a third party who, in the event of your death, shall thereafter be entitled to receive any distribution of Stock pursuant to this Award Agreement.

9. AWARD NOT A SERVICE CONTRACT. Your Award is not an employment or service contract, and nothing in your Award shall be deemed to create in any way whatsoever any obligation on your part to continue in the service of the Company or the Participating Company Group, or on the part of the Company or Participating Company Group to continue such service. In addition, nothing in your Award shall obligate the Company or the Participating Company Group, their respective stockholders, boards of directors, Officers or Employees to continue any relationship that you might have as an Employee, Director or Consultant for the Company or the Participating Company Group.

10. UNSECURED OBLIGATION . Your Award is unfunded, and even as to any Restricted Stock Units that vest, you shall be considered an unsecured creditor of the Company with respect to the Company’s obligation, if any, to issue Stock pursuant to this Award Agreement. You shall not have voting or any other rights as a stockholder of the Company with respect to the Stock acquired pursuant to this Award Agreement until such Stock is issued to you pursuant to this Award Agreement. Upon such issuance, you will obtain full voting and other rights as a stockholder of the Company with respect to the Stock so issued. Nothing contained in this Award Agreement, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind or a fiduciary relationship between you and the Company or any other person.

11. WITHHOLDING OBLIGATIONS. Regardless of any action taken by the Company or the Participating Company Group with respect to any or all income, employment, social insurance, or payroll taxes, payment on account or other tax-related withholdings or payments ( “ Tax-Related Items ” ), you acknowledge that the ultimate liability for all Tax-Related Items legally due by you is and remains your responsibility and that the Company and Participating Company Group (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of your Award, the subsequent sale of shares acquired pursuant to this Award, or the receipt of any dividends and (ii) do not commit to structure the terms of the grant or any other aspect of your Award to reduce or eliminate your liability for Tax-Related Items. At the time you vest in this Award, at the time you receive a distribution of shares of Stock pursuant to this Award, or at any other time as reasonably requested by the Company or the Participating Company Group, you shall pay or make adequate arrangements satisfactory to the Participating Company Group to satisfy all withholding obligations of the Participating Company Group. In this regard, at the time you vest in and/or receive a distribution of shares of Stock pursuant to this Award, or at any other time as reasonably requested by the Company or the Participating Company Group, you hereby authorize the withholding of that number of whole vested shares otherwise deliverable to you pursuant to this Award Agreement having a fair market value not in excess of the amount of the Tax-Related Items determined by the applicable minimum statutory rates. In no event may shares of Stock shall be withheld with a value exceeding the minimum amount of tax required to be withheld by law. Finally, you shall pay to the Company or Participating Company Group (as applicable) any amount of the Tax-Related Items that the Company or the Participating Company Group may be required to withhold as a result of your participation in the Plan that cannot be satisfied by the means previously described. You expressly acknowledge and agree that the Company may withhold from any compensation paid to you by the Company in partial or full satisfaction of the withholdings contemplated

by this Section 11. The Company and the Participating Company Group shall have no obligation to deliver shares of Stock until you have satisfied the obligations in connection with the Tax-Related Items as described in this section.

12. NATURE OF AWARD. In accepting your Award, you acknowledge that:

(a) the Plan is established voluntarily by the Company; it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Award Agreement;

(b) the grant of your Award is voluntary and occasional and does not create any contractual or other right to receive future grants of awards, or benefits in lieu of awards, even if awards have been granted repeatedly in the past;

(c) all decisions with respect to future Awards under the Plan, if any, will be at the sole discretion of the Committee;

(d) your participation in the Plan shall not create a right to further employment with the Company or the Participating Company Group and shall not interfere with any ability of the Company or the Participating Company Group to terminate your employment relationship at any time with or without cause;

(e) you are voluntarily participating in the Plan;

(f) this Award is not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension or retirement benefits or similar payments;

(g) in the event that you are not an employee of the Company, your Award will not be interpreted to form an employment contract or relationship with the Company; and furthermore, your Award will not be interpreted to form an employment contract with the other members of the Participating Company Group;

(h) the future value of the shares of Stock subject to your Award is unknown and cannot be predicted with certainty; and

(i) no claim or entitlement to compensation or damages arises from termination of your Award or diminution in value of your Award or shares of Stock issued pursuant to your Award resulting from termination of your service with the Company or the Participating Company Group (for any reason whether or not in breach of applicable labor laws), and you irrevocably release the Company and the Participating Company Group from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by executing the Grant Notice, you shall be deemed irrevocably to have waived your entitlement to pursue such a claim.

13. DELIVERY OF DOCUMENTS AND NOTICES. Any document relating to participating in the Plan or Program and/or notice required or permitted hereunder shall be given in writing and shall be deemed effectively given (except to the extent that this Award Agreement provides for effectiveness only upon actual receipt of such notice) upon personal delivery, electronic delivery, or upon deposit in the U.S. Post Office or foreign postal service, by registered or certified mail, with postage and fees prepaid,

addressed to the other party at the e-mail address, if any, provided for you by the Company or a Participating Company or at such other address as such party may designate in writing from time to time to the other party.

(a) Description of Electronic Delivery . The Plan and Program documents, which may include but do not necessarily include the Plan prospectus, Grant Notice, Award Agreement and U.S. financial reports of the Company, may be delivered to you electronically. Such means of delivery may include but do not necessarily include the delivery of a link to a Company intranet or the internet site of a third party involved in administering the Plan, the delivery of the document via e-mail or such other delivery determined at the Committee’s discretion.

(b) Consent to Electronic Delivery. You acknowledge that you have read Section 13 of this Award Agreement and consent to the electronic delivery of the Plan and Program documents, as described in this Section 13. You acknowledge that you may receive from the Company a paper copy of any documents delivered electronically at no cost if you contact the Company by telephone, through a postal service or electronic mail at equity@adobe.com. You further acknowledge that you will be provided with a paper copy of any documents delivered electronically if electronic delivery fails; similarly, you understand that you must provide the Company or any designated third party with a paper copy of any documents delivered electronically if electronic delivery fails. Also, you understand that your consent may be revoked or changed, including any change in the electronic mail address to which documents are delivered (if you have provided an electronic mail address), at any time by notifying the Company of such revised or revoked consent by telephone, postal service or electronic mail at equity@adobe.com. Finally, you understand that you are not required to consent to electronic delivery.

14. DATA PRIVACY CONSENT . You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by and among the members of the Participating Company Group for the exclusive purpose of implementing, administering and managing your participation in the Plan and Program.

You understand that the Company and the Participating Company Group hold certain personal information about you, including, but not limited to, your name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of Stock or directorships held in the Company, details of all awards or any other entitlement to shares of Stock awarded, canceled, exercised, vested, unvested or outstanding in your favor, for the purpose of implementing, administering and managing the Plan and Program (“ Data ”). You understand that Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan or Program, that these recipients may be located in your country or elsewhere, and that the recipient’s country may have different data privacy laws and protections than your country. You understand that you may request a list with the names and addresses of any potential recipients of the Data by contacting your local human resources representative. You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom you may elect to deposit any shares of Stock pursuant to this Award. You understand that Data will be held only as long as is necessary to implement, administer and manage your participation in the Plan. You understand that you may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local human resources representative. You understand, however, that refusing or withdrawing your consent may affect your ability to participate in the Plan. For more information on the consequences

of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.

15. HEADINGS. The headings of the Sections in this Award Agreement are inserted for convenience only and shall not be deemed to constitute a part of this Award Agreement or to affect the meaning of this Award Agreement.

16. MISCELLANEOUS .

(a) The rights and obligations of the Company under your Award shall be transferable to any one or more persons or entities, and all covenants and agreements hereunder shall inure to the benefit of, and be enforceable by the Company’s successors and assigns.

(b) You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

(c) You acknowledge and agree that you have reviewed your Award in its entirety, have had an opportunity to obtain the advice of counsel prior to executing and accepting your Award and fully understand all provisions of your Award.

17. GOVERNING PLAN DOCUMENT . Your Award is subject to all the provisions of the Plan, which are hereby made a part of your Award, and is further subject to all interpretations, amendments, rules and regulations which may from time to time be promulgated and adopted pursuant to the Plan. In the event of any conflict between the provisions of your Award and those of the Plan, the provisions of the Plan shall control.

18. APPLICABLE LAW AND VENUE. This Award Agreement shall be governed by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within the State of California. For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties as evidenced by this Award Agreement, the parties herby submit to and consent to the jurisdiction of the State of California and agree that such litigation shall be conducted only in the courts of Santa Clara County, California, or the federal courts of the United States for the Northern District of California, and no other courts, where this Award Agreement is made and/or performed.

19. APPLICATION OF SECTION 409A . Absent a proper deferral election, it is intended that all of the benefits and payments provided under this Award satisfy, to the greatest extent possible, the exemptions from the application of Code Section 409A provided under Treasury Regulations Section 1.409A 1(b)(4), and this Award will be construed to the greatest extent possible as consistent with those provisions. To the extent not so exempt, this Award and the payments and benefits to be provided hereunder are intended to, and will be construed and implemented so as to, comply in all respects with the applicable provisions of Code Section 409A, and any provisions calling for payments on a termination of employment or other service shall be read to mean a “separation from service” (as defined under Treasury Regulation Section 1.409-1(h) without reference to alternative definitions thereunder). For purposes of Code Section 409A (including, without limitation, for purposes of Treasury Regulation Section 1.409A 2(b)(2)(iii)), any right to receive any installment payments under this Award shall be treated as a right to receive a series of separate payments and, accordingly, each installment payment hereunder shall at all times be considered a separate and distinct payment. Notwithstanding any other provision of this Award, to the extent that (i) one or more of the payments or benefits received or to be received by you upon “separation from service” pursuant to this Plan would constitute deferred compensation subject to the

requirements of Code Section 409A, and (ii) you are a “specified employee” within the meaning of Code Section 409A at the time of separation from service, then to the extent delayed commencement of any portion of such payments or benefits is required in order to avoid a prohibited distribution under Code Section 409A(a)(2)(B)(i) and the related adverse taxation under Section 409A, such payments and benefits shall not be provided to you prior to the earliest of (i) the expiration of the six-month period measured from the date of separation from service, (ii) the date of your death or (iii) such earlier date as permitted under Section 409A without the imposition of adverse taxation on you. Upon the first business day following the expiration of such applicable Code Section 409A(a)(2)(B)(i) period, all payments and benefits deferred pursuant to this paragraph shall be paid in a lump sum to you, and any remaining payments and benefits due shall be paid as otherwise provided herein.

EXHIBIT 99.3

ADOBE SYSTEMS INCORPORATED

AMENDED AND RESTATED 2003 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT GRANT NOTICE

Adobe Systems Incorporated (the “Company” ), pursuant to its Amended and Restated 2003 Equity Incentive Plan (the “Plan” ), hereby awards to Participant the Restricted Stock Unit Award (the “ Award ”) covering the number of Restricted Stock Units set forth below. This Award is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Unit Award Agreement (the “ Award Agreement ”) and the Plan, each of which are attached hereto and incorporated herein in their entirety. Unless otherwise defined herein, capitalized terms shall have the meanings set forth in the Plan or the Program, as applicable.

Participant:	%%FIRST_NAME%-% %%LAST_NAME%-%
Date of Grant:	%%OPTION_DATE,’Month DD, YYYY’%-%
Vesting Commencement Date:	%%VEST_BASE_DATE,’Month DD, YYYY%-%
Number of Restricted Stock Units:	%%TOTAL_SHARES_GRANTED%-%
Payment for Stock:	Participant’s services to the Company (to the greatest extent permitted by applicable law)

Additional Terms/Acknowledgements: The Participant acknowledges receipt of, and understands and agrees to, this Grant Notice, the Award Agreement, and the Plan. Participant further acknowledges that as of the Date of Grant, this Grant Notice, the Award Agreement, and the Plan set forth the entire understanding between Participant and the Company regarding the Award and supersede all prior oral and written agreements on that subject with the exception of the Adobe Systems Incorporated Executive Severance Plan in the Event of a Change of Control and/or an individual written retention agreement or severance provision in effect on the Date of Grant between the Company, or a subsidiary of the Company, and the Participant.

ADOBE SYSTEMS INCORPORATED:


By:

Title:

ADOBE SYSTEMS INCORPORATED

AMENDED AND RESTATED 2003 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

Pursuant to the Grant Notice ( “Grant Notice” ) and this Award Agreement ( “Award Agreement” ), Adobe Systems Incorporated (the “Company” ) has awarded you, pursuant to its Amended and Restated 2003 Equity Incentive Plan (the “Plan” ), a Restricted Stock Unit Award for that number of Restricted Stock Units as indicated in the Grant Notice. Unless otherwise defined herein or the Grant Notice, capitalized terms shall have the meanings set forth in the Plan. Subject to adjustment and the terms and conditions as provided herein and in the Plan, each Restricted Stock Unit shall represent the right to receive one (1) share of Stock.

The details of your Award, in addition to those set forth in the Grant Notice, are as follows.

1. NUMBER OF STOCK UNITS AND SHARES OF STOCK.

2. PAYMENT BY YOU. Except as otherwise provided in the Grant Notice, this Award has been granted in consideration of your Services to the Company (or any other Participating Company, as applicable). Subject to Section 11 below, and except as otherwise provided in the Grant Notice, you will not be required to make any payment to the Company (other than your past and future services with the Company (or any other Participating Company, as applicable)) with respect to your receipt of the Award, the vesting of the Restricted Stock Units, or the delivery of the shares of Stock underlying the Restricted Stock Units.

3. VESTING .

(b) If your Service with the Company terminates because of your death or Disability, then you will be given credit for an additional twelve (12) months of continuous Service; provided, however, that in no event shall such applicable vesting exceed 100% vesting of your Award. For purposes of this provision, (i) your Service shall be deemed to have terminated on account of death if your death

(c) The determination that your Service was terminated shall be made by the Company (or any Participating Company, as applicable) in its sole discretion. Any such determination by the Company (or any Participating Company, as applicable) for the purposes of this Award Agreement shall have no effect upon any determination of the rights or obligations of you or the Company (or any Participating Company, as applicable) for any other purpose.

7. RESTRICTIVE LEGENDS. The shares of Stock issued pursuant to this Award shall be endorsed with appropriate legends, if any, determined by the Company.

12. NATURE OF AWARD. In accepting your Award, you acknowledge that:

(c) all decisions with respect to future Awards under the Plan, if any, will be at the sole discretion of the Committee;

(d) your participation in the Plan shall not create a right to further employment or service with the Company or the Participating Company Group and shall not interfere with any ability of the Company or the Participating Company Group to terminate your employment or service relationship at any time with or without cause;

(e) you are voluntarily participating in the Plan;

(h) the future value of the shares of Stock subject to your Award is unknown and cannot be predicted with certainty; and

(i) no claim or entitlement to compensation or damages arises from termination of your Award or diminution in value of your Award or shares of Stock issued pursuant to your Award resulting from termination of your Service with the Company or the Participating Company Group (for any reason whether or not in breach of applicable labor laws), and you irrevocably release the Company and the Participating Company Group from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by executing the Grant Notice, you shall be deemed irrevocably to have waived your entitlement to pursue such a claim.

of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.

16. MISCELLANEOUS .

(b) You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

EXHIBIT 99.4

ADOBE SYSTEMS INCORPORATED

NONSTATUTORY [INCENTIVE] STOCK OPTION AGREEMENT

THIS NONSTATUTORY [INCENTIVE] STOCK OPTION AGREEMENT (the “ Option Agreement ” ) is made and entered into as of the Date of Option Grant by and between Adobe Systems Incorporated and

%%FIRST_NAME%-% %%LAST_NAME%-% (the “ Participant ” ). The Company has granted to the Participant pursuant to the Adobe Systems Incorporated 2003 Equity Incentive Plan (the “ Plan ” ) an option to purchase certain shares of Stock (the “ Option ”), upon the terms and conditions set forth in this Option Agreement, but subject in any event to the Superseding Agreement, if any, described below.

1. DEFINITIONS AND CONSTRUCTION .

1.1 Definitions . Whenever used herein, the following terms shall have their respective meanings set forth below:

(a) “ Date of Option Grant ” means %%OPTION_DATE,’Month DD, YYYY’%-%

(b) “ Number of Option Shares ” means %%TOTAL_SHARES_GRANTED%-% shares of Stock, as adjusted from time to time pursuant to Section 9 [10].

(c) “ Exercise Price ” means $%%OPTION_PRICE%-% per share of Stock, as adjusted from time to time pursuant to Section 9 [10].

(d) “ Initial Vesting Date ” means the date occurring [ ] after the Date of Option Grant.

(e) “ Vested Shares ” means, on any relevant date, that portion (disregarding any fractional share) of the Number of Option Shares determined by multiplying the Number of Option Shares by the “ Vested Amount ” determined as of such date as follows:

			Vested Amount

	Prior to Initial Vesting Date		0

	On Initial Vesting Date, provided the Participant’s Service has not terminated prior to such date		[ ] [ ]

	Plus :

	For each of the next [ ] full months of the Participant’s continuous Service from the Initial Vesting Date until the Vested Amount equals 100%		[ ]

(f) “ Affiliate ” means (i) an entity, other than a Parent Corporation, that directly, or indirectly through one or more intermediary entities, controls the Company or (ii) an entity, other than a Subsidiary Corporation, that is controlled by the Company directly, or indirectly through one or more intermediary entities. For this purpose, the term “control” (including the term “controlled by”) means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of the relevant entity, whether through the ownership of voting securities, by contract or otherwise; or shall have such other meaning assigned such term for the purposes of registration in the United States (“U.S.”) on Form S-8 under the Securities Act.

(g) “ Board ” means the Board of Directors of the Company.

(h) “ Code ” means the U.S. Internal Revenue Code of 1986, as amended, and any applicable regulations promulgated thereunder.

(i) “ Committee ” means the Executive Compensation Committee or other committee of the Board duly appointed to administer the Plan and having such powers as shall be specified by the Board. If no committee of the Board has been appointed to administer the Plan, the Board shall exercise all of the powers of the Committee granted herein, and, in any event, the Board may in its discretion exercise any or all of such powers.

(j) “ Company ” means Adobe Systems Incorporated, a Delaware corporation, or any successor corporation thereto.

(k) “ Consultant ” means a person engaged to provide consulting or advisory services (other than as an Employee or a member of the Board) to a Participating Company, provided that the identity of such person, the nature of such services or the entity to which such services are provided would not preclude the Company from offering or selling securities to such person pursuant to the Plan in reliance on registration on a Form S-8 Registration Statement under the Securities Act.

(l) “ Disability ” means the permanent and total disability of the Participant within the meaning of Section 22(e)(3) of the Code.

(m) “ Employee ” means any person treated as an employee (including an Officer or a member of the Board who is also treated as an employee) in the records of a Participating Company; provided, however, that neither service as a member of the Board nor payment of a director’s fee shall be sufficient to constitute employment.

(n) “ Exchange Act ” means the U.S. Securities Exchange Act of 1934, as amended.

(o) “ Fair Market Value ” means, as of any date, the value of a share of Stock or other property as determined by the Committee, in its discretion, or by the Company, in its discretion, if such determination is expressly allocated to the Company herein, subject to the following:

(i) If, on such date, the Stock is listed on a national or regional securities exchange or market system, the Fair Market Value of a share of Stock shall be the closing price of a share of Stock (or the mean of the closing bid and asked prices of a share of Stock if the Stock is so quoted instead) as quoted on the Nasdaq Global Select Market, the Nasdaq SmallCap Market or such other national or regional securities exchange or market system constituting the primary market for the Stock, as reported on www.Nasdaq.com or such other source as the Company deems reliable. If the relevant date does not fall on a day on which the Stock has traded on such securities exchange or market system, the date on which the Fair Market Value shall be established shall be the last day on which the Stock was so traded prior to the relevant date, or such other appropriate day as shall be determined by the Committee, in its discretion.

If, on such date, the Stock is not listed on a national or regional securities exchange or market system, the Fair Market Value of a share of Stock shall be as determined by the Committee in good faith without regard to any restriction other than a restriction which, by its terms, will never lapse.

(p) “Officer” means any person designated by the Board as an officer of the Company.

(q) “ Option Expiration Date ” means the date seven (7) years after the Date of Option Grant.

(r) “ Parent Corporation ” means any present or future “parent corporation” of the Company, as defined in Section 424(e) of the Code.

(s) “ Participating Company ” means the Company or any Parent Corporation, Subsidiary Corporation or Affiliate.

(t) “ Participating Company Group ” means, at any point in time, all corporations collectively which are then Participating Companies.

(u) “ Securities Act ” means the U.S. Securities Act of 1933, as amended.

(v) “ Service ” means the Participant’s employment or service with the Participating Company Group as an Employee or a Consultant, whichever such capacity the Participant held on the Date of Option Grant or, if later, the date on which the Participant commenced Service. The Participant’s Service shall be deemed to have terminated if the Participant ceases to render Service to the Participating Company Group in such initial capacity. However, the Participant’s Service shall not be deemed to have terminated merely because of a change in the Participating Company for which the Participant renders Service in such initial capacity, provided that there is no interruption or termination of the Participant’s Service. Furthermore, the Participant’s Service with the Participating Company Group shall not be deemed to have terminated if the Participant takes any bona fide leave of absence approved by the Company of ninety (90) days or less. In the event of a leave in excess of ninety (90) days, the Participant’s Service shall be deemed to terminate on the ninety-first (91st) day of the leave unless the Participant’s right to return to Service with the Participating Company Group is guaranteed by statute or contract. Notwithstanding the foregoing, unless otherwise designated by the Company or required by law, a leave of absence shall not be treated as Service for purposes of determining vesting under the Participant’s Option Agreement. The Participant’s Service shall be deemed to have terminated either upon an actual termination of Service or upon the corporation for which the Participant performs Service ceasing to be a Participating Company. Subject to the foregoing, the Company, in its discretion, shall determine whether the Participant’s Service has terminated and the effective date of such termination.

(w) “ Stock ” means the common stock of the Company, as adjusted from time to time in accordance with Section 9 [10].

(x) “ Subsidiary Corporation ” means any present or future “subsidiary corporation” of the Company, as defined in Section 424(f) of the Code.

(y) “ Superseding Agreement ” means the Adobe Systems Incorporated Executive Severance Plan in the Event of a Change of Control and/or an individual written retention agreement or severance provision in effect on the Date of Option Grant between the Company, or a subsidiary of the Company, and the Participant, to the extent applicable to the Participant.

1.2 Construction . Captions and titles contained herein are for convenience only and shall not affect the meaning or interpretation of any provision of this Option Agreement. Except when otherwise indicated by the context, the singular shall include the plural and the plural shall include the singular. Use of the term “or” is not intended to be exclusive, unless the context clearly requires otherwise.

2. TAX STATUS OF OPTION .

This Option is intended to be a nonstatutory stock option and shall not be treated as an incentive stock option within the meaning of Section 422(b) of the Code.

[ TAX CONSEQUENCES .

2.1 Tax Status of Option . This Option is intended to be an incentive stock option within the meaning of Section 422(b) of the Code but the Company does not represent or warrant that this Option qualifies as such. The Participant should consult with the Participant’s own tax advisor regarding the tax effects of this Option

and the requirements necessary to obtain favorable income tax treatment under Section 422 of the Code, including, but not limited to, holding period requirements. (NOTE TO PARTICIPANT: If the Option is exercised more than three (3) months after the date on which you cease to be an Employee (other than by reason of death or permanent and total disability as defined in Section 22(e)(3) of the Code), the Option will be treated as a Nonstatutory Stock Option and not as an Incentive Stock Option to the extent required by Section 422 of the Code.)

2.2 ISO Fair Market Value Limitation . To the extent that the Option (together with all Incentive Stock Options granted to the Participant under all stock option plans of the Participating Company Group, including the Plan) becomes exercisable for the first time during any calendar year for shares having a Fair Market Value greater than One Hundred Thousand Dollars ($100,000), the portion of such options which exceeds such amount will be treated as Nonstatutory Stock Options. For purposes of this Section 2.2, options designated as Incentive Stock Options are taken into account in the order in which they were granted, and the Fair Market Value of stock is determined as of the time the option with respect to such stock is granted. If the Code is amended to provide for a different limitation from that set forth in this Section 2.2, such different limitation shall be deemed incorporated herein effective as of the date required or permitted by such amendment to the Code. If the Option is treated as an Incentive Stock Option in part and as a Nonstatutory Stock Option in part by reason of the limitation set forth in this Section 2.2, the Participant may designate which portion of such Option the Participant is exercising. In the absence of such designation, the Participant shall be deemed to have exercised the Incentive Stock Option portion of the Option first. Separate certificates representing each such portion shall be issued upon the exercise of the Option. (NOTE TO PARTICIPANT: If the aggregate Exercise Price of the Option (that is, the Exercise Price multiplied by the Number of Option Shares) plus the aggregate exercise price of any other Incentive Stock Options you hold (whether granted pursuant to the Plan or any other stock option plan of the Participating Company Group) is greater than $100,000, you should contact the Chief Financial Officer of the Company to ascertain whether the entire Option qualifies as an Incentive Stock Option.)]

3. ADMINISTRATION .

All questions of interpretation concerning this Option Agreement shall be determined by the Committee. All determinations by the Committee shall be final and binding upon all persons having an interest in the Option. Any Officer shall have the authority to act on behalf of the Company with respect to any matter, right, obligation, or election which is the responsibility of or which is allocated to the Company herein, provided the Officer has apparent authority with respect to such matter, right, obligation, or election.

4. EXERCISE OF THE OPTION .

4.1 Right to Exercise . Except as otherwise provided herein, the Option shall be exercisable on and after the Initial Vesting Date and prior to the termination of the Option (as provided in Section 7) in an amount not to exceed the number of Vested Shares less the number of shares previously acquired upon exercise of the Option. In no event shall the Option be exercisable for more shares than the Number of Option Shares.

4.2 Method of Exercise . Exercise of the Option shall be by means of electronic notice in a form authorized by the Company, which shall be digitally signed or authenticated by the Participant in such manner as required by the notice and transmitted to the Equity Compensation Department of the Company or other authorized representative of the Company (including a third-party administrator designated by the Company). In the event that the Participant is not authorized or is unable to provide electronic notice of exercise, the Option shall be exercised by written notice to the Company, which shall be signed by the Participant and delivered in person, by certified or registered mail, return receipt requested, by confirmed facsimile transmission, or by such other means as the Company may permit, to the Equity Compensation Department of the Company, or other authorized representative of the Company (including a third-party administrator designated by the Company). Each such notice, whether electronic or written, must state the Participant’s election to exercise the Option, the number of whole shares of Stock for which the Option is being exercised and such other representations and agreements as to the Participant’s investment intent with respect to such shares as may be required pursuant to the provisions of this Option Agreement. Further, each such notice must be received by the Company prior to the termination of the Option as set forth in Section 7 and must be accompanied by full payment of the aggregate Exercise Price for the number of shares of Stock being purchased. The Option shall be deemed to be exercised upon receipt by the Company of such electronic or written notice and the aggregate Exercise Price.

4.3 Payment of Exercise Price.

(a) Forms of Consideration Authorized. Except as otherwise provided below, payment of the aggregate Exercise Price for the number of shares of Stock for which the Option is being exercised shall be made (i) in cash, by check or by cash equivalent or (ii) by means of a Cashless Exercise, as defined in Section 4.3(b).

(b) Cashless Exercise. A “ Cashless Exercise ” means the delivery of a properly executed notice of exercise together with irrevocable instructions to a broker in a form acceptable to the Company providing for the assignment to the Company of the proceeds of a sale or loan with respect to some or all of the shares being acquired upon the exercise of the Option pursuant to a program or procedure approved by the Company (including, without limitation, through an exercise complying with the provisions of Regulation T as promulgated from time to time by the Board of Governors of the Federal Reserve System). The Company reserves, at any and all times, the right, in the Company’s sole and absolute discretion, to establish, decline to approve or terminate any such program or procedure, including with respect to the Participant notwithstanding that such program or procedures may be available to others.

4.4 Tax Withholding . Regardless of any action taken by the Participating Company Group with respect to any or all income tax, social insurance, payroll tax, payment on account or other tax-related withholdings or payments ( “ Tax-Related Items ” ), the Participant acknowledges that the ultimate liability for all Tax-Related Items legally due by the Participant is and remains the Participant’s responsibility and that the Participating Company Group (i) makes no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of the Option, including the grant, vesting or exercise of the Option, the subsequent sale of shares acquired pursuant to such exercise, or the receipt of any dividends and (ii) does not commit to structure the terms of the grant or any other aspect of the Option to reduce or eliminate the Participant’s liability for Tax-Related Items. In particular, while this Option is intended to be exempt from Code Section 409A pursuant to Treasury Regulation Section 1.409A-1(b)(5) and will be construed in accordance therewith to the greatest extent permitted by law, the Participant acknowledges that this Option is exempt from Section 409A of the Code only if the exercise price per share is at least equal to the “fair market value” per share of the Stock on the Date of Option Grant and there is no other impermissible deferral of compensation associated with the Option. At the time of exercise of the Option, the Participant shall pay or make adequate arrangements satisfactory to the Participating Company Group to satisfy all withholding obligations of the Participating Company Group. In this regard, at the time the Option is exercised, in whole or in part, or at any other time as reasonably requested by the Company, the Participant hereby authorizes withholding of all applicable Tax-Related Items from payroll and any other amounts payable to the Participant, and otherwise agrees to make adequate provision for withholding of all applicable Tax Related Items by the Participating Company Group, if any, which arise in connection with the Option. Alternatively, or in addition, if permissible under applicable law, the Participating Company Group may (i) sell or arrange for the sale of shares acquired by the Participant to meet the withholding obligation of Tax-Related Items and/or (ii) withhold in shares, provided that only the amount of shares necessary to satisfy the minimum statutory withholding amount are withheld. Finally, the Participant shall pay to the Participating Company Group any amount of the Tax-Related Items that the Participating Company Group may be required to withhold as a result of the Participant’s participation in the Plan that cannot be satisfied by the means previously described. The Company shall have no obligation to process the exercise of the Option or to deliver shares of Stock until the obligations in connection with the Tax-Related Items as described in this section have been satisfied by the Participant.

4.5 Beneficial Ownership of Shares; Certificate Registration . The Participant hereby authorizes the Company, in its sole discretion, to deposit for the benefit of the Participant with any broker with which the Participant has an account relationship of which the Company has notice any or all shares acquired by the Participant pursuant to the exercise of the Option. Except as provided by the preceding sentence, a certificate for the shares as to which the Option is exercised shall be registered in the name of the Participant, or, if applicable, in the names of the heirs of the Participant.

issuance of shares of Stock upon exercise would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, the Option may not be exercised unless (i) a registration statement under the Securities Act shall at the time of exercise of the Option be in effect with respect to the shares issuable upon exercise of the Option or (ii) in the opinion of legal counsel to the Company, the shares issuable upon exercise of the Option may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. THE PARTICIPANT IS CAUTIONED THAT THE OPTION MAY NOT BE EXERCISED UNLESS THE FOREGOING CONDITIONS ARE SATISFIED. ACCORDINGLY, THE PARTICIPANT MAY NOT BE ABLE TO EXERCISE THE OPTION WHEN DESIRED EVEN THOUGH THE OPTION IS VESTED. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance and sale of any shares subject to the Option 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. As a condition to the exercise of the Option, the Company may require the Participant to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company.

4.7 Fractional Shares . The Company shall not be required to issue fractional shares upon the exercise of the Option.

5. NONTRANSFERABILITY OF THE OPTION .

The Option may be exercised during the lifetime of the Participant only by the Participant or the Participant’s guardian or legal representative and may not be assigned or transferred in any manner except by will or by the laws of descent and distribution. Following the death of the Participant, the Option, to the extent provided in Section 8, may be exercised by the Participant’s legal representative or by any person empowered to do so under the deceased Participant’s will or under the then applicable laws of descent and distribution.

6. NATURE OF OPTION .

In accepting the Option, the Participant acknowledges that:

6.1 the Plan is established voluntarily by the Company; it is discretionary in nature and it may be modified, amended, suspended or terminated by the Company at any time, unless otherwise provided in the Plan and this Option Agreement;

6.2 the grant of the Option is voluntary and occasional and does not create any contractual or other right to receive future grants of Options, or benefits in lieu of Options, even if Options have been granted repeatedly in the past;

6.3 all decisions with respect to future Option grants, if any, will be at the sole discretion of the Company;

6.4 the Participant’s participation in the Plan shall not create a right to further employment with the Participating Company Group and shall not interfere with any ability of the Participating Company Group to terminate the Participant’s employment relationship at any time with or without cause;

6.5 the Participant is voluntarily participating in the Plan;

6.6 the Option is not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension or retirement benefits or similar payments;

grant will not be interpreted to form an employment contract with the other members of the Participating Company Group;

6.8 the future value of the underlying shares is unknown and cannot be predicted with certainty;

6.9 if the underlying shares do not increase in value, the Option will have no value;

6.10 if the Participant exercises the Option and obtains shares, the value of those shares acquired upon exercise may increase or decrease in value, even below the Option price; and

6.11 in consideration of the grant of the Option, no claim or entitlement to compensation or damages arises from termination of the Option or diminution in value of the Option or shares purchased through exercise of the Option resulting from termination of the Participant’s Service with the Participating Company Group (for any reason whether or not in breach of applicable labor laws) and the Participant irrevocably releases the Participating Company Group from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by signing this Option Agreement, the Participant shall be deemed irrevocably to have waived his or her entitlement to pursue such a claim.

7. TERMINATION OF THE OPTION .

The Option shall terminate and may no longer be exercised after the first to occur of (a) the Option Expiration Date, (b) the last date for exercising the Option following termination of the Participant’s Service as described in Section 8, or (c) a Change of Control to the extent provided in Section 11.2(c) of the Plan.

8. EFFECT OF TERMINATION OF SERVICE .

8.1 Option Exercisability .

(a) Normal Retirement. If the Participant’s Service terminates at or after the normal retirement age sixty-five (65) years ( “ Normal Retirement ” ) , then (i) the Option, to the extent unexercised and exercisable on the date on which the Participant’s Service terminated, may be exercised by the Participant at any time prior to the expiration of twelve (12) months after the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date, and (ii) solely for the purpose of computing the Vested Amount, the Participant will be given credit for an additional twelve (12) months of continuous Service; provided, however, that in no event shall the Vested Amount exceed 100%.

(b) Early Retirement. If the Participant’s Service terminates by reason of the early retirement of the Participant pursuant to an early retirement program established by the Participating Company to which the Participant renders Service ( “ Early Retirement ” ), then (i) the Option, to the extent unexercised and exercisable on the date on which the Participant’s Service terminated, may be exercised by the Participant at any time prior to the expiration of three (3) months (or such longer period as shall be established pursuant to such early retirement program) after the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date, and (ii) solely for the purpose of computing the Vested Amount, the Participant will be given credit for such additional months of continuous Service, if any, as shall be established pursuant to the early retirement program; provided, however, that in no event shall the Vested Amount exceed 100%.

(c) Disability. If the Participant’s Service terminates because of the Disability of the Participant, then (i) the Option, to the extent unexercised and exercisable on the date on which the Participant’s Service terminated, may be exercised by the Participant (or the Participant’s guardian or legal representative) at any time prior to the expiration of twelve (12) months after the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date, and (ii) solely for the purpose of computing the Vested Amount, the Participant will be given credit for an additional twelve (12) months of continuous Service; provided, however, that in no event shall the Vested Amount exceed 100%.

(d) Death. If the Participant’s Service terminates because of the death of the Participant, then (i) the Option, to the extent unexercised and exercisable on the date on which the Participant’s Service terminated, may be exercised by the Participant’s legal representative or other person who acquired the right to exercise the Option by reason of the Participant’s death at any time prior to the expiration of twelve (12) months after the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date, and (ii) solely for the purpose of computing the Vested Amount, the Participant will be given credit for an additional twelve (12) months of continuous Service; provided, however, that in no event shall the Vested Amount exceed 100%. The Participant’s Service shall be deemed to have terminated on account of death if the Participant dies within three (3) months after the Participant’s termination of Service.

(e) Other Termination of Service. If the Participant’s Service terminates for any reason, except Normal Retirement, Early Retirement, Disability, or death, the Option, to the extent unexercised and exercisable by the Participant on the date on which the Participant’s Service terminated, may be exercised by the Participant at any time prior to the expiration of three (3) months (or such other longer period of time as determined by the Committee, in its discretion) after the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date.

8.2 Extension if Exercise Prevented by Law . Notwithstanding the foregoing, if the exercise of the Option within the applicable time periods set forth in Section 8.1 is prevented by the provisions of Section 4.6, the Option shall remain exercisable until three (3) months after the date the Participant is notified by the Company that the Option is exercisable, but in any event no later than the Option Expiration Date.

8.3 Extension if Participant Subject to Section 16(b ). Notwithstanding the foregoing, if a sale within the applicable time periods set forth in Section 8.1 of shares acquired upon the exercise of the Option would subject the Participant to suit under Section 16(b) of the Exchange Act, the Option shall remain exercisable until the earliest to occur of (i) the tenth (10th) day following the date on which a sale of such shares by the Participant would no longer be subject to such suit, (ii) the one hundred and ninetieth (190th) day after the Participant’s termination of Service, or (iii) the Option Expiration Date.

8.4 Termination for Cause. Notwithstanding any other provision of this Option Agreement, if the Participant’s Service is terminated for Cause, the Option shall terminate and cease to be exercisable on the effective date of such termination of Service. “ Cause ” shall mean any of the following: (i) the Participant’s conviction of a felony; (ii) the Participant’s material act of fraud, dishonesty or other malfeasance; or (iii) the Participant’s willful, improper disclosure of a Participating Company’s confidential or proprietary information.

9. [ CHANGE OF CONTROL .

9.1 Fair Market Value Limitation . Should the exercisability of this Option be accelerated in connection with a Change of Control, then to the extent that the aggregate Fair Market Value of the shares of Stock with respect to which the Participant may exercise the Option for the first time during the calendar year of such acceleration, when added to the aggregate Fair Market Value of the shares subject to any other options designated as Incentive Stock Options granted to the Participant under all stock option plans of the Participating Company Group prior to the Date of Option Grant with respect to which such options are exercisable for the first time during the same calendar year, exceeds One Hundred Thousand Dollars ($100,000) (or such other limit, if any, imposed by Section 422 of the Code), the portion of the Option which exceeds such amount shall be treated as a Nonstatutory Stock Option. For purposes of the preceding sentence, options designated as Incentive Stock Options shall be taken into account in the order in which they were granted, and the Fair Market Value of shares of stock shall be determined as of the time the option with respect to such shares is granted.]

ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE .

adjustments shall be made in the number, Exercise Price and class of shares subject to the Option. If a majority of the shares which are of the same class as the shares that are subject to the Option are exchanged for, converted into, or otherwise become (whether or not pursuant to an Ownership Change Event) shares of another corporation (the “ New Shares ” ), the Committee may unilaterally amend the Option to provide that the Option is exercisable for New Shares. In the event of any such amendment, the Number of Option Shares and the Exercise Price shall be adjusted in a fair and equitable manner, as determined by the Committee, in its discretion. Notwithstanding the foregoing, any fractional share resulting from an adjustment pursuant to this Section 9 [10] shall be rounded down to the nearest whole number, and in no event may the Exercise Price be decreased to an amount less than the par value, if any, of the stock subject to the Option. The adjustments determined by the Committee pursuant to this Section 9 [10] shall be final, binding and conclusive.

10. RIGHTS AS A STOCKHOLDER, EMPLOYEE OR CONSULTANT .

The Participant shall have no rights as a stockholder with respect to any shares covered by the Option until the date of the issuance of the shares for which the Option has been exercised (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company). No adjustment shall be made for dividends, distributions or other rights for which the record date is prior to the date such shares are issued, except as provided in Section 9 [10]. If the Participant is an Employee, the Participant understands and acknowledges that, except as otherwise provided in a separate, written employment agreement between a Participating Company and the Participant, the Participant’s employment is “at will” and is for no specified term. Nothing in this Option Agreement shall confer upon the Participant any right to continue in the Service of a Participating Company or interfere in any way with any right of the Participating Company Group to terminate the Participant’s Service as an Employee or Consultant, as the case may be, at any time.

11. [ NOTICE OF SALES UPON DISQUALIFYING DISPOSITION .

The Participant shall dispose of the shares acquired pursuant to the Option only in accordance with the provisions of this Option Agreement. In addition, the Participant shall (a) promptly notify the Chief Financial Officer of the Company if the Participant disposes of any of the shares acquired pursuant to the Option within one (1) year after the date the Participant exercises all or part of the Option or within two (2) years after the Date of Option Grant and (b) provide the Company with a description of the circumstances of such disposition. Until such time as the Participant disposes of such shares in a manner consistent with the provisions of this Option Agreement, unless otherwise expressly authorized by the Company, the Participant shall hold all shares acquired pursuant to the Option in the Participant’s name (and not in the name of any nominee) for the one-year period immediately after the exercise of the Option and the two-year period immediately after Date of Option Grant. At any time during the one-year or two-year periods set forth above, the Company may place a legend on any certificate representing shares acquired pursuant to the Option requesting the transfer agent for the Company’s stock to notify the Company of any such transfers. The obligation of the Participant to notify the Company of any such transfer shall continue notwithstanding that a legend has been placed on the certificate pursuant to the preceding sentence.]

MISCELLANEOUS PROVISIONS .

11.1 Designation of Beneficiary. Subject to local laws and procedures, the Participant may file with the Company a written designation of a beneficiary who, in the event of the death of the Participant, shall thereafter be entitled to exercise the Option to the extent that it remains exercisable in accordance with this Option Agreement. Each designation will revoke all prior designations by the Participant, shall be in a form prescribed by the Company, and shall be effective only when filed by the Participant in writing with the Company during the Participant’s lifetime. If the Participant is married and designates a beneficiary other than the Participant’s spouse, the effectiveness of such designation may be subject to the consent of the Participant’s spouse. If the Participant dies without an effective designation of a beneficiary who is living at the time of the Participant’s death, the Option may be exercised by the Participant’s legal representative to the extent that it remains exercisable in accordance with this Option Agreement. If the designated beneficiary survives the Participant but dies before exercising the Option to the full extent that it remains exercisable in accordance with this Option Agreement, then the Option shall be exercisable by the legal representative of such deceased designated beneficiary to the extent that it remains exercisable in accordance with this Option Agreement. The determination of the Company as to which person, if any, qualifies as a designated beneficiary shall be final, conclusive and binding on all persons.

11.2 Binding Effect. This Option Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and assigns.

11.3 Termination or Amendment. The Committee may terminate or amend the Plan or the Option at any time; provided, however, that except as provided in connection with a Change of Control, no such termination or amendment may adversely affect the Option or any unexercised portion hereof without the consent of the Participant unless such termination or amendment is necessary to comply with any applicable law or government regulation. No amendment or addition to this Option Agreement shall be effective unless in writing.

11.4 Delivery of Documents and Notices. Any document relating to participating in the Plan and/or notice required or permitted hereunder shall be given in writing and shall be deemed effectively given (except to the extent that this Option Agreement provides for effectiveness only upon actual receipt of such notice) upon personal delivery, electronic delivery, or upon deposit in the U.S. Post Office or foreign postal service, by registered or certified mail, with postage and fees prepaid, addressed to the other party at the e-mail address, if any, provided for the Participant by a Participating Company or at the address shown below that party’s signature to this Option Agreement or at such other address as such party may designate in writing from time to time to the other party.

(a) Description of Electronic Delivery . The Plan documents, which may include but do not necessarily include: the Plan Prospectus, this Option Agreement and U.S. financial reports of the Company, may be delivered to the Participant electronically. In addition, the Participant may deliver electronically the notice called for by Section 4.2 (the “Notice of Exercise”) to the Company or to such third party involved in administering the Plan as the Company may designate from time to time. Such means of delivery may include but do not necessarily include the delivery of a link to a Company intranet or the internet site of a third party involved in administering the Plan, the delivery of the document via e-mail or such other delivery determined at the Committee’s discretion.

(b) Consent to Electronic Delivery. The Participant acknowledges that the Participant has read Section 11 [13].4 of this Option Agreement and consents to the electronic delivery of the Plan documents and the delivery of the Notice of Exercise, as described in Section 11 [13].4 (a) of this Option Agreement. The Participant acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically at no cost if the Participant contacts the Company by telephone, through a postal service or electronic mail at equity@adobe.com. The Participant further acknowledges that the Participant will be provided with a paper copy of any documents delivered electronically if electronic delivery fails; similarly, the Participant understands that the Participant must provide the Company or any designated third party with a paper copy of any documents delivered electronically if electronic delivery fails. Also, the Participant understands that the Participant’s consent may be revoked or changed, including any change in the electronic mail address to which documents are delivered (if Participant has provided an electronic mail address), at any time by notifying the Company of such revised or revoked consent by telephone, postal service or electronic mail at equity@adobe.com. Finally, the Participant understands that he or she is not required to consent to electronic delivery.

11.5 Data Privacy Consent . The Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Participant’s personal data as described in this document by and among the members of the Participating Company Group for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan.

retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participant’s participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom the Participant may elect to deposit any shares of Stock acquired upon exercise of the Option. The Participant understands that Data will be held only as long as is necessary to implement, administer and manage the Participant’s participation in the Plan. The Participant understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Participant’s local human resources representative. The Participant understands, however, that refusing or withdrawing the Participant’s consent may affect the Participant’s ability to participate in the Plan. For more information on the consequences of the Participant’s refusal to consent or withdrawal of consent, the Participant understands that he or she may contact the Participant’s local human resources representative.

11.6 Headings. The headings of the Sections in this Option Agreement are inserted for convenience only and shall not be deemed to constitute a part of this Option Agreement or to affect the meaning of this Option Agreement.

11.7 Integrated Agreement. This Option Agreement, together with the Superseding Agreement, if any, and the Plan constitutes the entire understanding and agreement of the Participant and the Participating Company Group with respect to the subject matter contained herein and supersedes any prior agreements, understandings, restrictions, representations, or warranties among the Participant and the Participating Company Group with respect to such subject matter other than those as set forth or provided for herein. To the extent contemplated herein, the provisions of this Option Agreement shall survive any exercise of the Option and shall remain in full force and effect. Any capitalized terms not defined herein shall have the definition as set forth in the Plan and/or the Superseding Agreement. In the event of any conflict between the provisions of this Option Agreement and those of the Plan, the provisions of the Plan shall control.

11.8 Applicable Law and Venue. This Option Agreement shall be governed by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within the State of California. For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties as evidenced by this Option Agreement, the parties herby submit to and consent to the jurisdiction of the State of California and agree that such litigation shall be conducted only in the courts of Santa Clara County, California, or the federal courts of the United States for the Northern District of California, and no other courts, where this Option Agreement is made and/or performed.

	ADOBE SYSTEMS INCORPORATED


	By:

	Title:

	Address:

The Participant represents that the Participant is familiar with the terms and provisions of this Option Agreement and hereby accepts the Option subject to all of the terms and provisions thereof. The Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Committee upon any questions arising under this Option Agreement.

EXHIBIT 99.5

ADOBE SYSTEMS INCORPORATED

2003 EQUITY INCENTIVE PLAN

[ ] PERFORMANCE SHARE PROGRAM

AWARD GRANT NOTICE

Adobe Systems Incorporated (the “Company” ), pursuant to its [ ] Performance Share Program (the “Program” ) under its 2003 Equity Incentive Plan (the “Plan” ), hereby awards to Participant the award (the “ Award ”) set forth below. This Award is subject to all of the terms and conditions as set forth herein and in the Performance Share Award Agreement, the Program and the Plan, all of which are attached hereto and incorporated herein in their entirety. Unless otherwise defined herein, capitalized terms shall have the meanings set forth in the Plan or the Program, as applicable.

Participant:
Date of Grant:
Vesting Commencement Date:
Number of Shares of Stock Subject to Target Award:	[ ] shares of Stock
Number of Shares of Stock Subject to Maximum Award:	[ ]% of number of shares of Stock subject to Target Award)_
Performance Period:	Company’s Fiscal Year [ ]

Determination of Actual Award: On the Certification Date, and provided that (i) the applicable Performance Goal is attained during the Performance Period and (ii) Participant continues to render Service to the Company or any other Participating Company through the Certification Date, the Company shall credit Participant with an Actual Award representing the number of shares of Stock (which may be equal to all or a portion (including none) of the Maximum Award) as determined by the Committee based on the degree of achievement of the Other Performance Goals as determined by the Executive Compensation Committee of the Board of Directors of the Company and the limitations set forth in Section 5 of the Performance Share Award Agreement.

Vesting Schedule: The Actual Award shall vest as to 1/3rd of the shares of Stock subject to the Actual Award on the later of (i) the Certification Date and (ii) the one year anniversary of the Vesting Commencement Date (the “ First Vesting Date ”), and thereafter as to 1/3rd of the shares of Stock subject to the Actual Award on each of the second and third anniversaries of the Vesting Commencement Date (each such date, a “ Vesting Date ”), so that the Actual Award will be fully vested as of the third anniversary of the Vesting Commencement Date; provided, however, that the Participant continues to render Service to the Company or any other Participating Company through each such vesting date.

Delivery of Shares : Subject to the limitations contained herein and the provisions of the Plan and the Program, the Company shall deliver to the Participant the vested shares of Stock subject to the Actual Award as provided in Section 3 of the Performance Share Award Agreement.

Additional Terms/Acknowledgements: The Participant acknowledges receipt of, and understands and agrees to, this Award Grant Notice, the Performance Share Award Agreement, the Program and the Plan. Participant further acknowledges that as of the Date of Grant, this Award Grant Notice, the Performance Share Award Agreement, the Program, and the Plan set forth the entire understanding between Participant and the Company regarding the Award and supersede all prior oral and written agreements on that subject, with the exception of the Adobe Systems Incorporated Executive Severance Plan in the Event of a Change of Control and/or an individual written retention agreement or severance provision in effect on the Date of Grant between the Company, or a subsidiary of the Company, and the Participant, to the extent applicable to the Participant (such documents, the “ Superseding Agreements ”). This Award is a “performance share unit” for purposes of the Superseding Agreements.

	ADOBE SYSTEMS INCORPORATED


	By:

	Address:

ADOBE SYSTEMS INCORPORATED

2003 EQUITY INCENTIVE PLAN

[ ] PERFORMANCE SHARE PROGRAM

PERFORMANCE SHARE AWARD AGREEMENT

Pursuant to the Award Grant Notice ( “Grant Notice” ) and this Performance Share Award Agreement ( “Award Agreement” ), Adobe Systems Incorporated (the “Company” ) has awarded you, pursuant to its [ ] Performance Share Program (the “Program” ) under its 2003 Equity Incentive Plan (the “Plan” ), the Maximum Award as indicated in the Grant Notice. Unless otherwise defined herein or in the Grant Notice, capitalized terms shall have the meanings set forth in the Plan or the Program, as applicable.

The details of your Award are as follows.

1. ENTITLEMENT TO SHARES.

(a) Determination of Actual Award .

(i) Generally . Provided that (i) the applicable Performance Goal is achieved during the Performance Period and (ii) you continue to render Service to the Company or any other Participating Company through the Certification Date, then, subject to the limitations contained herein and to the provisions of the Program and the Plan, you shall be credited with an Actual Award on the Certification Date equal to all or a portion (including none) of the Maximum Award, with a reduction from the Maximum Award determined by the Committee based on the degree of achievement of the Other Performance Goals as determined by the Executive Compensation Committee of the Board of Directors of the Company and, as applicable, based on any reduction pursuant to Section 5 of this Award Agreement. If the Committee does reduce the Maximum Award on account of the degree of achievement of Other Performance Goals, you will be credited with a portion (or none) of the shares of Stock subject to the Maximum Award; provided, however, that (i) if a specified level of Performance Goals (including all Other Performance Goals) is not achieved during the Performance Period, you will not be credited with or receive any shares of Stock as an Actual Award, and (ii) the maximum number of shares of Stock for which you may be credited as an Actual Award will in no event exceed the Maximum Award.

(ii) Change of Control . If a Change of Control occurs prior to the Certification Date, and provided you continue to render Service to the Company or any other Participating Company until immediately prior to the Change of Control, then, as of immediately prior to the Change of Control, you shall be credited with a pro-rated Actual Award on such date equal to that number of shares of Stock subject to the Target Award multiplied by a fraction, the numerator of which is the number of months of Service (rounded up for any partial months and subject to reduction pursuant to Section 5) you provided in the Performance Period as of immediately prior to the Change of Control (but in no event shall you be credited with more than the number of months in the Performance Period) and the denominator of which is the number of months in the Performance Period.

(b) Vesting . The Actual Award shall be subject to vesting in accordance with the Vesting Schedule set forth on the Grant Notice, subject to such acceleration as provided in Section 1(c) of this Award Agreement or Superseding Agreement, as applicable.

(c) Disability or Death .

(i) If your Service terminates prior to the Certification Date by reason of death or Disability, you (or your heirs in the case of death) will be credited with a pro-rated Actual Award equal to that number of shares of Stock that you would have been credited with pursuant to Section 1(a) had you remained in Service through the applicable date set forth in Section 1(a), with pro-ration based on the number of months of Service (rounded up for any partial months of Service and subject to reduction pursuant to Section 5) you provided in the Performance Period prior to your termination (but in no event shall you be credited with more than the

number of months in the Performance Period). For clarification, if the Actual Award is determined pursuant to Section 1(a)(ii), the Actual Award will not be pro-rated twice. You will be deemed to have vested in that 1/3rd of the shares of Stock subject to the Actual Award that would have vested on the First Vesting Date.

(ii) If your Service terminates on or after the Certification Date, you will be deemed to have vested in that 1/3rd of the shares of Stock subject to the Actual Award that would have vested on the next Vesting Date (which may be the First Vesting Date if the Certification Date occurs prior to the first anniversary of the Vesting Commencement Date).

(iii) The shares of Stock subject to an Actual Award that vest pursuant to this Section 1(c) shall be issued and delivered to you (or your heirs in the case of death) pursuant to Section 3 below.

2. DIVIDENDS . Except as provided in Section 6 below, you shall not receive or be credited with any payment or other adjustment in the number of shares subject to the Actual Award for cash dividends that may be made in respect of the shares of Stock to which your Actual Award relates unless and until, and only to the extent, such Actual Award has vested.

3. DELIVERY OF SHARES . Subject to Sections 4 and 12 of this Award Agreement, the Company shall issue and deliver to you (or your heirs in the case of death) the certificates representing the shares of Stock subject to a vested Actual Award (the “Certificates” ) within thirty (30) days following the applicable vesting date. If you elect to defer delivery of the shares of Stock as provided in Section 4 of this Award Agreement, shares of Stock will be issued and delivered to you on the date or dates that you elect on your deferral election form. The Certificates shall be in such form as is determined by the Company. No shares of Stock shall be issued prior to vesting.

4. DEFERRAL ELECTION. If permitted by the Company to do so, you may elect to defer receipt of the shares of Stock that would otherwise be issued pursuant to the vesting of your Award in accordance with the terms and conditions, including the applicable eligibility requirements, of the Company’s Deferred Compensation Plan. The Board (or an appropriate committee thereof) will, in its sole discretion, establish the rules and procedures for such deferrals.

5. EFFECT OF LEAVES OF ABSENCE. Unless otherwise required by law, if you have taken in excess of thirty (30) days of leaves of absence during a Performance Period, your Actual Award shall be prorated on the basis of the number of days of Service during the Performance Period during which you were not on a leave of absence.

6. NUMBER OF SHARES . The number of shares of Stock subject to your Award will be adjusted from time to time for capitalization adjustments, as provided in Section 4.2 of the Plan.

7. SECURITIES LAW COMPLIANCE . The grant of your Award and the issuance of any shares of Stock pursuant to an Actual Award shall be subject to compliance with all applicable requirements of federal, state or foreign law with respect to such securities. You may not be issued any shares of Stock pursuant to an Actual Award if the issuance of shares of Stock would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, you may not be issued any shares of Stock pursuant to an Actual Award unless (i) a registration statement under the Securities Act shall at the time of issuance be in effect with respect to the shares of Stock or (ii) in the opinion of legal counsel to the Company, the shares of Stock may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. YOU ARE CAUTIONED THAT THE SHARES OF STOCK MAY NOT BE ISSUED UNLESS THE FOREGOING CONDITIONS ARE SATISFIED. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance and sale of any shares of Stock pursuant to an Actual Award 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. As a condition to the issuance of any shares of Stock pursuant to an Actual Award, the Company may require you to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company.

8. RESTRICTIVE LEGENDS. The shares of Stock issued pursuant to an Actual Award shall be endorsed with appropriate legends, if any, determined by the Company.

9. TRANSFERABILITY. Your Award and any unvested shares of Stock subject to the Actual Award are not transferable, except by will or by the laws of descent and distribution. Notwithstanding the foregoing, by delivering written notice to the Company, in a form satisfactory to the Company, you may designate a third party who, in the event of your death, shall thereafter be entitled to receive any distribution of shares of Stock pursuant to Section 3 of this Award Agreement.

10. AWARD NOT A SERVICE CONTRACT . Your Award is not an employment or service contract, and nothing in your Award shall be deemed to create in any way whatsoever any obligation on your part to continue in the service of the Company or the Participating Company Group, or on the part of the Company or Participating Company Group to continue such service. In addition, nothing in your Award shall obligate the Company or the Participating Company Group, their respective stockholders, boards of directors, Officers or Employees to continue any relationship that you might have as an Employee, Director or Consultant for the Company or the Participating Company Group.

11. UNSECURED OBLIGATION . Your Award is unfunded, and you shall be considered an unsecured creditor of the Company with respect to the Company’s obligation, if any, to issue shares of Stock pursuant to an Actual Award under this Award Agreement. You shall not have voting or any other rights as a stockholder of the Company with respect to the Stock acquired pursuant to this Award Agreement until such Stock is issued to you pursuant to this Award Agreement. Upon such issuance, you will obtain full voting and other rights as a stockholder of the Company with respect to the Stock so issued. Nothing contained in this Award Agreement, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind or a fiduciary relationship between you and the Company or any other person.

12. WITHHOLDING OBLIGATIONS. Regardless of any action taken by the Company or the Participating Company Group with respect to any or all income, employment, social insurance, or payroll taxes, payment on account or other tax-related withholdings or payments ( “ Tax-Related Items ” ), you acknowledge that the ultimate liability for all Tax-Related Items legally due by you is and remains your responsibility and that the Company and Participating Company Group (i) make no representations or undertakings regarding the treatment of any Tax-Related Items in connection with any aspect of your Award, the subsequent sale of shares of Stock acquired pursuant to an Actual Award, or the receipt of any dividends and (ii) does not commit to structure the terms of the grant or any other aspect of your Award to reduce or eliminate your liability for Tax-Related Items. At the time any Actual Award is determined, at the time you vest in such Actual Award, at the time you receive a distribution of shares of Stock pursuant to such Actual Award, or at any other time reasonably as requested by the Company or the Participating Company Group, you shall pay or make adequate arrangements satisfactory to the Participating Company Group to satisfy all withholding obligations of the Participating Company Group. In this regard, at the time you receive a distribution of shares of Stock pursuant to an Actual Award, or at any other time as reasonably requested by the Company or the Participating Company Group, you hereby authorize the withholding of that number of whole vested shares of Stock otherwise deliverable to you pursuant to an Actual Award under this Award Agreement having a fair market value not in excess of the amount of the Tax-Related Items determined by the applicable minimum statutory rates. Finally, you shall pay to the Company or Participating Company Group (as applicable) any amount of the Tax-Related Items that the Company or the Participating Company Group may be required to withhold as a result of your participation in the Plan that cannot be satisfied by the means previously described. The Company and the Participating Company Group shall have no obligation to deliver shares of Stock until you have satisfied the obligations in connection with the Tax-Related Items as described in this section.

13. NATURE OF AWARD. In accepting your Award, you acknowledge that:

(b) the grant of your Award is voluntary and occasional and does not create any contractual or other right to receive future grants of Awards, or benefits in lieu of Awards, even if Awards have been granted repeatedly in the past;

(c) all decisions with respect to future Awards under the Plan, if any, will be at the sole discretion of the Committee;

(e) you are voluntarily participating in the Plan;

(f) an Award is not part of normal or expected compensation or salary for any purpose, including, but not limited to, calculating any severance, resignation, termination, redundancy, end-of-service payments, bonuses, long-service awards, pension or retirement benefits or similar payments;

(h) the future value of the shares of Stock subject to your Award is unknown and cannot be predicted with certainty; and

(i) no claim or entitlement to compensation or damages arises from termination of your Award or diminution in value of your Award or shares of Stock issued pursuant to an Actual Award resulting from termination of your Service with the Company or the Participating Company Group (for any reason whether or not in breach of applicable labor laws), and you irrevocably release the Company and the Participating Company Group from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by executing the Grant Notice, you shall be deemed irrevocably to have waived your entitlement to pursue such a claim.

14. DELIVERY OF DOCUMENTS AND NOTICES. Any document relating to participating in the Plan or Program and/or notice required or permitted hereunder shall be given in writing and shall be deemed effectively given (except to the extent that this Award Agreement provides for effectiveness only upon actual receipt of such notice) upon personal delivery, electronic delivery, or upon deposit in the U.S. Post Office or foreign postal service, by registered or certified mail, with postage and fees prepaid, addressed to the other party at the e-mail address, if any, provided for you by the Company or a Participating Company or at such other address as such party may designate in writing from time to time to the other party.

(a) Description of Electronic Delivery . The Plan and Program documents, which may include but do not necessarily include the Plan prospectus, Grant Notice, Award Agreement, Certificates, and U.S. financial reports of the Company, may be delivered to you electronically. Such means of delivery may include but do not necessarily include the delivery of a link to a Company intranet or the internet site of a third party involved in administering the Plan, the delivery of the document via e-mail or such other delivery determined at the Committee’s discretion.

(b) Consent to Electronic Delivery. You acknowledge that you have read Section 14 of this Award Agreement and consent to the electronic delivery of the Plan and Program documents, as described in Section 14 of this Award Agreement. You acknowledge that you may receive from the Company a paper copy of any documents delivered electronically at no cost if you contact the Company by telephone, through a postal service or electronic mail at equity@adobe.com. You further acknowledge that you will be provided with a paper copy of any documents delivered electronically if electronic delivery fails; similarly, you understand that you must provide the Company or any designated third party with a paper copy of any documents delivered electronically if electronic delivery fails. Also, you understand that your consent may be revoked or changed, including any change in the

electronic mail address to which documents are delivered (if you have provided an electronic mail address), at any time by notifying the Company of such revised or revoked consent by telephone, postal service or electronic mail at equity@adobe.com. Finally, you understand that you are not required to consent to electronic delivery.

15. DATA PRIVACY CONSENT . You hereby explicitly and unambiguously consent to the collection, use and transfer, in electronic or other form, of your personal data as described in this document by and among the members of the Participating Company Group for the exclusive purpose of implementing, administering and managing your participation in the Plan and Program.

You understand that the Company and the Participating Company Group hold certain personal information about you, including, but not limited to, your name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of Stock or directorships held in the Company, details of all Awards or any other entitlement to shares of Stock awarded, canceled, exercised, vested, unvested or outstanding in your favor, for the purpose of implementing, administering and managing the Plan and Program (“ Data ”). You understand that Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan or Program, that these recipients may be located in your country or elsewhere, and that the recipient’s country may have different data privacy laws and protections than your country. You understand that you may request a list with the names and addresses of any potential recipients of the Data by contacting your local human resources representative. You authorize the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing your participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom you may elect to deposit any shares of Stock pursuant to an Actual Award. You understand that Data will be held only as long as is necessary to implement, administer and manage your participation in the Plan. You understand that you may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing your local human resources representative. You understand, however, that refusing or withdrawing your consent may affect your ability to participate in the Plan or Program. For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.

16. APPLICATION OF SECTION 409A. Absent a proper deferral election, it is intended that all of the benefits and payments provided under this Award satisfy, to the greatest extent possible, the exemptions from the application of Code Section 409A provided under Treasury Regulations Section 1.409A 1(b)(4), and this Award will be construed to the greatest extent possible as consistent with those provisions. To the extent not so exempt, this Award and the payments and benefits to be provided hereunder are intended to, and will be construed and implemented so as to, comply in all respects with the applicable provisions of Code Section 409A, and any provisions calling for payments on a termination of employment or other service shall be read to mean a “separation from service” (as defined under Treasury Regulation Section 1.409-1(h) without reference to alternative definitions thereunder). For purposes of Code Section 409A (including, without limitation, for purposes of Treasury Regulation Section 1.409A 2(b)(2)(iii)), any right to receive any installment payments under this Award shall be treated as a right to receive a series of separate payments and, accordingly, each installment payment hereunder shall at all times be considered a separate and distinct payment. Notwithstanding any other provision of this Award, to the extent that (i) one or more of the payments or benefits received or to be received by you upon “separation from service” pursuant to this Plan would constitute deferred compensation subject to the requirements of Code Section 409A, and (ii) you are a “specified employee” within the meaning of Code Section 409A at the time of separation from service, then to the extent delayed commencement of any portion of such payments or benefits is required in order to avoid a prohibited distribution under Code Section 409A(a)(2)(B)(i) and the related adverse taxation under Section 409A, such payments and benefits shall not be provided to you prior to the earliest of (i) the expiration of the six-month period measured from the date of separation from service, (ii) the date of your death or (iii) such earlier date as permitted under Section 409A without the imposition of adverse taxation on you. Upon the first business day following the expiration of such applicable Code Section 409A(a)(2)(B)(i) period, all payments and benefits deferred pursuant to this paragraph shall be paid in a lump sum to you, and any remaining payments and benefits due shall be paid as otherwise provided herein.

17. HEADINGS. The headings of the Sections in this Award Agreement are inserted for convenience only and shall not be deemed to constitute a part of this Award Agreement or to affect the meaning of this Award Agreement.

18. AMENDMENT. The Committee may, without notice, amend, suspend or terminate the Program; provided, however, that no such action may adversely affect any then outstanding Award unless (i) expressly provided by the Committee and (ii) with the consent of you, unless such action is necessary to comply with any applicable law, regulation or rule.

19. MISCELLANEOUS .

(b) You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

20. GOVERNING PLAN DOCUMENT . Your Award is subject to all the provisions of the Plan and Program, the provisions of which are hereby made a part of your Award, and is further subject to all interpretations, amendments, rules and regulations which may from time to time be promulgated and adopted pursuant to the Plan or Program. In the event of any conflict between the provisions of your Award and those of the Plan or Program, the provisions of the Plan or Program shall control. In the event of any conflict between the provisions of the Plan or Program, the provisions of the Plan shall control.

21. APPLICABLE LAW. This Award Agreement shall be governed by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within the State of California.

EXHIBIT 99.6

ADOBE SYSTEMS INCORPORATED

AMENDED AND RESTATED 2003 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT GRANT NOTICE

(DIRECTOR — INITIAL GRANT)

Participant:	%%FIRST_NAME%-% %%LAST_NAME%-%
Date of Grant:	%%OPTION_DATE,’Month DD, YYYY’%-%
Vesting Commencement Date:	%%VEST_BASE_DATE,’Month DD, YYYY%-%
Number of Restricted Stock Units:	%%TOTAL_SHARES_GRANTED%-%
Payment for Stock:	Participant’s services to the Company (to the greatest extent permitted by applicable law)

Vesting Schedule : This Award shall vest as to fifty percent (50%) of the Restricted Stock Units on the first (1 st ) anniversary of the Vesting Commencement Date and the remaining fifty percent (50%) of the Restricted Stock Units shall vest on the second anniversary of the Vesting Commencement Date, so that the Restricted Stock Units are fully vested on the second anniversary of the Vesting Commencement Date; provided, however, that the Participant’s Service has not terminated prior to each such vesting date.

In the event of a Change of Control, any unvested portions of this Award shall become immediately vested in full as of immediately prior to the effective date of the Change of Control, subject to the consummation of the Change of Control.

Delivery Schedule : Except as otherwise provided in Section 5 of the Award Agreement, the Company shall deliver on each vesting date one share of Stock for each Restricted Stock Unit that vests on such date, less any shares to be withheld pursuant to Section 11 of the Award Agreement.

				ADOBE SYSTEMS INCORPORATED:


				By:

				Title:

Participant Signature:

Date:

ADOBE SYSTEMS INCORPORATED

AMENDED AND RESTATED 2003 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

(DIRECTOR)

Pursuant to the Grant Notice ( “Grant Notice” ) and this Award Agreement ( “Award Agreement” ), Adobe Systems Incorporated (the “Company” ) has awarded you, pursuant to its Amended and Restated 2003 Equity Incentive Plan (the “Plan” ), a Restricted Stock Unit Award for that number of Restricted Stock Units as indicated in the Grant Notice. Unless otherwise defined herein or the Grant Notice, capitalized terms shall have the meanings set forth in the Plan. Subject to adjustment and the terms and conditions as provided herein and in the Plan, each Restricted Stock Unit shall represent the right to receive one (1) share of Stock.

The details of your Award, in addition to those set forth in the Grant Notice, are as follows.

1. NUMBER OF STOCK UNITS AND SHARES OF STOCK.

3. VESTING .

(b) If your Service with the Company terminates because of your death or Disability, then you will be given credit for an additional twelve (12) months of continuous Service; provided,

however, that in no event shall such applicable vesting exceed 100% vesting of your Award. For purposes of this provision, (i) your Service shall be deemed to have terminated on account of death if your death occurs within three (3) months after your termination of Service, and (ii) “ Disability ” shall mean your permanent and total disability within the meaning of Section 22(e)(3) of the U.S. Internal Revenue Code of 1986, as amended (the “ Code ”), and any applicable regulations promulgated thereunder to the extent not inconsistent with the regulations under Section 409A of the Code.

7. RESTRICTIVE LEGENDS. The shares of Stock issued pursuant to this Award shall be endorsed with appropriate legends, if any, determined by the Company.

required to withhold as a result of your participation in the Plan that cannot be satisfied by the means previously described. You expressly acknowledge and agree that the Company may withhold from any compensation paid to you by the Company in partial or full satisfaction of the withholdings contemplated by this Section 11. The Company and the Participating Company Group shall have no obligation to deliver shares of Stock until you have satisfied the obligations in connection with the Tax-Related Items as described in this section.

12. NATURE OF AWARD. In accepting your Award, you acknowledge that:

(c) all decisions with respect to future Awards under the Plan, if any, will be at the sole discretion of the Committee;

(e) you are voluntarily participating in the Plan;

(h) the future value of the shares of Stock subject to your Award is unknown and cannot be predicted with certainty; and

(i) no claim or entitlement to compensation or damages arises from termination of your Award or diminution in value of your Award or shares of Stock issued pursuant to your Award resulting from termination of your Service with the Company or the Participating Company Group (for any reason whether or not in breach of applicable labor laws), and you irrevocably release the Company and the Participating Company Group from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by executing the Grant Notice, you shall be deemed irrevocably to have waived your entitlement to pursue such a claim.

13. DELIVERY OF DOCUMENTS AND NOTICES. Any document relating to participating in the Plan or Program and/or notice required or permitted hereunder shall be given in writing and shall be

deemed effectively given (except to the extent that this Award Agreement provides for effectiveness only upon actual receipt of such notice) upon personal delivery, electronic delivery, or upon deposit in the U.S. Post Office or foreign postal service, by registered or certified mail, with postage and fees prepaid, addressed to the other party at the e-mail address, if any, provided for you by the Company or a Participating Company or at such other address as such party may designate in writing from time to time to the other party.

local human resources representative. You understand, however, that refusing or withdrawing your consent may affect your ability to participate in the Plan. For more information on the consequences of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.

16. MISCELLANEOUS .

(b) You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

to the extent that (i) one or more of the payments or benefits received or to be received by you upon “separation from service” pursuant to this Plan would constitute deferred compensation subject to the requirements of Code Section 409A, and (ii) you are a “specified employee” within the meaning of Code Section 409A at the time of separation from service, then to the extent delayed commencement of any portion of such payments or benefits is required in order to avoid a prohibited distribution under Code Section 409A(a)(2)(B)(i) and the related adverse taxation under Section 409A, such payments and benefits shall not be provided to you prior to the earliest of (i) the expiration of the six-month period measured from the date of separation from service, (ii) the date of your death or (iii) such earlier date as permitted under Section 409A without the imposition of adverse taxation on you. Upon the first business day following the expiration of such applicable Code Section 409A(a)(2)(B)(i) period, all payments and benefits deferred pursuant to this paragraph shall be paid in a lump sum to you, and any remaining payments and benefits due shall be paid as otherwise provided herein.

EXHIBIT 99.7

ADOBE SYSTEMS INCORPORATED

AMENDED AND RESTATED 2003 EQUITY INCENTIVE PLAN
RESTRICTED STOCK UNIT GRANT NOTICE

(DIRECTOR — ANNUAL GRANT)

Participant:		%%FIRST_NAME%-% %%LAST_NAME%-%
Date of Grant:		%%OPTION_DATE,’Month DD, YYYY’%-%
Number of Restricted Stock Units:		%%TOTAL_SHARES_GRANTED%-%
Payment for Stock:		Participant’s services to the Company (to the greatest extent permitted by applicable law)

Vesting Schedule : This Award shall vest as to one hundred percent (100%) of the Restricted Stock Units on the day immediately preceding the day of the first annual meeting of the stockholders of the Company following the Date of Grant ; provided, however, that the Participant’s Service has not terminated prior to such vesting date.

Delivery Schedule : Except as otherwise provided in Section 5 of the Award Agreement, the Company shall deliver on the vesting date one share of Stock for each Restricted Stock Unit that vests on such date, less any shares to be withheld pursuant to Section 11 of the Award Agreement.

			ADOBE SYSTEMS INCORPORATED:

			By:


			Title:


Participant Signature:

Date:

ADOBE SYSTEMS INCORPORATED

AMENDED AND RESTATED 2003 EQUITY INCENTIVE PLAN

RESTRICTED STOCK UNIT AWARD AGREEMENT

(DIRECTOR — ANNUAL GRANT)

Pursuant to the Grant Notice ( “Grant Notice” ) and this Award Agreement ( “Award Agreement” ), Adobe Systems Incorporated (the “Company” ) has awarded you, pursuant to its Amended and Restated 2003 Equity Incentive Plan (the “Plan” ), a Restricted Stock Unit Award for that number of Restricted Stock Units as indicated in the Grant Notice. Unless otherwise defined herein or the Grant Notice, capitalized terms shall have the meanings set forth in the Plan. Subject to adjustment and the terms and conditions as provided herein and in the Plan, each Restricted Stock Unit shall represent the right to receive one (1) share of Stock.

The details of your Award, in addition to those set forth in the Grant Notice, are as follows.

1. NUMBER OF STOCK UNITS AND SHARES OF STOCK.

3. VESTING .

(b) If your Service with the Company terminates because of your death or Disability, then you will be given credit for an additional twelve (12) months of continuous Service; provided,

7. RESTRICTIVE LEGENDS. The shares of Stock issued pursuant to this Award shall be endorsed with appropriate legends, if any, determined by the Company.

12. NATURE OF AWARD. In accepting your Award, you acknowledge that:

(c) all decisions with respect to future Awards under the Plan, if any, will be at the sole discretion of the Committee;

(e) you are voluntarily participating in the Plan;

(h) the future value of the shares of Stock subject to your Award is unknown and cannot be predicted with certainty; and

(i) no claim or entitlement to compensation or damages arises from termination of your Award or diminution in value of your Award or shares of Stock issued pursuant to your Award resulting from termination of your Service with the Company or the Participating Company Group (for any reason whether or not in breach of applicable labor laws), and you irrevocably release the Company and the Participating Company Group from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by executing the Grant Notice, you shall be deemed irrevocably to have waived your entitlement to pursue such a claim.

13. DELIVERY OF DOCUMENTS AND NOTICES. Any document relating to participating in the Plan or Program and/or notice required or permitted hereunder shall be given in writing and shall be

16. MISCELLANEOUS .

(b) You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

EXHIBIT 99.8

ADOBE SYSTEMS INCORPORATED

NONSTATUTORY STOCK OPTION AGREEMENT

(DIRECTOR — ANNUAL GRANT)

THIS NONSTATUTORY STOCK OPTION AGREEMENT (the “ Option Agreement ” ) is made and entered into as of the Date of Option Grant by and between Adobe Systems Incorporated and

1. DEFINITIONS AND CONSTRUCTION .

1.1 Definitions . Whenever used herein, the following terms shall have their respective meanings set forth below:

(a) “ Date of Option Grant ” means %%OPTION_DATE,’Month DD, YYYY’%-%

(b) “ Number of Option Shares ” means %%TOTAL_SHARES_GRANTED%-% shares of Stock, as adjusted from time to time pursuant to Section 10.

(c) “ Exercise Price ” means $%%OPTION_PRICE%-% per share of Stock, as adjusted from time to time pursuant to Section 10.

(d) “ Vesting Date ” means the day immediately preceding the day of the first annual meeting of the stockholders of the Company following the Date of Option Grant.

(e) “ Vested Shares ” means, on any relevant date, that portion (disregarding any fractional share) of the Number of Option Shares determined by multiplying the Number of Option Shares by the “ Vested Percentage ” determined as of such date as follows:

		Vested Percentage

Prior to Vesting Date		0

On Vesting Date, provided the Participant’s Service has not terminated prior to such date		100%

(g) “ Board ” means the Board of Directors of the Company.

(h) “ Code ” means the U.S. Internal Revenue Code of 1986, as amended, and any applicable regulations promulgated thereunder.

(i) “ Committee ” means the Executive Compensation Committee or other committee of the Board duly appointed to administer the Plan in respect of Directors and having such powers as

shall be specified by the Board. If no committee of the Board has been appointed to administer the Plan, the Board shall exercise all of the powers of the Committee granted herein, and, in any event, the Board may in its discretion exercise any or all of such powers.

(j) “ Company ” means Adobe Systems Incorporated, a Delaware corporation, or any successor corporation thereto.

(k) “ Disability ” means the permanent and total disability of the Participant within the meaning of Section 22(e)(3) of the Code.

(l) “ Exchange Act ” means the U.S. Securities Exchange Act of 1934, as amended.

(m) “ Fair Market Value ” means, as of any date, the value of a share of Stock or other property as determined by the Committee, in its discretion, or by the Company, in its discretion, if such determination is expressly allocated to the Company herein, subject to the following:

(n) “Officer” means any person designated by the Board as an officer of the Company.

(o) “ Option Expiration Date ” means the date seven (7) years after the Date of Option Grant.

(p) “ Parent Corporation ” means any present or future “parent corporation” of the Company, as defined in Section 424(e) of the Code.

(q) “ Participating Company ” means the Company or any Parent Corporation, Subsidiary Corporation or Affiliate.

(r) “ Participating Company Group ” means, at any point in time, all corporations collectively which are then Participating Companies.

(s) “ Securities Act ” means the U.S. Securities Act of 1933, as amended.

(t) “ Service ” means the Participant’s service with the Participating Company Group as a Director. The Participant’s Service shall be deemed to have terminated if the Participant ceases to render Service to the Participating Company Group in such capacity. However, the Participant’s Service shall not be deemed to have terminated merely because of a change in the Participating Company for which the Participant renders Service in such initial capacity, provided that there is no interruption or termination of the Participant’s Service. Furthermore, the Participant’s Service with the Participating Company Group shall not be deemed to have terminated if the Participant takes any bona fide leave of absence approved by the Company of ninety (90) days or less. In the event of a leave in excess of ninety (90) days, the Participant’s Service shall be deemed to terminate on

the ninety-first (91st) day of the leave unless the Participant’s right to return to Service with the Participating Company Group is guaranteed by statute or contract. Notwithstanding the foregoing, unless otherwise designated by the Company or required by law, a leave of absence shall not be treated as Service for purposes of determining vesting under the Participant’s Option Agreement. The Participant’s Service shall be deemed to have terminated either upon an actual termination of Service or upon the corporation for which the Participant performs Service ceasing to be a Participating Company. Subject to the foregoing, the Company, in its discretion, shall determine whether the Participant’s Service has terminated and the effective date of such termination.

(u) “ Stock ” means the common stock of the Company, as adjusted from time to time in accordance with Section 10.

(v) “ Subsidiary Corporation ” means any present or future “subsidiary corporation” of the Company, as defined in Section 424(f) of the Code.

2. TAX STATUS OF OPTION . This Option is intended to be a nonstatutory stock option and shall not be treated as an incentive stock option within the meaning of Section 422(b) of the Code.

3. ADMINISTRATION .

4. EXERCISE OF THE OPTION .

4.1 Right to Exercise . Except as otherwise provided herein, the Option shall be exercisable on and after the Vesting Date and prior to the termination of the Option (as provided in Section 7) in an amount not to exceed the number of Vested Shares less the number of shares previously acquired upon exercise of the Option. In no event shall the Option be exercisable for more shares than the Number of Option Shares.

4.3 Payment of Exercise Price.

4.6 Restrictions on Grant of the Option and Issuance of Shares . The grant of the Option and the issuance of shares of Stock upon exercise of the Option shall be subject to compliance with all applicable requirements of federal, state or foreign law with respect to such securities. The Option may not be exercised if the issuance of shares of Stock upon exercise would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, the Option may not be exercised unless (i) a registration statement under the Securities Act shall at the time of exercise of the Option be in effect with respect to the shares issuable upon exercise of the Option or (ii) in the opinion of legal counsel to the Company, the shares issuable upon exercise of the Option may be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. THE PARTICIPANT IS CAUTIONED THAT THE OPTION MAY NOT BE EXERCISED UNLESS THE FOREGOING CONDITIONS ARE SATISFIED. ACCORDINGLY, THE PARTICIPANT MAY NOT BE ABLE TO EXERCISE THE OPTION WHEN DESIRED EVEN THOUGH THE OPTION IS VESTED. The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance and sale of any shares subject to the Option 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. As a condition to the exercise of the Option, the Company may require the Participant to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company.

4.7 Fractional Shares . The Company shall not be required to issue fractional shares upon the exercise of the Option.

5. NONTRANSFERABILITY OF THE OPTION .

6. NATURE OF OPTION .

In accepting the Option, the Participant acknowledges that:

6.3 all decisions with respect to future Option grants, if any, will be at the sole discretion of the Company;

6.4 the Participant’s participation in the Plan shall not create a right to employment or further service with the Participating Company Group and shall not interfere with any ability of the Participating Company Group to terminate the Participant’s relationship with the Company at any time with or without cause;

6.5 the Participant is voluntarily participating in the Plan;

6.7 in the event that the Participant is not an employee of the Company, the Option grant will not be interpreted to form an employment contract or relationship with the Company; and furthermore, the Option grant will not be interpreted to form an employment contract with the other members of the Participating Company Group;

6.8 the future value of the underlying shares is unknown and cannot be predicted with certainty;

6.9 if the underlying shares do not increase in value, the Option will have no value;

6.10 if the Participant exercises the Option and obtains shares, the value of those shares acquired upon exercise may increase or decrease in value, even below the Option price; and

6.11 in consideration of the grant of the Option, no claim or entitlement to compensation or damages arises from termination of the Option or diminution in value of the Option or shares purchased through exercise of the Option resulting from termination of the Participant’s Service with the Participating Company Group (for any reason whether or not in breach of applicable labor laws) and the Participant irrevocably releases the Participating Company Group from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by signing this Option Agreement, Participant shall be deemed irrevocably to have waived his or her entitlement to pursue such a claim.

7. TERMINATION OF THE OPTION .

8. EFFECT OF TERMINATION OF SERVICE .

8.1 Option Exercisability .

(a) Disability. If the Participant’s Service terminates because of the Disability of the Participant, then the Option, to the extent unexercised and exercisable on the date on which the Participant’s Service terminated, may be exercised by the Participant (or the Participant’s guardian or legal representative) at any time prior to the expiration of twelve (12) months after the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date.

(b) Death. If the Participant’s Service terminates because of the death of the Participant, then the Option, to the extent unexercised and exercisable on the date on which the Participant’s Service terminated, may be exercised by the Participant’s legal representative or other person who acquired the right to exercise the Option by reason of the Participant’s death at any time prior to the expiration of twelve (12) months after the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date. The Participant’s Service shall be deemed to have terminated on account of death if the Participant dies within three (3) months after the Participant’s termination of Service.

(c) Other Termination of Service. If the Participant’s Service terminates for any reason, except Disability, or death, the Option, to the extent unexercised and exercisable by the Participant on the date on which the Participant’s Service terminated, may be exercised by the Participant at any time prior to the expiration of three (3) months (or such other longer period of time as determined by the Committee, in its discretion) after the date on which the Participant’s Service terminated, but in any event no later than the Option Expiration Date.

8.2 Extension if Participant Meets Service Requirements. Notwithstanding the foregoing, if the Participant has completed at least four (4) years of continuous Service prior to Participant’s date of termination

of Service, the Option shall remain exercisable until one (1) year from the date of termination of Service, but in any event no later than the Option Expiration Date.

8.3 Extension if Exercise Prevented by Law . Notwithstanding the foregoing, if the exercise of the Option within the applicable time periods set forth in Section 8.1 is prevented by the provisions of Section 4.6, the Option shall remain exercisable until three (3) months after the date the Participant is notified by the Company that the Option is exercisable, but in any event no later than the Option Expiration Date.

8.4 Extension if Participant Subject to Section 16(b ). Notwithstanding the foregoing, if a sale within the applicable time periods set forth in Section 8.1 of shares acquired upon the exercise of the Option would subject the Participant to suit under Section 16(b) of the Exchange Act, the Option shall remain exercisable until the earliest to occur of (i) the tenth (10th) day following the date on which a sale of such shares by the Participant would no longer be subject to such suit, (ii) the one hundred and ninetieth (190th) day after the Participant’s termination of Service, or (iii) the Option Expiration Date.

9. CHANGE OF CONTROL .

In the event of a Change of Control, any unexercised and/or unvested portions of this Option shall become immediately exercisable and vested in full as of immediately prior to the effective date of the Change of Control, subject to the consummation of the Change in Control.

10. ADJUSTMENTS FOR CHANGES IN CAPITAL STRUCTURE .

In the event of any change in the Stock through merger, consolidation, reorganization, reincorporation, recapitalization, reclassification, stock dividend, stock split, reverse stock split, split-up, split-off, spin-off, combination of shares, exchange of shares or similar change in the capital structure of the Company, or in the event of payment of a dividend or distribution to the stockholders of the Company in a form other than Stock (excepting normal cash dividends) that has a material effect on the Fair Market Value of shares of Stock, appropriate adjustments shall be made in the number, Exercise Price and class of shares subject to the Option. If a majority of the shares which are of the same class as the shares that are subject to the Option are exchanged for, converted into, or otherwise become (whether or not pursuant to an Ownership Change Event) shares of another corporation (the “ New Shares ” ), the Committee may unilaterally amend the Option to provide that the Option is exercisable for New Shares. In the event of any such amendment, the Number of Option Shares and the Exercise Price shall be adjusted in a fair and equitable manner, as determined by the Committee, in its discretion. Notwithstanding the foregoing, any fractional share resulting from an adjustment pursuant to this Section 10 shall be rounded down to the nearest whole number, and in no event may the Exercise Price be decreased to an amount less than the par value, if any, of the stock subject to the Option. The adjustments determined by the Committee pursuant to this Section 10 shall be final, binding and conclusive.

11. RIGHTS AS A STOCKHOLDER; RIGHTS TO CONTINUE SERVICE .

12. MISCELLANEOUS PROVISIONS .

12.1 Designation of Beneficiary. Subject to local laws and procedures, the Participant may file with the Company a written designation of a beneficiary who, in the event of the death of the Participant, shall thereafter be entitled to exercise the Option to the extent that it remains exercisable in accordance with this Option Agreement. Each designation will revoke all prior designations by the Participant, shall be in a form prescribed by the Company, and shall be effective only when filed by the Participant in writing with the Company during the

Participant’s lifetime. If the Participant is married and designates a beneficiary other than the Participant’s spouse, the effectiveness of such designation may be subject to the consent of the Participant’s spouse. If the Participant dies without an effective designation of a beneficiary who is living at the time of the Participant’s death, the Option may be exercised by the Participant’s legal representative to the extent that it remains exercisable in accordance with this Option Agreement. If the designated beneficiary survives the Participant but dies before exercising the Option to the full extent that it remains exercisable in accordance with this Option Agreement, then the Option shall be exercisable by the legal representative of such deceased designated beneficiary to the extent that it remains exercisable in accordance with this Option Agreement. The determination of the Company as to which person, if any, qualifies as a designated beneficiary shall be final, conclusive and binding on all persons.

12.2 Binding Effect. This Option Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, executors, administrators, successors and assigns.

12.3 Termination or Amendment. The Committee may terminate or amend the Plan or the Option at any time; provided, however, that except as provided in connection with a Change of Control, no such termination or amendment may adversely affect the Option or any unexercised portion hereof without the consent of the Participant unless such termination or amendment is necessary to comply with any applicable law or government regulation. No amendment or addition to this Option Agreement shall be effective unless in writing.

12.4 Delivery of Documents and Notices. Any document relating to participating in the Plan and/or notice required or permitted hereunder shall be given in writing and shall be deemed effectively given (except to the extent that this Option Agreement provides for effectiveness only upon actual receipt of such notice) upon personal delivery, electronic delivery, or upon deposit in the U.S. Post Office or foreign postal service, by registered or certified mail, with postage and fees prepaid, addressed to the other party at the e-mail address, if any, provided for the Participant by a Participating Company or at the address shown below that party’s signature to this Option Agreement or at such other address as such party may designate in writing from time to time to the other party.

(b) Consent to Electronic Delivery. The Participant acknowledges that the Participant has read Section 12.4 of this Option Agreement and consents to the electronic delivery of the Plan documents and the delivery of the Notice of Exercise, as described in Section 12.4(a) of this Option Agreement. The Participant acknowledges that he or she may receive from the Company a paper copy of any documents delivered electronically at no cost if the Participant contacts the Company by telephone, through a postal service or electronic mail at equity@adobe.com. The Participant further acknowledges that the Participant will be provided with a paper copy of any documents delivered electronically if electronic delivery fails; similarly, the Participant understands that the Participant must provide the Company or any designated third party with a paper copy of any documents delivered electronically if electronic delivery fails. Also, the Participant understands that the Participant’s consent may be revoked or changed, including any change in the electronic mail address to which documents are delivered (if Participant has provided an electronic mail address), at any time by notifying the Company of such revised or revoked consent by telephone, postal service or electronic mail at equity@adobe.com. Finally, the Participant understands that he or she is not required to consent to electronic delivery.

12.5 Data Privacy Consent . The Participant hereby explicitly and unambiguously consents to the collection, use and transfer, in electronic or other form, of the Participant’s personal data as described in this document by and among the members of the Participating Company Group for the exclusive purpose of implementing, administering and managing the Participant’s participation in the Plan.

The Participant understands that the Company and the Participating Company Group hold certain personal information about the Participant, including, but not limited to, the Participant’s name, home address and telephone number, date of birth, social insurance number or other identification number, salary, nationality, job title, any shares of Stock or directorships held in the Company, details of all Options or any other entitlement to shares of Stock awarded, canceled, exercised, vested, unvested or outstanding in the Participant’s favor, for the purpose of implementing, administering and managing the Plan (“Data”). The Participant understands that Data may be transferred to any third parties assisting in the implementation, administration and management of the Plan, that these recipients may be located in the Participant’s country or elsewhere, and that the recipient’s country may have different data privacy laws and protections than the Participant’s country. The Participant understands that he or she may request a list with the names and addresses of any potential recipients of the Data by contacting the Participant’s local human resources representative. The Participant authorizes the recipients to receive, possess, use, retain and transfer the Data, in electronic or other form, for the purposes of implementing, administering and managing the Participant’s participation in the Plan, including any requisite transfer of such Data as may be required to a broker or other third party with whom the Participant may elect to deposit any shares of Stock acquired upon exercise of the Option. The Participant understands that Data will be held only as long as is necessary to implement, administer and manage the Participant’s participation in the Plan. The Participant understands that he or she may, at any time, view Data, request additional information about the storage and processing of Data, require any necessary amendments to Data or refuse or withdraw the consents herein, in any case without cost, by contacting in writing the Participant’s local human resources representative. The Participant understands, however, that refusing or withdrawing the Participant’s consent may affect the Participant’s ability to participate in the Plan. For more information on the consequences of the Participant’s refusal to consent or withdrawal of consent, the Participant understands that he or she may contact the Participant’s local human resources representative.

12.6 Integrated Agreement. This Option Agreement and the Plan constitute the entire understanding and agreement of the Participant and the Participating Company Group with respect to the subject matter contained herein and supersedes any prior agreements, understandings, restrictions, representations, or warranties among the Participant and the Participating Company Group with respect to such subject matter other than those as set forth or provided for herein. To the extent contemplated herein, the provisions of this Option Agreement shall survive any exercise of the Option and shall remain in full force and effect. Any capitalized terms not defined herein shall have the meaning set forth in the Plan.

12.7 Applicable Law. This Option Agreement shall be governed by the laws of the State of California as such laws are applied to agreements between California residents entered into and to be performed entirely within the State of California. For purposes of litigating any dispute that arises directly or indirectly from the relationship of the parties as evidenced by this Option Agreement, the parties herby submit to and consent to the jurisdiction of the State of California and agree that such litigation shall be conducted only in the courts of Santa Clara County, California, or the federal courts of the United States for the Northern District of California, and no other courts, where this Option Agreement is made and/or performed.

	ADOBE SYSTEMS INCORPORATED

	By:

	Title:

	Address:

The Participant represents that he or she is familiar with the terms and provisions of this Option Agreement and hereby accepts the Option subject to all of the terms and provisions thereof. The Participant hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board upon any questions arising under this Option Agreement.

Participant Signature:

Date:

EXHIBIT 99.9

ADOBE SYSTEMS INCORPORATED

2005 EQUITY INCENTIVE ASSUMPTION PLAN

RESTRICTED STOCK UNIT GRANT NOTICE

Adobe Systems Incorporated (the “Company” ), pursuant to its 2005 Equity Incentive Assumption Plan (the “Plan” ), hereby awards to Participant the Restricted Stock Unit Award (the “ Award ”) covering the number of Restricted Stock Units set forth below. This Award is subject to all of the terms and conditions as set forth herein and in the Restricted Stock Unit Award Agreement (the “ Award Agreement ”) and the Plan, each of which are attached hereto and incorporated herein in their entirety. Unless otherwise defined herein, capitalized terms shall have the meanings set forth in the Plan or the Program, as applicable.

Participant:		%%FIRST_NAME%-% %%LAST_NAME%-%
Date of Grant:		%%OPTION_DATE,’Month DD, YYYY’%-%
Vesting Commencement Date:		%%VEST_BASE_DATE,’Month DD, YYYY%-%
Number of Restricted Stock Units:		%%TOTAL_SHARES_GRANTED%-%
Payment for Stock:		Participant’s services to the Company (to the greatest extent permitted by applicable law)

Additional Terms/Acknowledgements: The Participant acknowledges receipt of, and understands and agrees to, this Grant Notice, the Award Agreement, and the Plan. Participant further acknowledges that as of the Date of Grant, this Grant Notice, the Award Agreement, and the Plan set forth the entire understanding between Participant and the Company regarding the Award and supersede all prior oral and written agreements on that subject with the exception of the Adobe Systems Incorporated Executive Severance Plan in the Event of a Change of Control and/or an individual written retention agreement or severance provision in effect on the Date of Grant between the Company, or a subsidiary of the Company, and the Participant.

ADOBE SYSTEMS INCORPORATED:

By:


Title:

ADOBE SYSTEMS INCORPORATED

2005 EQUITY INCENTIVE ASSUMPTION PLAN RESTRICTED STOCK UNIT AWARD AGREEMENT

Pursuant to the Grant Notice ( “Grant Notice” ) and this Award Agreement ( “Award Agreement” ), Adobe Systems Incorporated (the “Company” ) has awarded you, pursuant to its 2005 Equity Incentive Assumption Plan (the “Plan” ), a Restricted Stock Unit Award for that number of Restricted Stock Units as indicated in the Grant Notice. Unless otherwise defined herein or the Grant Notice, capitalized terms shall have the meanings set forth in the Plan. Subject to adjustment and the terms and conditions as provided herein and in the Plan, each Restricted Stock Unit shall represent the right to receive one (1) share of Stock.

The details of your Award, in addition to those set forth in the Grant Notice, are as follows.

1. NUMBER OF STOCK UNITS AND SHARES OF STOCK.

3. VESTING .

permanent and total disability within the meaning of Section 22(e)(3) of the U.S. Internal Revenue Code of 1986, as amended (the “ Code ”), and any applicable regulations promulgated thereunder to the extent not inconsistent with the regulations under Section 409A of the Code.

7. RESTRICTIVE LEGENDS. The shares of Stock issued pursuant to this Award shall be endorsed with appropriate legends, if any, determined by the Company.

12. NATURE OF AWARD. In accepting your Award, you acknowledge that:

(c) all decisions with respect to future Awards under the Plan, if any, will be at the sole discretion of the Committee;

(e) you are voluntarily participating in the Plan;

(h) the future value of the shares of Stock subject to your Award is unknown and cannot be predicted with certainty; and

(i) no claim or entitlement to compensation or damages arises from termination of your Award or diminution in value of your Award or shares of Stock issued pursuant to your Award resulting from termination of your Service with the Company or the Participating Company Group (for any reason whether or not in breach of applicable labor laws), and you irrevocably release the Company and the Participating Company Group from any such claim that may arise. If, notwithstanding the foregoing, any such claim is found by a court of competent jurisdiction to have arisen then, by executing the Grant Notice, you shall be deemed irrevocably to have waived your entitlement to pursue such a claim.

of your refusal to consent or withdrawal of consent, you understand that you may contact your local human resources representative.

16. MISCELLANEOUS .

(b) You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your Award.

EXHIBIT 99.10

ADOBE SYSTEMS INCORPORATED

NONSTATUTORY STOCK OPTION AGREEMENT

THIS NONSTATUTORY STOCK OPTION AGREEMENT (the “ Option Agreement ” ) is made and entered into as of the Date of Option Grant by and between Adobe Systems Incorporated and

%%FIRST_NAME%-% %%LAST_NAME%-% (the “ Participant ” ). The Company has granted to the Participant pursuant to the Adobe Systems Incorporated 2005 Equity Incentive Assumption Plan (the “ Plan ” ) an option to purchase certain shares of Stock (the “ Option ”), upon the terms and conditions set forth in this Option Agreement, but subject in any event to the Superseding Agreement, if any, described below.

1. DEFINITIONS AND CONSTRUCTION .

1.1 Definitions . Whenever used herein, the following terms shall have their respective meanings set forth below:

(a) “ Date of Option Grant ” means %%OPTION_DATE,’Month DD, YYYY’%-%

(b) “ Number of Option Shares ” means %%TOTAL_SHARES_GRANTED%-% shares of Stock, as adjusted from time to time pursuant to Section 9.

(c) “ Exercise Price ” means $%%OPTION_PRICE%-% per share of Stock, as adjusted from time to time pursuant to Section 9.

(d) “ Initial Vesting Date ” means the date occurring [ ] after the Date of Option Grant.

		Vested Amount

Prior to Initial Vesting Date		0

On Initial Vesting Date, provided the Participant’s Service has not terminated prior to such date		[ ] [ ]

Plus :

For each of the next [ ] full months of the Participant’s continuous Service from the Initial Vesting Date until the Vested Amount equals 100%		[ ]