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)

October 2, 2015

 

 

ALPHABET INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware   001-36380   61-1767919

(State or other jurisdiction

of incorporation)

 

(Commission

File Number)

 

(IRS Employer

Identification No.)

1600 Amphitheatre Parkway

Mountain View, CA 94043

(Address of principal executive offices, including zip code)

(650) 253-0000

(Registrant’s telephone number, including area code)

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):

 

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

 

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

 

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

 

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

 

 

 


Explanatory Note

On August 10, 2015, Google Inc. (“ Google ”) announced plans to create a new public holding company, Alphabet Inc. (“ Alphabet ”), by implementing a holding company reorganization (the “ Alphabet Merger ”). Following the Alphabet Merger, Alphabet, a Delaware corporation, became the successor issuer to Google, a Delaware corporation. This Current Report on Form 8-K (the “ Form 8-K ”) is being filed for the purpose of establishing Alphabet as the successor issuer pursuant to Rule 12g-3(a) under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”) and to disclose certain related matters. Pursuant to Rule 12g-3(a) under the Exchange Act, shares of Alphabet Class A Common Stock, par value $0.001 per share (“ Alphabet Class A shares ”) and shares of Alphabet Class C Capital Stock, par value $0.001 per share (“ Alphabet Class C shares ” and, together with the Alphabet Class A shares, the “ Alphabet shares ”), as successor issuer, are deemed registered under Section 12(b) of the Exchange Act.

 

Item 1.01. Entry into a Material Definitive Agreement.

Adoption of Agreement and Plan of Merger and Consummation of Holding Company Reorganization

On October 2, 2015, Google implemented a holding company reorganization pursuant to the Agreement and Plan of Merger (the “ Merger Agreement ”), dated as of October 2, 2015, among Google, Alphabet and Maple Technologies Inc., a Delaware corporation (“ Merger Sub ”), which resulted in Alphabet owning all of the outstanding capital stock of Google. Pursuant to the Alphabet Merger, Merger Sub, a direct, wholly owned subsidiary of Alphabet and an indirect, wholly owned subsidiary of Google, merged with and into Google, with Google surviving as a direct, wholly owned subsidiary of Alphabet. Each share of each class of Google stock issued and outstanding immediately prior to the Alphabet Merger automatically converted into an equivalent corresponding share of Alphabet stock, having the same designations, rights, powers and preferences and the qualifications, limitations and restrictions as the corresponding share of Google stock being converted. Accordingly, upon consummation of the Alphabet Merger, Google’s stockholders immediately prior to the consummation of the Alphabet Merger became stockholders of Alphabet. The stockholders of Google will not recognize gain or loss for U.S. federal income tax purposes upon the conversion of their shares in the Alphabet Merger.

The Alphabet Merger was conducted pursuant to Section 251(g) of the General Corporation Law of the State of Delaware (the “ DGCL ”), which provides for the formation of a holding company without a vote of the stockholders of the constituent corporation. The conversion of stock occurred automatically without an exchange of stock certificates. After the Alphabet Merger, unless exchanged, stock certificates that previously represented shares of a class of Google stock now represent the same number of shares of the corresponding class of Alphabet stock. Following the consummation of the Alphabet Merger, Alphabet Class C shares and Alphabet Class A shares continue to trade on the NASDAQ Global Select Market on an uninterrupted basis under the symbol “GOOG” and “GOOGL” respectively with new CUSIP numbers (#02079K 107 for Alphabet Class C shares and #02079K 305 for Alphabet Class A shares). Immediately after consummation of the Alphabet Merger, Alphabet has, on a consolidated basis, the same assets, businesses and operations as Google had immediately prior to the consummation of the Alphabet Merger.

As a result of the Alphabet Merger, Alphabet became the successor issuer to Google pursuant to 12g-3(a) of the Exchange Act and as a result the Alphabet Class A shares and the Alphabet Class C shares are deemed registered under Section 12(b) of the Exchange Act.


The foregoing descriptions of the Alphabet Merger and Merger Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Merger Agreement, which is filed as Exhibit 2.1 and which is incorporated by reference herein.

 

Item 3.03. Material Modification of Rights of Securityholders.

Upon consummation of the Alphabet Merger, each share of each class of Google stock issued and outstanding immediately prior to the Alphabet Merger automatically converted into an equivalent corresponding share of Alphabet stock, having the same designations, rights, powers and preferences and the qualifications, limitations and restrictions as the corresponding share of Google stock that was converted.

The information set forth in Item 1.01 and Item 5.03 is hereby incorporated by reference in this Item 3.03.

The Transfer Restriction Agreements and Class C Undertaking

On October 2, 2015, Alphabet entered into a transfer restriction agreement with each of Larry Page, Alphabet’s Chief Executive Officer; Sergey Brin, Alphabet’s President; and Eric E. Schmidt, Alphabet’s Executive Chairman of the Board of Directors; and certain of their respective affiliates (collectively, the “ Transfer Restriction Agreements ”). Under the Transfer Restriction Agreements, the parties are bound, without any modification, by the same restrictions, undertakings and obligations that are imposed under the transfer restriction agreements, related joinders and other documentation entered into with Google on March 25, 2014 in connection with Google’s settlement of the litigation relating to its Class C Capital Stock (the “ Google Transfer Restriction Agreements ”). The Google Transfer Restriction Agreements were entered into in connection with Google’s adjustment of its capital structure by establishing a new class of capital stock, Google Class C capital stock, and its impending dividend of one share of Google Class C capital stock for each share of Google Class A common stock and Google Class B common stock outstanding on March 27, 2014. They are intended to limit the ability of Larry, Sergey, and Eric to sell their stock in a manner that does not reduce their voting power.

Pursuant to the Transfer Restriction Agreements, none of Larry, Sergey, Eric, or certain of their respective affiliates that are party to the agreements (generally, trusts and other estate planning vehicles through which Larry, Sergey, and Eric hold all or a portion of their Alphabet Class A shares, shares of Alphabet Class B common stock (“ Alphabet Class B shares ”) and Alphabet Class C shares) may sell, assign, transfer, convey or hypothecate any Alphabet Class C shares if, as a result of such sale, transfer, conveyance or hypothecation, they, together with certain of their respective affiliates, would own more Alphabet Class B shares than Alphabet Class C shares. If at any time either Larry, Sergey, or Eric, in each case together with certain of his respective affiliates, owns more Alphabet Class B shares than Alphabet Class C shares, then Larry, Sergey, or Eric, as the case may be, and his respective affiliates, will be deemed to have automatically converted that number of Alphabet Class B shares into Alphabet Class A shares, such that after such conversion he and his affiliates own an equal number of Alphabet Class B shares as he and his affiliates own of Alphabet Class C shares. The required maximum ratio of Alphabet Class B shares to Alphabet Class C shares owned by Larry, Sergey and Eric is subject to adjustment in connection with certain dividends, stock splits, distributions or recapitalizations.

Larry, Sergey, Eric, and certain of their respective affiliates that are party to the Transfer Restriction Agreements may transfer Alphabet Class B shares to their affiliates as permitted by the terms of the Amended and Restated Certificate of Incorporation of Alphabet (the “ Alphabet Certificate of Incorporation ”) only if, immediately following such transfer, Larry, Sergey, or Eric, as the case may be, and his respective affiliates,


would own an aggregate number of Alphabet Class B shares equal to or less than the number of Alphabet Class C shares that he and his affiliates own. Additionally, Larry, Sergey, Eric, and certain of their respective affiliates that are party to the Transfer Restriction Agreements may transfer Alphabet Class C shares to their affiliates only if, immediately following such transfer, Larry, Sergey, or Eric, as the case may be, and his respective affiliates, would own an aggregate number of Alphabet Class B shares equal to or less than the number of Alphabet Class C shares that he and his affiliates own. However, each of Larry and his affiliates that are party to his Transfer Restriction Agreement and Sergey and his affiliates that are party to his Transfer Restriction Agreement may not transfer Alphabet Class B shares to another person in a transfer that does not result in the automatic conversion of such Alphabet Class B shares into Alphabet Class A shares pursuant to the terms of the Alphabet Certificate of Incorporation unless Larry or Sergey, as the case may be, and his respective affiliates, transfer, in the same manner and to the same extent, an equal number of Alphabet Class C shares to the transferee.

In the event of (i) any merger, consolidation, or other business combination requiring the approval of the holders of Alphabet’s capital stock (whether or not Alphabet is the surviving entity), or the acquisition of all or substantially all of Alphabet’s assets; (ii) any tender or exchange offer by any third party to acquire a majority of Alphabet Class A shares, Alphabet Class B shares or Alphabet Class C shares; or (iii) any tender or exchange offer by Alphabet to acquire any Alphabet Class A shares, Alphabet Class B shares or Alphabet Class C shares, none of Larry, Sergey, Eric, and certain of their respective affiliates that are party to the Transfer Restriction Agreements may sell, transfer or exchange, directly or indirectly, any Alphabet Class A shares, Alphabet Class B shares or Alphabet Class C shares in connection with such transaction or in a related transaction for (a) with respect to their Alphabet Class A shares or Alphabet Class B shares, an amount per share greater than the holders of Alphabet Class A shares receive in such transaction or a form of consideration different from the form that the holders of Alphabet Class A shares would receive, or may elect to receive, in such transaction; or (b) with respect to their Alphabet Class C shares, an amount per share greater than the holders of Alphabet Class C shares receive in such transaction or a form of consideration different from the form that the holders of Alphabet Class C shares would receive, or may elect to receive, in such transaction (the “ Founder Equal Treatment Provision ”).

With respect to Larry, Sergey, and certain of their respective affiliates, the applicable Transfer Restriction Agreements generally terminate when they collectively hold less than 34% of Alphabet’s total outstanding voting power. However, the Founder Equal Treatment Provision never terminates.

With respect to Eric and certain of his affiliates, the applicable Transfer Restriction Agreement generally terminates when they collectively hold less than 2% of Alphabet’s total outstanding voting power. However, the Founder Equal Treatment Provision never terminates.

Additionally, on October 2, 2015, Alphabet entered into a Class C Undertaking pertaining to the settlement entered into by Google, the Board of Directors of Google and the plaintiffs in the class action litigation involving the authorization to distribute Class C capital stock captioned  In Re: Google Inc. Class C Shareholder Litigation , Civil Action No. 7469-CS (the “ Google Class C Settlement ”), pursuant to which Alphabet will undertake to be bound by the restrictions, undertakings and all continuing obligations and to benefit from the rights of the Google Class C Settlement Agreement that are applicable to Google as if it were Google (the “ Class C Undertaking ”).

The foregoing descriptions of the Transfer Restriction Agreements and Class C Undertaking are qualified in their entirety by the terms of such agreements, which are filed hereto as Exhibit 4.3, Exhibit 4.4, Exhibit 4.5 and Exhibit 4.6, and incorporated herein by reference.


Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

The directors of Alphabet are the same as the directors of Google upon consummation of the Alphabet Merger.

Directors

 

Name

   Age    AC    LDCC    NCGC    EC

Larry Page

   42             X

Sergey Brin

   42             X

Eric E. Schmidt

   60             C

L. John Doerr

   64       X      

Diane B. Greene

   60    X         

John L. Hennessy

   63          C   

Ann Mather

   55    C         

Alan R. Mulally

   70    X         

Paul S. Otellini

   64       C      

K. Ram Shriram

   58       X      

Shirley M. Tilghman

   69          X   

 

AC

  

Audit Committee

LDCC

  

Leadership Development and Compensation Committee

NCGC

  

Nominating and Corporate Governance Committee

EC

  

Executive Committee

C

  

Committee Chairperson

Biographical information about Alphabet’s directors is included in Google’s Schedule 14A for the 2015 Annual Meeting of Stockholders under “Directors, Executive Officers and Corporate Governance” and is incorporated by reference herein.

The following persons are the executive officers of Alphabet upon consummation of the Alphabet Merger with the following positions and titles:

Executive Officers

 

Name

   Age   

Position with Alphabet

Larry Page

   42   

Chief Executive Officer

Sergey Brin

   42   

President

Eric E. Schmidt

   60   

Executive Chairman of the Board of Directors

David C. Drummond

   52   

Senior Vice President, Corporate Development, Chief Legal Officer and Secretary

Ruth Porat

   57   

Senior Vice President and Chief Financial Officer

Sundar Pichai

   43   

Chief Executive Officer, Google Inc.

Larry Page , the Chief Executive Officer of Alphabet, was one of Google’s founders and has served as a member of Google’s Board of Directors since its inception in September 1998, and as Google’s Chief Executive Officer since April 2011. From July 2001 to April 2011, Larry served as Google’s President,


Products. In addition, from September 1998 to July 2001, Larry served as Google’s Chief Executive Officer, and from September 1998 to July 2002, as Google’s Chief Financial Officer. Larry holds a Master of Science degree in computer science from Stanford University and a Bachelor of Science degree in engineering, with a concentration in computer engineering, from the University of Michigan.

Sergey Brin , President of Alphabet, was one of Google’s founders and has served as a member of Google’s Board of Directors since our inception in September 1998. From July 2001 to April 2011, Sergey served as Google’s President, Technology. In addition, from September 1998 to July 2001, Sergey served as Google’s President and chairman of Google’s Board of Directors. Sergey holds a Master of Science degree in computer science from Stanford University and a Bachelor of Science degree with high honors in mathematics and computer science from the University of Maryland at College Park.

Eric E. Schmidt , Executive Chairman of the Board of Directors of Alphabet, has served as the Executive Chairman of Google’s Board of Directors since April 2011 and as a member of Google’s Board of Directors since March 2001. From July 2001 to April 2011, Eric served as Google’s Chief Executive Officer. He was the chairman of Google’s Board of Directors from March 2001 to April 2004, and again from April 2007 to April 2011. Prior to joining Google, from April 1997 to November 2001, Eric served as chairman of the Board of Directors of Novell, Inc., a computer networking company, and, from April 1997 to July 2001, as the Chief Executive Officer of Novell. From 1983 until March 1997, Eric held various positions at Sun Microsystems, Inc., a supplier of network computing solutions, including Chief Technology Officer from February 1994 to March 1997, and President of Sun Technology Enterprises from February 1991 until February 1994. Eric was previously a director of Apple Inc., a designer, manufacturer, and marketer of personal computers and related products, from 2006 to 2009. Eric holds a Doctoral degree and a Master of Science degree in computer science from the University of California, Berkeley, and a Bachelor of Science degree in electrical engineering from Princeton University.

David C. Drummond , Senior Vice President, Corporate Development, Chief Legal Officer and Secretary of Alphabet, has previously served as Google’s Senior Vice President, Corporate Development since January 2006, as Chief Legal Officer since December 2006, and as Secretary since 2002. Previously, he served as Google’s Vice President, Corporate Development and General Counsel from February 2002 to December 2005. Prior to joining Google, from July 1999 to February 2002, David served as Chief Financial Officer of SmartForce, an educational software applications company. Prior to that, David was a partner at the law firm of Wilson Sonsini Goodrich & Rosati. David has been a member of the Board of Directors of KKR Management LLC, the general partner of KKR & Co. L.P., a private equity firm, since March 2014, and serves on its conflicts committee. David holds a Juris Doctor degree from Stanford University and a Bachelor of Arts degree in history from Santa Clara University.

Ruth Porat , Senior Vice President and Chief Financial Officer of Alphabet, also serves as the Senior Vice President and Chief Financial Officer at Google since May 2015. Prior to joining Google, she served as Executive Vice President and Chief Financial Officer of Morgan Stanley since January 2010. She previously served as Vice Chairman of Investment Banking from September 2003 to December 2009 and as Global Head of the Financial Institutions Group from September 2006 through December 2009. Ruth is Vice Chair of the Stanford University Board of Trustees, a Board Director at The Council on Foreign Relations and a member of the Advisory Council of the Hutchins Center on Fiscal and Monetary Policy at the Brookings Institution. Ruth received a Bachelor of Arts degree in Economics and International Relations from Stanford University, an M.B.A. with distinction from The Wharton School of the University of Pennsylvania and a Master of Science in industrial relations from the London School of Economics.


Sundar Pichai , Chief Executive Officer of Google, was previously the Senior Vice President of Products at Google and oversees product management, engineering, and research efforts for Google’s products and platforms. Since joining Google in 2004, Sundar has led a number of key consumer products which are now used by hundreds of millions of people and, prior to his current role, served as Google’s Senior Vice President of Android, Chrome and Apps. Sundar received a Bachelor of Engineering degree with honors in metallurgical engineering from the Indian Institute of Technology Kharagpur, a Master of Science degree in materials, science and engineering from Stanford University, and an M.B.A. from The Wharton School of the University of Pennsylvania.

In connection with the Alphabet Merger, on October 2, 2015, Alphabet also entered into the Compensation Plan Agreement with Google pursuant to which Alphabet assumed (including sponsorship of) the Google Inc. 2004 Stock Plan, the Google Inc. 2012 Stock Plan, the AdMob Inc. 2006 Stock Plan and UK Sub-Plan of the AdMob Inc. 2006 SubPlan and the Click Holding Corp. 2005 Stock Incentive Plan and any subplans, appendices or addendums thereunder (together, the “ Google Equity Compensation Plans ”), and all obligations of Google pursuant to each stock option to purchase a share of Google stock (a “ Google Option ”) and each right to acquire or vest in a share of Google stock (a “ Google Stock Unit ” and each of a Google Option and a Google Stock Unit, a “ Google Equity Award ”) that is outstanding immediately prior to October 2, 2015 and (i) issued under the Google Equity Compensation Plans and underlying grant agreements (each such grant agreement, a “ Google Equity Award Grant Agreement ” and such grant agreements together with the Google Equity Compensation Plans, the “ Google Equity Compensation Plans and Agreements ”) or (ii) granted by Google outside of the Google Equity Compensation Plans and Agreements pursuant to NASDAQ Listing Rule 5635(c), and (B) each such Google Equity Award was converted into (A) with respect to each Google Stock Unit, a right to acquire or vest in an Alphabet share or (B) with respect to a Google Option, an option to purchase an Alphabet share at an exercise price per share equal to the exercise price per share of Google stock subject to such Google Option immediately prior to October 2, 2015. On October 2, 2015, the Google Equity Awards, the Google Equity Compensation Plans and Agreements and any provision of any other compensatory plan, agreement or arrangement providing for the grant or issuance of shares of Google stock was automatically deemed to be amended (and, in the case of the Google Inc. 2012 Stock Plan, formally amended), to the extent necessary or appropriate, to provide that references to Google in such awards, documents and provisions will be read to refer to Alphabet and references to shares of Google stock in such awards, documents and provisions will be read to refer to Alphabet shares.

Furthermore, on October 2, 2015, Alphabet entered into the Director Arrangements Agreement pursuant to which Alphabet assumed any and all obligations to the individual signatories under the offer letters with certain of the current members of Google’s Board of Directors from and after October 2, 2015 in accordance with the terms of the offer letters as if Alphabet, and not Google, were the signatory thereto and all references to Google therein were replaced with references to Alphabet.

The directors and executive officers of Alphabet also entered into indemnification agreements with Alphabet.

The foregoing descriptions of the Compensation Plan Agreement, the Director Arrangements Agreement, the Alphabet Inc. 2012 Stock Plan and indemnification agreements do not purport to be complete and are qualified in their entirety by reference to the full text of the Compensation Plan Agreement, Director Arrangements Agreement, the Alphabet Inc. 2012 Stock Plan and form of indemnification agreement, which are filed as Exhibits 10.1, 10.2, 10.3 and 10.4, respectively, and each of which is incorporated by reference herein.


Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

In connection with the consummation of the Alphabet Merger, Alphabet’s Board of Directors approved the Alphabet Certificate of Incorporation and adopted the Amended and Restated Bylaws of Alphabet (the “ Alphabet Bylaws ”) that are each identical to those of Google immediately prior to the consummation of the Alphabet Merger, except for the change of the name of the corporation as permitted by Section 251(g) of the DGCL. Prior to the consummation of the Alphabet Merger, the sole stockholder of Alphabet approved the adoption of the Alphabet Certificate of Incorporation. The Alphabet Certificate of Incorporation was filed with the Delaware Secretary of State on October 2, 2015.

The foregoing descriptions of the Alphabet Certificate of Incorporation and the Alphabet Bylaws do not purport to be complete and are qualified in their entirety by reference to the full text of the Alphabet Certificate of Incorporation and the Alphabet Bylaws, which are filed as Exhibits 3.1 and 3.2 hereto, respectively, and each of which is incorporated by reference herein.

 

Item 5.05. Amendments to the Registrant’s Code of Ethics, or Waiver of a Provision of the Code of Ethics.

On October 2, 2015, Alphabet adopted a Code of Conduct (the “ Code ”) that was approved by the Board of Directors on August 10, 2015, and which applies to all directors, officers and employees of Alphabet and its subsidiaries and controlled affiliates.

The description of the Code contained in this report is qualified in its entirety by reference to the full text of the Code filed as Exhibit 14.1 to this Form 8-K. The Code is available on Google’s website at investor.google.com. We will post amendments to the Code or waivers of the Code for directors and executive officers on the same website.

 

Item 8.01. Other Items.

Successor Issuer

In connection with the Alphabet Merger and by operation of Rule 12g-3(a) promulgated under the Exchange Act, Alphabet is the successor issuer to Google and has succeeded to the attributes of Google as the registrant. Alphabet Class A shares and Alphabet Class C shares are deemed to be registered under Section 12(b) of the Exchange Act, and Alphabet is subject to the informational requirements of the Exchange Act, and the rules and regulations promulgated thereunder. Alphabet hereby reports this succession in accordance with Rule 12g-3(f) promulgated under the Exchange Act.

The description of Alphabet’s capital stock provided in Exhibit 99.1, which is incorporated by reference herein, modifies and supersedes any prior description of Alphabet’s capital stock in any registration statement or report filed with the Securities and Exchange Commission (the “ Commission ”) and will be available for incorporation by reference into certain of Alphabet’s filings with the Commission pursuant to the Securities Act of 1933, as amended, the Exchange Act, and the rules and forms promulgated thereunder.


Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits.

 

Exhibit

No.

   Description
  2.1    Agreement and Plan of Merger, dated October 2, 2015, by and among Google Inc., Alphabet Inc. and Maple Technologies Inc.
  3.1    Amended and Restated Certificate of Incorporation of Alphabet Inc., dated October 2, 2015
  3.2    Amended and Restated Bylaws of Alphabet Inc., dated October 2, 2015
  4.1    Specimen Class A Common Stock certificate
  4.2    Specimen Class C Capital Stock certificate
  4.3    Transfer Restriction Agreement, dated October 2, 2015, between Alphabet Inc. and Larry Page and certain of his affiliates
  4.4    Transfer Restriction Agreement, dated October 2, 2015, between Alphabet Inc. and Sergey Brin and certain of his affiliates
  4.5    Transfer Restriction Agreement, dated October 2, 2015, between Alphabet Inc. and Eric E. Schmidt and certain of his affiliates
  4.6    Class C Undertaking, dated October 2, 2015, executed by Alphabet Inc.
10.1    Compensation Plan Agreement, dated October 2, 2015 between Google Inc. and Alphabet Inc.
10.2    Director Arrangements Agreement, dated October 2, 2015 between Google Inc. and Alphabet Inc.
10.3    Alphabet Inc. 2012 Stock Plan
10.4    Form of Indemnification Agreement
10.5    Alphabet Inc. Deferred Compensation Plan
14.1    Code of Conduct of Alphabet Inc. dated October 2, 2015
99.1    Description of Capital Stock


SIGNATURE

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.

 

      ALPHABET INC.
Date: October 2, 2015      

/s/ Kent Walker

      Kent Walker
      Assistant Secretary


INDEX TO EXHIBITS

 

Exhibit

No.

   Description
  2.1    Agreement and Plan of Merger, dated October 2, 2015, by and among Google Inc., Alphabet Inc. and Maple Technologies Inc.
  3.1    Amended and Restated Certificate of Incorporation of Alphabet Inc., dated October 2, 2015
  3.2    Amended and Restated Bylaws of Alphabet Inc., dated October 2, 2015
  4.1    Specimen Class A Common Stock certificate
  4.2    Specimen Class C Capital Stock certificate
  4.3    Transfer Restriction Agreement, dated October 2, 2015, between Alphabet Inc. and Larry Page and certain of his affiliates
  4.4    Transfer Restriction Agreement, dated October 2, 2015, between Alphabet Inc. and Sergey Brin and certain of his affiliates
  4.5    Transfer Restriction Agreement, dated October 2, 2015, between Alphabet Inc. and Eric E. Schmidt and certain of his affiliates
  4.6    Class C Undertaking, dated October 2, 2015, executed by Alphabet Inc.
10.1    Compensation Plan Agreement, dated October 2, 2015 between Google Inc. and Alphabet Inc.
10.2    Director Arrangements Agreement, dated October 2, 2015 between Google Inc. and Alphabet Inc.
10.3    Alphabet Inc. 2012 Stock Plan
10.4    Form of Indemnification Agreement
10.5    Alphabet Inc. Deferred Compensation Plan
14.1    Code of Conduct of Alphabet Inc. dated October 2, 2015
99.1    Description of Capital Stock

Exhibit 2.1

AGREEMENT AND PLAN OF MERGER

This AGREEMENT AND PLAN OF MERGER (the “ Agreement ”), entered into as of October 2, 2015, by and among Google Inc., a Delaware corporation (the “ Company ”), Alphabet Inc., a Delaware corporation (“ Holdco ”) and a direct, wholly owned subsidiary of the Company, and Maple Technologies Inc., a Delaware corporation (“ Merger Sub ”) and a direct, wholly owned subsidiary of Holdco.

RECITALS

WHEREAS, on the date hereof, the Company has the authority to issue 15,100,000,000 shares, consisting of: (i) 9,000,000,000 shares of Class A Common Stock, par value $0.001 per share (the “ Company Class A Common Stock ”), of which 291,261,461 shares are issued and outstanding; (ii) 3,000,000,000 shares of Class B Common Stock, par value $0.001 per share (the “ Company Class B Common Stock ”), of which 50,940,307 shares are issued and outstanding; (iii) 3,000,000,000 shares of Class C Capital Stock, par value $0.001 per share (the “ Company Class C Capital Stock ”), of which 345,482,241 shares are issued and outstanding; and (iv) 100,000,000 shares of Preferred Stock, par value $0.001 per share (the “ Company Preferred Stock ”), of which no shares are issued and outstanding.

WHEREAS, as of the Effective Time (as defined below), Holdco will have the authority to issue 15,100,000,000 shares, consisting of: (i) 9,000,000,000 shares of Class A Common Stock, par value $0.001 per share (the “ Holdco Class A Common Stock ”); (ii) 3,000,000,000 shares of Class B Common Stock, par value $0.001 per share (the “Holdco Class B Common Stock”); (iii) 3,000,000,000 shares of Class C Capital Stock, par value $0.001 per share (the “ Holdco Class C Capital Stock ”); and (iv) 100,000,000 shares of Preferred Stock, par value $0.001 per share (the “ Holdco Preferred Stock ”).

WHEREAS, as of the date hereof, Merger Sub has the authority to issue 1,000 shares of common stock, par value $0.001 per share (the “ Merger Sub Common Stock ”), of which 100 shares are issued and outstanding on the date hereof and owned by Holdco.

WHEREAS, as of the Effective Time, the designations, rights, powers and preferences, and the qualifications, limitations and restrictions of the Holdco Class A Common Stock, Holdco Class B Common Stock, Holdco Class C Capital Stock and Holdco Preferred Stock will be the same as those of the Company Class A Common Stock, Company Class B Common Stock, Company Class C Capital Stock and Company Preferred Stock, respectively.

WHEREAS, the Amended and Restated Certificate of Incorporation of Holdco (the “ Holdco Charter ”) and the Bylaws of Holdco (the “ Holdco Bylaws ”), which will be in effect immediately following the Effective Time, contain provisions identical to the Fourth Amended and Restated Certificate of Incorporation of the Company (the “ Company Charter ”) and the Amended and Restated Bylaws of the Company (the “ Company Bylaws ”), in effect as of the date hereof and that will be in effect immediately prior to the Effective Time, respectively (other than as permitted by Section 251(g) of the General Corporation Law of the State of Delaware (the “ DGCL ”)).


WHEREAS, Holdco and Merger Sub are newly formed corporations organized for the sole purpose of participating in the transactions herein contemplated and actions related thereto, own no assets (other than Holdco’s ownership of Merger Sub and nominal capital) and have taken no actions other than those necessary or advisable to organize the corporations and to effect the transactions herein contemplated and actions related thereto.

WHEREAS, the Company desires to reorganize into a holding company structure pursuant to Section 251(g) of the DGCL, under which Holdco would become a holding company, by the merger of Merger Sub with and into the Company, and with each share of Company Class A Common Stock, Company Class B Common Stock and Company Class C Capital Stock being converted in the Merger (as defined below) into a share of Holdco Class A Common Stock, Holdco Class B Common Stock or Holdco Class C Capital Stock, respectively.

WHEREAS, on or about the date hereof, the Company and Holdco will enter or have entered into a Compensation Plan Agreement, pursuant to which, among other things, the Company will, at the Effective Time, transfer to Holdco, and Holdco will assume, sponsorship of all of the Company’s Equity Plans (as defined below) and all of the Company’s rights and obligations thereunder.

WHEREAS, the boards of directors of Holdco and the Company have approved and declared advisable this Agreement and the transactions contemplated hereby, including, without limitation, the Merger.

WHEREAS, the board of directors of Merger Sub has (i) approved and declared advisable this Agreement and the transactions contemplated hereby, including, without limitation, the Merger, (ii) resolved to submit the approval of the adoption of this Agreement and the transactions contemplated hereby, including, without limitation, the Merger, to its sole stockholder, and (iii) resolved to recommend to its sole stockholder that it approve the adoption of this Agreement and the transactions contemplated hereby, including, without limitation, the Merger.

WHEREAS, the parties intend, for United States federal income tax purposes, the Merger shall qualify as an exchange described in Section 351 of the Internal Revenue Code.

NOW, THEREFORE, in consideration of the premises and the covenants and agreements contained in this Agreement, and intending to be legally bound hereby, the Company, Holdco and Merger Sub hereby agree as follows:

1. THE MERGER. In accordance with Section 251(g) of the DGCL and subject to, and upon the terms and conditions of, this Agreement, Merger Sub shall be merged with and into the Company (the “ Merger ”), the separate corporate existence of Merger Sub shall cease, and the Company shall continue as the surviving corporation of the Merger (the “ Surviving Corporation ”). At the Effective Time, the effects of the Merger shall be as provided in this Agreement and in Section 259 of the DGCL.

2. EFFECTIVE TIME. As soon as practicable on or after the date hereof, the Company shall file a certificate of merger executed in accordance with the relevant provisions of the DGCL, with the Secretary of State of the State of Delaware (the “ Secretary of State ”) and shall make all other filings or recordings required under the DGCL to effectuate the Merger. The

 

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Merger shall become effective at such time as the certificate of merger is duly filed with the Secretary of State or at such later date and time as the parties shall agree and specify in the certificate of merger (the date and time the Merger becomes effective being referred to herein as the “ Effective Time ”).

3. CERTIFICATE OF INCORPORATION. At the Effective Time, the Company Charter shall be amended in the Merger as set forth below, and as so amended, shall be the certificate of incorporation of the Surviving Corporation (the “ Surviving Corporation Charter ”) until thereafter amended as provided therein or by the DGCL.

(a) ARTICLE IV, Section 1 of the Company Charter shall be deleted in its entirety and replaced with the following:

Section 1.  Authorized Shares . This Corporation is authorized to issue five hundred (500) shares of Class A Common Stock, par value $0.001 per share (the “ Class A Common Stock ”), five hundred (500) shares of Class B Common Stock, par value $0.001 per share (the “ Class B Common Stock ”, and together with the Class A Common Stock, the “ Common Stock ”), five hundred (500) shares of Class C Capital Stock, par value $0.001 per share (the “ Class C Capital Stock ”), and five hundred (500) shares of Preferred Stock, par value $0.001 per share. The number of authorized shares of any class or classes of stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of at least a majority of the voting power of the issued and outstanding shares of Common Stock of the Corporation, voting together as a single class.

(b) ARTICLE XI of the Company Charter shall be amended by adding a Section 3 immediately following Section 2 to read in its entirety as follows:

Section 3. Any act or transaction by or involving the Corporation, other than the election or removal of directors of the Corporation, that requires for its adoption under the General Corporation Law of the State of Delaware or this Certificate of Incorporation the approval of the stockholders of the Corporation shall, in accordance with Section 251(g) of the General Corporation Law of the State of Delaware, require, in addition, the approval of the stockholders of Alphabet Inc. (or any successor thereto by merger), by the same vote as is required by the General Corporation Law of the State of Delaware and/or this Certificate of Incorporation.

4. BYLAWS. From and after the Effective Time, the Company Bylaws, as in effect immediately prior to the Effective Time, shall constitute the Bylaws of the Surviving Corporation (the “ Surviving Corporation Bylaws ”) until thereafter amended as provided therein or by applicable law.

5. DIRECTORS. The directors of the Company in office immediately prior to the Effective Time shall be the directors of the Surviving Corporation and will continue to hold office from the Effective Time until the earlier of their resignation or removal or until their successors are duly elected or appointed and qualified in the manner provided in the Surviving Corporation Charter and Surviving Corporation Bylaws, or as otherwise provided by law.

 

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6. OFFICERS. The officers of the Company in office immediately prior to the Effective Time shall be the officers of the Surviving Corporation and will continue to hold office from the Effective Time until the earlier of their resignation or removal or until their successors are duly elected or appointed and qualified in the manner provided in the Surviving Corporation Charter and Surviving Corporation Bylaws, or as otherwise provided by law.

7. ADDITIONAL ACTIONS. If, at any time after the Effective Time, the Surviving Corporation shall consider or be advised that any deeds, bills of sale, assignments, assurances or any other actions or things are necessary or desirable to vest, perfect or confirm, of record or otherwise, in the Surviving Corporation its right, title or interest in, to or under any of the rights, properties or assets of either Merger Sub or the Company acquired or to be acquired by the Surviving Corporation as a result of, or in connection with, the Merger or otherwise to carry out this Agreement, the officers and directors of the Surviving Corporation shall be authorized to execute and deliver, in the name and on behalf of each of Merger Sub and the Company, all such deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf of each of Merger Sub and the Company or otherwise, all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in, to and under such rights, properties or assets in the Surviving Corporation or otherwise to carry out this Agreement.

8. CONVERSION OF SECURITIES. At the Effective Time, by virtue of the Merger and without any action on the part of Holdco, Merger Sub, the Company or any holder of any securities thereof:

(a) Conversion of Company Class A Common Stock, Company Class B Common Stock and Company Class C Capital Stock . Each share of Company Class A Common Stock, Company Class B Common Stock and Company Class C Capital Stock issued and outstanding immediately prior to the Effective Time shall be converted into one validly issued, fully paid and nonassessable share of Holdco Class A Common Stock, Holdco Class B Common Stock and Holdco Class C Capital Stock, respectively.

(b) Conversion of Company Stock Held as Treasury Stock . Each share of Company Class A Common Stock, Company Class B Common Stock and Company Class C Capital Stock held in the Company’s treasury shall be converted into one validly issued, fully paid and nonassessable share of Holdco Class A Common Stock, Holdco Class B Common Stock and Holdco Class C Capital Stock, respectively, to be held immediately after completion of the Merger in the treasury of Holdco.

(c) Conversion of Capital Stock of Merger Sub . Each share of Merger Sub Common Stock issued and outstanding immediately prior to the Effective Time shall be converted into one validly issued, fully paid and nonassessable share of Class A Common Stock, par value $0.001 per share, one validly issued, fully paid and nonassessable share of Class B Common Stock, par value $0.001 per share, and one validly issued, fully paid and nonassessable share of Class C Capital Stock, par value $0.001 per share, of the Surviving Corporation.

(d) Rights of Certificate Holders . Upon conversion thereof in accordance with this Section 8 , all shares of Company Class A Common Stock, Company Class B Common Stock and Company Class C Capital Stock shall no longer be outstanding and shall cease to exist, and each holder of a certificate representing any such shares of Company Class A

 

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Common Stock, Company Class B Common Stock or Company Class C Capital Stock shall cease to have any rights with respect to such shares of Company Class A Common Stock, Company Class B Common Stock or Company Class C Capital Stock, respectively, except, in all cases, as set forth in Section 9 herein. In addition, each outstanding book-entry that, immediately prior to the Effective Time, evidenced shares of Company Class A Common Stock, Company Class B Common Stock or Company Class C Capital Stock shall, from and after the Effective Time, be deemed and treated for all corporate purposes to evidence the ownership of the same number of shares of Holdco Class A Common Stock, Holdco Class B Common Stock, or Holdco Class C Capital Stock, respectively.

9. CERTIFICATES. At and after the Effective Time until thereafter surrendered for transfer or exchange in the ordinary course, each outstanding certificate which immediately prior thereto represented shares of Company Class A Common Stock, Company Class B Common Stock or Company Class C Capital Stock shall be deemed for all purposes to evidence ownership of and to represent the shares of Holdco Class A Common Stock, Holdco Class B Common Stock or Holdco Class C Capital Stock, as applicable, into which the shares of Company Class A Common Stock, Company Class B Common Stock or Company Class C Capital Stock represented by such certificate have been converted as herein provided and shall be so registered on the books and records of Holdco and its transfer agent. At and after the Effective Time, the shares of capital stock of Holdco shall be uncertificated; provided , that, any shares of capital stock of Holdco that are represented by outstanding certificates of the Company pursuant to the immediately preceding sentence shall continue to be represented by certificates as provided therein and shall not be uncertificated unless and until a valid certificate representing such shares pursuant to the immediately preceding sentence is delivered to Holdco at its registered office in the State of Delaware, its principal place of business, or an officer or agent of Holdco having custody of books and records of Holdco, at which time such certificate shall be canceled and in lieu of the delivery of a certificate representing the applicable shares of capital stock of Holdco, Holdco shall (i) issue to such holder the applicable uncertificated shares of capital stock of Holdco by registering such shares in Holdco’s books and records as book-entry shares, upon which such shares shall thereafter be uncertificated and (ii) take all action necessary to provide such holder with evidence of the uncertificated book-entry shares, including any action necessary under applicable law in accordance therewith, including in accordance with Sections 151(f) and 202 of the DGCL. If any certificate that prior to the Effective Time represented shares of Company Class A Common Stock, Company Class B Common Stock or Company Class C Capital Stock shall have been lost, stolen or destroyed, then, upon the making of an affidavit of such fact by the person or entity claiming such certificate to be lost, stolen or destroyed and the providing of an indemnity by such person or entity to Holdco, in form and substance reasonably satisfactory to Holdco, against any claim that may be made against it with respect to such certificate, Holdco shall issue to such person or entity, in exchange for such lost, stolen or destroyed certificate, uncertificated shares representing the applicable shares of Holdco Class A Common Stock, Holdco Class B Common Stock or Holdco Class C Capital Stock in accordance with the procedures set forth in the preceding sentence.

10. ASSUMPTION OF EQUITY PLANS AND AWARDS.

At the Effective Time, pursuant to this Merger Agreement and the Compensation Plan Agreement entered into between Holdco and the Company on or about the date hereof (the “ Compensation Plan Agreement ”), the Company will transfer to Holdco, and Holdco will assume, sponsorship of all of the Company’s Equity Plans (as defined below), along with all of the Company’s rights and obligations under the Equity Plans.

 

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At the Effective Time, pursuant to this Merger Agreement and the Compensation Plan Agreement, the Company will transfer to Holdco, and Holdco will assume, its rights and obligations under each stock option to purchase a share of Company capital stock (each, a “ Stock Option ”) and each right to acquire or vest in a share of Company capital stock (each, a “ GSU ” and together with the Stock Options, the “ Awards ”) issued under the Equity Plans or granted by the Company outside of the Equity Plans pursuant to NASDAQ Listing Rule 5635(c) that is outstanding and unexercised, unvested and not yet paid or payable immediately prior to the Effective Time, which Awards shall be converted into a stock option to purchase or a right to acquire or vest in, respectively, a share of Holdco capital stock of the same class and with the same rights and privileges relative to Holdco that such share underlying such Stock Option or GSU had relative to the Company immediately prior to the Effective Time on otherwise the same terms and conditions as were applicable immediately prior to the Effective Time, including, for Stock Options, at an exercise price per share equal to the exercise price per share for the applicable share of Company capital stock. For purposes of this Agreement, “ Equity Plans ” shall mean, collectively, the Google Inc. 2004 Stock Plan, the Google Inc. 2012 Stock Plan, the AdMob, Inc. 2006 Stock Plan and UK Sub-Plan of the AdMob, Inc. 2006 Stock Plan, Click Holding Corp. 2005 Stock Incentive Plan, and the Motorola Mobility Holdings, Inc. 2011 Incentive Compensation Plan and any and all subplans, appendices or addendums thereto, and any and all agreements evidencing Awards.

11. HOLDCO SHARES . Prior to the Effective Time, the Company and Holdco shall take any and all actions as are necessary to ensure that each share of capital stock of Holdco that is owned by the Company immediately prior to the Effective Time shall be cancelled and cease to be outstanding at the Effective Time, and no payment shall be made therefor, and the Company, by execution of this Agreement, agrees to forfeit such shares and relinquish any rights to such shares.

12. NO APPRAISAL RIGHTS. In accordance with the DGCL, no appraisal rights shall be available to any holder of shares of Company Class A Common Stock, Company Class B Common Stock, or Company Class C Capital Stock in connection with the Merger.

13. TERMINATION. This Agreement may be terminated, and the Merger and the other transactions provided for herein may be abandoned, whether before or after the adoption of this Agreement by the sole stockholder of Merger Sub, at any time prior to the Effective Time, by action of the board of directors of the Company. In the event of termination of this Agreement, this Agreement shall forthwith become void and have no effect, and neither the Company, Holdco, Merger Sub nor their respective stockholders, directors or officers shall have any liability with respect to such termination or abandonment.

14. AMENDMENTS. At any time prior to the Effective Time, this Agreement may be supplemented, amended or modified, whether before or after the adoption of this Agreement by the sole stockholder of Merger Sub, by the mutual consent of the parties to this Agreement by action by their respective boards of directors; provided , however , that, no amendment shall be effected subsequent to the adoption of this Agreement by the sole stockholder of Merger Sub that by law requires further approval or authorization by the sole stockholder of Merger Sub or the stockholders of the Company without such further approval or authorization. No amendment of any provision of this Agreement shall be valid unless the same shall be in writing and signed by all of the parties hereto.

 

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15. GOVERNING LAW. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws.

16. COUNTERPARTS. This Agreement may be executed in one or more counterparts, each of which when executed shall be deemed to be an original but all of which shall constitute one and the same agreement.

17. ENTIRE AGREEMENT. This Agreement, including the documents and instruments referred to herein, constitutes the entire agreement and supersedes all other prior agreements and undertakings, both written and oral, among the parties, or any of them, with respect to the subject matter hereof.

18. SEVERABILITY. The provisions of this Agreement are severable, and in the event any provision hereof is determined to be invalid or unenforceable, such invalidity or unenforceability shall not in any way affect the validity or enforceability of the remaining provisions hereof.

[Signature Page Follows]

 

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IN WITNESS WHEREOF , the Company, Holdco and Merger Sub have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

 

GOOGLE INC.
By:  

/s/ Kent Walker

Name:   Kent Walker
Title:   Assistant Secretary
ALPHABET INC.
By:  

/s/ Christine Flores

Name:   Christine Flores
Title:   Assistant Secretary
MAPLE TECHNOLOGIES INC.
By:  

/s/ Kenneth Yi

Name:   Kenneth Yi
Title:   CEO, President and Secretary

Exhibit 3.1

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF

ALPHABET INC.

a Delaware Corporation

Alphabet Inc., a corporation organized and existing under the laws of the State of Delaware (the “ Corporation ”), hereby certifies as follows:

A. The name of the Corporation is Alphabet Inc. The Corporation’s original Certificate of Incorporation was filed with the Secretary of State of the State of Delaware on July 23, 2015.

B. This Amended and Restated Certificate of Incorporation was duly adopted in accordance with Sections 242, 245 and 228 (by written consent of the sole stockholder of the Corporation) of the General Corporation Law of the State of Delaware, and restates, integrates and further amends the provisions of the Corporation’s Certificate of Incorporation.

C. The text of the Certificate of Incorporation of this Corporation is hereby amended and restated in its entirety, effective October 2, 2015, at 4:01 p.m., EDT, as set forth in Exhibit A attached hereto.

IN WITNESS WHEREOF, the Corporation has caused this Amended and Restated Certificate of Incorporation to be executed by the undersigned officer, thereunto duly authorized, this second day of October 2015.

 

ALPHABET INC.
a Delaware corporation
By:  

/s/ Larry Page

Name:   Larry Page
Title:   Chief Executive Officer


EXHIBIT A

ARTICLE I

The name of this corporation is Alphabet Inc. (hereinafter, the “ Corporation ”).

ARTICLE II

The address of the Corporation’s registered office in the State of Delaware is 2711 Centerville Road, Suite 400, City of Wilmington, County of New Castle, Delaware 19808. The name of its registered agent at such address is Corporation Service Company.

ARTICLE III

The nature of the business or purposes to be conducted or promoted by the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware.

ARTICLE IV

Section 1. Authorized Shares . This Corporation is authorized to issue nine billion (9,000,000,000) shares of Class A Common Stock, par value $0.001 per share (the “ Class A Common Stock ”), three billion (3,000,000,000) shares of Class B Common Stock, par value $0.001 per share (the “ Class B Common Stock ”, and together with the Class A Common Stock, the “ Common Stock ”), three billion (3,000,000,000) shares of Class C Capital Stock, par value $0.001 per share (the “ Class C Capital Stock ”), and one hundred million (100,000,000) shares of Preferred Stock, par value $0.001 per share. The number of authorized shares of any class or classes of stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of at least a majority of the voting power of the issued and outstanding shares of Common Stock of the Corporation, voting together as a single class.

Section 2. Common Stock . A statement of the designations of each class of Common Stock and the powers, preferences and rights and qualifications, limitations or restrictions thereof is as follows:

(a) Voting Rights .

(i) Except as otherwise provided herein or by applicable law, the holders of shares of Class A Common Stock and Class B Common Stock shall at all times vote together as one class on all matters (including the election of directors) submitted to a vote or for the consent of the stockholders of the Corporation.

(ii) Each holder of shares of Class A Common Stock shall be entitled to one (1) vote for each share of Class A Common Stock held as of the applicable date on any matter that is submitted to a vote or for the consent of the stockholders of the Corporation.

 

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(iii) Each holder of shares of Class B Common Stock shall be entitled to ten (10) votes for each share of Class B Common Stock held as of the applicable date on any matter that is submitted to a vote or for the consent of the stockholders of the Corporation.

(b) Dividends . Subject to the preferences applicable to any series of Preferred Stock, if any, outstanding at any time, the holders of Class A Common Stock and the holders of Class B Common Stock shall be entitled to share equally, on a per share basis, in such dividends and other distributions of cash, property or shares of stock of the Corporation as may be declared by the Board of Directors from time to time with respect to the Common Stock out of assets or funds of the Corporation legally available therefor; provided, however, that in the event that such dividend is paid in the form of shares of Common Stock or rights to acquire Common Stock, the holders of Class A Common Stock shall receive Class A Common Stock or rights to acquire Class A Common Stock, as the case may be, and the holders of Class B Common Stock shall receive Class B Common Stock or rights to acquire Class B Common Stock, as the case may be.

(c) Liquidation . Subject to the preferences applicable to any series of Preferred Stock, if any outstanding at any time, in the event of the voluntary or involuntary liquidation, dissolution, distribution of assets or winding up of the Corporation, the holders of Class A Common Stock and the holders of Class B Common Stock shall be entitled to share equally, on a per share basis, all assets of the Corporation of whatever kind available for distribution to the holders of Common Stock.

(d) Subdivision or Combinations . If the Corporation in any manner subdivides or combines the outstanding shares of one class of Common Stock, the outstanding shares of the other class of Common Stock will be subdivided or combined in the same manner.

(e) Equal Status . Except as expressly provided in this Article IV, Class A Common Stock and Class B Common Stock shall have the same rights and privileges and rank equally, share ratably and be identical in all respects as to all matters. Without limiting the generality of the foregoing, (i) in the event of a merger, consolidation or other business combination requiring the approval of the holders of the Corporation’s capital stock entitled to vote thereon (whether or not the Corporation is the surviving entity), the holders of the Class A Common Stock shall have the right to receive, or the right to elect to receive, the same form of consideration, if any, as the holders of the Class B Common Stock and the holders of the Class A Common Stock shall have the right to receive, or the right to elect to receive, at least the same amount of consideration, if any, on a per share basis as the holders of the Class B Common Stock, and (ii) in the event of (x) any tender or exchange offer to acquire any shares of Common Stock by any third party pursuant to an agreement to which the Corporation is a party or (y) any tender or exchange offer by the Corporation to acquire any shares of Common Stock, pursuant to the terms of the applicable tender or exchange offer, the holders of the Class A Common Stock shall have the right to receive, or the right to elect to receive, the same form of consideration as the holders of the Class B Common Stock and the holders of the Class A Common Stock shall have the right to receive, or the right to elect to receive, at least the same amount of consideration on a per share basis as the holders of the Class B Common Stock.

 

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(f) Conversion .

(i) As used in this Section 2(f), the following terms shall have the following meanings:

(1) “ Founder ” shall mean either Larry Page or Sergey Brin, each as a natural living person, and “ Founders ” shall mean both of them.

(2) “ Class B Stockholder ” shall mean (a) the Founders, (b) the registered holder of a share of Class B Common Stock of Google Inc. on July 6, 2004 (the “ Effective Time ”), (c) each natural person who Transferred shares of Class B Common Stock of Google Inc. (or securities convertible into or exchangeable for shares of Class B Common Stock of Google Inc.) prior to the Effective Time to a Permitted Entity that, as of the Effective Time, complies with the applicable exception for such Permitted Entity specified in Section 2(f)(iii)(2), and (d) the initial registered holder of any shares of Class B Common Stock of Google Inc. that were originally issued by the Corporation after the Effective Time.

(3) “ Permitted Entity ” shall mean, with respect to any individual Class B Stockholder, any trust, account, plan, corporation, partnership, or limited liability company specified in Section 2(f)(iii)(2) established by or for such individual Class B Stockholder, so long as such entity meets the requirements of the exception set forth in Section 2(f)(iii)(2) applicable to such entity.

(4) “ Transfer ” of a share of Class B Common Stock shall mean any sale, assignment, transfer, conveyance, hypothecation or other transfer or disposition of such share or any legal or beneficial interest in such share, whether or not for value and whether voluntary or involuntary or by operation of law. A “ Transfer ” shall also include, without limitation, a transfer of a share of Class B Common Stock to a broker or other nominee (regardless of whether or not there is a corresponding change in beneficial ownership), or the transfer of, or entering into a binding agreement with respect to, Voting Control over a share of Class B Common Stock by proxy or otherwise; provided , however , that the following shall not be considered a “ Transfer ” within the meaning of this Section 2(f)(i)(4):

a) the granting of a proxy to officers or directors of the Corporation at the request of the Board of Directors of the Corporation in connection with actions to be taken at an annual or special meeting of stockholders;

b) entering into a voting trust, agreement or arrangement (with or without granting a proxy) solely with stockholders who are Class B Stockholders, that (A) is disclosed either in a Schedule 13D filed with the Securities and Exchange Commission or in writing to the Secretary of the Corporation, (B) either has a term not exceeding one (1) year or is terminable by the Class B Stockholder at any time and (C) does not involve any payment of cash, securities, property or other consideration to the Class B Stockholder other than the mutual promise to vote shares in a designated manner; or

c) the pledge of shares of Class B Common Stock by a Class B Stockholder that creates a mere security interest in such shares pursuant to a bona fide loan or indebtedness transaction so long as the Class B Stockholder continues to exercise Voting Control over such pledged shares; provided , however , that a foreclosure on such shares of Class B Common Stock or other similar action by the pledgee shall constitute a “ Transfer .”

 

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(5) “ Voting Control ” with respect to a share of Class B Common Stock shall mean the power (whether exclusive or shared) to vote or direct the voting of such share of Class B Common Stock by proxy, voting agreement or otherwise.

(ii) Each share of Class B Common Stock shall be convertible into one (1) fully paid and nonassessable share of Class A Common Stock at the option of the holder thereof at any time upon written notice to the transfer agent of the Corporation.

(iii) Each share of Class B Common Stock shall automatically, without any further action, convert into one (1) fully paid and nonassessable share of Class A Common Stock upon a Transfer of such share, other than a Transfer:

(1) from a Founder, or such Founder’s Permitted Entities, to the other Founder, or such Founder’s Permitted Entities.

(2) by a Class B Stockholder who is a natural person to any of the following Permitted Entities, and from any of the following Permitted Entities back to such Class B Stockholder and/or any other Permitted Entity established by or for such Class B Stockholder:

a) a trust for the benefit of such Class B Stockholder and for the benefit of no other person, provided such Transfer does not involve any payment of cash, securities, property or other consideration (other than an interest in such trust) to the Class B Stockholder and, provided , further , that in the event such Class B Stockholder is no longer the exclusive beneficiary of such trust, each share of Class B Common Stock then held by such trust shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock;

b) a trust for the benefit of persons other than the Class B Stockholder so long as the Class B Stockholder has sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such trust, provided such Transfer does not involve any payment of cash, securities, property or other consideration (other than an interest in such trust) to the Class B Stockholder, and, provided , further , that in the event the Class B Stockholder no longer has sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such trust, each share of Class B Common Stock then held by such trust shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock;

c) a trust under the terms of which such Class B Stockholder has retained a “qualified interest” within the meaning of §2702(b)(1) of the Code and/or a reversionary interest so long as the Class B Stockholder has sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such trust; provided , however , that in the event the Class B Stockholder no longer has sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such trust, each share of Class B Common Stock then held by such trust shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock;

 

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d) an Individual Retirement Account, as defined in Section 408(a) of the Internal Revenue Code, or a pension, profit sharing, stock bonus or other type of plan or trust of which such Class B Stockholder is a participant or beneficiary and which satisfies the requirements for qualification under Section 401 of the Internal Revenue Code; provided that in each case such Class B Stockholder has sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held in such account, plan or trust, and provided , further , that in the event the Class B Stockholder no longer has sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such account, plan or trust, each share of Class B Common Stock then held by such trust shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock;

e) a corporation in which such Class B Stockholder directly, or indirectly through one or more Permitted Entities, owns shares with sufficient Voting Control in the corporation, or otherwise has legally enforceable rights, such that the Class B Stockholder retains sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such corporation; provided that in the event the Class B Stockholder no longer owns sufficient shares or has sufficient legally enforceable rights to enable the Class B Stockholder to retain sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such corporation, each share of Class B Common Stock then held by such corporation shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock;

f) a partnership in which such Class B Stockholder directly, or indirectly through one or more Permitted Entities, owns partnership interests with sufficient Voting Control in the partnership, or otherwise has legally enforceable rights, such that the Class B Stockholder retains sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such partnership; provided that in the event the Class B Stockholder no longer owns sufficient partnership interests or has sufficient legally enforceable rights to enable the Class B Stockholder to retain sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such partnership, each share of Class B Common Stock then held by such partnership shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock; or

g) a limited liability company in which such Class B Stockholder directly, or indirectly through one or more Permitted Entities, owns membership interests with sufficient Voting Control in the limited liability company, or otherwise has legally enforceable rights, such that the Class B Stockholder retains sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such limited liability company; provided that in the event the Class B Stockholder no longer owns sufficient membership interests or has sufficient legally enforceable rights to enable the Class B Stockholder to retain sole dispositive power and exclusive Voting Control with respect to the shares of Class B Common Stock held by such limited liability company, each share of Class B Common Stock then held by such limited liability company shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock.

 

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Notwithstanding the foregoing, if the shares of Class B Common Stock held by the Permitted Entity of a Class B Stockholder would constitute stock of a “controlled corporation” (as defined in Section 2036(b)(2) of the Code) upon the death of such Class B Stockholder, and the Transfer of shares Class B Common Stock by such Class B Stockholder to the Permitted Entity did not involve a bona fide sale for an adequate and full consideration in money or money’s worth (as contemplated by Section 2036(a) of the Code), then such shares will not automatically convert to Class A Common Stock if the Class B Stockholder does not directly or indirectly retain Voting Control over such shares until such time as the shares of Class B Common Stock would no longer constitute stock of a “controlled corporation” pursuant to the Code upon the death of such Class B Stockholder (such time is referred to as the “ Voting Shift ”). If the Class B Stockholder does not, within five (5) business days following the mailing of the Corporation’s proxy statement for the first annual or special meeting of stockholders following the Voting Shift, directly or indirectly through one or more Permitted Entities assume sole dispositive power and exclusive Voting Control with respect to such shares of Class B Common Stock, each such share of Class B Common Stock shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock.

(3) by a Class B Stockholder that is a partnership, or a nominee for a partnership, which partnership beneficially held more than five percent (5%) of the total outstanding shares of Class B Common Stock as of the Effective Time, to any person or entity that, at the Effective Time, was a partner of such partnership pro rata in accordance with their ownership interests in the partnership and the terms of any applicable partnership or similar agreement binding the partnership at the Effective Time, and any further Transfer(s) by any such partner that is a partnership or limited liability company to any person or entity that was at such time a partner or member of such partnership or limited liability company pro rata in accordance with their ownership interests in the partnership or limited liability company and the terms of any applicable partnership or similar agreement binding the partnership or limited liability company at the Effective Time. All shares of Class B Common Stock held by affiliated entities shall be aggregated together for the purposes of determining the satisfaction of such five percent (5%) threshold.

(4) by a Class B Stockholder that is a limited liability company, or a nominee for a limited liability company, which limited liability company beneficially held more than five percent (5%) of the total outstanding shares of Class B Common Stock as of the Effective Time, to any person or entity that, at the Effective Time, was a member of such limited liability company pro rata in accordance with their ownership interests in the company and the terms of any applicable agreement binding the company and its members at the Effective Time, and any further Transfer(s) by any such member that is a partnership or limited liability company to any person or entity that was at such time a partner or member of such partnership or limited liability company pro rata in accordance with their ownership interests in the partnership or limited liability company and the terms of any applicable partnership or similar agreement binding the partnership or limited liability company. All shares of Class B Common Stock held by affiliated entities shall be aggregated together for the purposes of determining the satisfaction of such five percent (5%) threshold.

 

7


(iv) Each share of Class B Common Stock held of record by a Class B Stockholder who is a natural person, or by such Class B Stockholder’s Permitted Entities, shall automatically, without any further action, convert into one (1) fully paid and nonassessable share of Class A Common Stock upon the death of such Class B Stockholder; provided , however , that:

(1) If a Founder, or such Founder’s Permitted Entity (in either case, the “ Transferring Founder ”) Transfers exclusive Voting Control (but not ownership) of shares of Class B Common Stock to the other Founder (the “ Transferee Founder ”) which Transfer of Voting Control is contingent or effective upon the death of the Transferring Founder, then each share of Class B Common Stock that is the subject of such Transfer shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock upon that date which is the earlier of: (a) nine (9) months after the date upon which the Transferring Founder died, or (b) the date upon which the Transferee Founder ceases to hold exclusive Voting Control over such shares of Class B Common Stock; provided , further , that if the Transferee Founder shall die within nine (9) months following the death of the Transferring Founder, then a trustee designated by the Transferee Founder and approved by the Board of Directors may exercise Voting Control over: (x) the Transferring Founders’ shares of Class B Common Stock and, in such instance, each such share of Class B Common Stock shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock upon that date which is the earlier of: (A) nine (9) months after the date upon which the Transferring Founder died, or (B) the date upon which such trustee ceases to hold exclusive Voting Control over such shares of Class B Common Stock; and (y) the Transferee Founders’ shares of Class B Common Stock (or shares held by an entity of the type referred to in paragraph (2) below established by or for the Transferee Founder) and, in such instance, each such share of Class B Common Stock shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock upon that date which is the earlier of: (A) nine (9) months after the date upon which the Transferee Founder died, or (B) the date upon which such trustee ceases to hold exclusive Voting Control over such shares of Class B Common Stock; and

(2) If both Founders die simultaneously, a trustee designated by the Founders and approved by the Board of Directors may exercise Voting Control over the Founders’ shares of Class B Common Stock and, in such instance, each such share of Class B Common Stock shall automatically convert into one (1) fully paid and nonassessable share of Class A Common Stock upon that date which is the earlier of: (a) nine (9) months after the date upon which both Founders died, or (b) the date upon which such trustee ceases to hold exclusive Voting Control over such shares of Class B Common Stock.

(v) The Corporation may, from time to time, establish such policies and procedures relating to the conversion of the Class B Common Stock to Class A Common Stock and the general administration of this dual class common stock structure, including the issuance of stock certificates with respect thereto, as it may deem necessary or advisable, and may request that holders of shares of Class B Common Stock furnish affidavits or other proof to the Corporation as it deems necessary to verify the ownership of Class B Common Stock and to confirm that a conversion to Class A Common Stock has not occurred. A determination by the Secretary of the Corporation that a Transfer results in a conversion to Class A Common Stock shall be conclusive.

 

8


(vi) In the event of a conversion of shares of Class B Common Stock to shares of Class A Common Stock pursuant to this Section 2, such conversion shall be deemed to have been made at the time that the Transfer of such shares occurred. Upon any conversion of Class B Common Stock to Class A Common Stock, all rights of the holder of shares of Class B Common Stock shall cease and the person or persons in whose names or names the certificate or certificates representing the shares of Class A Common Stock are to be issued shall be treated for all purposes as having become the record holder or holders of such shares of Class A Common Stock. Shares of Class B Common Stock that are converted into shares of Class A Common Stock as provided in this Section 2 shall be retired and may not be reissued.

(g) Reservation of Stock . The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Class A Common Stock, solely for the purpose of effecting the conversion of the shares of Class B Common Stock, such number of its shares of Class A Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding shares of Class B Common Stock into shares of Class A Common Stock.

Section 3. Change in Control Transaction . The Corporation shall not consummate a Change in Control Transaction without first obtaining the affirmative vote, at a duly called annual or special meeting of the stockholders of the Corporation, of the holders of the greater of: (A) a majority of the voting power of the issued and outstanding shares of capital stock of the Corporation then entitled to vote thereon, voting together as a single class, and (B) sixty percent (60%) of the voting power of the shares of capital stock present in person or represented by proxy at the stockholder meeting called to consider the Change in Control Transaction and entitled to vote thereon, voting together as a single class. For the purposes of this section, a “ Change in Control Transaction ” means the occurrence of any of the following events:

(a) the sale, encumbrance or disposition (other than non-exclusive licenses in the ordinary course of business and the grant of security interests in the ordinary course of business) by the Corporation of all or substantially all of the Corporation’s assets;

(b) the merger or consolidation of the Corporation with or into any other corporation or entity, other than a merger or consolidation which would result in the voting securities of the Corporation outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or its parent) more than fifty percent (50%) of the total voting power represented by the voting securities of the Corporation or such surviving entity or its parent outstanding immediately after such merger or consolidation; or

(c) the issuance by the Corporation, in a transaction or series of related transactions, of voting securities representing more than two percent (2%) of the total voting power of the Corporation before such issuance, to any person or persons acting as a group as contemplated in Rule 13d-5(b) under the Securities Exchange Act of 1934 (or any successor provision) such that, following such transaction or related transactions, such person or group of persons would hold more than fifty percent (50%) of the total voting power of the Corporation, after giving effect to such issuance.

 

9


Section 4. Preferred Stock . The Board of Directors is authorized, subject to any limitations prescribed by law, to provide for the issuance of shares of Preferred Stock in series, and to establish from time to time the number of shares to be included in each such series, and to fix the designation, power, preferences, and rights of the shares of each such series and any qualifications, limitations or restrictions thereof. Except as otherwise required by law, holders of Common Stock shall not be entitled to vote on any amendment to this Certificate of Incorporation (including any certificate of designation filed with respect to any series of Preferred Stock) that relates solely to the terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together as a class with the holders of one or more other such series, to vote thereon by law or pursuant to this Certificate of Incorporation (including any certificate of designation filed with respect to any series of Preferred Stock).

Section 5. Class C Capital Stock . A statement of the designation of the Class C Capital Stock and the powers, preferences and rights and qualifications, limitations or restrictions thereof is as follows:

(a) Voting . Except as otherwise required by applicable law, shares of Class C Capital Stock shall have no voting power and the holders thereof, as such, shall not be entitled to vote on any matter that is submitted to a vote or for the consent of the stockholders of the Corporation.

(b) Dividends . Subject to the preferences applicable to any series of Preferred Stock, if any, outstanding at any time, the holders of Class C Capital Stock shall be entitled to receive, on a per share basis, the same form and amount of dividends and other distributions of cash, property or shares of stock of the Corporation as may be declared by the Board of Directors from time to time with respect to shares of the Common Stock out of assets or funds of the Corporation legally available therefor; provided , however , that in the event that such dividend is paid in the form of shares of Common Stock or rights to acquire Common Stock, the holders of Class C Capital Stock shall receive Class C Capital Stock or rights to acquire Class C Capital Stock, as the case may be.

(c) Conversion upon Liquidation . Immediately prior to the earlier of (i) any distribution of assets of the Corporation to the holders of the Common Stock in connection with a voluntary or involuntary liquidation, dissolution, distribution of assets or winding up of the Corporation pursuant to Section 2(c) or (ii) any record date established to determine the holders of capital stock of the Corporation entitled to receive such distribution of assets, each outstanding share of the Class C Capital Stock shall automatically, without any further action, convert into and become one (1) fully paid and nonassessable share of Class A Common Stock. The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Class A Common Stock, solely for the purpose of effecting the conversion of the shares of Class C Capital Stock pursuant to this Section 5(c), such number of its shares of Class A Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding shares of Class C Capital Stock into shares of Class A Common Stock.

(d) Subdivision or Combinations . If the Corporation in any manner subdivides or combines the outstanding shares of any class of Common Stock, the outstanding

 

10


shares of the Class C Capital Stock will be subdivided or combined in the same manner. The Corporation shall not subdivide or combine the outstanding shares of the Class C Capital Stock unless a subdivision or combination is made in the same manner with respect to each class of Common Stock.

(e) Equal Status . Except as expressly provided in this Article IV, Class C Capital Stock shall have the same rights and privileges and rank equally, share ratably and be identical in all respects to the Common Stock as to all matters. Without limiting the generality of the foregoing, (i) in the event of a merger, consolidation or other business combination of the Corporation requiring the approval of the holders of the Corporation’s capital stock entitled to vote thereon (whether or not the Corporation is the surviving entity), the holders of the Class C Capital Stock shall receive the same amount and form of consideration, if any, on a per share basis as the consideration, if any, received by holders of the Class A Common Stock in connection with such merger, consolidation or combination ( provided that if holders of Class A Common Stock are entitled to make an election as to the amount or form of consideration such holders shall receive in any such merger, consolidation or combination with respect to their shares of Class A Common Stock, the holders of Class C Capital Stock shall be entitled to make the same election as to their shares of Class C Capital Stock), and (ii) in the event of (x) any tender or exchange offer to acquire any shares of Common Stock by any third party pursuant to an agreement to which the Corporation is a party or (y) any tender or exchange offer by the Corporation to acquire any shares of Common Stock, pursuant to the terms of the applicable tender or exchange offer, the holders of the Class C Capital Stock shall receive the same amount and form of consideration on a per share basis as the holders of the Class A Common Stock ( provided that if holders of Class A Common Stock are entitled to make an election as to the amount or form of consideration such holders shall receive in any such tender or exchange offer with respect to their shares of Class A Common Stock, the holders of Class C Capital Stock shall be entitled to make the same election as to their shares of Class C Capital Stock).

ARTICLE V

The Corporation is to have perpetual existence.

ARTICLE VI

Section 1. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors. In addition to the powers and authority expressly conferred upon them by statute or by this Certificate of Incorporation or the Bylaws of the Corporation, the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation.

Section 2. In furtherance and not in limitation of the powers conferred by statute, the Board of Directors is expressly authorized to adopt, alter, amend or repeal the Bylaws of the Corporation. The affirmative vote of at least a majority of the Board of Directors then in office shall be required in order for the Board of Directors to adopt, amend, alter or repeal the Corporation’s Bylaws. The Corporation’s Bylaws may also be adopted, amended, altered or repealed by the stockholders of the Corporation. Notwithstanding the above or any other provision of this Certificate of Incorporation, the Bylaws of the Corporation may not be

 

11


amended, altered or repealed except in accordance with Article X of the Bylaws. No Bylaw hereafter legally adopted, amended, altered or repealed shall invalidate any prior act of the directors or officers of the Corporation that would have been valid if such Bylaw had not been adopted, amended, altered or repealed.

Section 3.

(a) If, at any time during which shares of capital stock of the Corporation are listed for trading on either The Nasdaq National Market (“ Nasdaq ”) or the New York Stock Exchange (“ NYSE ”), holders of the requisite voting power under the then-applicable Nasdaq or NYSE listing standards notify the Corporation in writing of their election to cause the Corporation to rely upon the applicable “controlled company” exemptions (the “ Controlled Company Exemption ”) to the corporate governance rules and requirements of the Nasdaq or the NYSE (the “ Exchange Governance Rules ”), the Corporation shall call a special meeting of the stockholders to consider whether to approve the election to be held within ninety (90) days of written notice of such election (or, if the next succeeding annual meeting of stockholders will be held within ninety (90) days of written notice of such election, the Corporation shall include a proposal to the same effect to be considered at such annual meeting). The Corporation shall not elect to rely upon the Controlled Company Exemption until such time as the Corporation shall have received the approval from holders of at least sixty-six and two thirds percent (66 2/3%) of the voting power of the issued and outstanding shares of capital stock of the Corporation at such annual or special meeting.

(b) In the event such approval is obtained, for so long as shares of the capital stock of the Corporation are listed on either the Nasdaq or the NYSE and the Corporation remains eligible for the Controlled Company Exemption under the requirements of the applicable Exchange Governance Rules, then the Board of Directors shall be constituted such that (i) a majority of the directors on the Board of Directors shall be Outside Directors (as defined below), and (ii) the Corporation’s compensation committee and the governance and nominating committee (or such committees serving similar functions as the Board of Directors of the Corporation shall constitute from time to time) shall consist of at least two (2) members of the Board of Directors and shall be composed entirely of Outside Directors. In the event the number of Outside Directors serving on the Board of Directors constitutes less than a majority of the directors on the Board of Directors as a result of the death, resignation or removal of an Outside Director, then the Board of Directors may continue to properly exercise its powers and no action of the Board of Directors shall be so invalidated, provided, that the Board of Directors shall promptly take such action as is necessary to appoint new Outside Director(s) to the Board of Directors.

(c) An “ Outside Director ” shall mean a director who, currently and for any of the past three years, is and was not an officer of the Corporation (other than service as the chairman of the Board of Directors) or a parent or subsidiary of the Corporation and is not and was not otherwise employed by the corporation or a parent or subsidiary of the Corporation.

Section 4. The chairman of the Board of Directors shall be an Outside Director (as defined above) and shall not hold any other office of the Corporation unless the appointment of the chairman is approved by two-thirds of the members of the Board of Directors then in office,

 

12


provided , however , that if there is no chief executive officer or president of the Corporation as a result of the death, resignation or removal of such officer, then the chairman of the Board of Directors may also serve in an interim capacity as the chief executive officer of the Corporation until the Board shall appoint a new chief executive officer.

Section 5. The Board of Directors of the Corporation shall establish an audit committee whose principal purpose will be to oversee the Corporation’s and its subsidiaries’ accounting and financial reporting processes, internal systems of control, independent auditor relationships and audits of consolidated financial statements of the Corporation and its subsidiaries. The audit committee will also determine the appointment of the independent auditors of the Corporation and any change in such appointment and ensure the independence of the Corporation’s auditors. In addition, the audit committee will assume such other duties and responsibilities delegated to it by the Board of Directors and specified for it under applicable law and Exchange Governance Rules.

Section 6. The Board of Directors of the Corporation shall establish a corporate governance and nominating committee whose principal duties will be to assist the Board of Directors by identifying individuals qualified to become members of the Board of Directors consistent with criteria approved by the Board of Directors, to recommend to the Board of Directors for its approval the slate of nominees to be proposed by the Board of Directors to the stockholders for election to the Board of Directors, to develop and recommend to the Board of Directors the governance principles applicable to the Corporation, as well as such other duties and responsibilities delegated to it by the Board of Directors and specified for it under applicable law and Exchange Governance Rules. In the event the corporate governance and nominating committee will not be recommending a then incumbent director for inclusion in the slate of nominees to be proposed by the Board of Directors to the stockholders for election to the Board of Directors, and provided such incumbent director has not notified the committee that he or she will be resigning or that he or she does not intend to stand for re-election to the Board of Directors, then, in the case of an election to be held at an annual meeting of stockholders, the corporate governance and nominating committee will recommend the slate of nominees to the Board of Directors at least thirty (30) days prior to the latest date required by the provisions of Sections 2.14 (advance notice of stockholder business) and 2.15 (advance notice of director nominations) of the Bylaws of the Corporation (as such provisions may be amended from time to time) for stockholders to submit nominations for directors at such annual meeting, or in the case of an election to be held at a special meeting of stockholders, at least ten (10) days prior to the latest date required by the provisions of Sections 2.14 and 2.15 of the Bylaws for stockholders to submit nominations for directors at such special meeting.

Section 7. The Board of Directors of the Corporation shall establish a compensation committee whose principal duties will be to review employee compensation policies and programs as well as the compensation of the chief executive officer and other executive officers of the Corporation, to recommend to the Board of Directors a compensation program for outside members of the Board of Directors, as well as such other duties and responsibilities delegated to it by the Board of Directors and specified for it under applicable law and Exchange Governance Rules.

 

13


Section 8. Elections of directors need not be by written ballot unless the Bylaws of the Corporation shall so provide.

Section 9. No stockholder will be permitted to cumulate votes at any election of directors.

Section 10. The number of directors that constitute the whole Board of Directors shall be fixed exclusively in the manner designated in the Bylaws of the Corporation.

ARTICLE VII

Section 1. To the fullest extent permitted by the General Corporation Law of Delaware as the same exists or as may hereafter be amended, a director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director. If the General Corporation Law of Delaware is amended to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation shall be eliminated to the fullest extent permitted by the General Corporation Law of Delaware, as so amended.

Section 2. The Corporation may indemnify to the fullest extent permitted by law any person made or threatened to be made a party to an action or proceeding, whether criminal, civil, administrative or investigative, by reason of the fact that he, she, his or her testator or intestate is or was a director, officer, employee or agent at the request of the Corporation or any predecessor to the Corporation or serves or served at any other enterprise as a director, officer, employee or agent at the request of the Corporation or any predecessor to the Corporation.

Section 3. Neither any amendment or repeal of any Section of this Article VII, nor the adoption of any provision of this Certificate of Incorporation inconsistent with this Article VII, shall eliminate or reduce the effect of this Article VII, in respect of any matter occurring, or any action or proceeding accruing or arising or that, but for this Article VII, would accrue or arise, prior to such amendment, repeal or adoption of an inconsistent provision.

ARTICLE VIII

Meetings of stockholders may be held within or without the State of Delaware, as the Bylaws may provide. The books of the Corporation may be kept (subject to any provision contained in the statutes) outside of the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the Bylaws of the Corporation.

ARTICLE IX

Section 1. Except as otherwise provided for or fixed by or pursuant to the provisions of Article IV hereof in relation to the rights of the holders of Preferred Stock to elect directors under specified circumstances, newly created directorships resulting from any increase in the number of directors, created in accordance with the Bylaws of the Corporation, and any vacancies on the Board of Directors resulting from death, resignation, disqualification, removal or other cause shall be filled only by the affirmative vote of a majority of the remaining directors then in office, even though less than a quorum of the Board of Directors, or by a sole remaining

 

14


director. Any director elected in accordance with the preceding sentence shall hold office until the next annual meeting of stockholders and until such director’s successor shall have been elected and qualified, or until such director’s earlier death, resignation or removal. No decrease in the number of directors constituting the Board of Directors shall shorten the term of any incumbent director.

Section 2. Any director or the entire Board of Directors may be removed from office at any time, with or without cause, by the affirmative vote of the holders of at least a majority of the voting power of the issued and outstanding shares of capital stock of the Corporation then entitled to vote in the election of directors.

ARTICLE X

Advance notice of new business and stockholder nominations for the election of directors shall be given in the manner and to the extent provided in the Bylaws of the Corporation.

ARTICLE XI

Section 1. Unless otherwise required by law, special meetings of the stockholders of the Corporation, for any purpose or purposes, may be called only by (i) the Board of Directors of the Corporation, (ii) the Chairman of the Board of Directors of the Corporation, (iii) the Chief Executive Officer (or, in the absence of a Chief Executive Officer, the President) of the Corporation, or (iv) a holder, or group of holders, of Common Stock holding more than twenty percent (20%) of the total voting power of the outstanding shares of capital stock of the Corporation then entitled to vote.

Section 2. Any action required or permitted to be taken by the stockholders of the Corporation must be effected at a duly called annual or special meeting of stockholders of the Corporation and may not be effected by any consent in writing by such stockholders.

ARTICLE XII

The Corporation reserves the right to amend or repeal any provision contained in this Certificate of Incorporation in the manner prescribed by the laws of the State of Delaware and all rights conferred upon stockholders are granted subject to this reservation; provided , however , that notwithstanding any other provision of this Certificate of Incorporation, or any provision of law that might otherwise permit a lesser vote or no vote, but in addition to any vote of the holders of any class or series of the stock of the Corporation, and, as applicable, such other approvals of the Board of Directors of the Corporation, as are required by law or by this Certificate of Incorporation: (i) the unanimous consent of Board of Directors then in office, and the affirmative vote of the holders at least a majority of the voting power of the issued and outstanding shares of capital stock of the Corporation then entitled to vote, shall be required to amend or repeal Article IV, Section 2, Article IV, Section 5 or this clause (i) of Article XII; (ii) the affirmative vote of the holders of the greater of: (A) a majority of the voting power of the issued and outstanding shares of capital stock of the Corporation then entitled to vote thereon, or (B) sixty percent (60%) of the voting power of the shares of capital stock present in person or represented by proxy at the stockholder meeting and entitled to vote thereon, shall be required to amend or repeal Article IV, Section 3 or this clause (ii) of Article XII; (iii) the consent of a

 

15


majority of the members of the Board then in office, and the affirmative vote of the holders at least sixty-six and two-thirds percent (66 2/3%) of the voting power of the issued and outstanding shares of capital stock of the Corporation then entitled to vote shall be required to amend or repeal Article IV, Section 4 and Article XI or this clause (iii) of Article XII; (iv) the unanimous consent of the Board of Directors then in office and the consent of at least sixty-six and two-thirds percent (66 2/3%) of the voting power of the issued and outstanding shares of capital stock of the Corporation shall be required to amend or repeal Article VI, Section 3, 5, 6 or 7 or this clause (iv) of Article XII; and (v) the consent of at least two-thirds of the members of the Board of Directors then in office and the affirmative vote of the holders of at least a majority of the voting power of the issued and outstanding shares of capital stock of the Corporation then entitled to vote shall be required to amend or repeal Article VI, Section 4 or this clause (v) of Article XII.

 

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Exhibit 3.2

 

 

AMENDED AND RESTATED

BYLAWS

OF

ALPHABET INC.

(effective as of October 2, 2015)


TABLE OF CONTENTS

 

         Page  

ARTICLE I — CORPORATE OFFICES

     1   

1.1

 

REGISTERED OFFICE.

     1   

1.2

 

OTHER OFFICES.

     1   

ARTICLE II — MEETINGS OF STOCKHOLDERS

     1   

2.1

 

PLACE OF MEETINGS.

     1   

2.2

 

ANNUAL MEETING.

     1   

2.3

 

SPECIAL MEETING.

     1   

2.4

 

NOTICE OF STOCKHOLDERS’ MEETINGS.

     2   

2.5

 

MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE.

     3   

2.6

 

QUORUM.

     3   

2.7

 

ADJOURNED MEETING; NOTICE.

     3   

2.8

 

ADMINISTRATION OF THE MEETING.

     4   

2.9

 

VOTING.

     4   

2.10

 

NO STOCKHOLDER ACTION BY WRITTEN CONSENT WITHOUT A MEETING.

     5   

2.11

 

RECORD DATE FOR STOCKHOLDER NOTICE; VOTING; GIVING CONSENTS.

     5   

2.12

 

PROXIES.

     6   

2.13

 

LIST OF STOCKHOLDERS ENTITLED TO VOTE.

     6   

2.14

 

ADVANCE NOTICE OF STOCKHOLDER BUSINESS.

     6   

2.15

 

ADVANCE NOTICE OF DIRECTOR NOMINATIONS.

     7   

ARTICLE III — DIRECTORS

     8   

3.1

 

POWERS.

     8   

3.2

 

NUMBER OF DIRECTORS.

     9   

3.3

 

ELECTION, QUALIFICATION AND TERM OF OFFICE OF DIRECTORS.

     9   

3.4

 

RESIGNATION AND VACANCIES.

     9   

3.5

 

PLACE OF MEETINGS; MEETINGS BY TELEPHONE.

     9   

3.6

 

REGULAR MEETINGS.

     10   

3.7

 

SPECIAL MEETINGS; NOTICE.

     10   

3.8

 

QUORUM.

     10   

3.9

 

WAIVER OF NOTICE.

     11   

3.10

 

BOARD ACTION BY WRITTEN CONSENT WITHOUT A MEETING.

     11   

3.11

 

ADJOURNED MEETING; NOTICE.

     11   

3.12

 

FEES AND COMPENSATION OF DIRECTORS.

     11   

3.13

 

REMOVAL OF DIRECTORS.

     11   

3.14

 

CORPORATE GOVERNANCE COMPLIANCE.

     11   

ARTICLE IV — COMMITTEES

     12   

4.1

 

COMMITTEES OF DIRECTORS.

     12   

4.2

 

COMMITTEE MINUTES.

     12   

4.3

 

MEETINGS AND ACTION OF COMMITTEES.

     12   

4.4

 

AUDIT COMMITTEE.

     13   

4.5

 

CORPORATE GOVERNANCE AND NOMINATING COMMITTEE.

     13   

4.6

 

COMPENSATION COMMITTEE.

     13   

 

-i-


TABLE OF CONTENTS

 

         Page  

ARTICLE V — OFFICERS

     14   

5.1

 

OFFICERS.

     14   

5.2

 

APPOINTMENT OF OFFICERS.

     14   

5.3

 

SUBORDINATE OFFICERS.

     14   

5.4

 

REMOVAL AND RESIGNATION OF OFFICERS.

     14   

5.5

 

VACANCIES IN OFFICES.

     15   

5.6

 

CHAIRMAN OF THE BOARD.

     15   

5.7

 

CHIEF EXECUTIVE OFFICER.

     15   

5.8

 

PRESIDENTS.

     15   

5.9

 

VICE PRESIDENTS.

     15   

5.10

 

SECRETARY.

     16   

5.11

 

CHIEF FINANCIAL OFFICER.

     16   

5.12

 

TREASURER.

     17   

5.13

 

ASSISTANT SECRETARY.

     17   

5.14

 

ASSISTANT TREASURER.

     17   

5.15

 

REPRESENTATION OF SHARES OF OTHER CORPORATIONS.

     17   

5.16

 

AUTHORITY AND DUTIES OF OFFICERS.

     18   

ARTICLE VI — RECORDS AND REPORTS

     18   

6.1

 

MAINTENANCE AND INSPECTION OF RECORDS.

     18   

6.2

 

INSPECTION BY DIRECTORS.

     18   

ARTICLE VII — GENERAL MATTERS

     19   

7.1

 

CHECKS; DRAFTS; EVIDENCES OF INDEBTEDNESS.

     19   

7.2

 

EXECUTION OF CORPORATE CONTRACTS AND INSTRUMENTS.

     19   

7.3

 

STOCK CERTIFICATES; PARTLY PAID SHARES.

     19   

7.4

 

SPECIAL DESIGNATION ON CERTIFICATES.

     19   

7.5

 

LOST CERTIFICATES.

     20   

7.6

 

CONSTRUCTION; DEFINITIONS.

     20   

7.7

 

DIVIDENDS.

     20   

7.8

 

FISCAL YEAR.

     20   

7.9

 

SEAL.

     20   

7.10

 

TRANSFER OF STOCK.

     21   

7.11

 

STOCK TRANSFER AGREEMENTS.

     21   

7.12

 

REGISTERED STOCKHOLDERS.

     21   

7.13

 

WAIVER OF NOTICE.

     21   

7.14

 

CHARITABLE FOUNDATION.

     22   

ARTICLE VIII — NOTICE BY ELECTRONIC TRANSMISSION

     22   

8.1

 

NOTICE BY ELECTRONIC TRANSMISSION.

     22   

8.2

 

DEFINITION OF ELECTRONIC TRANSMISSION.

     23   

8.3

 

INAPPLICABILITY.

     23   

 

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TABLE OF CONTENTS

 

         Page  

ARTICLE IX — INDEMNIFICATION OF DIRECTORS AND OFFICERS

     23   

9.1

 

POWER TO INDEMNIFY IN ACTIONS, SUITS OR PROCEEDINGS OTHER THAN THOSE BY OR IN THE RIGHT OF THE CORPORATION.

     23   

9.2

 

POWER TO INDEMNIFY IN ACTIONS, SUITS OR PROCEEDINGS BY OR IN THE RIGHT OF THE CORPORATION.

     23   

9.3

 

AUTHORIZATION OF INDEMNIFICATION.

     24   

9.4

 

GOOD FAITH DEFINED.

     24   

9.5

 

INDEMNIFICATION BY A COURT.

     25   

9.6

 

EXPENSES PAYABLE IN ADVANCE.

     25   

9.7

 

NONEXCLUSIVITY OF INDEMNIFICATION AND ADVANCEMENT OF EXPENSES.

     25   

9.8

 

INSURANCE.

     26   

9.9

 

CERTAIN DEFINITIONS.

     26   

9.10

 

SURVIVAL OF INDEMNIFICATION AND ADVANCEMENT OF EXPENSES.

     26   

9.11

 

LIMITATION ON INDEMNIFICATION.

     27   

9.12

 

INDEMNIFICATION OF EMPLOYEES AND AGENTS.

     27   

9.13

 

EFFECT OF AMENDMENT OR REPEAL.

     27   

ARTICLE X — AMENDMENTS

     27   

 

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AMENDED AND RESTATED

BYLAWS OF ALPHABET INC.

 

 

ARTICLE I — CORPORATE OFFICES

1.1 REGISTERED OFFICE.

The registered office of Alphabet Inc. shall be fixed in the corporation’s certificate of incorporation, as the same may be amended and/or restated from time to time (as so amended and/or restated, the “ Certificate ”).

1.2 OTHER OFFICES.

The corporation’s Board of Directors (the “ Board ”) may at any time establish other offices at any place or places where the corporation is qualified to do business.

ARTICLE II — MEETINGS OF STOCKHOLDERS

2.1 PLACE OF MEETINGS.

Meetings of stockholders shall be held at any place within or outside the State of Delaware as designated by the Board. The Board may, in its sole discretion, determine that a meeting of stockholders shall not be held at any place, but may instead be held solely by means of remote communication as authorized by Section 211(a)(2) of the Delaware General Corporation Law (the “ DGCL ”). In the absence of any such designation or determination, stockholders’ meetings shall be held at the corporation’s principal executive office.

2.2 ANNUAL MEETING.

The annual meeting of stockholders shall be held each year on a date and at a time designated by the Board. At the annual meeting, directors shall be elected and any other proper business may be transacted.

2.3 SPECIAL MEETING.

Unless otherwise required by law or the Certificate, special meetings of the stockholders may be called at any time, for any purpose or purposes, only by (i) the Board, (ii) the Chairman of the Board, (iii) the chief executive officer of the corporation, or (iv) holders of more than twenty percent (20%) of the total voting power of the outstanding shares of capital stock of the corporation then entitled to vote.

If any person(s) other than the Board calls a special meeting, the request shall:

(i) be in writing;

(ii) specify the general nature of the business proposed to be transacted; and

 

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(iii) be delivered personally or sent by registered mail or by facsimile transmission to the secretary of the corporation.

Upon receipt of such a request, the Board shall determine the date, time and place of such special meeting, which must be scheduled to be held on a date that is within ninety (90) days of receipt by the secretary of the request therefor, and the secretary of the corporation shall prepare a proper notice thereof. No business may be transacted at such special meeting other than the business specified in the notice to stockholders of such meeting.

2.4 NOTICE OF STOCKHOLDERS’ MEETINGS.

All notices of meetings of stockholders shall be sent or otherwise given in accordance with either Section 2.5 or Section 8.1 of these bylaws not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to vote at such meeting, except as otherwise required by applicable law. The notice shall specify the place, if any, date and hour of the meeting, the means of remote communication, if any, by which stockholders and proxy holders may be deemed to be present in person and vote at such meeting, and, in the case of a special meeting, the purpose or purposes for which the meeting is called. Any previously scheduled meeting of stockholders may be postponed, and, unless the Certificate provides otherwise, any special meeting of the stockholders may be cancelled by resolution duly adopted by a majority of the Board members then in office upon public notice given prior to the date previously scheduled for such meeting of stockholders.

Whenever notice is required to be given, under the DGCL, the Certificate or these bylaws, to any person with whom communication is unlawful, the giving of such notice to such person shall not be required and there shall be no duty to apply to any governmental authority or agency for a license or permit to give such notice to such person. Any action or meeting which shall be taken or held without notice to any such person with whom communication is unlawful shall have the same force and effect as if such notice had been duly given. In the event that the action taken by the corporation is such as to require the filing of a certificate with the Secretary of State of Delaware, the certificate shall state, if such is the fact and if notice is required, that notice was given to all persons entitled to receive notice except such persons with whom communication is unlawful.

Whenever notice is required to be given, under any provision of the DGCL, the Certificate or these bylaws, to any stockholder to whom (a) notice of two (2) consecutive annual meetings, or (b) all, and at least two (2) payments (if sent by first-class mail) of dividends or interest on securities during a twelve (12) month period, have been mailed addressed to such person at such person’s address as shown on the records of the corporation and have been returned undeliverable, the giving of such notice to such person shall not be required. Any action or meeting which shall be taken or held without notice to such person shall have the same force and effect as if such notice had been duly given. If any such person shall deliver to the corporation a written notice setting forth such person’s then current address, the requirement that notice be given to such person shall be reinstated. In the event that the action taken by the corporation is such as to require the filing of a certificate with the Secretary of State of Delaware, the certificate need not state that notice was not given to persons to whom notice was not required to be given pursuant to Section 230(b) of the DGCL.

 

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The exception in subsection (a) of the above paragraph to the requirement that notice be given shall not be applicable to any notice returned as undeliverable if the notice was given by electronic transmission.

2.5 MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE.

Notice of any meeting of stockholders shall be given:

(i) if mailed, when deposited in the United States mail, postage prepaid, directed to the stockholder at his or her address as it appears on the corporation’s records;

(ii) if electronically transmitted, as provided in Section 8.1 of these bylaws; or

(iii) otherwise, when delivered.

An affidavit of the secretary or an assistant secretary of the corporation or of the transfer agent or any other agent of the corporation that the notice has been given shall, in the absence of fraud, be prima facie evidence of the facts stated therein.

Notice may be waived in accordance with Section 7.13 of these bylaws.

2.6 QUORUM.

Unless otherwise provided in the Certificate or required by law, stockholders representing a majority of the voting power of the issued and outstanding capital stock of the corporation, present in person or represented by proxy, shall constitute a quorum for the transaction of business at all meetings of the stockholders. If such quorum is not present or represented at any meeting of the stockholders, then the chairman of the meeting, or the stockholders representing a majority of the voting power of the capital stock at the meeting, present in person or represented by proxy, shall have power to adjourn the meeting from time to time until a quorum is present or represented. At such adjourned meeting at which a quorum is present or represented, any business may be transacted that might have been transacted at the meeting as originally noticed. The stockholders present at a duly called meeting at which quorum is present may continue to transact business until adjournment, notwithstanding the withdrawal of enough stockholders to leave less than a quorum.

2.7 ADJOURNED MEETING; NOTICE.

When a meeting is adjourned to another time or place, unless these bylaws otherwise require, notice need not be given of the adjourned meeting if the time, place if any thereof, and the means of remote communications if any by which stockholders and proxy holders may be deemed to be present in person and vote at such adjourned meeting are announced at the meeting at which the adjournment is taken. At the continuation of the adjourned meeting, the corporation may transact any business that might have been transacted at the original meeting. If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting in accordance with the provisions of Section 2.4 and 2.5 of these bylaws.

 

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2.8 ADMINISTRATION OF THE MEETING.

Meetings of stockholders shall be presided over by the chairman of the Board or, in the absence thereof, by such person as the chairman of the Board shall appoint, or, in the absence thereof or in the event that the chairman shall fail to make such appointment, any officer of the corporation elected by the Board. In the absence of the secretary of the corporation, the secretary of the meeting shall be such person as the chairman of the meeting appoints.

The Board shall, in advance of any meeting of stockholders, appoint one (1) or more inspector(s), who may include individual(s) who serve the corporation in other capacities, including without limitation as officers, employees or agents, to act at the meeting of stockholders and make a written report thereof. The Board may designate one (1) or more persons as alternate inspector(s) to replace any inspector, who fails to act. If no inspector or alternate has been appointed or is able to act at a meeting of stockholders, the chairman of the meeting shall appoint one (1) or more inspector(s) to act at the meeting. Each inspector, before discharging his or her duties, shall take and sign an oath to faithfully execute the duties of inspector with strict impartiality and according to the best of his or her ability. The inspector(s) or alternate(s) shall have the duties prescribed pursuant to Section 231 of the DGCL or other applicable law.

The Board shall be entitled to make such rules or regulations for the conduct of meetings of stockholders as it shall deem necessary, appropriate or convenient. Subject to such rules and regulations, if any, the chairman of the meeting shall have the right and authority to prescribe such rules, regulations and procedures and to do all acts as, in the judgment of such chairman, are necessary, appropriate or convenient for the proper conduct of the meeting, including without limitation establishing an agenda of business of the meeting, rules or regulations to maintain order, restrictions on entry to the meeting after the time fixed for commencement thereof and the fixing of the date and time of the opening and closing of the polls for each matter upon which the stockholders will vote at a meeting (and shall announce such at the meeting).

2.9 VOTING.

The stockholders entitled to vote at any meeting of stockholders shall be determined in accordance with the provisions of Section 2.11 of these bylaws, subject to Section 217 (relating to voting rights of fiduciaries, pledgors and joint owners of stock) and Section 218 (relating to voting trusts and other voting agreements) of the DGCL.

Except as otherwise provided in the provisions of Section 213 of the DGCL (relating to the fixing of a date for determination of stockholders of record) or these bylaws, each stockholder shall be entitled to that number of votes for each share of capital stock held by such stockholder as set forth in the Certificate.

In all matters, other than the election of directors and except as otherwise required by law, the Certificate or these bylaws, the affirmative vote of a majority of the voting power of the shares present or represented by proxy at the meeting and entitled to vote on the subject matter shall be the act of the stockholders. Directors shall be elected by a plurality of the voting power of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors.

 

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The stockholders of the corporation shall not have the right to cumulate their votes for the election of directors of the corporation.

2.10 NO STOCKHOLDER ACTION BY WRITTEN CONSENT WITHOUT A MEETING.

Any action required or permitted to be taken by the stockholders of the corporation (if the corporation has more than one stockholder at such time) must be effected at a duly called annual or special meeting of stockholders of the corporation and may not be effected by any consent in writing by such stockholders.

2.11 RECORD DATE FOR STOCKHOLDER NOTICE; VOTING; GIVING CONSENTS.

In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or entitled to receive payment of any dividend or other distribution or allotment of any rights, or entitled to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board may fix, in advance, a record date, which record date shall not precede the date on which the resolution fixing the record date is adopted and which shall not be more than sixty (60) nor less than ten (10) days before the date of such meeting, nor more than sixty (60) days prior to any other such action.

If the Board does not fix a record date in accordance with these bylaws and applicable law:

(i) The record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held.

(ii) The record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board is necessary, shall be the first day on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation.

(iii) The record date for determining stockholders for any other purpose shall be at the close of business on the day on which the Board adopts the resolution relating thereto.

A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board may fix a new record date for the adjourned meeting.

 

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2.12 PROXIES.

Each stockholder entitled to vote at a meeting of stockholders may authorize another person or persons to act for such stockholder by proxy authorized by an instrument in writing or by a transmission permitted by law and filed with the secretary of the corporation, but no such proxy shall be voted or acted upon after three (3) years from its date, unless the proxy provides for a longer period. A stockholder may also authorize another person or persons to act for him, her or it as proxy in the manner(s) provided under Section 212(c) of the DGCL or as otherwise provided under Delaware law. The revocability of a proxy that states on its face that it is irrevocable shall be governed by the provisions of Section 212 of the DGCL.

2.13 LIST OF STOCKHOLDERS ENTITLED TO VOTE.

The officer who has charge of the stock ledger of the corporation shall prepare and make, at least ten (10) days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. The corporation shall not be required to include electronic mail addresses or other electronic contact information on such list. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting for a period of at least ten (10) days prior to the meeting: (i) on a reasonably accessible electronic network, provided that the information required to gain access to such list is provided with the notice of the meeting, or (ii) during ordinary business hours, at the corporation’s principal place of business.

In the event that the corporation determines to make the list available on an electronic network, the corporation may take reasonable steps to ensure that such information is available only to stockholders of the corporation. If the meeting is to be held at a place, then the list shall be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. If the meeting is to be held solely by means of remote communication, then the list shall also be open to the examination of any stockholder during the whole time of the meeting on a reasonably accessible electronic network, and the information required to access such list shall be provided with the notice of the meeting.

2.14 ADVANCE NOTICE OF STOCKHOLDER BUSINESS.

Only such business shall be conducted as shall have been properly brought before a meeting of the stockholders of the corporation. To be properly brought before an annual meeting, business must be (a) specified in the notice of meeting (or any supplement thereto) given by or at the direction of the Board, (b) otherwise properly brought before the meeting by or at the direction of the Board, or (c) a proper matter for stockholder action under the DGCL that has been properly brought before the meeting by a stockholder (i) who is a stockholder of record on the date of the giving of the notice provided for in this Section 2.14 and on the record date for the determination of stockholders entitled to vote at such annual meeting and (ii) who complies with the notice procedures set forth in this Section 2.14. For such business to be considered properly brought before the meeting by a stockholder such stockholder must, in addition to any other applicable requirements, have given timely notice in proper form of such stockholder’s intent to bring such business before such meeting. To be timely, such stockholder’s notice must

 

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be delivered to or mailed and received by the secretary of the corporation at the principal executive offices of the corporation not later than the close of business on the 90th day, nor earlier than the close of business on the 120th day, prior to the anniversary date of the immediately preceding annual meeting; provided, however, that in the event that no annual meeting was held in the previous year or the annual meeting is called for a date that is not within thirty (30) days before or after such anniversary date, notice by the stockholder to be timely must be so received not later than the close of business on the tenth (10th) day following the day on which such notice of the date of the meeting was mailed or public disclosure of the date of the meeting was made, whichever occurs first.

To be in proper form, a stockholder’s notice to the secretary shall be in writing and shall set forth:

(a) the name and record address of the stockholder who intends to propose the business and the class or series and number of shares of capital stock of the corporation which are owned beneficially or of record by such stockholder;

(b) a representation that the stockholder is a holder of record of stock of the corporation entitled to vote at such meeting and intends to appear in person or by proxy at the meeting to introduce the business specified in the notice;

(c) a brief description of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting;

(d) any material interest of the stockholder in such business; and

(e) any other information that is required to be provided by the stockholder pursuant to Regulation 14A under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”).

Notwithstanding the foregoing, in order to include information with respect to a stockholder proposal in the proxy statement and form of proxy for a stockholder’s meeting, stockholders must provide notice as required by, and otherwise comply with the requirements of, the Exchange Act and the regulations promulgated thereunder.

No business shall be conducted at the annual meeting of stockholders except business brought before the annual meeting in accordance with the procedures set forth in this Section 2.14. The chairman of the meeting may refuse to acknowledge the proposal of any business not made in compliance with the foregoing procedure.

2.15 ADVANCE NOTICE OF DIRECTOR NOMINATIONS.

Only persons who are nominated in accordance with the following procedures shall be eligible for election as directors of the corporation, except as may be otherwise provided in the Certificate with respect to the right of holders of Preferred Stock of the corporation to nominate and elect a specified number of directors. To be properly brought before an annual meeting of stockholders, or any special meeting of stockholders called for the purpose of electing directors, nominations for the election of director must be (a) specified in the notice of meeting (or any

 

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supplement thereto), (b) made by or at the direction of the Board (or any duly authorized committee thereof) or (c) made by any stockholder of the corporation (i) who is a stockholder of record on the date of the giving of the notice provided for in this Section 2.15 and on the record date for the determination of stockholders entitled to vote at such meeting and (ii) who complies with the notice procedures set forth in this Section 2.15.

In addition to any other applicable requirements, for a nomination to be made by a stockholder, such stockholder must have given timely notice thereof in proper written form to the secretary of the corporation. To be timely, a stockholder’s notice to the secretary must be delivered to or mailed and received at the principal executive offices of the corporation, in the case of an annual meeting, in accordance with the provisions set forth in Section 2.14, and, in the case of a special meeting of stockholders called for the purpose of electing directors, not later than the close of business on the tenth (10th) day following the day on which notice of the date of the special meeting was mailed or public disclosure of the date of the special meeting was made, whichever first occurs.

To be in proper written form, a stockholder’s notice to the secretary must set forth:

(a) as to each person whom the stockholder proposes to nominate for election as a director (i) the name, age, business address and residence address of the person, (ii) the principal occupation or employment of the person, (iii) the class or series and number of shares of capital stock of the corporation which are owned beneficially or of record by the person, (iv) a description of all arrangements or understandings between the stockholder and each nominee and any other person or persons (naming such person or persons) pursuant to which the nominations are to be made by the stockholder, and (v) any other information relating to such person that is required to be disclosed in solicitations of proxies for elections of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act (including without limitation such person’s written consent to being named in the proxy statement, if any, as a nominee and to serving as a director if elected); and

(b) as to such stockholder giving notice, the information required to be provided pursuant to Section 2.14.

Subject to the rights of any holders of Preferred Stock of the corporation, no person shall be eligible for election as a director of the corporation unless nominated in accordance with the procedures set forth in this Section 2.15. If the chairman of the meeting properly determines that a nomination was not made in accordance with the foregoing procedures, the chairman shall declare to the meeting that the nomination was defective and such defective nomination shall be disregarded.

ARTICLE III — DIRECTORS

3.1 POWERS.

Subject to the provisions of the DGCL and any limitations in the Certificate, the business and affairs of the corporation shall be managed and all corporate powers shall be exercised by or under the direction of the Board.

 

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3.2 NUMBER OF DIRECTORS.

Subject to the rights of the holders of any series of Preferred Stock to elect directors under specified circumstances, the authorized number of directors shall be determined from time to time by resolution of the Board, provided the Board shall consist of at least five members. No reduction of the authorized number of directors shall have the effect of removing any director before that director’s term of office expires.

3.3 ELECTION, QUALIFICATION AND TERM OF OFFICE OF DIRECTORS.

Except as provided in Section 3.4 and Section 3.13 of these bylaws, directors shall be elected at each annual meeting of stockholders to hold office until the next annual meeting. Directors need not be stockholders unless so required by the Certificate or these bylaws. The Certificate or these bylaws may prescribe other qualifications for directors. Each director, including a director elected to fill a vacancy, shall hold office until such director’s successor is elected and qualified or until such director’s earlier death, resignation or removal.

All elections of directors shall be by written ballot, unless otherwise provided in the Certificate. If authorized by the Board, such requirement of a written ballot shall be satisfied by a ballot submitted by electronic transmission, provided that any such electronic transmission must be either set forth or be submitted with information from which it can be determined that the electronic transmission was authorized.

3.4 RESIGNATION AND VACANCIES.

Any director may resign at any time upon written notice or by electronic transmission to the chairman of the Board, with a copy to the secretary of the corporation.

Subject to the rights of the holders of any series of Preferred Stock of the corporation then outstanding and unless the Board otherwise determines, newly created directorships resulting from any increase in the authorized number of directors, or any vacancies on the Board resulting from the death, resignation, retirement, disqualification, removal from office or other cause shall, unless otherwise required by law, be filled by the affirmative vote of a majority of the remaining directors then in office, even though less than a quorum of the Board, or by a sole remaining director. When one or more directors resigns and the resignation is effective at a future date, a majority of the directors then in office, including those who have so resigned, shall have power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective, and each director so chosen shall hold office as provided in this section in the filling of other vacancies.

3.5 PLACE OF MEETINGS; MEETINGS BY TELEPHONE.

The Board may hold meetings, both regular and special, either within or outside the State of Delaware.

Unless otherwise restricted by the Certificate or these bylaws, members of the Board, or any committee designated by the Board, may participate in a meeting of the Board, or any committee, by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.

 

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3.6 REGULAR MEETINGS.

Regular meetings of the Board may be held with at least five business days prior notice at such time and at such place as shall from time to time be determined by the Board.

3.7 SPECIAL MEETINGS; NOTICE.

Special meetings of the Board for any purpose or purposes may be called at any time by the chairman of the Board, the chief executive officer, the secretary or any two directors. The person(s) authorized to call special meetings of the Board may fix the place and time of the meeting.

Notice of the time and place of special meetings shall be:

(i) delivered personally by hand, by courier or by telephone;

(ii) sent by United States first-class mail, postage prepaid;

(iii) sent by facsimile; or

(iv) sent by electronic mail,

directed to each director at that director’s address, telephone number, facsimile number or electronic mail address, as the case may be, as shown on the corporation’s records.

If the notice is (i) delivered personally by hand, by courier or by telephone, (ii) sent by facsimile or (iii) sent by electronic mail, it shall be delivered or sent at least twenty-four (24) hours before the time of the holding of the meeting. If the notice is sent by United States mail, it shall be deposited in the United States mail at least four days before the time of the holding of the meeting. Any oral notice may be communicated either to the director or to a person at the office of the director who the person giving notice has reason to believe will promptly communicate such notice to the director. The notice need not specify the place of the meeting if the meeting is to be held at the corporation’s principal executive office nor the purpose of the meeting.

3.8 QUORUM.

Except as otherwise required by law or the Certificate, at all meetings of the Board, a majority of the authorized number of directors (as determined pursuant to Section 3.2 of these bylaws) shall constitute a quorum for the transaction of business, except to adjourn as provided in Section 3.11 of these bylaws. The vote of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board, except as may be otherwise specifically provided by statute, the Certificate or these bylaws.

 

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3.9 WAIVER OF NOTICE.

Whenever notice is required to be given under any provisions of the DGCL, the Certificate or these bylaws, a written waiver thereof, signed by the person entitled to notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time stated therein, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting solely for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the directors, or members of a committee of directors, need be specified in any written waiver of notice or any waiver by electronic transmission unless so required by the Certificate or these bylaws.

3.10 BOARD ACTION BY WRITTEN CONSENT WITHOUT A MEETING.

Unless otherwise restricted by the Certificate or these bylaws, any action required or permitted to be taken at any meeting of the Board, or of any committee thereof, may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing or by electronic transmission and the writing or writings or electronic transmission or transmissions are filed with the minutes of proceedings of the Board or committee. Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.

3.11 ADJOURNED MEETING; NOTICE.

If a quorum is not present at any meeting of the Board, then a majority of the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum is present.

3.12 FEES AND COMPENSATION OF DIRECTORS.

Unless otherwise restricted by the Certificate or these bylaws, the Board shall have the authority to fix the compensation of directors.

3.13 REMOVAL OF DIRECTORS.

Subject to the rights of the holders of any series of Preferred Stock then outstanding, any director or the entire Board may be removed from office at any time, with or without cause, by the affirmative vote of the holders of at least a majority of the voting power of the issued and outstanding shares of capital stock of the corporation then entitled to vote in the election of directors.

3.14 CORPORATE GOVERNANCE COMPLIANCE.

Without otherwise limiting the powers of the Board set forth in Section 3.1 and provided that shares of capital stock of the corporation are listed for trading on either the NASDAQ Stock Market (“ NASDAQ ”) or the New York Stock Exchange (“ NYSE ”), the corporation shall comply with the corporate governance rules and requirements of the NASDAQ or the NYSE, as applicable.

 

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ARTICLE IV — COMMITTEES

4.1 COMMITTEES OF DIRECTORS.

The Board may designate one or more committees, each committee to consist of one or more of the directors of the corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the Board to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board or in these bylaws, shall have and may exercise such lawfully delegable powers and duties as the Board may confer. Each committee will comply with all applicable provisions of: the Sarbanes-Oxley Act of 2002, the rules and regulations of the Securities and Exchange Commission, and the rules and requirements of NASDAQ or NYSE, as applicable, and will have the right to retain independent legal counsel and other advisers at the corporation’s expense.

4.2 COMMITTEE MINUTES.

Each committee shall keep regular minutes of its meetings and report to the Board when required.

4.3 MEETINGS AND ACTION OF COMMITTEES.

Meetings and actions of committees shall be governed by, and held and taken in accordance with, the provisions of:

(i) Section 3.5 (place of meetings and meetings by telephone);

(ii) Section 3.6 (regular meetings);

(iii) Section 3.7 (special meetings and notice);

(iv) Section 3.8 (quorum);

(v) Section 3.9 (waiver of notice);

(vi) Section 3.10 (action without a meeting); and

(vii) Section 3.11 (adjournment and notice of adjournment).

with such changes in the context of those bylaws as are necessary to substitute the committee and its members for the Board and its members.

 

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Notwithstanding the foregoing:

(i) the time of regular meetings of committees may be determined either by resolution of the Board or by resolution of the committee;

(ii) special meetings of committees may also be called by resolution of the Board; and

(iii) notice of special meetings of committees shall also be given to all alternate members, who shall have the right to attend all meetings of the committee. The Board may adopt rules for the government of any committee not inconsistent with the provisions of these bylaws.

4.4 AUDIT COMMITTEE.

The Board shall establish an Audit Committee whose principal purpose will be to oversee the corporation’s and its subsidiaries’ accounting and financial reporting processes, internal systems of control, independent auditor relationships and audits of consolidated financial statements of the corporation and its subsidiaries. The Audit Committee will also determine the appointment of the independent auditors of the corporation and any change in such appointment and ensure the independence of the corporation’s auditors. In addition, the Audit Committee will assume such other duties and responsibilities as the Board may confer upon the committee from time to time.

4.5 CORPORATE GOVERNANCE AND NOMINATING COMMITTEE.

The Board shall establish a Corporate Governance and Nominating Committee whose principal duties will be to assist the Board by identifying individuals qualified to become Board members consistent with criteria approved by the Board, to recommend to the Board for its approval the slate of nominees to be proposed by the Board to the stockholders for election to the Board, to develop and recommend to the Board the governance principles applicable to the corporation, as well as such other duties and responsibilities as the Board may confer upon the committee from time to time. In the event the Corporate Governance and Nominating Committee will not be recommending a then incumbent director for inclusion in the slate of nominees to be proposed by the Board to the stockholders for election to the Board, and provided such incumbent director has not notified the Committee that he or she will be resigning or that he or she does not intend to stand for re-election to the Board, then, in the case of an election to be held at an annual meeting of stockholders, the Committee will recommend the slate of nominees to the Board at least thirty (30) days prior to the latest date required by the provisions of Sections 2.14 and 2.15 of these bylaws for stockholders to submit nominations for directors at such annual meeting, or in the case of an election to be held at a special meeting of stockholders, at least ten (10) days prior to the latest date required by the provisions of Sections 2.14 and 2.15 of these bylaws for stockholders to submit nominations for directors at such special meeting.

4.6 COMPENSATION COMMITTEE.

The Board shall establish a Compensation Committee whose principal duties will be to review employee compensation policies and programs as well as the compensation of the chief

 

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executive officer and other executive officers of the corporation, to recommend to the Board a compensation program for outside Board members, as well as such other duties and responsibilities as the Board may confer upon the committee from time to time.

ARTICLE V — OFFICERS

5.1 OFFICERS.

The officers of the corporation shall be a chief executive officer and a secretary. The corporation may also have, at the discretion of the Board, a chairman of the Board, a vice chairman of the Board, one or more presidents, a chief financial officer, a treasurer, one or more vice presidents, one or more assistant vice presidents, one or more assistant treasurers, one or more assistant secretaries, and any such other officers as may be appointed in accordance with the provisions of these bylaws.

Any number of offices may be held by the same person, provided, however, that, except as provided in Section 5.6 below, the chairman of the Board shall not hold any other office of the corporation.

5.2 APPOINTMENT OF OFFICERS.

The Board shall appoint the officers of the corporation, except such officers as may be appointed in accordance with the provisions of Sections 5.3 of these bylaws, subject to the rights, if any, of an officer under any contract of employment. Each officer shall hold office until his or her successor is elected and qualified or until his or her earlier resignation or removal. A failure to elect officers shall not dissolve or otherwise affect the corporation.

5.3 SUBORDINATE OFFICERS.

The Board may appoint, or empower the chief executive officer of the corporation, to appoint, such other officers and agents as the business of the corporation may require. Each of such officers and agents shall hold office for such period, have such authority, and perform such duties as are provided in these bylaws or as the Board may from time to time determine.

5.4 REMOVAL AND RESIGNATION OF OFFICERS.

Any officer may be removed, either with or without cause, by an affirmative vote of the majority of the Board at any regular or special meeting of the Board or, except in the case of an officer appointed by the Board, by any officer upon whom such power of removal has been conferred by the Board.

Any officer may resign at any time by giving written notice to the corporation. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice. Unless otherwise specified in the notice of resignation, the acceptance of the resignation shall not be necessary to make it effective. Any resignation is without prejudice to the rights, if any, of the corporation under any contract to which the officer is a party.

 

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5.5 VACANCIES IN OFFICES.

Any vacancy occurring in any office of the corporation shall be filled by the Board or as provided in Section 5.2.

5.6 CHAIRMAN OF THE BOARD.

The chairman of the Board shall be a member of the Board and, if present, preside at meetings of the Board and exercise and perform such other powers and duties as may from time to time be assigned to him or her by the Board or as may be prescribed by these bylaws.

The chairman shall be an Outside Director (as defined in the Certificate) and shall not hold any other office of the corporation unless the appointment of the chairman is approved by two-thirds of the members of the Board then in office, provided, however, that if there is no chief executive officer or president of the corporation as a result of the death, resignation or removal of such officer, then the chairman of the Board may also serve in an interim capacity as the chief executive officer of the corporation until the Board shall appoint a new chief executive officer and, while serving in such interim capacity, shall have the powers and duties prescribed in Section 5.7 of these bylaws.

5.7 CHIEF EXECUTIVE OFFICER.

Subject to the control of the Board and any supervisory powers the Board may give to the chairman of the Board, the chief executive officer shall have general supervision, direction, and control of the business and affairs of the corporation and shall see that all orders and resolutions of the Board are carried into effect. The chief executive officer shall, together with any president or presidents of the corporation, also perform all duties incidental to this office that may be required by law and all such other duties as are properly required of this office by the Board of Directors. The chief executive officer shall serve as chairman of and preside at all meetings of the stockholders. In the absence of the chairman of the Board, the chief executive officer shall preside at all meetings of the Board.

5.8 PRESIDENTS.

Subject to the control of the Board and any supervisory powers the Board may give to the chairman of the Board, any president or presidents of the corporation shall, together with the chief executive officer, have general supervision, direction, and control of the business and affairs of the corporation and shall see that all orders and resolutions of the Board are carried into effect. A president shall have such other powers and perform such other duties as from time to time may be prescribed for him or her by the Board, these bylaws, the chief executive officer, or the chairman of the Board.

5.9 VICE PRESIDENTS.

In the absence or disability of any president, the vice presidents, if any, in order of their rank as fixed by the Board or, if not ranked, a vice president designated by the Board, shall perform all the duties of a president. When acting as a president, the appropriate vice president shall have all the powers of, and be subject to all the restrictions upon, that president. The vice

 

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presidents shall have such other powers and perform such other duties as from time to time may be prescribed for them respectively by the Board, these bylaws, the chairman of the Board, the chief executive officer or, in the absence of a chief executive officer, any president.

5.10 SECRETARY.

The secretary shall keep or cause to be kept, at the principal executive office of the corporation or such other place as the Board may direct, a book of minutes of all meetings and actions of directors, committees of directors, and stockholders. The minutes shall show:

(i) the time and place of each meeting;

(ii) whether regular or special (and, if special, how authorized and the notice given);

(iii) the names of those present at directors’ meetings or committee meetings;

(iv) the number of shares present or represented at stockholders’ meetings; and

(v) the proceedings thereof.

The secretary shall keep, or cause to be kept, at the principal executive office of the corporation or at the office of the corporation’s transfer agent or registrar, as determined by resolution of the Board, a share register, or a duplicate share register showing:

(i) the names of all stockholders and their addresses;

(ii) the number and classes of shares held by each;

(iii) the number and date of certificates evidencing such shares; and

(iv) the number and date of cancellation of every certificate surrendered for cancellation.

The secretary shall give, or cause to be given, notice of all meetings of the stockholders and of the Board required to be given by law or by these bylaws. The secretary shall keep the seal of the corporation, if one be adopted, in safe custody and shall have such other powers and perform such other duties as may be prescribed by the Board or by these bylaws.

5.11 CHIEF FINANCIAL OFFICER.

The chief financial officer shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the corporation, including accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital, retained earnings and shares. The books of account shall at all reasonable times be open to inspection by any director.

The chief financial officer shall deposit all moneys and other valuables in the name and to the credit of the corporation with such depositories as the Board may designate. The chief

 

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financial officer shall disburse the funds of the corporation as may be ordered by the Board, shall render to the chief executive officer or, in the absence of a chief executive officer, any president and directors, whenever they request it, an account of all his or her transactions as chief financial officer and of the financial condition of the corporation, and shall have other powers and perform such other duties as may be prescribed by the Board or these bylaws.

The chief financial officer may be the treasurer of the corporation.

5.12 TREASURER.

The treasurer shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the corporation, including accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital, retained earnings and shares. The books of account shall at all reasonable times be open to inspection by any director.

The treasurer shall deposit all moneys and other valuables in the name and to the credit of the corporation with such depositories as the Board may designate. The treasurer shall disburse the funds of the corporation as may be ordered by the Board, shall render to the chief executive officer or, in the absence of a chief executive officer, any president and the directors, whenever they request it, an account of all his or her transactions as treasurer and of the financial condition of the corporation, and shall have other powers and perform such other duties as may be prescribed by the Board or these bylaws.

5.13 ASSISTANT SECRETARY.

The assistant secretary, or, if there is more than one, the assistant secretaries in the order determined by the Board (or if there be no such determination, then in the order of their election) shall, in the absence of the secretary or in the event of the secretary’s inability or refusal to act, perform the duties and exercise the powers of the secretary and shall perform such other duties and have such other powers as may be prescribed by the Board or these bylaws.

5.14 ASSISTANT TREASURER.

The assistant treasurer, or, if there is more than one, the assistant treasurers, in the order determined by the Board (or if there be no such determination, then in the order of their election), shall, in the absence of the chief financial officer or treasurer or in the event of the chief financial officer’s or treasurer’s inability or refusal to act, perform the duties and exercise the powers of the chief financial officer or treasurer, as applicable, and shall perform such other duties and have such other powers as may be prescribed by the Board or these bylaws.

5.15 REPRESENTATION OF SHARES OF OTHER CORPORATIONS.

The chairman of the Board, the chief executive officer, any president, any vice president, the treasurer, the secretary or assistant secretary of this corporation, or any other person authorized by the Board, the chief executive officer, a president or a vice president, is authorized to vote, represent, and exercise on behalf of this corporation all rights incident to any and all shares or other equity interests of any other corporation or entity standing in the name of this

 

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corporation. The authority granted herein may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by such person having the authority.

5.16 AUTHORITY AND DUTIES OF OFFICERS.

In addition to the foregoing authority and duties, all officers of the corporation shall respectively have such authority and perform such duties in the management of the business of the corporation as may be designated from time to time by the Board.

ARTICLE VI — RECORDS AND REPORTS

6.1 MAINTENANCE AND INSPECTION OF RECORDS.

The corporation shall, either at its principal executive office or at such place or places as designated by the Board, keep a record of its stockholders listing their names and addresses and the number and class of shares held by each stockholder, a copy of these bylaws, as may be amended to date, minute books, accounting books and other records.

Any such records maintained by the corporation may be kept on, or by means of, or be in the form of, any information storage device or method, provided that the records so kept can be converted into clearly legible paper form within a reasonable time. The corporation shall so convert any records so kept upon the request of any person entitled to inspect such records pursuant to the provisions of the DGCL. When records are kept in such manner, a clearly legible paper form produced from or by means of the information storage device or method shall be admissible in evidence, and accepted for all other purposes, to the same extent as an original paper form accurately portrays the record.

Any stockholder of record, in person or by attorney or other agent, shall, upon written demand under oath stating the purpose thereof, have the right during the usual hours for business to inspect for any proper purpose the corporation’s stock ledger, a list of its stockholders, and its other books and records and to make copies or extracts therefrom. A proper purpose shall mean a purpose reasonably related to such person’s interest as a stockholder. In every instance where an attorney or other agent is the person who seeks the right to inspection, the demand under oath shall be accompanied by a power of attorney or such other writing that authorizes the attorney or other agent to so act on behalf of the stockholder. The demand under oath shall be directed to the corporation at its registered office in Delaware or at its principal executive office.

6.2 INSPECTION BY DIRECTORS.

Any director shall have the right to examine the corporation’s stock ledger, a list of its stockholders, and its other books and records for a purpose reasonably related to his or her position as a director.

 

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ARTICLE VII — GENERAL MATTERS

7.1 CHECKS; DRAFTS; EVIDENCES OF INDEBTEDNESS.

From time to time, the Board shall determine by resolution which person or persons may sign or endorse all checks, drafts, other orders for payment of money, notes or other evidences of indebtedness that are issued in the name of or payable to the corporation, and only the persons so authorized shall sign or endorse those instruments.

7.2 EXECUTION OF CORPORATE CONTRACTS AND INSTRUMENTS.

Except as otherwise provided in these bylaws, the Board, or any officers of the corporation authorized thereby, may authorize any officer or officers, or agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the corporation; such authority may be general or confined to specific instances.

7.3 STOCK CERTIFICATES; PARTLY PAID SHARES.

The shares of the corporation shall be represented by certificates, provided that the Board may provide by resolution or resolutions that some or all of any or all classes or series of its stock shall be uncertificated shares. Any such resolution shall not apply to shares represented by a certificate until such certificate is surrendered to the corporation. Notwithstanding the adoption of such a resolution by the Board, every holder of stock represented by certificates and upon request every holder of uncertificated shares shall be entitled to have a certificate signed by, or in the name of the corporation by the chairman or vice-chairman of the Board, or any president or vice-president, and by the treasurer or an assistant treasurer, or the secretary or an assistant secretary of such corporation representing the number of shares registered in certificate form. Any or all of the signatures on the certificate may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he or she were such officer, transfer agent or registrar at the date of issue.

The corporation may issue the whole or any part of its shares as partly paid and subject to call for the remainder of the consideration to be paid therefor. Upon the face or back of each stock certificate issued to represent any such partly paid shares, and upon the books and records of the corporation in the case of uncertificated partly paid shares, the total amount of the consideration to be paid therefor and the amount paid thereon shall be stated. Upon the declaration of any dividend on fully paid shares, the corporation shall declare a dividend upon partly paid shares of the same class, but only upon the basis of the percentage of the consideration actually paid thereon.

7.4 SPECIAL DESIGNATION ON CERTIFICATES.

If the corporation is authorized to issue more than one class of stock or more than one series of any class, then the powers, designations, preferences, and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights shall be set forth in full or

 

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summarized on the face or back of the certificate that the corporation shall issue to represent such class or series of stock; provided , however , that, except as otherwise provided in Section 202 of the DGCL, in lieu of the foregoing requirements there may be set forth on the face or back of the certificate that the corporation shall issue to represent such class or series of stock a statement that the corporation will furnish without charge to each stockholder who so requests the powers, designations, preferences, and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights.

7.5 LOST CERTIFICATES.

Except as provided in this Section 7.6, no new certificates for shares shall be issued to replace a previously issued certificate unless the latter is surrendered to the corporation and cancelled at the same time. The corporation may issue a new certificate of stock or uncertificated shares in the place of any certificate theretofore issued by it, alleged to have been lost, stolen or destroyed, and the corporation may require the owner of the lost, stolen or destroyed certificate, or such owner’s legal representative, to give the corporation a bond sufficient to indemnify it against any claim that may be made against it on account of the alleged loss, theft or destruction of any such certificate or the issuance of such new certificate or uncertificated shares.

7.6 CONSTRUCTION; DEFINITIONS.

Unless the context requires otherwise, the general provisions, rules of construction, and definitions in the DGCL shall govern the construction of these bylaws. Without limiting the generality of this provision, the singular number includes the plural, the plural number includes the singular, and the term “person” includes both a corporation and a natural person.

7.7 DIVIDENDS.

The Board, subject to any restrictions contained in either (i) the DGCL, or (ii) the Certificate, may declare and pay dividends upon the shares of its capital stock. Dividends may be paid in cash, in property, or in shares of the corporation’s capital stock.

The Board may set apart out of any of the funds of the corporation available for dividends a reserve or reserves for any proper purpose and may abolish any such reserve.

7.8 FISCAL YEAR.

The fiscal year of the corporation shall be fixed by resolution of the Board and may be changed by the Board.

7.9 SEAL.

The corporation may adopt a corporate seal, which shall be adopted and which may be altered by the Board. The corporation may use the corporate seal by causing it or a facsimile thereof to be impressed or affixed or in any other manner reproduced.

 

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7.10 TRANSFER OF STOCK.

Transfers of stock shall be made only upon the transfer books of the corporation kept at an office of the corporation or by transfer agents designated to transfer shares of the stock of the corporation. Except where a certificate is issued in accordance with Section 7.5 of these bylaws, an outstanding certificate for the number of shares involved shall be surrendered for cancellation before a new certificate is issued therefore. Upon surrender to the corporation or the transfer agent of the corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignation or authority to transfer, it shall be the duty of the corporation to issue a new certificate to the person entitled thereto, cancel the old certificate, and record the transaction in its books.

7.11 STOCK TRANSFER AGREEMENTS.

The corporation shall have power to enter into and perform any agreement with any number of stockholders of any one or more classes or series of stock of the corporation to restrict the transfer of shares of stock of the corporation of any one or more classes or series owned by such stockholders in any manner not prohibited by the DGCL.

7.12 REGISTERED STOCKHOLDERS.

The corporation:

(i) shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends and to vote as such owner;

(ii) shall be entitled to hold liable for calls and assessments on partly paid shares the person registered on its books as the owner of shares; and

(iii) shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of another person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Delaware.

7.13 WAIVER OF NOTICE.

Whenever notice is required to be given under any provision of the DGCL, the Certificate or these bylaws, a written waiver, signed by the person entitled to notice, or a waiver by electronic transmission by the person entitled to notice, whether before or after the time of the event for which notice is to be given, shall be deemed equivalent to notice. Attendance of a person at a meeting shall constitute a waiver of notice of such meeting, except when the person attends a meeting solely for the express purpose of objecting at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice or any waiver by electronic transmission unless so required by the Certificate or these bylaws.

 

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7.14 CHARITABLE FOUNDATION.

The establishment by the corporation of a charitable foundation will require Board approval, as will contributions by the corporation to the foundation and disbursements by the foundation. The Board may delegate authority over the foundation to one or more persons who are not directors of the corporation with the approval of two-thirds of the members of the Board.

ARTICLE VIII — NOTICE BY ELECTRONIC TRANSMISSION

8.1 NOTICE BY ELECTRONIC TRANSMISSION.

Without limiting the manner by which notice otherwise may be given effectively to stockholders pursuant to the DGCL, the Certificate or these bylaws, any notice to stockholders given by the corporation under any provision of the DGCL, the Certificate or these bylaws shall be effective if given by a form of electronic transmission consented to by the stockholder to whom the notice is given. Any such consent shall be revocable by the stockholder by written notice to the corporation. Any such consent shall be deemed revoked if:

(i) the corporation is unable to deliver by electronic transmission two consecutive notices given by the corporation in accordance with such consent; and

(ii) such inability becomes known to the secretary or an assistant secretary of the corporation or to the transfer agent, or other person responsible for the giving of notice.

However, the inadvertent failure to treat such inability as a revocation shall not invalidate any meeting or other action.

Any notice given pursuant to the preceding paragraph shall be deemed given:

(i) if by facsimile telecommunication, when directed to a number at which the stockholder has consented to receive notice;

(ii) if by electronic mail, when directed to an electronic mail address at which the stockholder has consented to receive notice;

(iii) if by a posting on an electronic network together with separate notice to the stockholder of such specific posting, upon the later of (A) such posting and (B) the giving of such separate notice; and

(iv) if by any other form of electronic transmission, when directed to the stockholder.

An affidavit of the secretary or an assistant secretary or of the transfer agent or other agent of the corporation that the notice has been given by a form of electronic transmission shall, in the absence of fraud, be prima facie evidence of the facts stated therein.

 

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8.2 DEFINITION OF ELECTRONIC TRANSMISSION.

An “electronic transmission” means any form of communication, not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved, and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process.

8.3 INAPPLICABILITY.

Notice by a form of electronic transmission shall not apply to Section 164 (failure to pay for stock; remedies), Section 296 (adjudication of claims; appeal), Section 311 (revocation of voluntary dissolution), Section 312 (renewal, revival, extension and restoration of certificate of incorporation) or Section 324 (attachment of shares of stock) of the DGCL.

ARTICLE IX — INDEMNIFICATION OF DIRECTORS AND OFFICERS

9.1 POWER TO INDEMNIFY IN ACTIONS, SUITS OR PROCEEDINGS OTHER THAN THOSE BY OR IN THE RIGHT OF THE CORPORATION.

Subject to Section 9.3 of this Article IX, the corporation shall indemnify, to the fullest extent permitted by the DGCL, as now or hereafter in effect, any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that such person (or the legal representative of such person) is or was a director or officer of the corporation or any predecessor of the corporation, or is or was a director or officer of the corporation serving at the request of the corporation as a director or officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that such person’s conduct was unlawful.

9.2 POWER TO INDEMNIFY IN ACTIONS, SUITS OR PROCEEDINGS BY OR IN THE RIGHT OF THE CORPORATION.

Subject to Section 9.3 of this Article IX, the corporation shall indemnify, to the fullest extent permitted by the DGCL, as now or hereafter in effect, any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that such person (or the legal representative of such person) is or was a director or officer of the

 

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corporation or any predecessor of the corporation, or is or was a director or officer of the corporation serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation; except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.

9.3 AUTHORIZATION OF INDEMNIFICATION.

Any indemnification under this Article IX (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director or officer is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section 9.1 or Section 9.2 of this Article IX, as the case may be. Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (i) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (ii) by a committee of such directors designated by a majority vote of such directors, even though less than a quorum, or (iii) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion or (iv) by the stockholders (but only if a majority of the directors who are not parties to such action, suit or proceeding, if they constitute a quorum of the board of directors, presents the issue of entitlement to indemnification to the stockholders for their determination). Such determination shall be made, with respect to former directors and officers, by any person or persons having the authority to act on the matter on behalf of the corporation. To the extent, however, that a present or former director or officer of the corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding described above, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith, without the necessity of authorization in the specific case.

9.4 GOOD FAITH DEFINED.

For purposes of any determination under Section 9.3 of this Article IX, to the fullest extent permitted by applicable law, a person shall be deemed to have acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the corporation, or, with respect to any criminal action or proceeding, to have had no reasonable cause to believe such person’s conduct was unlawful, if such person’s action is based on the records or books of account of the corporation or another enterprise, or on information supplied to such person by the officers of the corporation or another enterprise in the course of their duties, or on the advice of legal counsel for the corporation or another enterprise or on information or records given or reports made to the corporation or another enterprise by an independent certified public accountant or by an appraiser or other expert selected with

 

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reasonable care by the corporation or another enterprise. The term “another enterprise” as used in this Section 9.4 shall mean any other corporation or any partnership, joint venture, trust, employee benefit plan or other enterprise of which such person is or was serving at the request of the corporation as a director, officer, employee or agent. The provisions of this Section 9.4 shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standard of conduct set forth in Section 9.1 or 9.2 of this Article IX, as the case may be.

9.5 INDEMNIFICATION BY A COURT.

Notwithstanding any contrary determination in the specific case under Section 9.3 of this Article IX, and notwithstanding the absence of any determination thereunder, any director or officer may apply to the Court of Chancery in the State of Delaware for indemnification to the extent otherwise permissible under Sections 9.1 and 9.2 of this Article IX. The basis of such indemnification by a court shall be a determination by such court that indemnification of the director or officer is proper in the circumstances because such person has met the applicable standards of conduct set forth in Section 9.1 or 9.2 of this Article IX, as the case may be. Neither a contrary determination in the specific case under Section 9.3 of this Article IX nor the absence of any determination thereunder shall be a defense to such application or create a presumption that the director or officer seeking indemnification has not met any applicable standard of conduct. Notice of any application for indemnification pursuant to this Section 9.5 shall be given to the corporation promptly upon the filing of such application. If successful, in whole or in part, the director or officer seeking indemnification shall also be entitled to be paid the expense of prosecuting such application.

9.6 EXPENSES PAYABLE IN ADVANCE.

To the fullest extent not prohibited by the DGCL, or by any other applicable law, expenses incurred by a person who is or was a director or officer in defending any civil, criminal, administrative or investigative action, suit or proceeding shall be paid by the corporation in advance of the final disposition of such action, suit or proceeding; provided, however, that if the DGCL requires, an advance of expenses incurred by any person in his or her capacity as a director or officer (and not in any other capacity) shall be made only upon receipt of an undertaking by or on behalf of such person to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation as authorized in this Article IX.

9.7 NONEXCLUSIVITY OF INDEMNIFICATION AND ADVANCEMENT OF EXPENSES.

The indemnification and advancement of expenses provided by or granted pursuant to this Article IX shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under the Certificate, any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office, it being the policy of the corporation that indemnification of the persons specified in Sections 9.1 and 9.2 of this Article IX shall be made to the fullest extent permitted by law. The provisions of this

 

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Article IX shall not be deemed to preclude the indemnification of any person who is not specified in Section 9.1 or 9.2 of this Article IX but whom the corporation has the power or obligation to indemnify under the provisions of the DGCL, or otherwise. The corporation is specifically authorized to enter into individual contracts with any or all of its directors, officers, employees or agents respecting indemnification and advances, to the fullest extent not prohibited by the DGCL, or by any other applicable law.

9.8 INSURANCE.

To the fullest extent permitted by the DGCL or any other applicable law, the corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was a director, officer, employee or agent of the corporation serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the corporation would have the power or the obligation to indemnify such person against such liability under the provisions of this Article IX.

9.9 CERTAIN DEFINITIONS.

For purposes of this Article IX, references to “the corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors or officers, so that any person who is or was a director or officer of such constituent corporation, or is or was a director or officer of such constituent corporation serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, shall stand in the same position under the provisions of this Article IX with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued. For purposes of this Article IX, references to “fines” shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to “serving at the request of the corporation” shall include any service as a director, officer, employee or agent of the corporation which imposes duties on, or involves services by, such director or officer with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the corporation” as referred to in this Article IX.

9.10 SURVIVAL OF INDEMNIFICATION AND ADVANCEMENT OF EXPENSES.

The rights to indemnification and advancement of expenses conferred by this Article IX shall continue as to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors, administrators and other personal and legal representatives of such a person.

 

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9.11 LIMITATION ON INDEMNIFICATION.

Notwithstanding anything contained in this Article IX to the contrary, except for proceedings to enforce rights to indemnification (which shall be governed by Section 9.5 hereof), the corporation shall not be obligated to indemnify any director or officer in connection with a proceeding (or part thereof) initiated by such person unless such proceeding (or part thereof) was authorized or consented to by the board of directors of the corporation.

9.12 INDEMNIFICATION OF EMPLOYEES AND AGENTS.

The corporation may, to the extent authorized from time to time by the board of directors, provide rights to indemnification and to the advancement of expenses to employees and agents of the corporation similar to those conferred in this Article IX to directors and officers of the corporation.

9.13 EFFECT OF AMENDMENT OR REPEAL.

Neither any amendment or repeal of any Section of this Article IX, nor the adoption of any provision of the Certificate or the bylaws inconsistent with this Article IX, shall adversely affect any right or protection of any director, officer, employee or other agent established pursuant to this Article IX existing at the time of such amendment, repeal or adoption of an inconsistent provision, including without limitation by eliminating or reducing the effect of this Article IX, for or in respect of any act, omission or other matter occurring, or any action or proceeding accruing or arising (or that, but for this Article IX, would accrue or arise), prior to such amendment, repeal or adoption of an inconsistent provision.

ARTICLE X — AMENDMENTS

The bylaws of the corporation may be adopted, amended or repealed by a majority of the voting power of the stockholders entitled to vote; provided, however, that the corporation may, in its Certificate, also confer the power to adopt, amend or repeal bylaws upon the Board. The fact that such power has been so conferred upon the Board shall not divest the stockholders of the power, nor limit their power to adopt, amend or repeal bylaws.

*  *  *  *  *

 

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ALPHABET INC.

a Delaware corporation

CERTIFICATE OF ADOPTION OF AMENDED AND RESTATED BYLAWS

The undersigned hereby certifies that he or she is the duly elected, qualified, and acting Chief Executive Officer of Alphabet Inc., a Delaware corporation and that the foregoing bylaws, comprising twenty-seven (27) pages, were adopted as the corporation’s bylaws as of October 2, 2015 by the corporation’s board of directors on August 10, 2015.

IN WITNESS WHEREOF, the undersigned has hereunto set his or her hand this second day of October, 2015.

 

/s/ Larry Page

Larry Page

Chief Executive Officer

Exhibit 4.1

 

LOGO

DEL A WA RE SEAL 2015 CORPORATE AL P H A B E T I NC . AUTHORIZED SIGNATURE TRANSFER AGENT AND REGISTRAR COMPUTERSHARE TRUST COMPANY, N.A. BY: COUNTERSIGNED AND REGISTERED: SENIOR VICE PRESIDENT, CORPORATE DEVELOPMENT, EXECUTIVE CHAIRMAN CHIEF LEGAL OFFICER AND SECRETARY transferable only on the books of the Corporation by the holder hereof in person or by duly authorized Attorney upon surrender of this certificate properly endorsed. This certificate is not valid until countersigned and registered by the Transfer Agent and Registrar. WITNESS the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers. Dated: ALPHABET INC. FULLY PAID AND NON-ASSESSABLE SHARES OF CLASS A COMMON STOCK, PAR VALUE $0.001 PER SHARE, OF IS THE OWNER OF THIS CERTIFIES THAT SEE REVERSE SIDE FOR CERTAIN RESTRICTIONS CUSIP 02079K 30 5 THIS CERTIFICATE IS TRANSFERABLE IN CANTON, MA, JERSEY CITY, NJ AND COLLEGE STATION, TX INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE GOOGL ALPHABET INC. ABnote North America 711 ARMSTRONG LANE, COLUMBIA, TN 38401 (931) 388-3003 SALES: HOLLY GRONER 931-490-7660 NOTE: TEXT RECEIVED BY MODEM OR E-MAIL IS NOT PROOFREAD WORD FOR WORD. COLOR: This proof was printed from a digital file on a graphics quality, color laser printer. It is a good representation of the color as it will appear on the final product. It is not an exact color rendition, and the final printed product may appear slightly different from the proof due to the difference between the dyes and printing ink. Colors Selected for Printing: Intaglio prints in SC-15 Maroon. PLEASE INITIAL THE APPROPRIATE SELECTION FOR THIS PROOF: OK AS IS OK WITH CHANGES MAKE CHANGES AND SEND ANOTHER PROOF REV. 1 WO—09949 FACE OPERATOR: DKS ALPHABET INC. PROOF OF: SEPTEMBER 25, 2015


LOGO

The signature(s) must be guaranteed by a brokerage firm or a financial institution that is a member of a securities approved Medallion program, such as Securities Transfer Agents Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) or New York Stock Exchange, Inc. Medallion Signature Program (MSP). SIGNATURE(S) GUARANTEED The signature(s) to this assignment must correspond with the name(s) as written upon the face of the certificate in every particular, without alteration or enlargement or any change whatsoever. NOTICE: Dated to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises. Attorney stock represented by the within Certificate and do hereby irrevocably of the Class A common constitute and appoint Shares (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE FOR VALUE RECEIVED, hereby sell, assign and transfer unto Additional abbreviations may also be used though not in the above list. UNIF TRF MIN ACT — Custodian (until age ) (Cust) under Uniform Transfers (Minor) to Minors Act (State) UNIF GIFT MIN ACT — Custodian (Cust) (Minor) under Uniform Gifts to Minors Act (State) TEN COM TEN ENT JT TEN COM PROP — as tenants in common — as tenants by the entireties — as joint tenants with right of survivorship and not as tenants in common — as community property The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations: KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, OR DESTROYED, THE CORPORATION WILL REQUIRE A BOND OF INDEMNITY AS A CONDITION TO THE ISSUANCE OF A REPLACEMENT CERTIFICATE. A statement of the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications or restrictions of such preferences and/or rights as established, from time to time, by the Certificate of Incorporation of the Corporation and by any certificate of determination, and the number of shares constituting each class or series and the designations thereof, may be obtained by any stockholder of the Corporation upon written request and without charge from the secretary of the Corporation at the principal office of the Corporation. ALPHABET INC. PLEASE INITIAL THE APPROPRIATE SELECTION FOR THIS PROOF: OK AS IS OK WITH CHANGES MAKE CHANGES AND SEND ANOTHER PROOF ABnote North America 711 ARMSTRONG LANE, COLUMBIA, TN 38401 (931) 388-3003 SALES: HOLLY GRONER 931-490-7660 REV. 1 WO—09949 BACK OPERATOR: DKS ALPHABET INC. PROOF OF: SEPTEMBER 25, 2015

Exhibit 4.2

 

LOGO

DELAWARE SEAL 2015 CORPORATE ALPHABET INC . AUTHORIZED SIGNATURE TRANSFER AGENT AND REGISTRAR COMPUTERSHARE TRUST COMPANY, N.A. BY: COUNTERSIGNED AND REGISTERED: SENIOR VICE PRESIDENT, CORPORATE DEVELOPMENT, EXECUTIVE CHAIRMAN CHIEF LEGAL OFFICER AND SECRETARY transferable only on the books of the Corporation by the holder hereof in person or by duly authorized Attorney upon surrender of this certificate properly endorsed. This certificate is not valid until countersigned and registered by the Transfer Agent and Registrar. WITNESS the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers. Dated: ALPHABET INC. FULLY PAID AND NON-ASSESSABLE SHARES OF CLASS C CAPITAL STOCK, PAR VALUE $0.001 PER SHARE, OF IS THE OWNER OF THIS CERTIFIES THAT SEE REVERSE SIDE FOR CERTAIN RESTRICTIONS CUSIP 02079K 10 7 THIS CERTIFICATE IS TRANSFERABLE IN CANTON, MA, JERSEY CITY, NJ AND COLLEGE STATION, TX INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE GOOG ALPHABET INC. ABnote North America 711 ARMSTRONG LANE, COLUMBIA, TN 38401 (931) 388-3003 SALES: HOLLY GRONER 931-490-7660 NOTE: TEXT RECEIVED BY MODEM OR E-MAIL IS NOT PROOFREAD WORD FOR WORD. COLOR: This proof was printed from a digital file on a graphics quality, color laser printer. It is a good representation of the color as it will appear on the final product. It is not an exact color rendition, and the final printed product may appear slightly different from the proof due to the difference between the dyes and printing ink. Colors Selected for Printing: Intaglio prints in SC-13 Red. PLEASE INITIAL THE APPROPRIATE SELECTION FOR THIS PROOF: OK AS IS OK WITH CHANGES MAKE CHANGES AND SEND ANOTHER PROOF REV. 2 WO - 09909 FACE OPERATOR: DKS ALPHABET INC. PROOF OF: SEPTEMBER 25, 2015


LOGO

The signature(s) must be guaranteed by a brokerage firm or a financial institution that is a member of a securities approved Medallion program, such as Securities Transfer Agents Medallion Program (STAMP), Stock Exchanges Medallion Program (SEMP) or New York Stock Exchange, Inc. Medallion Signature Program (MSP). SIGNATURE(S) GUARANTEED The signature(s) to this assignment must correspond with the name(s) as written upon the face of the certificate in every particular, without alteration or enlargement or any change whatsoever. NOTICE: Dated to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises. Attorney of the Class C capital stock represented by the within Certificate and do hereby irrevocably constitute and appoint Shares (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE) PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE hereby sell, assign FOR VALUE RECEIVED, and transfer unto Additional abbreviations may also be used though not in the above list. UNIF TRF MIN ACT — Custodian (until age ) (Cust) under Uniform Transfers (Minor) to Minors Act (State) UNIF GIFT MIN ACT — Custodian (Cust) (Minor) under Uniform Gifts to Minors Act (State) TEN COM TEN ENT JT TEN COM PROP — as tenants in common — as tenants by the entireties — as joint tenants with right of survivorship and not as tenants in common — as community property The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations: KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN, OR DESTROYED, THE CORPORATION WILL REQUIRE A BOND OF INDEMNITY AS A CONDITION TO THE ISSUANCE OF A REPLACEMENT CERTIFICATE. A statement of the powers, designations, preferences and relative, participating, optional or other special rights of each class of stock or series thereof and the qualifications or restrictions of such preferences and/or rights as established, from time to time, by the Certificate of Incorporation of the Corporation and by any certificate of determination, and the number of shares constituting each class or series and the designations thereof, may be obtained by any stockholder of the Corporation upon written request and without charge from the secretary of the Corporation at the principal office of the Corporation. ALPHABET INC. PLEASE INITIAL THE APPROPRIATE SELECTION FOR THIS PROOF: OK AS IS OK WITH CHANGES MAKE CHANGES AND SEND ANOTHER PROOF ABnote North America 711 ARMSTRONG LANE, COLUMBIA, TN 38401 (931) 388-3003 SALES: HOLLY GRONER 931-490-7660 REV. 1 WO - 09909 BACK OPERATOR: DKS ALPHABET INC. PROOF OF: SEPTEMBER 17, 2015

Exhibit 4.3

ALPHABET INC. TRANSFER RESTRICTION AGREEMENT

This Transfer Restriction Agreement (this “ Agreement ”) is made as of October 2, 2015, among Alphabet Inc., a Delaware corporation (the “ Company ” or “ Alphabet ”), Larry Page, the Lawrence Page Trust, the Lawrence Page Trust II and the Lawrence Page Trust III (“Larry Page and his Permitted Entities”), and the other Holders signatory hereto. Capitalized terms used but not otherwise defined have the meaning set forth in Section 1.

RECITALS

WHEREAS, the Board of Directors (the “ Board ” or the “ Board of Directors ”) of the Company has authorized the entry into the Agreement and Plan of Merger (“ Merger Agreement ”) with Google Inc. (“ Google ”) and Maple Technologies Inc. (“ Maple ”), attached hereto as Exhibit A;

WHEREAS, concurrently with the execution of this Agreement, as of the Effective Time (as defined in the Merger Agreement), (i) Maple will be merged with and into Google with Google being the surviving corporation in the merger, (ii) the shares of each class of outstanding capital stock of Google will be converted into shares of the corresponding class of capital stock of Alphabet, in each case with the same designations, rights, powers and preferences, and the same qualifications, limitations and restrictions, and (iii) Google will become a wholly owned subsidiary of Alphabet;

WHEREAS, in connection with the consummation of the Merger Agreement and effective at the Effective Time, the Board and the sole stockholder of the Company have adopted the Amended and Restated Certificate of Incorporation of Alphabet, attached hereto as Exhibit B , which, among other matters, includes a class of capital stock, par value $0.001 per share, of the Company designated as “Class C Capital Stock” (the “ Non-Voting Capital Stock ”);

WHEREAS, as of the Effective Time, each share of Google Class A Common Stock, Google Class B Common Stock and Google Class C Capital Stock will be converted into a share of Alphabet Class A Common Stock, par value $0.001 per share (the “ Class A Common Stock ”), Alphabet Class B Common Stock, par value $0.001 per share (the “ Class B Common Stock ”) and Non-Voting Capital Stock, respectively; and

WHEREAS, in connection with the consummation of the Merger Agreement, the Holders and the Company desire to agree to certain matters with respect to the ownership and transfer of shares of Class A Common Stock, Class B Common Stock and Non-Voting Capital Stock by the Holders.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing and the mutual promises, agreements and covenants set forth herein, and for other good and valuable consideration the receipt and adequacy of which the Parties acknowledge, the Parties hereby agree as follows:

1. Certain Definitions . As used in this Agreement, the following terms have the following respective meanings:

Covered Holders ” shall mean, collectively, (i) Larry Page, a natural living person, and all other members of his Holder Group and (ii) Sergey Brin, a natural living person, and all other members of his “Holder Group” as defined in that certain Transfer Restriction Agreement, dated as of the date hereof, among the Company, Sergey Brin, and each of the other parties thereto.

DGCL ” shall mean the General Corporation Law of the State of Delaware, as the same shall be in effect from time to time.


Holder ” shall mean Larry Page and his Permitted Entities and any other person or entity that is, or is required pursuant to the terms of this Agreement to be, a party to this Agreement.

Holder Group ” shall mean, at any time, with respect to Larry Page, such Holder taken together with each of the Permitted Entities of such Holder that both (i) own, beneficially and of record, shares of Class B Common Stock or shares of Non-Voting Capital Stock at such time, and (ii) meet the requirements of the applicable exception for such Permitted Entity specified in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation at such time. For the avoidance of doubt, (x) no Permitted Entity shall be a member of the Holder Group for purposes of this Agreement unless such Permitted Entity has executed and delivered a copy of this Agreement to the Company, regardless of whether such Permitted Entity would otherwise be a “Permitted Entity” as defined in Article IV, Section 2(f) of the Amended and Restated Certificate of Incorporation and (y) a Permitted Entity shall immediately cease to be a member of the Holder Group for purposes of Section 2 and Section 3 at such time as such Permitted Entity no longer meets the requirements of the applicable exception for such Permitted Entity specified in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation.

Independent Director ” means a member of the Board designated by the Nominating and Corporate Governance Committee of the Board as an independent director.

Number of Non-Voting Shares ” with respect to a Holder or the Holder Group, as applicable, shall mean, at any time, the aggregate number of shares of Non-Voting Capital Stock owned, beneficially and of record, by the Holder or Holder Group, as applicable, less the aggregate number of shares of Non-Voting Capital Stock deemed Sold by the Holder or Holder Group, as applicable, pursuant to clause (ii) of the definition of “Sell” below.

Parties ” shall mean the Company and the Holders.

Permitted Entity ” shall mean, with respect to Larry Page, any trust, account, plan, corporation, partnership, or limited liability company specified in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation established by or for Larry Page and to whom Larry Page has Transferred shares of Class B Common Stock or Non-Voting Capital Stock, so long as (i) such entity meets the requirements of the exception set forth in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation applicable to such entity (and, if such entity holds shares of Non-Voting Capital Stock, such entity meets the requirements of the applicable exception set forth in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation with respect to all shares of Non-Voting Capital Stock held by it as if such shares of Non-Voting Capital Stock were Class B Common Stock thereunder, mutatis mutandis ) and (ii) such entity has agreed to be bound by the terms of this Agreement and has executed and delivered a copy of this Agreement to the Company.

person ” shall mean any individual, general or limited partnership, firm, corporation, limited liability company, association, trust, unincorporated organization or other entity.

Sell ,” “ Sold ” or “ Sale ” with respect to a share of Non-Voting Capital Stock shall mean (i) any sale, assignment, transfer, conveyance, hypothecation or other Transfer or disposition of such share or any legal or beneficial interest in such share, whether or not for value and whether voluntary or involuntary or by operation of law, including a transfer of such share to a broker or other nominee (regardless of whether or not there is a corresponding change in record or beneficial ownership), or (ii) the entry into any contract, agreement or other binding arrangement with respect to any of the actions in the foregoing clause (i) regarding such share; provided , however , that the following shall not be considered a “Sale” within the meaning of this Section: the granting of a proxy to officers or directors of the Company at the request of the Board of Directors of the Company in connection with actions to be taken at an annual or special meeting of stockholders by the holders of the Non-Voting Common Stock.

Transfer ” shall have the meaning set forth in the Amended and Restated Certificate of Incorporation.

2. Sales of Non-Voting Capital Stock .

(a) A Holder, and, to the extent such Holder is a member of a Holder Group, such Holder Group shall not Sell any shares of Non-Voting Capital Stock if, immediately following such Sale, such Holder, or to the extent that such Holder is a member of a Holder Group, such Holder Group, as applicable, would own, beneficially and of record, an

 

2


aggregate number of shares of Class B Common Stock greater than the Number of Non-Voting Shares of such Holder or Holder Group, as applicable (after taking into account the conversion of shares of Class B Common Stock owned beneficially and of record by the Holder or Holder Group, as applicable, that are converted into shares of Class A Common Stock at the time of such Sale, if any, whether as a result of a simultaneous Transfer of such Class B Common Stock or otherwise); provided that this required maximum ratio of shares of Class B Common Stock to the Number of Non-Voting Shares shall be subject to adjustment as provided in Section 6(c).

(b) The Company shall not, and shall direct its transfer agent not to, permit any Sale of shares of Non-Voting Capital Stock in violation of this Agreement. The shares of Non-Voting Capital Stock held by a Holder and, to the extent such Holder is a member of a Holder Group, such Holder Group will be in uncertificated form, with stop transfer orders in place. The Company shall cooperate reasonably with the Holder and the other members of the Holder Group to lift such stop transfer orders with respect to any shares of Non-Voting Capital Stock that are Sold by any such member of the Holder Group in compliance with this Agreement.

(c) (i) If at any time a Holder, or to the extent that such Holder is a member of a Holder Group, such Holder Group, owns, beneficially and of record, an aggregate number of shares of Class B Common Stock greater than the Number of Non-Voting Shares of such Holder or Holder Group, as applicable (including because a Holder ceases to be a member of a Holder Group) (with this required maximum ratio of shares of Class B Common Stock to the Number of Non-Voting Shares subject to adjustment as provided in Section 6(c)), such Holder or Holder Group, as applicable, shall be deemed to have irrevocably converted a number of shares of Class B Common Stock owned beneficially and of record by such Holder or Holder Group, as applicable, automatically and without any further action, into an equal number of fully paid and nonassessable shares of Class A Common Stock such that after the deemed conversion the aggregate number of shares of Class B Common Stock owned, beneficially and of record, by such Holder or Holder Group, as applicable, shall equal the Number of Non-Voting Shares of such Holder or Holder Group, as applicable. Upon any such conversion of shares of Class B Common Stock to Class A Common Stock, all rights of the holder of such shares of Class B Common Stock shall cease and the person or persons in whose name or names the certificate or certificates representing the shares of Class A Common Stock are to be issued shall be treated for all purposes as having become the record holder or holders of such shares of Class A Common Stock.

(ii) Each Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group authorizes the Company and its transfer agent to take any and all actions that may be necessary to cause any such conversion to occur, whether or not such Holder or, to the extent applicable, such Holder Group has taken any action with respect thereto, including the Company providing appropriate instruction on behalf of such Holder to its transfer agent. The Holders and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group agree that the automatic conversion set forth in Section 2(c)(i) above shall apply (i) first, to shares of Class B Common Stock owned beneficially and of record by the Holder that is Transferring the shares of Non-Voting Capital Stock and (ii) in all other circumstances, including a Holder ceasing to be a member of a Holder Group or if the Holder no longer owns beneficially and of record any shares of Class B Common Stock, to shares of Class B Common Stock owned beneficially and of record by the other members of the Holder Group proportionately based on the number of shares of Class B Common Stock then held by each such member of the Holder Group.

(iii) Each Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group shall cooperate fully with the Company in connection with any such conversion, and shall take such actions as may be necessary or desirable to cause the documentation and implementation of such conversion as promptly as practicable following the Company or any Holder or Holder Group, as applicable, becoming aware that such Holder or Holder Group, as applicable, owns, beneficially and of record, an aggregate number of shares of Class B Common Stock greater than the Number of Non-Voting Shares of such Holder or Holder Group, as applicable.

(d) Notwithstanding any requirement for a maximum ratio of shares of Class B Common Stock to the Number of Non-Voting Shares to be in effect “immediately” or “at any time,” in order to facilitate Sales of shares on The NASDAQ Stock Market, Inc. (“ Nasdaq ”) over the course of a Nasdaq trading day, the Holder and such Holder’s Holder Group shall be permitted to temporarily hold more shares of Class B Common Stock than the Number of Non-Voting Shares during the trading day, so long as the maximum ratio requirement is satisfied by the close of regular trading on such trading day and such trading day is not a record date for any stockholder vote.

 

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3. Transfers of Class B Common Stock and Non-Voting Capital Stock .

(a) A Holder who is a member of a Holder Group may Transfer (i) shares of Class B Common Stock to any other Holder who is a member of the same Holder Group in a Transfer which does not result in an automatic conversion of the Class B Common Stock into Class A Common Stock under the terms of Article IV, Section 2(f) of the Amended and Restated Certificate of Incorporation or (ii) shares of Non-Voting Capital Stock to any other Holder who is a member of the Holder Group, only if, in either such case, immediately following such Transfer the Holder Group would collectively own, beneficially and of record, an aggregate number of shares of Class B Common Stock equal to or less than the Number of Non-Voting Shares of the Holder Group; provided that this required ratio of the shares of Class B Common Stock to the Number of Non-Voting Shares shall be subject to adjustment as provided in Section 6(c).

(b) Except as provided in Section 3(a), a Holder may not Transfer shares of Class B Common Stock to another person in a Transfer which does not result in an automatic conversion of the Class B Common Stock into Class A Common Stock under the terms of Article IV, Section 2(f) of the Amended and Restated Certificate of Incorporation unless such Holder simultaneously Transfers, in the same manner and to the same extent, an equal number of shares of Non-Voting Capital Stock to such transferee; provided that this required ratio of the shares of Class B Common Stock to the Number of Non-Voting Shares shall be subject to adjustment as provided in Section 6(c).

(c) A Holder shall not Transfer shares of Class B Common Stock to any transferee who is not a party to this Agreement or a party to a Transfer Restriction Agreement with the Company in the form of this Agreement. If any such transferee is not a party to such an agreement prior to such Transfer, then the Holder shall cause such person to become a party to this Agreement or another such Transfer Restriction Agreement and shall deliver to the Company a duly executed copy hereof or thereof prior to the consummation of such Transfer.

4. Sales or Transfers of Class A Common Stock . Except as set forth in Section 5, this Agreement shall not limit or restrict any member of the Holder Group’s ability to Sell or Transfer any shares of Class A Common Stock.

5. No Short Sales or Derivative Transactions . Each Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group agrees to comply with the Alphabet Policy Against Insider Trading attached hereto as Exhibit C (the “ Insider Trading Policy ”) with respect to the Class A Common Stock, the Class B Common Stock, the Non-Voting Capital Stock and all other Company securities. The Parties agree that any waiver of the Insider Trading Policy shall only be effective if granted in accordance with Section 11(c). Notwithstanding any amendment to the Insider Trading Policy that may be effected by the Company from time to time, each Holder shall remain subject to the prohibitions against short sales and derivative transactions contained in the Insider Trading Policy as in effect on the date of this Agreement.

6. Certain Additional Agreements .

(a) Except in connection with a Sale permitted by this Agreement, a Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group shall at all times hold all shares of Non-Voting Capital Stock and Class B Common Stock beneficially and of record in such Holder’s name, and shall not hold any such shares through any nominee or broker.

(b) For all purposes under this Agreement, a share of “Non-Voting Capital Stock,” as of a given date of determination, shall be deemed to constitute (i) any securities issued by the Company in respect of a share of Class B Common Stock (other than shares of Class B Common Stock or rights to acquire Class B Common Stock), whether by dividend, stock split, distribution, recapitalization or otherwise after the date hereof and as of such date of determination and (ii) any securities issued by the Company (other than shares of Class B Common Stock or rights to acquire Class B Common Stock) in respect of the shares and securities referenced in clauses (i) and this clause (ii), whether by dividend, stock split, distribution, recapitalization or otherwise after the date hereof and as of such date of determination.

(c) It is the intention and agreement of the Parties that none of the securities received in any future dividend, stock split, distribution or recapitalization or otherwise with respect to a share of Class B Common Stock or with respect to the Non-Voting Capital Stock received in connection with such share of Class B Common Stock, shall be Sold

 

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(other than pursuant to a Transfer in accordance with Section 3) unless the required ratio of shares of Class B Common Stock to the Number of Non-Voting Shares is not exceeded. If additional securities are so received, the required ratio of Class B Common Stock to such shares of Non-Voting Capital Stock for purposes of this Agreement (including Sections 2(a), 2(c), 3(a), and 3(b)) shall be equitably adjusted to account for such additional securities (e.g., if, after the Effective Time, one additional share of Non-Voting Capital Stock is distributed for each share of Class B Common Stock and Non-Voting Capital Stock, this Agreement shall be modified to require each Holder to hold at least three shares of Non-Voting Capital Stock for each share of Class B Common Stock).

(d) With respect to its ownership of shares of Class B Common Stock or Non-Voting Capital Stock, no member of the Holder Group shall take any action that, in the reasonable, good faith determination of the Company, is contrary to the purpose of this Agreement.

7. Company Sale and Equal Status . To the extent that any transaction is, or series of related transactions are, (a) a merger, consolidation or other business combination requiring the approval of the holders of the Company’s capital stock (whether or not the Company is the surviving entity) or acquisition of all or substantially all of the Company’s assets, (b) any tender or exchange offer by any third party to acquire a majority of the shares of Class A Common Stock, Class B Common Stock or Non-Voting Capital Stock or (c) any tender or exchange offer by the Company to acquire any shares of Class A Common Stock, Class B Common Stock or Non-Voting Capital Stock (any such transaction, a “ Company Sale or Recapitalization ”), no member of the Holder Group shall sell, transfer or exchange, directly or indirectly, any shares of Class A Common Stock, Class B Common Stock or Non-Voting Capital Stock in, or in a transaction related to, such Company Sale or Recapitalization, for (x) with respect to such member’s shares of Class A Common Stock or Class B Common Stock, an amount per share greater than that received in such Company Sale or Recapitalization by the holders of Class A Common Stock, or a form of consideration different from the form that holders of Class A Common Stock would receive, or may elect to receive, in such Company Sale or Recapitalization, or (y) with respect to such member’s shares of Non-Voting Capital Stock, an amount per share greater than that received in such Company Sale or Recapitalization by the other holders of Non-Voting Capital Stock, or a form of consideration different from the form that other holders of Non-Voting Capital Stock would receive, or may elect to receive, in such Company Sale or Recapitalization.

8. Administration of this Agreement . The Company shall establish, from time to time, such policies and procedures relating to the general administration of the terms of this Agreement, any Sales or Transfers of Class B Common Stock or Non-Voting Capital Stock permitted hereunder and any conversion of Class B Common Stock to Class A Common Stock contemplated hereby, as it may deem necessary or advisable, and shall deliver notice to the Holders of the restrictions placed on their shares of Common Stock and Non-Voting Capital Stock by this Agreement and by the Amended and Restated Certificate of Incorporation in accordance with Section 151(f) and 202(a) of the DGCL. A determination by a majority of the members of the Board other than any of the Covered Holders who are members of the Board or by the Secretary of the Company that a conversion of Class B Common Stock to Class A Common Stock pursuant to Section 2(c) hereof has occurred shall be conclusive absent manifest error.

9. Scope of this Agreement . This Agreement shall not in any way constitute an amendment, modification, supplement or waiver of any right, preference, privilege, term or provision set forth or contained in the Amended and Restated Certificate of Incorporation.

10. Termination .

(a) Except as set forth in Section 10(b) below, this Agreement may be terminated only by a written instrument that has been executed by each of the Holders and that has been approved by a majority of the members of the Board other than any of the Covered Holders who are members of the Board and executed on behalf of the Company.

(b) This Agreement shall terminate, except for Sections 7 and 11 which shall survive such termination and other than with respect to any action or event occurring or arising prior to such termination, at such time as the voting power of the shares of Class A Common Stock, Class B Common Stock and other outstanding equity securities of the Company collectively owned, beneficially and of record, by the Covered Holders would represent in the aggregate less than thirty four percent (34%) of the voting power of all of the outstanding equity securities of the Company (including such shares of Class A Common Stock and Class B Common Stock) entitled to vote generally in the election of directors at an annual meeting of the stockholders of the Company.

 

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11. Miscellaneous .

(a) Successors and Assigns . Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned or transferred (whether by operation of law or otherwise) by the Company, on the one hand, or any member of the Holder Group, on the other hand, without the prior written consent of the Holder or the Company, respectively, and any purported assignment or other transfer without such consent shall be void and unenforceable; provided , however , that the Company may assign or transfer this agreement to a successor entity in connection with any merger, consolidation, reorganization or business combination transaction. Subject to the preceding sentence, this Agreement shall be binding upon, inure to the benefit of and be enforceable by the Parties and their respective successors and assigns. Nothing in this Agreement, express or implied, is intended to confer upon any person other than the Parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities of any nature whatsoever under or by reason of this Agreement.

(b) Entire Agreement . This Agreement constitutes the full and entire understanding and agreement among the Parties with respect to the subject matter hereof.

(c) Amendment and Waiver . This Agreement or any of its provisions may be waived, amended, modified or supplemented only by a written instrument that has been executed by each of the Holders and that has been (i) considered and recommended by a committee consisting of two or more Independent Directors who do not hold Class B stock (the “TRA Committee”); and (ii) upon positive recommendation by the TRA Committee, approved by every member of the Board other than any of the Covered Holders who are members of the Board and executed on behalf of the Company. The TRA Committee shall be advised by independent legal counsel and financial advisors, paid for by Alphabet, who shall not have a current or recently concluded (within one year) material relationship with Alphabet or any of the Holders. At their election, Independent Directors who are not members of the TRA Committee shall be entitled to retain independent counsel, paid for by Alphabet, or may be advised by counsel to the TRA Committee if they and the TRA Committee deem such representation advisable. Any failure of the Parties to comply with any obligation, covenant, agreement or condition in this Agreement may be waived by the Party entitled to the benefit thereof only by a written instrument that has been signed by the Party granting such waiver and that, in the case of the Company, has been approved by a majority of the members of the Board other than any of the Covered Holders who are members of the Board. No delay on the part of any Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any Party of any right, power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder, nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

Notwithstanding any other provisions herein, any waiver, modification, amendment, or supplementation of this Agreement shall be publicly disclosed at least 30 days before such waiver, modification, amendment, or supplementation takes effect . Such disclosure shall identify the terms of the waiver, modification, amendment, or supplementation of this Agreement, and shall be made in any one of a Form 8-K, Form 10-Q, or Form 10-K filed with the United States Securities and Exchange Commission and marked for public dissemination. The reason for such disclosure shall be to provide a meaningful opportunity for judicial review of such waiver, modification, amendment, or supplementation. Alphabet and its Board of Directors agree that they will not object to such judicial review being adjudicated pursuant to the entire-fairness standard applied by the law of the State of Delaware and that they shall bear the burden of establishing entire fairness and will not seek to shift the burden back to plaintiff(s).

(d) Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given or made as follows: (i) if sent by registered or certified mail in the United States return receipt requested, upon receipt; (ii) if sent by nationally recognized overnight air courier, one (1) business day after mailing; (iii) if sent by facsimile transmission, when transmitted and receipt is confirmed and (iv) if otherwise actually personally delivered, when delivered, provided , however , that such notices, requests,

 

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demands and other communications are delivered to the address set forth below, or to such other address as any Party shall provide by like notice to the other Party:

If to the Company, to:

Alphabet Inc.

1600 Amphitheatre Parkway

Mountain View, CA 94043

Facsimile: 650.887.1790

Attention: Secretary

with a copy (which shall not constitute notice) to:

Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, NY 10006

Facsimile: 212.225.3999

Attention: Ethan Klingsberg

If to the Holder or any other member of the Holder Group, to:

Larry Page

c/o Alphabet Inc.

1600 Amphitheatre Parkway

Mountain View, CA 94043

Facsimile: 650.887.1790

(e) Governing Law; WAIVER OF JURY TRIAL . This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware applicable to contracts executed in and to be performed entirely within such State, without regard to the conflict of laws principles thereof which would result in the application of the laws of any other jurisdiction. Each of the Parties hereby irrevocably and unconditionally submits to the exclusive jurisdiction of the Court of Chancery of the State of Delaware or, to the extent such court does not have subject matter jurisdiction, the United States District Court for the District of Delaware, and any appellate court therefrom, in any action or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby, including any action or proceeding brought by, in the right of or on behalf of the Company (including any derivative action or proceeding), or for recognition or enforcement of any judgment relating thereto, and each of the Parties hereby irrevocably and unconditionally (i) agrees not to commence any such action or proceeding except in such courts; (ii) agrees that any claim in respect of any such action or proceeding may be heard and determined in any such court; (iii) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any such action or proceeding in any such court; and (iv) waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. Each of the Parties hereby agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Each of the Parties hereby irrevocably consents to service of process in the manner provided for notices in Section 11(d). Nothing in this Agreement shall affect the right of any Party to serve process in any other manner permitted by applicable law. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE, IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

(f) Equitable Remedies . Each Party acknowledges and agrees that the other Party would be irreparably damaged in the event that any of the terms or provisions of this Agreement are not performed in accordance with their specific terms or otherwise are breached. Therefore, notwithstanding anything to the contrary set forth in this Agreement, each Party hereby agrees that the other Party shall be entitled to an injunction or injunctions to prevent breaches of any of the terms or provisions of this Agreement, and to enforce specifically the performance by such first Party under this Agreement, and each Party hereby agrees to waive the defense in any such suit that the other Party has an adequate remedy at law and to interpose no opposition, legal or otherwise, as to the propriety of injunction or specific performance as a remedy, and hereby agrees to waive any requirement to post any bond in connection with obtaining such relief. The equitable remedies described in this Section 11(f) shall be in addition to, and not in lieu of,

 

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any other remedies at law or in equity that the Parties may elect to pursue. The rights and remedies provided for in this Agreement are cumulative and are not exclusive of any other rights or remedies which the Parties may have hereunder or may otherwise have at law or in equity.

(g) Severability . In the event that any one or more of the terms or provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement so long as the absence of such terms or provisions does not materially adversely affect any Party, and the Parties shall use their commercially reasonable efforts to substitute one or more valid, legal and enforceable terms or provisions into this Agreement which, insofar as practicable, implement the purposes and intent of this Agreement and which are not materially adverse to any Party. Any term or provision of this Agreement held invalid or unenforceable only in part, degree or within certain jurisdictions shall remain in full force and effect to the extent not held invalid or unenforceable to the extent consistent with the intent of the Parties as reflected by this Agreement and not materially adverse to any Party. To the extent permitted by applicable law, each Party waives any term or provision of law which renders any term or provision of this Agreement to be invalid, illegal or unenforceable in any respect.

(h) Interpretation . The Section headings in this Agreement are for convenience of reference only and shall not be deemed to alter or affect the meaning or interpretation of any provision of this Agreement. The Parties have participated jointly in the negotiation and drafting of this Agreement and have been advised by counsel in connection therewith. In the event an ambiguity or question of intent or interpretation arises with respect to any term or provision of this Agreement, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the terms or provisions of this Agreement. For all purposes of and under this Agreement, (i) the word “including” shall be deemed to be immediately followed by the words “without limitation;” (ii) words (including defined terms) in the singular shall be deemed to include the plural and vice versa; and (iii) the terms “hereof,” “herein,” “hereto,” “herewith” and any other words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular term or provision of this Agreement, unless otherwise specified.

(i) Counterparts . This Agreement may be executed in one or more counterparts (including by facsimile or electronic signature and by electronic mail or PDF), each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement.

*    *    *    *    *

(Signature Pages Follow)

 

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IN WITNESS WHEREOF , the Company and the Holder have executed this Agreement as of the date first above written.

 

Alphabet Inc.
By:  

/s/ Kent Walker

Name:   Kent Walker
Title:   Assistant Secretary
Larry Page

/s/ Larry Page

 

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IN WITNESS WHEREOF , the Permitted Entity named below has executed this Agreement as of the date first above written and agrees to be bound by the terms of this Agreement applicable to Permitted Entities as a Holder and a member of the Holder Group thereunder.

 

Lawrence Page Trust

/s/ Danielle M. Kiss

Name:  

Danielle M. Kiss

Title:   Authorized Signatory

 

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IN WITNESS WHEREOF , the Permitted Entity named below has executed this Agreement as of the date first above written and agrees to be bound by the terms of this Agreement applicable to Permitted Entities as a Holder and a member of the Holder Group thereunder.

 

Lawrence Page Trust II

/s/ Danielle M. Kiss

Name:  

Danielle M. Kiss

Title:   Authorized Signatory

 

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IN WITNESS WHEREOF , the Permitted Entity named below has executed this Agreement as of the date first above written and agrees to be bound by the terms of this Agreement applicable to Permitted Entities as a Holder and a member of the Holder Group thereunder.

 

Lawrence Page Trust III

/s/ Danielle M. Kiss

Name:  

Danielle M. Kiss

Title:   Authorized Signatory

 

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Exhibit 4.4

ALPHABET INC. TRANSFER RESTRICTION AGREEMENT

This Transfer Restriction Agreement (this “ Agreement ”) is made as of October 2, 2015, among Alphabet Inc., a Delaware corporation (the “ Company ” or “ Alphabet ”), Sergey Brin, the MDC Trust I, the MDC Trust II and the MDC Trust III (“Sergey Brin and his Permitted Entities”), and the other Holders signatory hereto. Capitalized terms used but not otherwise defined have the meaning set forth in Section 1.

RECITALS

WHEREAS, the Board of Directors (the “ Board ” or the “ Board of Directors ”) of the Company has authorized the entry into the Agreement and Plan of Merger (“ Merger Agreement ”) with Google Inc. (“ Google ”) and Maple Technologies Inc. (“ Maple ”), attached hereto as Exhibit A;

WHEREAS, concurrently with the execution of this Agreement, as of the Effective Time (as defined in the Merger Agreement), (i) Maple will be merged with and into Google with Google being the surviving corporation in the merger, (ii) the shares of each class of outstanding capital stock of Google will be converted into shares of the corresponding class of capital stock of Alphabet, in each case with the same designations, rights, powers and preferences, and the same qualifications, limitations and restrictions, and (iii) Google will become a wholly owned subsidiary of Alphabet;

WHEREAS, in connection with the consummation of the Merger Agreement and effective at the Effective Time, the Board and the sole stockholder of the Company have adopted the Amended and Restated Certificate of Incorporation of Alphabet, attached hereto as Exhibit B , which, among other matters, includes a class of capital stock, par value $0.001 per share, of the Company designated as “Class C Capital Stock” (the “ Non-Voting Capital Stock ”);

WHEREAS, as of the Effective Time, each share of Google Class A Common Stock, Google Class B Common Stock and Google Class C Capital Stock will be converted into a share of Alphabet Class A Common Stock, par value $0.001 per share (the “ Class A Common Stock ”), Alphabet Class B Common Stock, par value $0.001 per share (the “ Class B Common Stock ”) and Non-Voting Capital Stock, respectively; and

WHEREAS, in connection with the consummation of the Merger Agreement, the Holders and the Company desire to agree to certain matters with respect to the ownership and transfer of shares of Class A Common Stock, Class B Common Stock and Non-Voting Capital Stock by the Holders.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing and the mutual promises, agreements and covenants set forth herein, and for other good and valuable consideration the receipt and adequacy of which the Parties acknowledge, the Parties hereby agree as follows:

1. Certain Definitions . As used in this Agreement, the following terms have the following respective meanings:

Covered Holders ” shall mean, collectively, (i) Sergey Brin, a natural living person, and all other members of his Holder Group and (ii) Larry Page, a natural living person, and all other members of his “Holder Group” as defined in that certain Transfer Restriction Agreement, dated as of the date hereof, among the Company, Larry Page, and each of the other parties thereto.

DGCL ” shall mean the General Corporation Law of the State of Delaware, as the same shall be in effect from time to time.


Holder ” shall mean Sergey Brin and his Permitted Entities and any other person or entity that is, or is required pursuant to the terms of this Agreement to be, a party to this Agreement.

Holder Group ” shall mean, at any time, with respect to Sergey Brin, such Holder taken together with each of the Permitted Entities of such Holder that both (i) own, beneficially and of record, shares of Class B Common Stock or shares of Non-Voting Capital Stock at such time, and (ii) meet the requirements of the applicable exception for such Permitted Entity specified in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation at such time. For the avoidance of doubt, (x) no Permitted Entity shall be a member of the Holder Group for purposes of this Agreement unless such Permitted Entity has executed and delivered a copy of this Agreement to the Company, regardless of whether such Permitted Entity would otherwise be a “Permitted Entity” as defined in Article IV, Section 2(f) of the Amended and Restated Certificate of Incorporation and (y) a Permitted Entity shall immediately cease to be a member of the Holder Group for purposes of Section 2 and Section 3 at such time as such Permitted Entity no longer meets the requirements of the applicable exception for such Permitted Entity specified in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation.

Independent Director ” means a member of the Board designated by the Nominating and Corporate Governance Committee of the Board as an independent director.

Number of Non-Voting Shares ” with respect to a Holder or the Holder Group, as applicable, shall mean, at any time, the aggregate number of shares of Non-Voting Capital Stock owned, beneficially and of record, by the Holder or Holder Group, as applicable, less the aggregate number of shares of Non-Voting Capital Stock deemed Sold by the Holder or Holder Group, as applicable, pursuant to clause (ii) of the definition of “Sell” below.

Parties ” shall mean the Company and the Holders.

Permitted Entity ” shall mean, with respect to Sergey Brin, any trust, account, plan, corporation, partnership, or limited liability company specified in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation established by or for Sergey Brin and to whom Sergey Brin has Transferred shares of Class B Common Stock or Non-Voting Capital Stock, so long as (i) such entity meets the requirements of the exception set forth in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation applicable to such entity (and, if such entity holds shares of Non-Voting Capital Stock, such entity meets the requirements of the applicable exception set forth in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation with respect to all shares of Non-Voting Capital Stock held by it as if such shares of Non-Voting Capital Stock were Class B Common Stock thereunder, mutatis mutandis ) and (ii) such entity has agreed to be bound by the terms of this Agreement and has executed and delivered a copy of this Agreement to the Company.

person ” shall mean any individual, general or limited partnership, firm, corporation, limited liability company, association, trust, unincorporated organization or other entity.

Sell ,” “ Sold ” or “ Sale ” with respect to a share of Non-Voting Capital Stock shall mean (i) any sale, assignment, transfer, conveyance, hypothecation or other Transfer or disposition of such share or any legal or beneficial interest in such share, whether or not for value and whether voluntary or involuntary or by operation of law, including a transfer of such share to a broker or other nominee (regardless of whether or not there is a corresponding change in record or beneficial ownership), or (ii) the entry into any contract, agreement or other binding arrangement with respect to any of the actions in the foregoing clause (i) regarding such share; provided , however , that the following shall not be considered a “Sale” within the meaning of this Section: the granting of a proxy to officers or directors of the Company at the request of the Board of Directors of the Company in connection with actions to be taken at an annual or special meeting of stockholders by the holders of the Non-Voting Common Stock.

Transfer ” shall have the meaning set forth in the Amended and Restated Certificate of Incorporation.

 

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2. Sales of Non-Voting Capital Stock .

(a) A Holder, and, to the extent such Holder is a member of a Holder Group, such Holder Group shall not Sell any shares of Non-Voting Capital Stock if, immediately following such Sale, such Holder, or to the extent that such Holder is a member of a Holder Group, such Holder Group, as applicable, would own, beneficially and of record, an aggregate number of shares of Class B Common Stock greater than the Number of Non-Voting Shares of such Holder or Holder Group, as applicable (after taking into account the conversion of shares of Class B Common Stock owned beneficially and of record by the Holder or Holder Group, as applicable, that are converted into shares of Class A Common Stock at the time of such Sale, if any, whether as a result of a simultaneous Transfer of such Class B Common Stock or otherwise); provided that this required maximum ratio of shares of Class B Common Stock to the Number of Non-Voting Shares shall be subject to adjustment as provided in Section 6(c).

(b) The Company shall not, and shall direct its transfer agent not to, permit any Sale of shares of Non-Voting Capital Stock in violation of this Agreement. The shares of Non-Voting Capital Stock held by a Holder and, to the extent such Holder is a member of a Holder Group, such Holder Group will be in uncertificated form, with stop transfer orders in place. The Company shall cooperate reasonably with the Holder and the other members of the Holder Group to lift such stop transfer orders with respect to any shares of Non-Voting Capital Stock that are Sold by any such member of the Holder Group in compliance with this Agreement.

(c) (i) If at any time a Holder, or to the extent that such Holder is a member of a Holder Group, such Holder Group, owns, beneficially and of record, an aggregate number of shares of Class B Common Stock greater than the Number of Non-Voting Shares of such Holder or Holder Group, as applicable (including because a Holder ceases to be a member of a Holder Group) (with this required maximum ratio of shares of Class B Common Stock to the Number of Non-Voting Shares subject to adjustment as provided in Section 6(c)), such Holder or Holder Group, as applicable, shall be deemed to have irrevocably converted a number of shares of Class B Common Stock owned beneficially and of record by such Holder or Holder Group, as applicable, automatically and without any further action, into an equal number of fully paid and nonassessable shares of Class A Common Stock such that after the deemed conversion the aggregate number of shares of Class B Common Stock owned, beneficially and of record, by such Holder or Holder Group, as applicable, shall equal the Number of Non-Voting Shares of such Holder or Holder Group, as applicable. Upon any such conversion of shares of Class B Common Stock to Class A Common Stock, all rights of the holder of such shares of Class B Common Stock shall cease and the person or persons in whose name or names the certificate or certificates representing the shares of Class A Common Stock are to be issued shall be treated for all purposes as having become the record holder or holders of such shares of Class A Common Stock.

(ii) Each Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group authorizes the Company and its transfer agent to take any and all actions that may be necessary to cause any such conversion to occur, whether or not such Holder or, to the extent applicable, such Holder Group has taken any action with respect thereto, including the Company providing appropriate instruction on behalf of such Holder to its transfer agent. The Holders and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group agree that the automatic conversion set forth in Section 2(c)(i) above shall apply (i) first, to shares of Class B Common Stock owned beneficially and of record by the Holder that is Transferring the shares of Non-Voting Capital Stock and (ii) in all other circumstances, including a Holder ceasing to be a member of a Holder Group or if the Holder no longer owns beneficially and of record any shares of Class B Common Stock, to shares of Class B Common Stock owned beneficially and of record by the other members of the Holder Group proportionately based on the number of shares of Class B Common Stock then held by each such member of the Holder Group.

(iii) Each Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group shall cooperate fully with the Company in connection with any such conversion, and shall take such actions as may be necessary or desirable to cause the documentation and implementation of such conversion as promptly as practicable following the Company or any Holder or Holder Group, as applicable, becoming aware that such Holder or Holder Group, as applicable, owns, beneficially and of record, an aggregate number of shares of Class B Common Stock greater than the Number of Non-Voting Shares of such Holder or Holder Group, as applicable.

(d) Notwithstanding any requirement for a maximum ratio of shares of Class B Common Stock to the Number of Non-Voting Shares to be in effect “immediately” or “at any time,” in order to facilitate Sales of shares on The NASDAQ Stock Market, Inc. (“ Nasdaq ”) over the course of a Nasdaq trading day, the Holder and such Holder’s

 

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Holder Group shall be permitted to temporarily hold more shares of Class B Common Stock than the Number of Non-Voting Shares during the trading day, so long as the maximum ratio requirement is satisfied by the close of regular trading on such trading day and such trading day is not a record date for any stockholder vote.

3. Transfers of Class B Common Stock and Non-Voting Capital Stock .

(a) A Holder who is a member of a Holder Group may Transfer (i) shares of Class B Common Stock to any other Holder who is a member of the same Holder Group in a Transfer which does not result in an automatic conversion of the Class B Common Stock into Class A Common Stock under the terms of Article IV, Section 2(f) of the Amended and Restated Certificate of Incorporation or (ii) shares of Non-Voting Capital Stock to any other Holder who is a member of the Holder Group, only if, in either such case, immediately following such Transfer the Holder Group would collectively own, beneficially and of record, an aggregate number of shares of Class B Common Stock equal to or less than the Number of Non-Voting Shares of the Holder Group; provided that this required ratio of the shares of Class B Common Stock to the Number of Non-Voting Shares shall be subject to adjustment as provided in Section 6(c).

(b) Except as provided in Section 3(a), a Holder may not Transfer shares of Class B Common Stock to another person in a Transfer which does not result in an automatic conversion of the Class B Common Stock into Class A Common Stock under the terms of Article IV, Section 2(f) of the Amended and Restated Certificate of Incorporation unless such Holder simultaneously Transfers, in the same manner and to the same extent, an equal number of shares of Non-Voting Capital Stock to such transferee; provided that this required ratio of the shares of Class B Common Stock to the Number of Non-Voting Shares shall be subject to adjustment as provided in Section 6(c).

(c) A Holder shall not Transfer shares of Class B Common Stock to any transferee who is not a party to this Agreement or a party to a Transfer Restriction Agreement with the Company in the form of this Agreement. If any such transferee is not a party to such an agreement prior to such Transfer, then the Holder shall cause such person to become a party to this Agreement or another such Transfer Restriction Agreement and shall deliver to the Company a duly executed copy hereof or thereof prior to the consummation of such Transfer.

4. Sales or Transfers of Class A Common Stock . Except as set forth in Section 5, this Agreement shall not limit or restrict any member of the Holder Group’s ability to Sell or Transfer any shares of Class A Common Stock.

5. No Short Sales or Derivative Transactions . Each Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group agrees to comply with the Alphabet Policy Against Insider Trading attached hereto as Exhibit C (the “ Insider Trading Policy ”) with respect to the Class A Common Stock, the Class B Common Stock, the Non-Voting Capital Stock and all other Company securities. The Parties agree that any waiver of the Insider Trading Policy shall only be effective if granted in accordance with Section 11(c). Notwithstanding any amendment to the Insider Trading Policy that may be effected by the Company from time to time, each Holder shall remain subject to the prohibitions against short sales and derivative transactions contained in the Insider Trading Policy as in effect on the date of this Agreement.

6. Certain Additional Agreements .

(a) Except in connection with a Sale permitted by this Agreement, a Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group shall at all times hold all shares of Non-Voting Capital Stock and Class B Common Stock beneficially and of record in such Holder’s name, and shall not hold any such shares through any nominee or broker.

(b) For all purposes under this Agreement, a share of “Non-Voting Capital Stock,” as of a given date of determination, shall be deemed to constitute (i) any securities issued by the Company in respect of a share of Class B Common Stock (other than shares of Class B Common Stock or rights to acquire Class B Common Stock), whether by dividend, stock split, distribution, recapitalization or otherwise after the date hereof and as of such date of determination and (ii) any securities issued by the Company (other than shares of Class B Common Stock or rights to acquire Class B Common Stock) in respect of the shares and securities referenced in clauses (i) and this clause (ii), whether by dividend, stock split, distribution, recapitalization or otherwise after the date hereof and as of such date of determination.

 

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(c) It is the intention and agreement of the Parties that none of the securities received in any future dividend, stock split, distribution or recapitalization or otherwise with respect to a share of Class B Common Stock or with respect to the Non-Voting Capital Stock received in connection with such share of Class B Common Stock, shall be Sold (other than pursuant to a Transfer in accordance with Section 3) unless the required ratio of shares of Class B Common Stock to the Number of Non-Voting Shares is not exceeded. If additional securities are so received, the required ratio of Class B Common Stock to such shares of Non-Voting Capital Stock for purposes of this Agreement (including Sections 2(a), 2(c), 3(a), and 3(b)) shall be equitably adjusted to account for such additional securities (e.g., if, after the Effective Time, one additional share of Non-Voting Capital Stock is distributed for each share of Class B Common Stock and Non-Voting Capital Stock, this Agreement shall be modified to require each Holder to hold at least three shares of Non-Voting Capital Stock for each share of Class B Common Stock).

(d) With respect to its ownership of shares of Class B Common Stock or Non-Voting Capital Stock, no member of the Holder Group shall take any action that, in the reasonable, good faith determination of the Company, is contrary to the purpose of this Agreement.

7. Company Sale and Equal Status . To the extent that any transaction is, or series of related transactions are, (a) a merger, consolidation or other business combination requiring the approval of the holders of the Company’s capital stock (whether or not the Company is the surviving entity) or acquisition of all or substantially all of the Company’s assets, (b) any tender or exchange offer by any third party to acquire a majority of the shares of Class A Common Stock, Class B Common Stock or Non-Voting Capital Stock or (c) any tender or exchange offer by the Company to acquire any shares of Class A Common Stock, Class B Common Stock or Non-Voting Capital Stock (any such transaction, a “ Company Sale or Recapitalization ”), no member of the Holder Group shall sell, transfer or exchange, directly or indirectly, any shares of Class A Common Stock, Class B Common Stock or Non-Voting Capital Stock in, or in a transaction related to, such Company Sale or Recapitalization, for (x) with respect to such member’s shares of Class A Common Stock or Class B Common Stock, an amount per share greater than that received in such Company Sale or Recapitalization by the holders of Class A Common Stock, or a form of consideration different from the form that holders of Class A Common Stock would receive, or may elect to receive, in such Company Sale or Recapitalization, or (y) with respect to such member’s shares of Non-Voting Capital Stock, an amount per share greater than that received in such Company Sale or Recapitalization by the other holders of Non-Voting Capital Stock, or a form of consideration different from the form that other holders of Non-Voting Capital Stock would receive, or may elect to receive, in such Company Sale or Recapitalization.

8. Administration of this Agreement . The Company shall establish, from time to time, such policies and procedures relating to the general administration of the terms of this Agreement, any Sales or Transfers of Class B Common Stock or Non-Voting Capital Stock permitted hereunder and any conversion of Class B Common Stock to Class A Common Stock contemplated hereby, as it may deem necessary or advisable, and shall deliver notice to the Holders of the restrictions placed on their shares of Common Stock and Non-Voting Capital Stock by this Agreement and by the Amended and Restated Certificate of Incorporation in accordance with Section 151(f) and 202(a) of the DGCL. A determination by a majority of the members of the Board other than any of the Covered Holders who are members of the Board or by the Secretary of the Company that a conversion of Class B Common Stock to Class A Common Stock pursuant to Section 2(c) hereof has occurred shall be conclusive absent manifest error.

9. Scope of this Agreement . This Agreement shall not in any way constitute an amendment, modification, supplement or waiver of any right, preference, privilege, term or provision set forth or contained in the Amended and Restated Certificate of Incorporation.

 

10. Termination .

(a) Except as set forth in Section 10(b) below, this Agreement may be terminated only by a written instrument that has been executed by each of the Holders and that has been approved by a majority of the members of the Board other than any of the Covered Holders who are members of the Board and executed on behalf of the Company.

 

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(b) This Agreement shall terminate, except for Sections 7 and 11 which shall survive such termination and other than with respect to any action or event occurring or arising prior to such termination, at such time as the voting power of the shares of Class A Common Stock, Class B Common Stock and other outstanding equity securities of the Company collectively owned, beneficially and of record, by the Covered Holders would represent in the aggregate less than thirty four percent (34%) of the voting power of all of the outstanding equity securities of the Company (including such shares of Class A Common Stock and Class B Common Stock) entitled to vote generally in the election of directors at an annual meeting of the stockholders of the Company.

 

11. Miscellaneous .

(a) Successors and Assigns . Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned or transferred (whether by operation of law or otherwise) by the Company, on the one hand, or any member of the Holder Group, on the other hand, without the prior written consent of the Holder or the Company, respectively, and any purported assignment or other transfer without such consent shall be void and unenforceable; provided , however , that the Company may assign or transfer this agreement to a successor entity in connection with any merger, consolidation, reorganization or business combination transaction. Subject to the preceding sentence, this Agreement shall be binding upon, inure to the benefit of and be enforceable by the Parties and their respective successors and assigns. Nothing in this Agreement, express or implied, is intended to confer upon any person other than the Parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities of any nature whatsoever under or by reason of this Agreement.

(b) Entire Agreement . This Agreement constitutes the full and entire understanding and agreement among the Parties with respect to the subject matter hereof.

(c) Amendment and Waiver . This Agreement or any of its provisions may be waived, amended, modified or supplemented only by a written instrument that has been executed by each of the Holders and that has been (i) considered and recommended by a committee consisting of two or more Independent Directors who do not hold Class B stock (the “TRA Committee”); and (ii) upon positive recommendation by the TRA Committee, approved by every member of the Board other than any of the Covered Holders who are members of the Board and executed on behalf of the Company. The TRA Committee shall be advised by independent legal counsel and financial advisors, paid for by Alphabet, who shall not have a current or recently concluded (within one year) material relationship with Alphabet or any of the Holders. At their election, Independent Directors who are not members of the TRA Committee shall be entitled to retain independent counsel, paid for by Alphabet, or may be advised by counsel to the TRA Committee if they and the TRA Committee deem such representation advisable. Any failure of the Parties to comply with any obligation, covenant, agreement or condition in this Agreement may be waived by the Party entitled to the benefit thereof only by a written instrument that has been signed by the Party granting such waiver and that, in the case of the Company, has been approved by a majority of the members of the Board other than any of the Covered Holders who are members of the Board. No delay on the part of any Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any Party of any right, power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder, nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

Notwithstanding any other provisions herein, any waiver, modification, amendment, or supplementation of this Agreement shall be publicly disclosed at least 30 days before such waiver, modification, amendment, or supplementation takes effect . Such disclosure shall identify the terms of the waiver, modification, amendment, or supplementation of this Agreement, and shall be made in any one of a Form 8-K, Form 10-Q, or Form 10-K filed with the United States Securities and Exchange Commission and marked for public dissemination. The reason for such disclosure shall be to provide a meaningful opportunity for judicial review of such waiver, modification, amendment, or supplementation. Alphabet and its Board of Directors agree that they will not object to such judicial review being adjudicated pursuant to the entire-fairness standard applied by the law of the State of Delaware and that they shall bear the burden of establishing entire fairness and will not seek to shift the burden back to plaintiff(s).

(d) Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given or made as follows: (i) if sent by registered or certified mail in the United States return receipt requested, upon receipt; (ii) if sent by nationally recognized overnight air courier, one (1)

 

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business day after mailing; (iii) if sent by facsimile transmission, when transmitted and receipt is confirmed and (iv) if otherwise actually personally delivered, when delivered, provided , however , that such notices, requests, demands and other communications are delivered to the address set forth below, or to such other address as any Party shall provide by like notice to the other Party:

If to the Company, to:

Alphabet Inc.

1600 Amphitheatre Parkway

Mountain View, CA 94043

Facsimile: 650.887.1790

Attention: Secretary

with a copy (which shall not constitute notice) to:

Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, NY 10006

Facsimile: 212.225.3999

Attention: Ethan Klingsberg

If to the Holder or any other member of the Holder Group, to:

Sergey Brin

c/o Alphabet Inc.

1600 Amphitheatre Parkway

Mountain View, CA 94043

Facsimile: 650.887.1790

(e) Governing Law; WAIVER OF JURY TRIAL . This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware applicable to contracts executed in and to be performed entirely within such State, without regard to the conflict of laws principles thereof which would result in the application of the laws of any other jurisdiction. Each of the Parties hereby irrevocably and unconditionally submits to the exclusive jurisdiction of the Court of Chancery of the State of Delaware or, to the extent such court does not have subject matter jurisdiction, the United States District Court for the District of Delaware, and any appellate court therefrom, in any action or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby, including any action or proceeding brought by, in the right of or on behalf of the Company (including any derivative action or proceeding), or for recognition or enforcement of any judgment relating thereto, and each of the Parties hereby irrevocably and unconditionally (i) agrees not to commence any such action or proceeding except in such courts; (ii) agrees that any claim in respect of any such action or proceeding may be heard and determined in any such court; (iii) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any such action or proceeding in any such court; and (iv) waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. Each of the Parties hereby agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Each of the Parties hereby irrevocably consents to service of process in the manner provided for notices in Section 11(d). Nothing in this Agreement shall affect the right of any Party to serve process in any other manner permitted by applicable law. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE, IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

(f) Equitable Remedies . Each Party acknowledges and agrees that the other Party would be irreparably damaged in the event that any of the terms or provisions of this Agreement are not performed in accordance with their specific terms or otherwise are breached. Therefore, notwithstanding anything to the contrary set forth in this Agreement, each Party hereby agrees that the other Party shall be entitled to an injunction or injunctions to prevent breaches of

 

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any of the terms or provisions of this Agreement, and to enforce specifically the performance by such first Party under this Agreement, and each Party hereby agrees to waive the defense in any such suit that the other Party has an adequate remedy at law and to interpose no opposition, legal or otherwise, as to the propriety of injunction or specific performance as a remedy, and hereby agrees to waive any requirement to post any bond in connection with obtaining such relief. The equitable remedies described in this Section 11(f) shall be in addition to, and not in lieu of, any other remedies at law or in equity that the Parties may elect to pursue. The rights and remedies provided for in this Agreement are cumulative and are not exclusive of any other rights or remedies which the Parties may have hereunder or may otherwise have at law or in equity.

(g) Severability . In the event that any one or more of the terms or provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement so long as the absence of such terms or provisions does not materially adversely affect any Party, and the Parties shall use their commercially reasonable efforts to substitute one or more valid, legal and enforceable terms or provisions into this Agreement which, insofar as practicable, implement the purposes and intent of this Agreement and which are not materially adverse to any Party. Any term or provision of this Agreement held invalid or unenforceable only in part, degree or within certain jurisdictions shall remain in full force and effect to the extent not held invalid or unenforceable to the extent consistent with the intent of the Parties as reflected by this Agreement and not materially adverse to any Party. To the extent permitted by applicable law, each Party waives any term or provision of law which renders any term or provision of this Agreement to be invalid, illegal or unenforceable in any respect.

(h) Interpretation . The Section headings in this Agreement are for convenience of reference only and shall not be deemed to alter or affect the meaning or interpretation of any provision of this Agreement. The Parties have participated jointly in the negotiation and drafting of this Agreement and have been advised by counsel in connection therewith. In the event an ambiguity or question of intent or interpretation arises with respect to any term or provision of this Agreement, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the terms or provisions of this Agreement. For all purposes of and under this Agreement, (i) the word “including” shall be deemed to be immediately followed by the words “without limitation;” (ii) words (including defined terms) in the singular shall be deemed to include the plural and vice versa; and (iii) the terms “hereof,” “herein,” “hereto,” “herewith” and any other words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular term or provision of this Agreement, unless otherwise specified.

(i) Counterparts . This Agreement may be executed in one or more counterparts (including by facsimile or electronic signature and by electronic mail or PDF), each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement.

*  *  *  *  *

(Signature Pages Follow)

 

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IN WITNESS WHEREOF , the Company and the Holder have executed this Agreement as of the date first above written.

 

Alphabet Inc.
By:  

/s/ Kent Walker

Name:   Kent Walker
Title:   Assistant Secretary
Sergey Brin

/s/ Sergey Brin

 

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IN WITNESS WHEREOF , the Permitted Entity named below has executed this Agreement as of the date first above written and agrees to be bound by the terms of this Agreement applicable to Permitted Entities as a Holder and a member of the Holder Group thereunder.

 

J.P. Morgan Trust Company of Delaware as Trustee

 

MDC Trust I

/s/ Danielle M. Kiss

Name:  

Danielle M. Kiss

Title:   Authorized Signatory

 

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IN WITNESS WHEREOF , the Permitted Entity named below has executed this Agreement as of the date first above written and agrees to be bound by the terms of this Agreement applicable to Permitted Entities as a Holder and a member of the Holder Group thereunder.

 

J.P. Morgan Trust Company of Delaware as Trustee

 

MDC Trust II

/s/ Danielle M. Kiss

Name:  

Danielle M. Kiss

Title:   Authorized Signatory

 

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IN WITNESS WHEREOF , the Permitted Entity named below has executed this Agreement as of the date first above written and agrees to be bound by the terms of this Agreement applicable to Permitted Entities as a Holder and a member of the Holder Group thereunder.

 

J.P. Morgan Trust Company of Delaware as Trustee

 

MDC Trust III

/s/ Danielle M. Kiss

Name:  

Danielle M. Kiss

Title:   Authorized Signatory

 

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Exhibit 4.5

ALPHABET INC. TRANSFER RESTRICTION AGREEMENT

This Transfer Restriction Agreement (this “ Agreement ”) is made as of October 2, 2015, among Alphabet Inc., a Delaware corporation (the “ Company ” or “ Alphabet ”), Eric E. Schmidt, the Eric Schmidt & Wendy Schmidt TR Schmidt Family Living Trust 01/01/89, Schmidt Investments L.P. and Schmidt Investments L.P. Fund II (“Eric Schmidt and his Permitted Entities”), and the other Holders signatory hereto. Capitalized terms used but not otherwise defined have the meaning set forth in Section 1.

RECITALS

WHEREAS, the Board of Directors (the “ Board ” or the “ Board of Directors ”) of the Company has authorized the entry into the Agreement and Plan of Merger (“ Merger Agreement ”) with Google Inc. (“ Google ”) and Maple Technologies Inc. (“ Maple ”), attached hereto as Exhibit A;

WHEREAS, concurrently with the execution of this Agreement, as of the Effective Time (as defined in the Merger Agreement), (i) Maple will be merged with and into Google with Google being the surviving corporation in the merger, (ii) the shares of each class of outstanding capital stock of Google will be converted into shares of the corresponding class of capital stock of Alphabet, in each case with the same designations, rights, powers and preferences, and the same qualifications, limitations and restrictions, and (iii) Google will become a wholly owned subsidiary of Alphabet;

WHEREAS, in connection with the consummation of the Merger Agreement and effective at the Effective Time, the Board and the sole stockholder of the Company have adopted the Amended and Restated Certificate of Incorporation of Alphabet, attached hereto as Exhibit B , which, among other matters, includes a class of capital stock, par value $0.001 per share, of the Company designated as “Class C Capital Stock” (the “ Non-Voting Capital Stock ”);

WHEREAS, as of the Effective Time, each share of Google Class A Common Stock, Google Class B Common Stock and Google Class C Capital Stock will be converted into a share of Alphabet Class A Common Stock, par value $0.001 per share (the “ Class A Common Stock ”), Alphabet Class B Common Stock, par value $0.001 per share (the “ Class B Common Stock ”) and Non-Voting Capital Stock, respectively; and

WHEREAS, in connection with the consummation of the Merger Agreement, the Holders and the Company desire to agree to certain matters with respect to the ownership and transfer of shares of Class A Common Stock, Class B Common Stock and Non-Voting Capital Stock by the Holders.

AGREEMENT

NOW, THEREFORE, in consideration of the foregoing and the mutual promises, agreements and covenants set forth herein, and for other good and valuable consideration the receipt and adequacy of which the Parties acknowledge, the Parties hereby agree as follows:

1. Certain Definitions . As used in this Agreement, the following terms have the following respective meanings:

Covered Holders ” shall mean, collectively, (i) Larry Page, a natural living person, and all other members of his “Holder Group” as defined in that certain Transfer Restriction Agreement, dated as of the date hereof, among the Company, Larry Page, and each of the other parties thereto and (ii) Sergey Brin, a natural living person, and all other members of his “Holder Group” as defined in that certain Transfer Restriction Agreement, dated as of the date hereof, among the Company, Sergey Brin, and each of the other parties thereto.

DGCL ” shall mean the General Corporation Law of the State of Delaware, as the same shall be in effect from time to time.


Holder ” shall mean Eric Schmidt and his Permitted Entities and any other person or entity that is, or is required pursuant to the terms of this Agreement to be, a party to this Agreement.

Holder Group ” shall mean, at any time, with respect to Eric Schmidt, such Holder taken together with each of the Permitted Entities of such Holder that both (i) own, beneficially and of record, shares of Class B Common Stock or shares of Non-Voting Capital Stock at such time, and (ii) meet the requirements of the applicable exception for such Permitted Entity specified in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation at such time. For the avoidance of doubt, (x) no Permitted Entity shall be a member of the Holder Group for purposes of this Agreement unless such Permitted Entity has executed and delivered a copy of this Agreement to the Company, regardless of whether such Permitted Entity would otherwise be a “Permitted Entity” as defined in Article IV, Section 2(f) of the Amended and Restated Certificate of Incorporation and (y) a Permitted Entity shall immediately cease to be a member of the Holder Group for purposes of Section 2 and Section 3 at such time as such Permitted Entity no longer meets the requirements of the applicable exception for such Permitted Entity specified in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation.

Independent Director ” means a member of the Board designated by the Nominating and Corporate Governance Committee of the Board as an independent director.

Number of Non-Voting Shares ” with respect to a Holder or the Holder Group, as applicable, shall mean, at any time, the aggregate number of shares of Non-Voting Capital Stock owned, beneficially and of record, by the Holder or Holder Group, as applicable, less the aggregate number of shares of Non-Voting Capital Stock deemed Sold by the Holder or Holder Group, as applicable, pursuant to clause (ii) of the definition of “Sell” below.

Parties ” shall mean the Company and the Holders.

Permitted Entity ” shall mean, with respect to Eric Schmidt, any trust, account, plan, corporation, partnership, or limited liability company specified in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation established by or for Eric Schmidt and to whom Eric Schmidt has Transferred shares of Class B Common Stock or Non-Voting Capital Stock, so long as (i) such entity meets the requirements of the exception set forth in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation applicable to such entity (and, if such entity holds shares of Non-Voting Capital Stock, such entity meets the requirements of the applicable exception set forth in Article IV, Section 2(f)(iii)(2) of the Amended and Restated Certificate of Incorporation with respect to all shares of Non-Voting Capital Stock held by it as if such shares of Non-Voting Capital Stock were Class B Common Stock thereunder, mutatis mutandis ) and (ii) such entity has agreed to be bound by the terms of this Agreement and has executed and delivered a copy of this Agreement to the Company.

person ” shall mean any individual, general or limited partnership, firm, corporation, limited liability company, association, trust, unincorporated organization or other entity.

Sell ,” “ Sold ” or “ Sale ” with respect to a share of Non-Voting Capital Stock shall mean (i) any sale, assignment, transfer, conveyance, hypothecation or other Transfer or disposition of such share or any legal or beneficial interest in such share, whether or not for value and whether voluntary or involuntary or by operation of law, including a transfer of such share to a broker or other nominee (regardless of whether or not there is a corresponding change in record or beneficial ownership), or (ii) the entry into any contract, agreement or other binding arrangement with respect to any of the actions in the foregoing clause (i) regarding such share; provided , however , that the following shall not be considered a “Sale” within the meaning of this Section: the granting of a proxy to officers or directors of the Company at the request of the Board of Directors of the Company in connection with actions to be taken at an annual or special meeting of stockholders by the holders of the Non-Voting Common Stock.

Transfer ” shall have the meaning set forth in the Amended and Restated Certificate of Incorporation.

 

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2. Sales of Non-Voting Capital Stock .

(a) A Holder, and, to the extent such Holder is a member of a Holder Group, such Holder Group shall not Sell any shares of Non-Voting Capital Stock if, immediately following such Sale, such Holder, or to the extent that such Holder is a member of a Holder Group, such Holder Group, as applicable, would own, beneficially and of record, an aggregate number of shares of Class B Common Stock greater than the Number of Non-Voting Shares of such Holder or Holder Group, as applicable (after taking into account the conversion of shares of Class B Common Stock owned beneficially and of record by the Holder or Holder Group, as applicable, that are converted into shares of Class A Common Stock at the time of such Sale, if any, whether as a result of a simultaneous Transfer of such Class B Common Stock or otherwise); provided that this required maximum ratio of shares of Class B Common Stock to the Number of Non-Voting Shares shall be subject to adjustment as provided in Section 6(c).

(b) The Company shall not, and shall direct its transfer agent not to, permit any Sale of shares of Non-Voting Capital Stock in violation of this Agreement. The shares of Non-Voting Capital Stock held by a Holder and, to the extent such Holder is a member of a Holder Group, such Holder Group will be in uncertificated form, with stop transfer orders in place. The Company shall cooperate reasonably with the Holder and the other members of the Holder Group to lift such stop transfer orders with respect to any shares of Non-Voting Capital Stock that are Sold by any such member of the Holder Group in compliance with this Agreement.

(c) (i) If at any time a Holder, or to the extent that such Holder is a member of a Holder Group, such Holder Group, owns, beneficially and of record, an aggregate number of shares of Class B Common Stock greater than the Number of Non-Voting Shares of such Holder or Holder Group, as applicable (including because a Holder ceases to be a member of a Holder Group) (with this required maximum ratio of shares of Class B Common Stock to the Number of Non-Voting Shares subject to adjustment as provided in Section 6(c)), such Holder or Holder Group, as applicable, shall be deemed to have irrevocably converted a number of shares of Class B Common Stock owned beneficially and of record by such Holder or Holder Group, as applicable, automatically and without any further action, into an equal number of fully paid and nonassessable shares of Class A Common Stock such that after the deemed conversion the aggregate number of shares of Class B Common Stock owned, beneficially and of record, by such Holder or Holder Group, as applicable, shall equal the Number of Non-Voting Shares of such Holder or Holder Group, as applicable. Upon any such conversion of shares of Class B Common Stock to Class A Common Stock, all rights of the holder of such shares of Class B Common Stock shall cease and the person or persons in whose name or names the certificate or certificates representing the shares of Class A Common Stock are to be issued shall be treated for all purposes as having become the record holder or holders of such shares of Class A Common Stock.

(ii) Each Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group authorizes the Company and its transfer agent to take any and all actions that may be necessary to cause any such conversion to occur, whether or not such Holder or, to the extent applicable, such Holder Group has taken any action with respect thereto, including the Company providing appropriate instruction on behalf of such Holder to its transfer agent. The Holders and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group agree that the automatic conversion set forth in Section 2(c)(i) above shall apply (i) first, to shares of Class B Common Stock owned beneficially and of record by the Holder that is Transferring the shares of Non-Voting Capital Stock and (ii) in all other circumstances, including a Holder ceasing to be a member of a Holder Group or if the Holder no longer owns beneficially and of record any shares of Class B Common Stock, to shares of Class B Common Stock owned beneficially and of record by the other members of the Holder Group proportionately based on the number of shares of Class B Common Stock then held by each such member of the Holder Group.

(iii) Each Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group shall cooperate fully with the Company in connection with any such conversion, and shall take such actions as may be necessary or desirable to cause the documentation and implementation of such conversion as promptly as practicable following the Company or any Holder or Holder Group, as applicable, becoming aware that such Holder or Holder Group, as applicable, owns, beneficially and of record, an aggregate number of shares of Class B Common Stock greater than the Number of Non-Voting Shares of such Holder or Holder Group, as applicable.

(d) Notwithstanding any requirement for a maximum ratio of shares of Class B Common Stock to the Number of Non-Voting Shares to be in effect “immediately” or “at any time,” in order to facilitate Sales of shares on The NASDAQ Stock Market, Inc. (“ Nasdaq ”) over the course of a Nasdaq trading day, the Holder and such Holder’s Holder Group shall be permitted to temporarily hold more shares of Class B Common Stock than the Number of Non-Voting Shares during the trading day, so long as the maximum ratio requirement is satisfied by the close of regular trading on such trading day and such trading day is not a record date for any stockholder vote.

 

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3. Transfers of Class B Common Stock and Non-Voting Capital Stock .

(a) A Holder who is a member of a Holder Group may Transfer (i) shares of Class B Common Stock to any other Holder who is a member of the same Holder Group in a Transfer which does not result in an automatic conversion of the Class B Common Stock into Class A Common Stock under the terms of Article IV, Section 2(f) of the Amended and Restated Certificate of Incorporation or (ii) shares of Non-Voting Capital Stock to any other Holder who is a member of the Holder Group, only if, in either such case, immediately following such Transfer the Holder Group would collectively own, beneficially and of record, an aggregate number of shares of Class B Common Stock equal to or less than the Number of Non-Voting Shares of the Holder Group; provided that this required ratio of the shares of Class B Common Stock to the Number of Non-Voting Shares shall be subject to adjustment as provided in Section 6(c).

(b) A Holder shall not Transfer shares of Class B Common Stock to any transferee who is not a party to this Agreement or a party to a Transfer Restriction Agreement with the Company in the form of this Agreement. If any such transferee is not a party to such an agreement prior to such Transfer, then the Holder shall cause such person to become a party to this Agreement or another such Transfer Restriction Agreement and shall deliver to the Company a duly executed copy hereof or thereof prior to the consummation of such Transfer.

4. Sales or Transfers of Class A Common Stock . Except as set forth in Section 5, this Agreement shall not limit or restrict any member of the Holder Group’s ability to Sell or Transfer any shares of Class A Common Stock.

5. No Short Sales or Derivative Transactions . Each Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group agrees to comply with the Alphabet Policy Against Insider Trading attached hereto as Exhibit C (the “ Insider Trading Policy ”) with respect to the Class A Common Stock, the Class B Common Stock, the Non-Voting Capital Stock and all other Company securities. The Parties agree that any waiver of the Insider Trading Policy shall only be effective if granted in accordance with Section 11(c). Notwithstanding any amendment to the Insider Trading Policy that may be effected by the Company from time to time, each Holder shall remain subject to the prohibitions against short sales and derivative transactions contained in the Insider Trading Policy as in effect on the date of this Agreement.

6. Certain Additional Agreements .

(a) Except in connection with a Sale permitted by this Agreement, a Holder and, to the extent such Holder is a member of a Holder Group, each member of such Holder Group shall at all times hold all shares of Non-Voting Capital Stock and Class B Common Stock beneficially and of record in such Holder’s name, and shall not hold any such shares through any nominee or broker.

(b) For all purposes under this Agreement, a share of “Non-Voting Capital Stock,” as of a given date of determination, shall be deemed to constitute (i) any securities issued by the Company in respect of a share of Class B Common Stock (other than shares of Class B Common Stock or rights to acquire Class B Common Stock), whether by dividend, stock split, distribution, recapitalization or otherwise after the date hereof and as of such date of determination and (ii) any securities issued by the Company (other than shares of Class B Common Stock or rights to acquire Class B Common Stock) in respect of the shares and securities referenced in clauses (i) and this clause (ii), whether by dividend, stock split, distribution, recapitalization or otherwise after the date hereof and as of such date of determination.

(c) It is the intention and agreement of the Parties that none of the securities received in any future dividend, stock split, distribution or recapitalization or otherwise with respect to a share of Class B Common Stock or with respect to the Non-Voting Capital Stock received in connection with such share of Class B Common Stock, shall be Sold (other than pursuant to a Transfer in accordance with Section 3) unless the required ratio of shares of Class B Common Stock to the Number of Non-Voting Shares is not exceeded. If additional securities are so received, the required ratio of Class B Common Stock to such shares of Non-Voting Capital Stock for purposes of this Agreement

 

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(including Sections 2(a), 2(c), 3(a)) shall be equitably adjusted to account for such additional securities (e.g., if, after the Effective Time, one additional share of Non-Voting Capital Stock is distributed for each share of Class B Common Stock and Non-Voting Capital Stock, this Agreement shall be modified to require each Holder to hold at least three shares of Non-Voting Capital Stock for each share of Class B Common Stock).

(d) With respect to its ownership of shares of Class B Common Stock or Non-Voting Capital Stock, no member of the Holder Group shall take any action that, in the reasonable, good faith determination of the Company, is contrary to the purpose of this Agreement.

7. Company Sale and Equal Status . To the extent that any transaction is, or series of related transactions are, (a) a merger, consolidation or other business combination requiring the approval of the holders of the Company’s capital stock (whether or not the Company is the surviving entity) or acquisition of all or substantially all of the Company’s assets, (b) any tender or exchange offer by any third party to acquire a majority of the shares of Class A Common Stock, Class B Common Stock or Non-Voting Capital Stock or (c) any tender or exchange offer by the Company to acquire any shares of Class A Common Stock, Class B Common Stock or Non-Voting Capital Stock (any such transaction, a “ Company Sale or Recapitalization ”), no member of the Holder Group shall sell, transfer or exchange, directly or indirectly, any shares of Class A Common Stock, Class B Common Stock or Non-Voting Capital Stock in, or in a transaction related to, such Company Sale or Recapitalization, for (x) with respect to such member’s shares of Class A Common Stock or Class B Common Stock, an amount per share greater than that received in such Company Sale or Recapitalization by the holders of Class A Common Stock, or a form of consideration different from the form that holders of Class A Common Stock would receive, or may elect to receive, in such Company Sale or Recapitalization, or (y) with respect to such member’s shares of Non-Voting Capital Stock, an amount per share greater than that received in such Company Sale or Recapitalization by the other holders of Non-Voting Capital Stock, or a form of consideration different from the form that other holders of Non-Voting Capital Stock would receive, or may elect to receive, in such Company Sale or Recapitalization.

8. Administration of this Agreement . The Company shall establish, from time to time, such policies and procedures relating to the general administration of the terms of this Agreement, any Sales or Transfers of Class B Common Stock or Non-Voting Capital Stock permitted hereunder and any conversion of Class B Common Stock to Class A Common Stock contemplated hereby, as it may deem necessary or advisable, and shall deliver notice to the Holders of the restrictions placed on their shares of Common Stock and Non-Voting Capital Stock by this Agreement and by the Amended and Restated Certificate of Incorporation in accordance with Section 151(f) and 202(a) of the DGCL. A determination by a majority of the members of the Board other than any of the Covered Holders who are members of the Board or by the Secretary of the Company that a conversion of Class B Common Stock to Class A Common Stock pursuant to Section 2(c) hereof has occurred shall be conclusive absent manifest error.

9. Scope of this Agreement . This Agreement shall not in any way constitute an amendment, modification, supplement or waiver of any right, preference, privilege, term or provision set forth or contained in the Amended and Restated Certificate of Incorporation.

10. Termination .

(a) Except as set forth in Section 10(b) below, this Agreement may be terminated only by a written instrument that has been executed by each of the Holders and that has been approved by a majority of the members of the Board other than any of the Covered Holders who are members of the Board and executed on behalf of the Company.

(b) This Agreement shall terminate, except for Sections 7 and 11 which shall survive such termination and other than with respect to any action or event occurring or arising prior to such termination, at such time as the voting power of the shares of Class A Common Stock, Class B Common Stock and other outstanding equity securities of the Company collectively owned, beneficially and of record, by the Holder and the other members of his Holder Group would represent in the aggregate less than two percent (2%) of the voting power of all of the outstanding equity securities of the Company (including such shares of Class A Common Stock and Class B Common Stock) entitled to vote generally in the election of directors at an annual meeting of the stockholders of the Company.

 

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11. Miscellaneous .

(a) Successors and Assigns . Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned or transferred (whether by operation of law or otherwise) by the Company, on the one hand, or any member of the Holder Group, on the other hand, without the prior written consent of the Holder or the Company, respectively, and any purported assignment or other transfer without such consent shall be void and unenforceable; provided , however , that the Company may assign or transfer this agreement to a successor entity in connection with any merger, consolidation, reorganization or business combination transaction. Subject to the preceding sentence, this Agreement shall be binding upon, inure to the benefit of and be enforceable by the Parties and their respective successors and assigns. Nothing in this Agreement, express or implied, is intended to confer upon any person other than the Parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities of any nature whatsoever under or by reason of this Agreement.

(b) Entire Agreement . This Agreement constitutes the full and entire understanding and agreement among the Parties with respect to the subject matter hereof.

(c) Amendment and Waiver . This Agreement or any of its provisions may be waived, amended, modified or supplemented only by a written instrument that has been executed by each of the Holders and that has been (i) considered and recommended by a committee consisting of two or more Independent Directors who do not hold Class B stock (the “TRA Committee”); and (ii) upon positive recommendation by the TRA Committee, approved by every member of the Board other than any of the Covered Holders who are members of the Board and executed on behalf of the Company. The TRA Committee shall be advised by independent legal counsel and financial advisors, paid for by Alphabet, who shall not have a current or recently concluded (within one year) material relationship with Alphabet or any of the Holders. At their election, Independent Directors who are not members of the TRA Committee shall be entitled to retain independent counsel, paid for by Alphabet, or may be advised by counsel to the TRA Committee if they and the TRA Committee deem such representation advisable. Any failure of the Parties to comply with any obligation, covenant, agreement or condition in this Agreement may be waived by the Party entitled to the benefit thereof only by a written instrument that has been signed by the Party granting such waiver and that, in the case of the Company, has been approved by a majority of the members of the Board other than any of the Covered Holders who are members of the Board. No delay on the part of any Party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any waiver on the part of any Party of any right, power or privilege hereunder operate as a waiver of any other right, power or privilege hereunder, nor shall any single or partial exercise of any right, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, power or privilege hereunder.

Notwithstanding any other provisions herein, any waiver, modification, amendment, or supplementation of this Agreement shall be publicly disclosed at least 30 days before such waiver, modification, amendment, or supplementation takes effect . Such disclosure shall identify the terms of the waiver, modification, amendment, or supplementation of this Agreement, and shall be made in any one of a Form 8-K, Form 10-Q, or Form 10-K filed with the United States Securities and Exchange Commission and marked for public dissemination. The reason for such disclosure shall be to provide a meaningful opportunity for judicial review of such waiver, modification, amendment, or supplementation. Alphabet and its Board of Directors agree that they will not object to such judicial review being adjudicated pursuant to the entire-fairness standard applied by the law of the State of Delaware and that they shall bear the burden of establishing entire fairness and will not seek to shift the burden back to plaintiff(s).

(d) Notices. All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given or made as follows: (i) if sent by registered or certified mail in the United States return receipt requested, upon receipt; (ii) if sent by nationally recognized overnight air courier, one (1) business day after mailing; (iii) if sent by facsimile transmission, when transmitted and receipt is confirmed and (iv) if otherwise actually personally delivered, when delivered, provided , however , that such notices, requests,

 

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demands and other communications are delivered to the address set forth below, or to such other address as any Party shall provide by like notice to the other Party:

If to the Company, to:

Alphabet Inc.

1600 Amphitheatre Parkway

Mountain View, CA 94043

Facsimile: 650.887.1790

Attention: Secretary

with a copy (which shall not constitute notice) to:

Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, NY 10006

Facsimile: 212.225.3999

Attention: Ethan Klingsberg

If to the Holder or any other member of the Holder Group, to:

Eric E. Schmidt

c/o Alphabet Inc.

1600 Amphitheatre Parkway

Mountain View, CA 94043

Facsimile: 650.887.1790

(e) Governing Law; WAIVER OF JURY TRIAL . This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware applicable to contracts executed in and to be performed entirely within such State, without regard to the conflict of laws principles thereof which would result in the application of the laws of any other jurisdiction. Each of the Parties hereby irrevocably and unconditionally submits to the exclusive jurisdiction of the Court of Chancery of the State of Delaware or, to the extent such court does not have subject matter jurisdiction, the United States District Court for the District of Delaware, and any appellate court therefrom, in any action or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby, including any action or proceeding brought by, in the right of or on behalf of the Company (including any derivative action or proceeding), or for recognition or enforcement of any judgment relating thereto, and each of the Parties hereby irrevocably and unconditionally (i) agrees not to commence any such action or proceeding except in such courts; (ii) agrees that any claim in respect of any such action or proceeding may be heard and determined in any such court; (iii) waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any such action or proceeding in any such court; and (iv) waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court. Each of the Parties hereby agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Each of the Parties hereby irrevocably consents to service of process in the manner provided for notices in Section 11(d). Nothing in this Agreement shall affect the right of any Party to serve process in any other manner permitted by applicable law. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE, IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

(f) Equitable Remedies . Each Party acknowledges and agrees that the other Party would be irreparably damaged in the event that any of the terms or provisions of this Agreement are not performed in accordance with their specific terms or otherwise are breached. Therefore, notwithstanding anything to the contrary set forth in this Agreement, each Party hereby agrees that the other Party shall be entitled to an injunction or injunctions to prevent breaches of any of the terms or provisions of this Agreement, and to enforce specifically the performance by such first Party under this Agreement, and each Party hereby agrees to waive the defense in any such suit that the other Party has an adequate remedy at law and to interpose no opposition, legal or otherwise, as to the propriety of injunction or specific performance as a remedy, and hereby agrees to waive any requirement to post any bond in connection with obtaining such relief. The equitable remedies described in this Section 11(f) shall be in addition to, and not in lieu of, any other remedies at law or in equity that the Parties may elect to pursue. The rights and remedies provided for in this Agreement are cumulative and are not exclusive of any other rights or remedies which the Parties may have hereunder or may otherwise have at law or in equity.

 

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(g) Severability . In the event that any one or more of the terms or provisions contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement so long as the absence of such terms or provisions does not materially adversely affect any Party, and the Parties shall use their commercially reasonable efforts to substitute one or more valid, legal and enforceable terms or provisions into this Agreement which, insofar as practicable, implement the purposes and intent of this Agreement and which are not materially adverse to any Party. Any term or provision of this Agreement held invalid or unenforceable only in part, degree or within certain jurisdictions shall remain in full force and effect to the extent not held invalid or unenforceable to the extent consistent with the intent of the Parties as reflected by this Agreement and not materially adverse to any Party. To the extent permitted by applicable law, each Party waives any term or provision of law which renders any term or provision of this Agreement to be invalid, illegal or unenforceable in any respect.

(h) Interpretation . The Section headings in this Agreement are for convenience of reference only and shall not be deemed to alter or affect the meaning or interpretation of any provision of this Agreement. The Parties have participated jointly in the negotiation and drafting of this Agreement and have been advised by counsel in connection therewith. In the event an ambiguity or question of intent or interpretation arises with respect to any term or provision of this Agreement, this Agreement shall be construed as if drafted jointly by the Parties, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship of any of the terms or provisions of this Agreement. For all purposes of and under this Agreement, (i) the word “including” shall be deemed to be immediately followed by the words “without limitation;” (ii) words (including defined terms) in the singular shall be deemed to include the plural and vice versa; and (iii) the terms “hereof,” “herein,” “hereto,” “herewith” and any other words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular term or provision of this Agreement, unless otherwise specified.

(i) Counterparts . This Agreement may be executed in one or more counterparts (including by facsimile or electronic signature and by electronic mail or PDF), each of which when executed shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement.

* * * * *

(Signature Pages Follow)

 

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IN WITNESS WHEREOF , the Company and the Holder have executed this Agreement as of the date first above written.

 

Alphabet Inc.
By:  

/s/ Kent Walker

Name:  

Kent Walker

Title:  

Assistant Secretary

Eric E. Schmidt

/s/ Eric E. Schmidt

 

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IN WITNESS WHEREOF , the Permitted Entity named below has executed this Agreement as of the date first above written and agrees to be bound by the terms of this Agreement applicable to Permitted Entities as a Holder and a member of the Holder Group thereunder.

 

Eric Schmidt & Wendy Schmidt TR Schmidt Family Living Trust 01/01/89

/s/ Eric E. Schmidt

Name:   Eric E. Schmidt
Title:   Authorized Signatory

 

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IN WITNESS WHEREOF , the Permitted Entity named below has executed this Agreement as of the date first above written and agrees to be bound by the terms of this Agreement applicable to Permitted Entities as a Holder and a member of the Holder Group thereunder.

 

Schmidt Investments L.P.

/s/ Eric E. Schmidt

Name:   Eric E. Schmidt
Title:   Authorized Signatory

 

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IN WITNESS WHEREOF , the Permitted Entity named below has executed this Agreement as of the date first above written and agrees to be bound by the terms of this Agreement applicable to Permitted Entities as a Holder and a member of the Holder Group thereunder.

 

Schmidt Investments L.P. Fund II

/s/ Eric E. Schmidt

Name:   Eric E. Schmidt
Title:   Authorized Signatory

 

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Exhibit 4.6

CLASS C UNDERTAKING

This CLASS C UNDERTAKING (this “ Undertaking ”), dated as of October 2, 2015 (the “ Effective Time ”), is made and entered into by Alphabet Inc., a Delaware corporation (“ Alphabet ”).

W I T N E S S E T H:

WHEREAS, on November 4, 2013, Google Inc. (“ Google ”) and the other parties in the consolidated class action No. 7469-CS before the Court of Chancery of the State of Delaware entered into a Revised Stipulation of Compromise and Settlement (the “ Stipulation ”);

WHEREAS, the Board of Directors (the “ Board ”) of Alphabet has authorized the entry into the Agreement and Plan of Merger (“ Merger Agreement ”) with Google Inc. (“ Google ”) and Maple Technologies Inc. (“ Maple ”), attached hereto as Exhibit A ; and

WHEREAS, pursuant to the Merger Agreement, (i) Merger Sub will be merged with and into Google with Google being the surviving corporation in the merger, (ii) the shares of each class of outstanding capital stock of Google will be converted into shares of the corresponding class of capital stock of Alphabet, in each case with the same designations, rights, powers and preferences, and the same qualifications, limitations and restrictions, and (iii) Google will become a wholly owned subsidiary of Alphabet.

WHEREAS, Alphabet has entered into certain transfer restriction agreements (the “ TRA’s ”) of even date herewith with Larry Page, Sergey Brin, and Eric E. Schmidt (the “ Executives ”) and certain of their respective affiliates pursuant to which the Executives and certain of their respective affiliates agree to be bound with respect to their Alphabet capital stock by the same restrictions, undertakings and obligations under the transfer restriction agreements, each dated as of March 25, 2014, between Google Inc., each of the Executives and certain of their respective affiliates in connection with the prior settlement of litigation relating to Class C Capital Stock;

WHEREAS, as of May 2015, following Google’s distribution of the Adjustment Payment (as defined in the Stipulation) Google has satisfied its obligations under Section 3.1(a) of the Stipulation; and

WHEREAS, the provisions of Section 3.1(b) of the Stipulation are included in the TRA’s.


NOW, THEREFORE, for the benefit of all the beneficiaries of the Stipulation, Alphabet hereby irrevocably undertakes as follows, effective as of the Effective Time:

 

1. To be bound by the continuing restrictions, undertakings and obligations and to benefit from the rights of the Stipulation that are applicable to Google Inc. as if it were Google Inc., including, without limitation, Articles 3.1(c) and 3.1(d) thereof.

 

2. This Undertaking shall be construed and enforced in accordance with the laws of the State of Delaware, without regard to any principles of conflict of laws.

[ Signature page follows ]


IN WITNESS WHEREOF, Alphabet has caused this Undertaking to be executed as of the date first written above by an officer thereof thereunto duly authorized.

 

Alphabet Inc.

/s/ Christine Flores

By:  

Christine Flores

Title:  

Assistant Secretary

Exhibit 10.1

COMPENSATION PLAN AGREEMENT

THIS COMPENSATION PLAN AGREEMENT (this “ Agreement ”) dated as of October 2, 2015 is between Google Inc., a Delaware corporation (“ Google ”) (which will be the surviving entity following the merger at the Effective Time (as defined herein), in which Maple Technologies Inc., a Delaware corporation (“ MergerSub ”) will be merged with and into Google) and Alphabet Inc., a Delaware corporation (“ Alphabet ”). All capitalized terms used in this Agreement and not defined herein have the respective meanings ascribed to them in the Agreement and Plan of Merger, dated as of October 2, 2015 (the “ Merger Agreement ”), by and among Google, Alphabet and MergerSub.

RECITALS

WHEREAS , pursuant to the Merger Agreement, at the Effective Time, MergerSub will be merged with and into Google, with Google continuing as the surviving entity in such merger and each outstanding share of capital stock of Google (“ Google Stock ”) will be converted into one share of capital stock of Alphabet (“ Alphabet Stock ”) of the same class and with the same rights and privileges relative to Alphabet that such share had relative to Google prior to the merger (the “ Reorganization ”);

WHEREAS , in connection with the Reorganization, (A) Google will transfer (including sponsorship of) to Alphabet, and Alphabet will assume (including sponsorship of), Google’s equity compensation plans listed in Exhibit A and any subplans, appendices or addendums thereto (the “ Google Equity Compensation Plans ”) and all obligations of Google pursuant to each stock option to purchase a share of Google Stock (a “ Google Option ”) and each right to acquire or vest in a share of Google Stock (a “ Google Stock Unit ” and each of a Google Option and a Google Stock Unit, a “ Google Equity Award ”) that is outstanding immediately prior to the Effective Time and (i) issued under the Google Equity Compensation Plans and underlying grant agreements (each such grant agreement, a “ Google Equity Award Grant Agreement ” and such grant agreements together with the Google Equity Compensation Plans, the “ Google Equity Compensation Plans and Agreements ”) or (ii) granted by Google outside of the Google Equity Compensation Plans and Agreements pursuant to NASDAQ Listing Rule 5635(c), all upon the terms and subject to the conditions set forth in the Merger Agreement and this Agreement, and (B) each such Google Equity Award will be converted into (A) with respect to each Google Stock Unit, a right to acquire or vest in a share of Alphabet Stock or (B) with respect to a Google Option, an option to purchase a share of Alphabet Stock at an exercise price per share equal to the exercise price per share of Google Stock subject to such Google Option immediately prior to the Effective Time;

WHEREAS , Google maintains the Google Inc. Deferred Compensation Plan, as amended (the “ Deferred Compensation Plan ”);

WHEREAS , the Board of Directors of Google has determined that it is in the best interests of Google for Google to enter into this Agreement;

WHEREAS , the Board of Directors of Alphabet has determined that it is in the best interests of Alphabet and its shareholders for Alphabet to enter into this Agreement;

WHEREAS , the Board of Directors of Google and the Board of Directors of Alphabet have determined that the Reorganization does not constitute a “Change in Control” under the Google Equity Compensation Plans and Agreements or the Google Equity Awards, as such term is defined therein.

NOW, THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, Google and Alphabet hereby agree as follows:

I.

EQUITY PLANS AND AWARDS

1.     Subject to and as of the Effective Time, Alphabet will assume and will perform, from and after the Effective Time, all of the obligations of Google pursuant to the Google Equity Compensation Plans and Agreements.


2.     Subject to and as of the Effective Time, (a) Alphabet will assume each Google Equity Award that is outstanding and unexercised, unvested and not yet paid or payable immediately prior to the Effective Time (i) issued under the Google Equity Compensation Plans and Agreements or (ii) granted by Google outside of the Google Equity Compensation Plans and Agreements pursuant to NASDAQ Listing Rule 5635(c) and (b) each such Google Equity Award shall be converted into (A) with respect to each Google Stock Unit, a right to acquire or vest in, on otherwise the same terms and conditions as were applicable under the applicable Google Equity Compensation Plan and/or Google Equity Award Grant Agreement (as modified herein), a share of Alphabet Stock with the same rights and privileges applicable to the share of Google Stock subject to such Google Stock Unit immediately prior to the Effective Time and (B) with respect to a Google Option, an option to purchase, on otherwise the same terms and conditions as were applicable under the applicable Google Equity Compensation Plan and/or Google Equity Award Grant Agreement (as modified herein), a share of Alphabet Stock with the same rights and privileges applicable to the share of Google Stock subject to such Google Option immediately prior to the Effective Time, at an exercise price per share equal to the exercise price per share of Google Stock subject to such Google Option immediately prior to the Effective Time. All Google Options shall be adjusted and converted in accordance with the requirements of Section 424 of the United States Internal Revenue Code of 1986, as amended, and regulations thereunder.

3.     At the Effective Time, the Google Equity Awards, the Google Equity Compensation Plans and Agreements and any provision of any other compensatory plan, agreement or arrangement providing for the grant or issuance of Google Stock shall each be automatically deemed to be amended, to the extent necessary or appropriate, to provide that references to Google in such awards, documents and provisions shall be read to refer to Alphabet and references to Google Stock in such awards, documents and provisions shall be read to refer to Alphabet Stock. Alphabet and Google agree to (i) prepare and execute all amendments to the Google Equity Compensation Plans and Agreements, Google Equity Awards and other documents necessary to effectuate Alphabet’s assumption of the Google Equity Compensation Plans and Agreements and outstanding Google Equity Awards, (ii) provide notice of the assumption to holders of such Google Equity Awards, and (iii) submit any required filings with the Securities and Exchange Commission in connection with same.

4.     On or prior to the Effective Time, Alphabet shall reserve sufficient shares of Alphabet Stock to provide for the issuance of Alphabet Stock to satisfy Alphabet’s obligations under this Agreement with respect to the Google Equity Compensation Plans and Agreements and Google Equity Awards.

5.     Google and Alphabet agree that the Reorganization does not constitute a “Change in Control” under the Google Equity Compensation Plans and Agreements or the Google Equity Awards, as such term is defined therein.

II.

DEFERRED COMPENSATION PLAN

1.     Subject to and as of the Effective Time, Alphabet will assume and will perform, from and after the Effective Time, all of the obligations of Google pursuant to the Deferred Compensation Plan, noting that no assets of Alphabet shall be held in any way as collateral security for the fulfilling of the obligations of Alphabet, any and all of Alphabet’s assets shall be, and remain, the general unpledged, unrestricted assets of Alphabet, subject to the claims of Alphabet’s general creditors and that Alphabet’s obligation as to the Deferred Compensation Plan shall be merely that of an unfunded and unsecured promise of Alphabet to pay money in the future, and the rights of any participants or beneficiaries of the Deferred Compensation Plan shall be no greater than those of unsecured general creditors of Alphabet.

2.     At the Effective Time, the Deferred Compensation Plan shall be automatically deemed to be amended, to the extent necessary or appropriate, to provide that references to Google shall be read to refer to Alphabet. Alphabet and Google agree to prepare and execute all amendments to the Deferred Compensation Plan and other documents necessary to effectuate Alphabet’s assumption of the Deferred Compensation Plan.

 

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III.

MISCELLANEOUS

1.     Each of Google and Alphabet will, from time to time and at all times hereafter, upon every reasonable request to do so by any other party hereto, make, do, execute and deliver, or cause to be made, done, executed and delivered, all such further acts, deeds, assurances and things as may be reasonably required or necessary in order to further implement and carry out the intent and purpose of this Agreement.

 

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IN WITNESS WHEREOF, the undersigned have executed this Compensation Plan Agreement as of the date first written above.

 

GOOGLE INC.
a Delaware corporation
By:  

/s/ Kenneth Yi

  Name: Kenneth Yi
  Title: Assistant Secretary

ALPHABET INC.

a Delaware corporation

By:  

/s/ Christine Flores

  Name: Christine Flores
  Title: Assistant Secretary

 

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Exhibit A

Equity Plans

 

    The Google Inc. 2004 Stock Plan
    The Google Inc. 2012 Stock Plan
    The AdMob, Inc. 2006 Stock Plan and UK Sub-Plan of the AdMob, Inc. 2006 Stock Plan
    Click Holding Corp. 2005 Stock Incentive Plan
    The Motorola Mobility Holdings, Inc. 2011 Incentive Compensation Plan

 

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Exhibit 10.2

DIRECTOR ARRANGEMENTS AGREEMENT

THIS DIRECTOR ARRANGEMENTS AGREEMENT (this “ Agreement ”) dated as of October 2, 2015 is between Google Inc., a Delaware corporation (“ Google ”), and Alphabet Inc., a Delaware corporation (“ Alphabet ”).

RECITALS

WHEREAS , Google has previously entered into offer letters with certain of the current members of Google’s Board of Directors (the “ Offer Letters ) in respect of such individuals’ service to Google;

WHEREAS , the Board of Directors of Alphabet has determined that it is in the best interests of Alphabet for Alphabet enter into an agreement with Google providing for Alphabet’s performance of obligations under the Offer Letters as if Alphabet, and not Google, were the signatory thereto, from and after the date hereof, with Google having no further obligations under the Offer Letters from and after the date hereof;

WHEREAS , the Board of Directors of Google has determined that it is in the best interests of Google to agree to enter into such an agreement;

NOW, THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, Google and Alphabet hereby agree as follows:

SECTION 1. OFFER LETTERS

(a) Alphabet hereby agrees to assume to perform any and all obligations to the individual signatories under the Offer Letters from and after the date hereof in accordance with the terms of such Offer Letters as if Alphabet, and not Google, were the signatory thereto and all references to Google therein were replaced with references to Alphabet, and from and after the date hereof, Google shall have no further obligations under the Offer Letters.

(b) Each of Google and Alphabet agree that the individual signatories to the Offer Letters and their heirs and assignees shall be express third-party beneficiaries of this Section 1 of this Agreement and entitled to enforce directly such section and the contractual rights against Alphabet under their Offer Letters granted pursuant to this Section 1.

SECTION 2. MISCELLANEOUS

(a) Each of Google and Alphabet will, from time to time and at all times hereafter, upon every reasonable request to do so by any other party hereto, make, do, execute and deliver, or cause to be made, done, executed and delivered, all such further acts, deeds, assurances and things as may be reasonably required or necessary in order to further implement and carry out the intent and purpose of this Agreement.

[Signatures Follow on Next Page]


IN WITNESS WHEREOF, the undersigned have executed this Director Arrangements Agreement as of the date first written above.

 

GOOGLE INC.

a Delaware corporation

By:

  /s/ Christine Flores
 

 

  Name: Christine Flores
  Title: Assistant Secretary

ALPHABET INC.

a Delaware corporation

By:

  /s/ Kent Walker
 

 

  Name: Kent Walker
  Title: Assistant Secretary

 

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Exhibit 10.3

ALPHABET INC.

2012 STOCK PLAN

(Amended and restated as of October 2, 2015)

 

1. Purpose of the Plan

This Plan is intended to promote the interests of the Company and its stockholders by providing the employees and consultants of the Company and members of the Board of Directors with incentives and rewards to encourage them to continue in the service of the Company and with a proprietary interest in pursuing the long-term growth, profitability and financial success of the Company.

 

2. Definitions

As used in the Plan or in any instrument governing the terms of any Incentive Award, the following definitions apply to the terms indicated below:

 

  (a) “Alphabet” means Alphabet Inc., a Delaware corporation.

 

  (b) “Board of Directors” means the Board of Directors of Alphabet.

 

  (c) “Capital Stock” means Alphabet’s Class C Capital Stock, $0.001 par value per share, or any other security into which such capital stock shall be changed as contemplated by the adjustment provisions of Section 10 of the Plan.

 

  (d) “Cash Incentive Award” means an award granted pursuant to Section 8 of the Plan.

 

  (e) “Code” means the Internal Revenue Code of 1986, as amended from time to time, and all regulations, interpretations and administrative guidance issued thereunder.

 

  (f) “Committee” means the Leadership Development and Compensation Committee of the Board of Directors or such other committee as the Board of Directors shall appoint from time to time to administer the Plan and to otherwise exercise and perform the authority and functions assigned to the Committee under the terms of the Plan.

 

  (g) “Company” means Alphabet and all of its Subsidiaries, collectively.

 

  (h) “Covered Employee” means each Participant who is an executive officer (within the meaning of Rule 3b-7 under the Exchange Act) of Alphabet.

 

  (i) “Deferred Compensation Plan” means any plan, agreement or arrangement maintained by the Company from time to time that provides opportunities for deferral of compensation.

 

  (j) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

  (k)

“Fair Market Value” means, with respect to a share of Capital Stock, as of the applicable date of determination (i) the closing sales price on the date of determination or, if not so reported for such day, the immediately preceding business day of a share of Capital Stock as reported on the principal securities exchange on which shares of Capital Stock are then listed or admitted to trading or (ii) if not so reported, the closing bid price on the date of determination or, if


  not so reported for such day, on the immediately preceding business day as reported on The NASDAQ Stock Market or (iii) if not so reported, as furnished by any member of the Financial Industry Regulatory Authority, Inc. selected by the Committee. In the event that the price of a share of Capital Stock shall not be so reported, the Fair Market Value of a share of Capital Stock shall be determined by the Committee in its sole discretion. Notwithstanding the preceding, for federal, state and local income tax reporting purposes and for such other purposes as the Committee deems appropriate, the Fair Market Value shall be determined by the Committee in accordance with uniform and nondiscriminatory standards adopted by it from time to time.

 

  (l) “Incentive Award” means one or more Stock Incentive Awards and Cash Incentive Awards, collectively.

 

  (m) “Incentive Award Transfer Program” means any program instituted by the Board of Directors or the Committee which would permit Participants the opportunity to transfer any outstanding Incentive Awards to a financial institution or other Person selected by the Board of Directors or the Committee.

 

  (n) “ISO” shall mean any Option, or portion thereof, awarded to a Participant pursuant to the Plan which is designated by the Committee as an incentive stock option and also meets the applicable requirements of an incentive stock option pursuant to Section 422 of the Code.

 

  (o) “Option” means a stock option to purchase shares of Capital Stock granted to a Participant pursuant to Section 6 of the Plan.

 

  (p) “Other Stock-Based Award” means an award granted to a Participant pursuant to Section 7 of the Plan.

 

  (q) “Participant” means an employee or consultant of the Company or a member of the Board of Directors who is eligible to participate in the Plan pursuant to the terms and conditions hereof and to whom one or more Incentive Awards have been granted pursuant to the Plan and have not been fully settled or cancelled and, following the death of any such Person, his successors, heirs, executors and administrators, as the case may be.

 

  (r) “Performance-Based Compensation” means compensation that satisfies the requirements of Section 162(m) of the Code for deductibility of “qualified performance-based compensation.”

 

  (s) “Performance Measures” means such measures as are described in Section 9 of the Plan on which performance goals are based in order to qualify certain awards granted hereunder as Performance-Based Compensation.

 

  (t) “Performance Percentage” means the factor determined pursuant to a Performance Schedule that is to be applied to a Target Award and that reflects actual performance compared to the Performance Target.

 

  (u) “Performance Period” means the period of time during which Performance Targets must be met in order to determine the degree of payout and/or vesting with respect to an Incentive Award that is intended to qualify as Performance-Based Compensation. Performance Periods may be overlapping.

 

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  (v) “Performance Schedule” means a schedule or other objective method for determining the applicable Performance Percentage to be applied to each Target Award.

 

  (w) “Performance Target” means performance goals and objectives with respect to a Performance Period.

 

  (x) “Person” means a “person” as such term is used in Section 13(d) and 14(d) of the Exchange Act, including any “group” within the meaning of Section 13(d)(3) under the Exchange Act.

 

  (y) “Plan” means this 2012 Stock Plan, as it may be amended from time to time.

 

  (z) “Securities Act” means the Securities Act of 1933, as amended.

 

  (aa) “Stock Incentive Award” means an Option or Other Stock-Based Award granted pursuant to the terms of the Plan.

 

  (bb) “Subsidiary” means any “subsidiary” within the meaning of Rule 405 under the Securities Act.

 

  (cc) “Target Award” means target payout amount for an Incentive Award.

 

3. Stock Subject to the Plan and Limitations on Cash Incentive Awards

 

  (a) Stock Subject to the Plan

The maximum number of shares of Capital Stock that may be covered by Incentive Awards granted under the Plan shall not exceed 47,000,000 shares of Capital Stock in the aggregate. The maximum number of shares of Capital Stock that may be covered by Incentive Awards granted under the Plan that are intended to be ISOs shall not exceed 47,000,000 shares of Capital Stock in the aggregate. The shares referred to in the preceding sentences of this paragraph shall be subject to adjustment as provided in Section 10 and the following provisions of this Section 3. Shares of Capital Stock issued under the Plan may be either authorized and unissued shares or treasury shares, or both, at the sole discretion of the Committee.

For purposes of the preceding paragraph, shares of Capital Stock covered by Incentive Awards shall only be counted as used to the extent they are actually issued and delivered to a Participant (or such Participant’s permitted transferees as described in the Plan) pursuant to the Plan. For purposes of clarification, in accordance with the preceding sentence if an Incentive Award is settled for cash or if shares of Capital Stock are withheld to pay the exercise price of an Option or to satisfy any tax withholding requirement in connection with an Incentive Award, only the shares issued (if any), net of the shares withheld, will be deemed delivered for purposes of determining the number of shares of Capital Stock that are available for delivery under the Plan. In addition, shares of Capital Stock related to Incentive Awards that expire, are forfeited or cancelled or terminate for any reason without the issuance of shares shall not be treated as issued pursuant to the Plan. In addition, if shares of Capital Stock owned by a Participant (or such Participant’s permitted transferees as described in the Plan) are tendered (either actually or through attestation) to the Company in payment of any obligation in connection with an Incentive Award, the number of shares tendered shall be added to the number of shares of Capital Stock that are available for delivery under the Plan. Shares of Capital Stock covered by

 

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Incentive Awards granted pursuant to the Plan in connection with the conversion, replacement, or adjustment of outstanding equity-based awards to reflect a merger or acquisition (within the meaning of NASDAQ Listing Rule 5635(c) and Interpretive Material 5635-1) shall not count as used under the Plan for purposes of this Section 3. Notwithstanding anything to the contrary herein, shares of Capital Stock attributable to Incentive Awards transferred under any Incentive Award Transfer Program shall not again be available for delivery under the Plan.

 

  (b) Individual Award Limits

Subject to adjustment as provided in Section 10, the maximum number of shares of Capital Stock that may be covered by Incentive Awards intended to qualify as Performance-Based Compensation that are granted to any Covered Employee in any calendar year shall not exceed 1,000,000 shares. The amount payable to any Covered Employee with respect to any calendar year for all Cash Incentive Awards shall not exceed $100 million. For purposes of the preceding sentence, the phrase “amount payable with respect to any calendar year” means the amount of cash, or value of other property, required to be paid based on the achievement of applicable Performance Measures during a Performance Period that ends in a calendar year, disregarding any deferral pursuant to the terms of a Deferred Compensation Plan unless the terms of the deferral are intended to comply with the requirements for performance-based compensation under Section 162(m) of the Code.

 

4. Administration of the Plan

The Plan shall be administered by a Committee of the Board of Directors consisting of two or more persons, each of whom qualifies as a “non-employee director” (within the meaning of Rule 16b-3 promulgated under Section 16 of the Exchange Act), an “outside director” within the meaning of Treasury Regulation Section 1.162-27(e)(3) and as “independent” within the meaning of any applicable stock exchange listing rules or similar regulatory authority. The Committee shall, consistent with the terms of the Plan, from time to time designate those employees and consultants of the Company and members of the Board of Directors who shall be granted Incentive Awards under the Plan and the amount, type and other terms and conditions of such Incentive Awards. All of the powers and responsibilities of the Committee under the Plan may be delegated by the Committee to any subcommittee thereof. In addition, the Committee may from time to time authorize a subcommittee consisting of one or more members of the Board of Directors (including members who are employees of the Company) or employees of the Company to grant Incentive Awards, subject to such restrictions and limitation as the Committee may specify and to the requirements of Delaware General Corporation Law Section 157.

The Committee shall have full discretionary authority to administer the Plan, including discretionary authority to interpret and construe any and all provisions of the Plan and the terms of any Incentive Award (and any agreement evidencing the grant of any Incentive Award) granted thereunder and to adopt and amend from time to time such rules and regulations for the administration of the Plan as the Committee may deem necessary or appropriate. The Committee shall have the authority, in its discretion, to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations related to sub-plans established for the purpose of satisfying applicable foreign laws and/or qualifying for preferred tax treatment under applicable foreign tax laws. For purposes of clarity, the Committee may exercise all discretion granted to it under the Plan in a non-uniform manner among Participants.

 

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Without limiting the generality of the foregoing paragraph, the Committee shall determine whether an authorized leave of absence, or absence in military or government service, shall constitute termination of employment, provided that a Participant who is an employee will not be deemed to cease employment in the case of any leave of absence approved by the Company. Unless the Committee provides otherwise in the agreement evidencing the grant of an Incentive Award, vesting of Incentive Awards granted hereunder will be suspended during any unpaid leave of absence and will resume on the date the Participant returns to work on a regular schedule as determined by the Company, it being understood that no vesting credit will be awarded for the time vesting has been suspended during such leave of absence. For purposes of ISOs, no such leave may exceed ninety (90) days, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of absence approved by the Company is not so guaranteed, then three months following the 91 st day of such leave any ISO held by the Participant will cease to be treated as an ISO and will be treated for tax purposes as a non-qualified Option. The provisions of this paragraph shall be administered and interpreted in a manner that does not give rise to any tax under Section 409A of the Code.

The employment of a Participant with the Company shall be deemed to have terminated for all purposes of the Plan if such Participant is employed by or provides services to a Person that is a Subsidiary of the Company and such Person ceases to be a Subsidiary of the Company, unless the Committee determines otherwise. The Committee may, without limitation and in its discretion, in connection with any such determination, provide for the accelerated vesting of any Incentive Award upon or after such cessation, subject to such terms and conditions as the Committee shall specify. The employment of a Participant with the Company shall not be deemed to have terminated for any purpose of the Plan if such Participant is employed by a Person that is part of the Company, and such Participant’s employment is subsequently transferred to any other Person that is part of the Company, unless and to the extent the Committee specifies otherwise in writing in the instrument evidencing the grant of an Incentive Award or otherwise. A Participant who ceases to be an employee of the Company but continues, or simultaneously commences, services as a consultant or director of the Company shall not be deemed to have had a termination of employment for purposes of the Plan, unless the Committee determines otherwise. Decisions of the Committee shall be final, binding and conclusive on all parties. All discretion granted to the Committee pursuant to this paragraph must be exercised in a manner that would not cause any tax to become due under Section 409A of the Code.

On or after the date of grant of an Incentive Award under the Plan, the Committee may (i) accelerate the date on which any such Incentive Award becomes vested, exercisable or transferable, as the case may be, (ii) extend the term of any such Incentive Award, including, without limitation, extending the period following a termination of a Participant’s employment during which any such Incentive Award may remain outstanding, (iii) waive any conditions to the vesting, exercisability or transferability, as the case may be, of any such Incentive Award, or (iv) provide for the payment of dividends or dividend equivalents with respect to any such Incentive Award; provided , that the Committee shall not have any such authority to the extent that the grant of such authority would cause any tax to become due under Section 409A of the Code.

The Board of Directors or the Committee may, at any time, in its sole and complete discretion, implement an Incentive Award Transfer Program.

The Company shall pay any amount payable with respect to an Incentive Award in accordance with the terms of such Incentive Award, provided that the Committee may, in its discretion, defer the payment of amounts payable with respect to an Incentive Award subject to and in accordance with the terms of a Deferred Compensation Plan.

 

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5. Eligibility

The Persons who shall be eligible to be selected by the Committee from time to time to receive Incentive Awards pursuant to the Plan shall be those Persons (a) who are employees and consultants of, or who render services directly or indirectly to, the Company or (b) who are members of the Board of Directors. Each Incentive Award granted under the Plan shall be evidenced by an instrument in writing in form and substance approved by the Committee.

 

6. Options

The Committee may from time to time grant Options, subject to the following terms and conditions:

 

  (a) Exercise Price

The exercise price per share of Capital Stock covered by any Option shall be not less than 100% of the Fair Market Value of a share of Capital Stock on the date on which such Option is granted.

 

  (b) Term and Exercise of Options

(i) Each Option shall become vested and exercisable on such date or dates, during such period and for such number of shares of Capital Stock as shall be determined by the Committee on or after the date such Option is granted and set forth in the agreement evidencing the grant of such Option; provided , however that no Option shall be exercisable after the expiration of ten (10) years from the date such Option is granted; and, provided , further , that each Option shall be subject to earlier termination, expiration or cancellation as provided in the Plan or in the agreement evidencing the grant of such Option.

(ii) Each Option may be exercised in whole or in part; provided , however that no partial exercise of an Option shall be for an aggregate exercise price of less than $1,000. The partial exercise of an Option shall not cause the expiration, termination or cancellation of the remaining portion thereof.

(iii) An Option shall be exercised by such methods and procedures as the Committee determines from time to time, including without limitation through net physical settlement or other method of cashless exercise.

(iv) Options may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of a Participant, only by the Participant; provided , however that the Committee may permit in its discretion Options to be sold, pledged, assigned, hypothecated, transferred, or disposed of, on a general or specific basis, subject to such conditions and limitations as the Committee may determine, including through the implementation of an Incentive Award Transfer Program.

 

  (c) Effect of Termination of Employment or Other Relationship

The agreement evidencing the grant of each Option shall specify the consequences with respect to such Option of the termination of the employment or other service between the Company and the Participant holding the Option.

 

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  (d) Additional Terms for ISOs

Each Option that is intended to qualify as an ISO shall be designated as such in the agreement evidencing its grant, and each agreement evidencing the grant of an Option that does not include any such designation shall be deemed to be a non-qualified Option. ISOs may only be granted to Persons who are employees of the Company. The aggregate Fair Market Value (determined as of the date of grant of the ISOs) of the number of shares of Capital Stock with respect to which ISOs are exercisable for the first time by any Participant during any calendar year under all plans of the Company shall not exceed $100,000, or such other maximum amount as is then applicable under Section 422 of the Code. Any Option or a portion thereof that is designated as an ISO that for any reason fails to meet the requirements of an ISO shall be treated hereunder as a non-qualified Option. No ISO may be granted to a Person who, at the time of the proposed grant, owns (or is deemed to own under the Code) stock possessing more than ten percent (10%) of the total combined voting power of all classes of common stock of the Company unless (i) the exercise price of such ISO is at least one hundred ten percent (110%) of the Fair Market Value of a share of Capital Stock at the time such ISO is granted and (ii) such ISO is not exercisable after the expiration of five years from the date it is granted.

 

  (e) Repricing .

Notwithstanding anything to the contrary herein, Alphabet may reprice any Option without the approval of the stockholders of Alphabet. For this purpose, “reprice” means (i) any of the following or any other action that has the same effect: (A) lowering the exercise price of an Option after it is granted, (B) any other action that is treated as a repricing under U.S. generally accepted accounting principles (“ GAAP ”), or (C) cancelling an Option at a time when its exercise price exceeds the Fair Market Value of the underlying Capital Stock, in exchange for another Option, restricted stock or other equity, unless the cancellation and exchange occurs in connection with a merger, acquisition, spin-off or other similar corporate transaction; and (ii) any other action that is considered to be a repricing under formal or informal guidance issued by The NASDAQ Stock Market.

 

7. Other Stock-Based Awards

The Committee may grant equity-based or equity-related awards not otherwise described herein in such amounts and subject to such terms and conditions as the Committee shall determine. Without limiting the generality of the preceding sentence, each such Other Stock-Based Award may (a) involve the transfer of actual shares of Capital Stock to Participants, either at the time of grant or thereafter, or payment in cash or otherwise of amounts based on the value of shares of Capital Stock, (b) be subject to performance-based and/or service-based conditions, (c) be in the form of stock appreciation rights, phantom stock, restricted stock, restricted stock units, performance shares, deferred share units or share-denominated performance units, (d) be designed to comply with applicable laws of jurisdictions other than the United States and (e) be designed to qualify as Performance-Based Compensation; provided , that each Other Stock-Based Award shall be denominated in, or shall have a value determined by reference to, a number of shares of Capital Stock that is specified at the time of the grant of such award.

 

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8. Cash Incentive Awards

The Committee may grant Cash Incentive Awards with respect to any Performance Period, subject to terms and conditions determined by the Committee in its sole discretion, provided that such terms and conditions are consistent with the terms and conditions of the Plan. Cash Incentive Awards may be settled in cash or in other property, including shares of Capital Stock, provided that the term “Cash Incentive Award” shall exclude any Stock Incentive Award. Cash Incentive Awards shall be designed to qualify as Performance-Based Compensation.

 

9. Performance-Based Compensation

 

  (a) Calculation

The amount payable with respect to an Incentive Award that is intended to qualify as Performance-Based Compensation shall be determined in any manner permitted by Section 162(m) of the Code.

 

  (b) Discretionary Reduction

Unless otherwise specified in the agreement evidencing the grant of an Incentive Award that is intended to qualify as Performance-Based Compensation, the Committee may, in its discretion, reduce or eliminate the amount payable to any Participant with respect to the Incentive Award, based on such factors as the Committee may deem relevant, but the Committee may not increase any such amount above the amount established in accordance with the relevant Performance Schedule. For purposes of clarity, the Committee may exercise the discretion provided by the foregoing sentence in a non-uniform manner among Participants.

 

  (c) Performance Measures

The performance goals upon which the payment or vesting of any Incentive Award (other than Options and stock appreciation rights) that is intended to qualify as Performance-Based Compensation depends shall relate to one or more of the following Performance Measures: market price of Capital Stock, earnings per share of Capital Stock, income, net income or profit (before or after taxes), economic profit, operating income, operating margin, profit margin, gross margins, return on equity or stockholder equity, total shareholder return, market capitalization, enterprise value, cash flow (including but not limited to operating cash flow and free cash flow), cash position, return on assets or net assets, return on capital, return on invested capital, return on sales, stockholder returns, economic value added, cash value added, earnings or net earnings (before or after interest, taxes, depreciation and amortization), earnings from continuing operations, operating earnings, controllable profits, sales or revenues, sales growth, new orders, capital or investment, ratio of debt to debt plus equity, ratio of operating earnings to capital spending, new product innovation, product release schedules or ship targets, market share, cost reduction goals, inventory or supply chain management initiatives, budget comparisons, implementation or completion of specified projects or processes, customer satisfaction MBOs (management by objectives), productivity, expense, margins, operating efficiency, working capital, the formation of joint ventures, research or development collaborations, or the completion of other transactions, any other measure of financial performance that can be determined pursuant to GAAP, or any combination of any of the foregoing.

A Performance Measure (i) may relate to the performance of the Participant, Alphabet, a Subsidiary of Alphabet, the Company, any business group, business unit or other subdivision of the Company, or any combination of the foregoing, as the Committee deems appropriate and (ii) may be expressed as an amount, as an increase or decrease over a specified period, as a relative comparison to the performance of a group of comparator companies or a published or special index, or any other external measure of the selected performance criteria, as the Committee

 

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deems appropriate. The measurement of any Performance Measure may exclude the impact of unusual, non-recurring or extraordinary items or expenses; items relating to financing activities; charges for restructurings or productivity initiatives; other non-operating items; discontinued operations; items related to the disposal of a business or segment of a business; the cumulative effect of changes in accounting treatment; items related to a change in accounting principle; items related to changes in applicable laws or business conditions; any impact of impairment of tangible or intangible assets; any impact of the issuance or repurchase of equity securities and or other changes in the number of outstanding shares of any class of Alphabet equity securities; any gain, loss, income or expense attributable to acquisitions or dispositions of stock or assets; items attributable to the business operations of any entity acquired by Alphabet during a Performance Period; stock-based compensation expense; in-process research and development expense; future contributions to the Google Foundation; gain or loss from all or certain claims and/or litigation and insurance recoveries; items that are outside the scope of Alphabet’s core, on-going business activities; and any other items, each determined in accordance with GAAP and as identified in Alphabet’s audited financial statements, including the notes thereto.

 

  (d) Performance Schedules

Within ninety (90) days after the beginning of a Performance Period, and in any case before twenty-five percent (25%) of the Performance Period has elapsed, the Committee shall establish (a) Performance Targets for such Performance Period, (b) Target Awards for each Participant, and (c) Performance Schedules for such Performance Period.

 

  (e) Termination of Employment

With respect to an Incentive Award that is intended to qualify as Performance-Based Compensation, the consequences of the termination of employment of the Participant holding such Incentive Award shall be determined by the Committee in its sole discretion and set forth in the applicable agreement evidencing the grant of the Incentive Award, it being intended that no agreement providing for a payment to a Participant upon termination of employment shall be given effect to the extent that it would cause an Incentive Award that was intended to qualify as Performance-Based Compensation to fail to so qualify.

 

  (f) Committee Discretion

Nothing in this Section 9 is intended to limit the Committee’s discretion to adopt conditions with respect to any Incentive Award that is not intended to qualify as Performance-Based Compensation. In addition, the Committee may, subject to the terms of the Plan, amend previously granted Incentive Awards in a way that disqualifies them as Performance-Based Compensation.

 

10. Adjustment Upon Certain Changes

Subject to any action by the stockholders of Alphabet required by law, applicable tax rules or the rules of any exchange on which shares of common stock of Alphabet (for the avoidance of doubt, references to common stock of Alphabet in this Plan shall include Capital Stock) are listed for trading:

 

  (a) Shares Available for Grants

In the event of any change in the number or type of shares of common stock of Alphabet outstanding by reason of any stock dividend or split, recapitalization, merger, consolidation,

 

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combination or exchange of shares or similar corporate change, or any change in the type and number of shares of common stock of Alphabet outstanding by reason of any other event or transaction, the Committee shall make appropriate adjustments in the type and maximum aggregate number of shares with respect to which the Committee may grant Incentive Awards, the type and maximum aggregate number of shares with respect to which the Committee may grant Incentive Awards that are intended to be ISOs, and the type and maximum aggregate number of shares with respect to which the Committee may grant Incentive Awards that are intended to qualify as Performance-Based Compensation to any Covered Employee in any calendar year.

 

  (b) Increase or Decrease in Issued Shares Without Consideration

In the event of any increase or decrease in the number or type of issued shares of common stock of Alphabet resulting from a subdivision or consolidation of shares of common stock of Alphabet or the payment of a stock dividend (but only on the shares of common stock of Alphabet), or any other increase or decrease in the number of such shares effected without receipt or payment of consideration by the Company, the Committee shall appropriately adjust the type or number of shares subject to each outstanding Incentive Award and the exercise price per share, if any, of shares subject to each such Incentive Award.

 

  (c) Certain Mergers

In the event of any merger, consolidation or similar transaction as a result of which the holders of shares of Capital Stock receive consideration consisting exclusively of securities of the surviving corporation in such transaction, the Committee shall appropriately adjust each Incentive Award outstanding on the date of such merger or consolidation so that it pertains and applies to the securities which a holder of the number of shares of Capital Stock subject to such Incentive Award would have received in such merger or consolidation.

 

  (d) Certain Other Transactions

In the event of (i) a dissolution or liquidation of Alphabet, (ii) a sale of all or substantially all of the Company’s assets (on a consolidated basis) or (iii) a merger, consolidation or similar transaction involving Alphabet in which the holders of shares of Capital Stock receive securities and/or other property, including cash, other than shares of the surviving corporation in such transaction, the Committee shall, in its sole discretion, have the power to:

(A) cancel, effective immediately prior to the occurrence of such event, each Incentive Award (whether or not then exercisable or vested), and, in full consideration of such cancellation, pay to the Participant to whom such Incentive Award was granted an amount in cash, for each share of Capital Stock subject to such Incentive Award, equal to the value, as determined by the Committee, of such share of Capital Stock, provided that with respect to the shares of Capital Stock subject to any outstanding Option such value shall be equal to the excess of (1) the value, as determined by the Committee, of the property (including cash) received by the holder of a share of Capital Stock as a result of such event over (2) the exercise price of a share of Capital Stock subject to such Option; or

(B) provide for the exchange of each Incentive Award (whether or not then exercisable or vested) for an Incentive Award with respect to (1) some or all of the property which a holder of the number of shares of Capital Stock subject to such

 

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Incentive Award would have received in such transaction or (2) securities of the acquirer or surviving corporation, and, incident thereto, make an equitable adjustment as determined by the Committee in the exercise price per share, if any, of stock subject to the Incentive Award, or the number of shares or amount of property subject to the Incentive Award or provide for a payment (in cash or other property) to the Participant to whom such Incentive Award was granted in partial consideration for the exchange of the Incentive Award.

 

  (e) Other Changes

In the event of any change in the capitalization of Alphabet or corporate change other than those specifically referred to in paragraphs 10(b), (c) or (d), including without limitation, any extraordinary cash dividend, spin-off, split-off, sale of a Subsidiary or business unit, or similar transaction, the Committee may make such adjustments in the issuer, number and class of shares subject to Stock Incentive Awards outstanding on the date on which such change occurs, such as, for example, a rollover of Stock Incentive Awards, and in such other terms of such Incentive Award, including without limitation in any Performance Schedule, Performance Target or Target Award, as the Committee may consider appropriate, provided that if any such Incentive Award is intended to be Performance-Based Compensation such adjustment is consistent with the requirements of Section 162(m) of the Code.

 

  (f) Cash Incentive Awards

In the event of any transaction or event described in this Section 10, including without limitation any corporate change referred to in paragraph (e) hereof, the Committee may, in its sole discretion, make such adjustments in any Performance Schedule, Performance Target or Target Award, and in such other terms of any Cash Incentive Award, as the Committee may consider appropriate in respect of such transaction or event, provided that such adjustments must be consistent with the requirements of Section 162(m) of the Code.

 

  (g) No Other Rights

Except as expressly provided in the Plan, no Participant shall have any rights by reason of any subdivision or consolidation of shares of stock of any class, the payment of any dividend, any increase or decrease in the number of shares of stock of any class or any dissolution, liquidation, merger or consolidation of Alphabet or any other corporation. Except as expressly provided in the Plan, no issuance by Alphabet of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number of shares or amount of other property subject to, or the terms related to, any Incentive Award.

 

  (h) Savings Clause

No provision of this Section 10 shall be given effect to the extent that such provision would cause any tax to become due under Section 409A of the Code.

 

11. Rights Under the Plan

No Person shall have any rights as a stockholder with respect to any shares of Capital Stock covered by or relating to any Incentive Award until the date of the issuance of such shares on the books and records of Alphabet. Except as otherwise expressly provided in Section 10 hereof, no adjustment of any Incentive Award shall be made for dividends or other rights for

 

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which the record date occurs prior to the date of such issuance. Nothing in this Section 11 is intended, or should be construed, to limit the authority of the Committee to cause the Company to make payments based on the dividends that would be payable with respect to any share of Capital Stock if it were issued or outstanding, or from granting rights related to such dividends.

The Company shall not have any obligation to establish any separate fund or trust or other segregation of assets to provide for payments under the Plan. To the extent any person acquires any rights to receive payments hereunder from the Company, such rights shall be no greater than those of an unsecured creditor.

 

12. No Special Employment Rights; No Right to Incentive Award

(a) Nothing contained in the Plan or any agreement evidence the grant of any Incentive Award shall confer upon any Participant any right with respect to the continuation of his employment by or service to the Company or interfere in any way with the right of the Company at any time to terminate such employment or service or to increase or decrease the compensation of the Participant from the rate in existence at the time of the grant of an Incentive Award.

(b) No person shall have any claim or right to receive an Incentive Award hereunder. The Committee’s granting of an Incentive Award to a Participant at any time shall neither require the Committee to grant an Incentive Award to such Participant or any other Participant or other person at any time nor preclude the Committee from making subsequent grants to such Participant or any other Participant or other person.

 

13. Securities Matters

(a) Alphabet shall be under no obligation to effect the registration pursuant to the Securities Act of any shares of Capital Stock to be issued hereunder or to effect similar compliance under any state or local laws. Notwithstanding anything herein to the contrary, Alphabet shall not be obligated to cause to be issued any shares of Capital Stock pursuant to the Plan unless and until Alphabet is advised by its counsel that the issuance of such shares is in compliance with all applicable laws, regulations of governmental authority and the requirements of any securities exchange on which shares of Capital Stock are traded. The Committee may require, as a condition to the issuance of shares of Capital Stock pursuant to the terms hereof, that the recipient of such shares make such covenants, agreements and representations, and that any certificates representing such shares bear such legends, as the Committee deems necessary or desirable.

(b) The exercise of any Option granted hereunder shall only be effective at such time as counsel to Alphabet shall have determined that the issuance of shares of Capital Stock pursuant to such exercise is in compliance with all applicable laws, regulations of governmental authority and the requirements of any securities exchange on which shares of Capital Stock are traded. Alphabet may, in its sole discretion, defer the effectiveness of an exercise of an Option hereunder or the issuance of shares of Capital Stock pursuant to any Incentive Award pending or to ensure compliance under federal, state or local securities laws. Alphabet shall inform the Participant in writing of its decision to defer the effectiveness of the exercise of an Option or the issuance of shares of Capital Stock pursuant to any Incentive Award. During the period that the effectiveness of the exercise of an Option has been deferred, the Participant may, by written notice, withdraw such exercise and obtain the refund of any amount paid with respect thereto.

 

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14. Withholding Taxes

 

  (a) Cash Remittance

Whenever shares of Capital Stock are to be issued upon the exercise of an Option or the grant or vesting of an Incentive Award, and whenever any amount shall become payable in respect of any Incentive Award, Alphabet shall have the right to require the Participant to remit to Alphabet in cash an amount sufficient to satisfy federal, state and local withholding tax requirements, if any, attributable to such exercise, grant, vesting or payment prior to issuance of such shares or the effectiveness of the lapse of such restrictions or making of such payment. In addition, upon the exercise or settlement of any Incentive Award in cash, or the making of any other payment with respect to any Incentive Award (other than in shares of Capital Stock), Alphabet shall have the right to withhold from any payment required to be made pursuant thereto an amount sufficient to satisfy the federal, state and local withholding tax requirements, if any, attributable to such exercise, settlement or payment.

 

  (b) Stock Remittance

At the election of the Participant, subject to the approval of the Committee, when shares of Capital Stock are to be issued upon the exercise, grant or vesting of an Incentive Award, the Participant may tender to Alphabet a number of shares of Capital Stock that have been owned by the Participant for at least six months (or such other period as the Committee may determine) having a Fair Market Value at the tender date determined by the Committee to be sufficient to satisfy the minimum federal, state and local withholding tax requirements, if any, attributable to such exercise, grant or vesting but not greater than the minimum withholding obligations, as determined by Alphabet in its sole discretion. Such election shall satisfy the Participant’s obligations under Section 14(a) hereof, if any.

 

  (c) Stock Withholding

When shares of Capital Stock are to be issued upon the exercise, grant or vesting of an Incentive Award, Alphabet shall have the authority to withhold a number of such shares having a Fair Market Value at the date of the applicable taxable event determined by the Committee to be sufficient to satisfy the minimum federal, state and local withholding tax requirements, if any, attributable to such exercise, grant or vesting but not greater than the minimum withholding obligations, as determined by Alphabet in its sole discretion.

 

15. Amendment or Termination of the Plan

The Board of Directors may at any time suspend or discontinue the Plan or revise or amend it in any respect whatsoever; provided , however , that to the extent that any applicable law, tax requirement, or rule of a stock exchange requires stockholder approval in order for any such revision or amendment to be effective, such revision or amendment shall not be effective without such approval. The preceding sentence shall not restrict the Committee’s ability to exercise its discretionary authority hereunder pursuant to Section 4 hereof, which discretion may be exercised without amendment to the Plan. No provision of this Section 15 shall be given effect to the extent that such provision would cause any tax to become due under Section 409A of the Code. Except as expressly provided in the Plan, no action hereunder may, without the consent of a Participant, reduce the Participant’s rights under any previously granted and outstanding Incentive Award. Nothing in the Plan shall limit the right of the Company to pay compensation of any kind outside the terms of the Plan.

 

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16. No Obligation to Exercise

The grant to a Participant of an Incentive Award shall impose no obligation upon such Participant to exercise such Incentive Award.

 

17. Transfers Upon Death

Upon the death of a Participant, outstanding Incentive Awards granted to such Participant may be exercised by the Participant’s designated beneficiary, provided that such beneficiary has been designated prior to the Participant’s death. Each such designation shall revoke all prior designations by the Participant and shall be effective only if given in a form and manner acceptable to the Committee. In the absence of any such effective designation, such Incentive Awards may be exercised only by the executors or administrators of the Participant’s estate or by any person or persons who shall have acquired such right to exercise by will or by the laws of descent and distribution. No transfer by will or the laws of descent and distribution of any Incentive Award, or the right to exercise any Incentive Award, shall be effective to bind Alphabet unless the Committee shall have been furnished with (a) written notice thereof and with a copy of the will and/or such evidence as the Committee may deem necessary to establish the validity of the transfer and (b) an agreement by the transferee to comply with all the terms and conditions of the Incentive Award that are or would have been applicable to the Participant and to be bound by the acknowledgements made by the Participant in connection with the grant of the Incentive Award.

 

18. Expenses and Receipts

The expenses of the Plan shall be paid by the Company. Any proceeds received by Alphabet in connection with any Incentive Award will be used for general corporate purposes.

 

19. Governing Law

The Plan and the rights of all persons under the Plan shall be construed and administered in accordance with the laws of the State of New York without regard to its conflict of law principles.

 

20. Effective Date and Term of Plan

The Plan was approved by the board of directors of Google Inc. on April 11, 2012, approved by the stockholders of Google Inc. on June 21, 2012, assumed by Alphabet on October 2, 2015 and was amended and restated as of October 2, 2015. No grants of Incentive Awards may be made under the Plan after April 11, 2022.

 

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Exhibit 10.4

INDEMNIFICATION AGREEMENT

THIS AGREEMENT is entered into, effective as of             , 201   by and between Alphabet Inc., a Delaware corporation (the “Company”), and              (“Indemnitee”).

WHEREAS, it is essential to the Company to retain and attract as directors and officers the most capable persons available;

WHEREAS, Indemnitee is a director and/or officer of the Company;

WHEREAS, both the Company and Indemnitee recognize the increased risk of litigation and other claims currently being asserted against directors and officers of corporations;

WHEREAS, the Certificate of Incorporation and Bylaws of the Company require the Company to indemnify and advance expenses to its directors and officers to the fullest extent permitted under Delaware law, and the Indemnitee has been serving and continues to serve as a director and/or officer of the Company in part in reliance on the Company’s Certificate of Incorporation and Bylaws; and

WHEREAS, in recognition of Indemnitee’s need for (i) substantial protection against personal liability based on Indemnitee’s reliance on the aforesaid Certificate of Incorporation and Bylaws, (ii) specific contractual assurance that the protection promised by the Certificate of Incorporation and Bylaws will be available to Indemnitee (regardless of, among other things, any amendment to or revocation of the Certificate of Incorporation and Bylaws or any change in the composition of the Company’s Board of Directors or acquisition transaction relating to the Company), and (iii) an inducement to continue to provide effective services to the Company as a director and/or officer, the Company wishes to provide in this Agreement for the indemnification of and the advancing of expenses to Indemnitee to the fullest extent (whether partial or complete) permitted under Delaware law and as set forth in this Agreement, and, to the extent insurance is maintained, to provide for the continued coverage of Indemnitee under the Company’s directors’ and officers’ liability insurance policies.

NOW, THEREFORE, in consideration of the above premises and of Indemnitee continuing to serve the Company directly or, at its request, with another enterprise, and intending to be legally bound hereby, the parties agree as follows:

1. Certain Definitions :

(a) Board : the Board of Directors of the Company.

(b) Affiliate : any corporation or other person or entity that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the person specified.

 

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(c) Change in Control : shall be deemed to have occurred if (i) any “person” (as such term is used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) (other than a trustee or other fiduciary holding securities under an employee benefit plan of the Company or a corporation owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of stock of the Company, and other than any person holding shares of the Company on the date that the Company first registers under the Act or any transferee of such individual if such transferee is a spouse or lineal descendant of the transferee or a trust for the benefit of the individual, his spouse or lineal descendants), is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing 30% or more of the total voting power represented by the Company’s then outstanding Voting Securities, or (ii) during any period of two consecutive years, individuals who at the beginning of such period constitute the Board and any new director whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds (2/3) of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority of the Board, or (iii) the stockholders of the Company approve a merger or consolidation of the Company with any other entity, other than a merger or consolidation that would result in the Voting Securities of the Company outstanding immediately prior thereto continuing to represent (either by remaining outstanding or by being converted into Voting Securities of the surviving entity or a direct or indirect successor entity) at least 80% of the total voting power represented by the Voting Securities of the Company or such surviving entity or a direct or indirect successor entity outstanding immediately after such merger or consolidation, or (iv) the stockholders of the Company approve a plan of complete liquidation of the Company or an agreement for the sale or disposition by the Company (in one transaction or a series of transactions) of all or substantially all of the Company’s assets.

(d) Expenses : any fees, expenses, liabilities, or losses, including attorneys’ fees, any federal, state, local, or foreign taxes imposed as a result of the actual or deemed receipt of any payments under this Agreement, and all other fees, costs, expenses, disbursements, and obligations, paid or incurred in connection with investigating, defending, being a witness in, participating in (including on appeal), or preparing for any of the foregoing in, any Proceeding, including court costs, filing fees, transcript costs, fees of experts and consultants, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees, and any premium for, security for, and other costs associated with any supersedeas bond, appeal bond, or other bond or bond equivalent. Expenses shall not include judgments, fines, ERISA excise taxes, penalties, liabilities, amounts paid or to be paid in settlement, or any interest, assessments, or other charges imposed thereon.

(e) Corporate Status : the status of a person who (i) is or was a director or officer of the Company or Google Inc., or (ii) while a director or officer of the Company, is or was serving at the request of the Company as a director, officer, manager, partner, employee, trustee, agent, or fiduciary of another foreign or domestic corporation, partnership, limited liability company, joint venture, employee benefit plan, trust, or other enterprise, or was a director, officer, employee, or agent of a foreign or domestic corporation that was a predecessor corporation of the Company or of another enterprise at the request of such predecessor corporation.

 

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(f) Independent Counsel : the person or body appointed in connection with Section 3.

(g) Losses : Expenses and any judgments, fines, ERISA excise taxes, penalties, liabilities, amounts paid or to be paid in settlement, any interest, assessments, or other charges imposed thereon, in each case, paid or incurred in connection with any Proceeding.

(h) Proceeding : any threatened, pending, or completed action, suit, or proceeding or any alternative dispute resolution mechanism (including an action by or in the right of the Company), or any inquiry, hearing, or investigation, whether conducted by the Company or any other party, that Indemnitee in good faith believes might lead to the institution of any such action, suit, or proceeding, whether civil, criminal, administrative, investigative, or other.

(i) Reviewing Party : the person or body appointed in accordance with Section 3.

(j) Voting Securities : any securities of the Company that vote generally in the election of directors.

2. Agreement to Indemnify .

(a) General Agreement . The Company shall indemnify the Indemnitee (i) as provided in this Agreement, and (ii) subject to the provisions of this Agreement, to the fullest extent permitted by applicable law and in the manner permitted by such law. In the event Indemnitee was, is, or becomes a party to or witness or other participant in, or is threatened to be made a party to or witness or other participant in, a Proceeding by reason of (or arising in part out of) Indemnitee’s Corporate Status, the Company shall indemnify Indemnitee from and against any and all Losses incurred by Indemnitee, or on Indemnitee’s behalf, in connection with such Proceeding, to the fullest extent permitted by law, as the same exists or may hereafter be amended or interpreted.

(b) Initiation of Proceeding . Notwithstanding anything in this Agreement to the contrary, Indemnitee shall not be entitled to indemnification or Expense Advances (as defined below) pursuant to this Agreement in connection with any Proceeding initiated by Indemnitee against the Company or any director or officer of the Company unless (i) the Company has joined in or the Board has consented to the initiation of such Proceeding; (ii) the Proceeding is one to enforce indemnification or advancement rights, or rights to insurance coverage, for which indemnification is provided under Section 5; or (iii) the Proceeding is instituted after a Change in Control (other than a Change in Control approved by a majority of the directors on the Board who were directors immediately prior to such Change in Control) and Independent Counsel has approved its initiation.

(c) Expense Advances . In the event Indemnitee was, is, or becomes a party to or witness or other participant in, or is threatened to be made a party to

 

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or witness or other participant in, a Proceeding by reason of (or arising in part out of) Indemnitee’s Corporate Status, then, if so requested by Indemnitee, the Company shall advance to Indemnitee, prior to the final disposition of such Proceeding, any and all Expenses actually and reasonably incurred by Indemnitee, or on Indemnitee’s behalf, in connection with such Proceeding (an “Expense Advance”). Any such Expense Advance shall be made within ten (10) business days after the receipt by the Company of a statement or statements from Indemnitee requesting such Expense Advance from time to time. Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee. This Agreement shall constitute an undertaking providing that the Indemnitee undertakes to repay such Expense Advances if and to the extent that it is ultimately determined by a court of competent jurisdiction in a final judgment, not subject to appeal, that Indemnitee is not entitled to be indemnified by the Company. Indemnitee’s obligation to reimburse the Company for Expense Advances shall be unsecured and no interest shall be charged thereon.

(d) Mandatory Indemnification . Notwithstanding any other provision of this Agreement, to the extent that Indemnitee has been successful on the merits or otherwise (including dismissal without prejudice) in defense of any Proceeding to which Indemnitee is or was a party, or with respect to which Indemnitee was a witness or other participant, by reason of (or arising in part out of) Indemnitee’s Corporate Status or in defense of any issue or matter therein, Indemnitee shall be indemnified against all Expenses actually and reasonably incurred in connection therewith. If the Indemnitee is not wholly successful in defending one or more but less than all claims, issues, or matters in such Proceeding (including dismissal without prejudice of certain claims), the Company shall indemnify the Indemnitee against all Expenses actually and reasonably incurred by the Indemnitee or on the Indemnitee’s behalf in defending each such successfully resolved claim, issue, or matter.

(e) Partial Indemnification . If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of Losses, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion thereof to which Indemnitee is entitled.

(f) Prohibited Indemnification . No indemnification pursuant to this Agreement shall be paid by the Company on account of any Proceeding in which judgment is rendered against Indemnitee for (i) an accounting of profits made from the purchase or sale by Indemnitee of securities of the Company pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934, as amended, or similar provisions of any federal, state, or local laws, (ii) any reimbursement of the Company by the Indemnitee of any bonus or other incentive-based or equity-based compensation or of any profits realized by the Indemnitee from the sale of securities of the Company, as required in each case under the Securities Exchange Act of 1934 (including any such reimbursements that arise from an accounting restatement of the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”), or the payment to the Company of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 306 of the Sarbanes-Oxley Act) or (iii) any other amount specifically prohibited by applicable state or federal law or stock exchange listing condition.

 

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3. Reviewing Party . Prior to any Change in Control, the Reviewing Party shall be any appropriate person or body consisting of a member or members of the Board or any other person or body appointed by the Board in accordance with applicable law who is not a party to the particular Proceeding with respect to which Indemnitee is seeking indemnification; after a Change in Control, the Independent Counsel referred to below shall become the Reviewing Party. With respect to all matters arising after a Change in Control (other than a Change in Control approved by a majority of the directors on the Board who were directors immediately prior to such Change in Control) concerning the rights of Indemnitee to indemnity payments and Expense Advances under this Agreement or any other agreement or under applicable law or the Company’s Certificate of Incorporation or Bylaws now or hereafter in effect relating to indemnification for Proceedings to which the Indemnitee is or was or becomes a party, witness or other participant, or to which Indemnitee is threatened to be made a party, witness, or other participant, by reason of (or arising in part out of) Indemnitee’s Corporate Status, the Company shall seek legal advice only from Independent Counsel selected by Indemnitee and approved by the Company (which approval shall not be unreasonably withheld), and who has not otherwise performed services for the Company or the Indemnitee (other than in connection with indemnification matters) within the last five years. The Independent Counsel shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement. Such counsel, among other things, shall render its written opinion to the Company and Indemnitee as to whether and to what extent the Indemnitee should be permitted to be indemnified under applicable law. The Company agrees to pay the reasonable fees of the Independent Counsel and to indemnify fully such counsel against any and all expenses (including attorneys’ fees), claims, liabilities, loss, and damages arising out of or relating to this Agreement or the engagement of Independent Counsel pursuant hereto.

4. Indemnification Process and Appeal .

(a) Indemnification Payment . Indemnitee shall be entitled to indemnification of Losses, and shall receive payment thereof, from the Company in accordance with this Agreement as soon as practicable after Indemnitee has made written demand on the Company for indemnification (following the final disposition of the applicable Proceeding), unless the Reviewing Party has determined (and, if the Reviewing Party is Independent Counsel, has determined in a written opinion to the Company) that Indemnitee is not entitled to indemnification under applicable law.

(b) Suit to Enforce Rights . In the event that (i) a determination is made pursuant to Section 4(a) of this Agreement that the Indemnitee is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 2(c) of this Agreement, (iii) except when the Reviewing Party is Independent Counsel pursuant to Section 3 hereof, no determination of entitlement to indemnification shall have been made pursuant to Section 4(a) of this Agreement within thirty (30) calendar days after receipt by the Company of the Indemnitee’s written request for indemnification, (iv) if the Reviewing Party is Independent Counsel and no determination of entitlement to indemnification shall have been made pursuant to

 

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Section 4(a) hereof within sixty (60) calendar days after receipt by the Company of the Indemnitee’s written request for indemnification, (v) payment of indemnification is not made within ten (10) calendar days after a determination has been made by the Reviewing Party pursuant to Section 4(a) that the Indemnitee is entitled to indemnification, then, in each case, the Indemnitee shall be entitled to seek an adjudication by any court in the State of California or the State of Delaware having subject matter jurisdiction thereof relating to the Indemnitee’s entitlement to such indemnification or Expense Advancement. The Company hereby consents to service of process and to appear in any such proceeding. Any determination by the Reviewing Party not challenged within 120 days by the Indemnitee shall be binding on the Company and Indemnitee. The remedy provided for in this Section 4 shall not be exclusive and shall be in addition to any other remedies available to Indemnitee at law or in equity.

(c) Defense to Indemnification, Burden of Proof, and Presumptions . It shall be a defense to any action brought by Indemnitee against the Company to enforce this Agreement (other than an action brought to enforce a claim for Expenses incurred in defending a Proceeding in advance of its final disposition) that it is not permissible under applicable law for the Company to indemnify Indemnitee for the amount claimed, but the burden of proving such defense shall be on the Company. In any judicial proceeding or other action, suit, or proceeding brought by the Indemnitee to enforce rights to indemnification or to an Expense Advancement hereunder, or in any action, suit, or proceeding brought by the Company to recover an Expense Advancement (whether pursuant to the terms of an undertaking or otherwise), the burden shall be on the Company to prove that the Indemnitee is not entitled to be indemnified, or to such an Expense Advancement, as the case may be. Neither the failure of the Reviewing Party or the Company (including its Board, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action by Indemnitee that indemnification of the claimant is proper under the circumstances because Indemnitee has met the standard of conduct set forth in applicable law, nor an actual determination by the Reviewing Party or Company (including its Board, independent legal counsel, or its stockholders) that the Indemnitee had not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the Indemnitee has not met the applicable standard of conduct. For purposes of this Agreement, the termination of any claim, action, suit, or proceeding, by judgment, order, settlement (whether with or without court approval), conviction, or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that Indemnitee did not meet any particular standard of conduct or have any particular belief or that a court has determined that indemnification is not permitted by applicable law.

5. Indemnification for Expenses Incurred in Enforcing Rights . To the fullest extent permitted by law, the Company shall indemnify Indemnitee against any and all Expenses that are incurred by Indemnitee in connection with any action brought by Indemnitee for

(i) indemnification or Expense Advancement by the Company under this Agreement or any other agreement or under applicable law or the Company’s Certificate of Incorporation or Bylaws now or hereafter in effect relating to indemnification or advancement of expenses with respect to any Proceeding to which the Indemnitee is or was or becomes a party, witness or other participant, or to which Indemnitee is threatened to be made a party, witness, or other participant, by reason of (or arising in part out of) Indemnitee’s Corporate Status, and/or

 

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(ii) recovery under directors’ and officers’ liability insurance policies maintained by the Company,

but only in the event that Indemnitee ultimately is determined to be entitled to such indemnification, Expense Advancement, or insurance recovery, as the case may be. In addition, the Company shall, if so requested by Indemnitee, advance the foregoing Expenses to Indemnitee, subject to and in accordance with Section 2(c).

6. Notification and Defense of Proceeding .

(a) Notice . Promptly after receipt by Indemnitee of notice of the commencement of any Proceeding, Indemnitee shall, if a claim in respect thereof is to be made against the Company under this Agreement, notify the Company of the commencement thereof; but the omission so to notify the Company will not relieve the Company from any liability that it may have to Indemnitee, except as provided in Section 6(c).

(b) Defense . With respect to any Proceeding as to which Indemnitee notifies the Company of the commencement thereof, the Company will be entitled to participate in the Proceeding at its own expense and except as otherwise provided below, to the extent the Company so wishes, it may assume the defense thereof with counsel reasonably satisfactory to Indemnitee. After notice from the Company to Indemnitee of its election to assume the defense of any Proceeding, the Company shall not be liable to Indemnitee under this Agreement or otherwise for any Expenses subsequently incurred by Indemnitee in connection with the defense of such Proceeding other than reasonable costs of investigation or as otherwise provided below. Indemnitee shall have the right to employ legal counsel in such Proceeding, but all Expenses related thereto incurred after notice from the Company of its assumption of the defense shall be at Indemnitee’s expense unless: (i) the employment of legal counsel by Indemnitee has been authorized by the Company, (ii) Indemnitee has reasonably determined that there may be a conflict of interest between Indemnitee and the Company in the defense of the Proceeding, (iii) after a Change in Control (other than a Change in Control approved by a majority of the directors on the Board who were directors immediately prior to such Change in Control), the employment of counsel by Indemnitee has been approved by the Independent Counsel, or (iv) the Company shall not in fact have employed counsel to assume the defense of such Proceeding, in each of which cases all Expenses of the Proceeding shall be borne by the Company to the extent provided in Section 2 hereof. The Company shall not be entitled to assume the defense of any Proceeding brought by or on behalf of the Company or as to which Indemnitee shall have made the determination provided for in (ii), (iii) and (iv) above.

(c) Settlement of Claims . The Company shall not be liable to indemnify Indemnitee under this Agreement or otherwise for any amounts paid in settlement of any Proceeding effected without the Company’s written consent, such consent not to be unreasonably withheld; provided, however, that if a Change in Control has occurred (other than a Change in Control approved by a majority of the directors on the Board who were directors

 

7


immediately prior to such Change in Control), the Company shall be liable for indemnification of Indemnitee for amounts paid in settlement if the Independent Counsel has approved the settlement. The Company shall not settle any Proceeding in any manner that would impose any penalty or limitation on Indemnitee without Indemnitee’s written consent. The Company shall not be liable to indemnify the Indemnitee under this Agreement with regard to any judicial award if the Company was not given a reasonable and timely opportunity, at its expense, to participate in the defense of such action; the Company’s liability hereunder shall not be excused if participation in the Proceeding by the Company was barred by this Agreement.

7. Establishment of Trust . In the event of a Change in Control (other than a Change in Control approved by a majority of the directors on the Board who were directors immediately prior to such Change in Control) the Company shall, upon written request by Indemnitee, create a Trust for the benefit of the Indemnitee and from time to time upon written request of Indemnitee shall fund the Trust in an amount sufficient to satisfy any and all Losses reasonably anticipated at the time of each such request to be incurred in connection with investigating, preparing for, participating in, and/or defending any Proceeding to which the Indemnitee is or was or becomes a party, witness or other participant, or to which Indemnitee is threatened to be made a party, witness, or other participant, by reason of (or arising in part out of) Indemnitee’s Corporate Status. The amount or amounts to be deposited in the Trust pursuant to the foregoing funding obligation shall be determined by the Independent Counsel. The terms of the Trust shall provide that (i) the Trust shall not be revoked or the principal thereof invaded without the written consent of the Indemnitee, (ii) to the extent the Indemnitee has a right to Expense Advances pursuant to this Agreement, the Trustee shall advance, within ten (10) business days of a request by the Indemnitee in accordance with Section 2(c), any and all Expenses to the Indemnitee (and the Indemnitee hereby agrees to reimburse the Trust under the same circumstances for which the Indemnitee would be required to reimburse the Company under Section 2(c) of this Agreement), (iii) the Trust shall continue to be funded by the Company in accordance with the funding obligation set forth above, (iv) the Trustee shall promptly pay to the Indemnitee all amounts for which the Indemnitee shall be entitled to indemnification pursuant to this Agreement or otherwise, and (v) all unexpended funds in the Trust shall revert to the Company upon a final determination by the Independent Counsel or a court of competent jurisdiction, as the case may be, that the Indemnitee has been fully indemnified under the terms of this Agreement. The Trustee shall be chosen by the Indemnitee. Nothing in this Section 7 shall relieve the Company of any of its obligations under this Agreement. All income earned on the assets held in the Trust shall be reported as income by the Company for federal, state, local, and foreign tax purposes. The Company shall pay all costs of establishing and maintaining the Trust and shall indemnify the Trustee against any and all expenses (including attorneys’ fees), claims, liabilities, loss, and damages arising out of or relating to this Agreement or the establishment and maintenance of the Trust.

8. Contribution . To the fullest extent permitted by applicable law, if the indemnification provided for in this Agreement is unavailable to Indemnitee for any reason whatsoever, the Company, in lieu of indemnifying Indemnitee, shall contribute to the amount incurred by Indemnitee, for any and all Losses, in connection with any claim relating to an Indemnifiable Event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (i) the relative benefits

 

8


received by the Company, on the one hand, and Indemnitee, on the other hand, as a result of the event(s) and/or transaction(s) giving cause to such Proceeding; and/or (ii) the relative fault of the Company (and its directors, officers, employees and agents), on the one hand, and Indemnitee, on the other hand, in connection with such event(s) and/or transaction(s).

9. Non-Exclusivity . Except to the extent expressly provided herein, and only to such extent, the rights of Indemnitee hereunder shall be in addition to and shall not be deemed exclusive of any other rights Indemnitee may have under the Company’s Certificate of Incorporation, Bylaws, applicable law, or otherwise, both as to action in or by reason of the Indemnitee’s Corporate Status and as to action in or by reason of any other capacity of the Indemnitee while serving as a director or officer of the Company or Google Inc.; provided, however, that this Agreement shall supersede any prior indemnification agreement between the Company or Google Inc. and the Indemnitee. To the extent that a change in applicable law (whether by statute or judicial decision) permits greater indemnification than would be afforded currently under the Company’s Certificate of Incorporation, Bylaws, applicable law, or this Agreement, it is the intent of the parties that Indemnitee enjoy by this Agreement the greater benefits so afforded by such change.

10. Liability Insurance . To the extent the Company maintains an insurance policy or policies providing general and/or directors’ and officers’ liability insurance, Indemnitee shall be covered by such policy or policies, in accordance with its or their terms, to the maximum extent of the coverage available for any Company director or officer.

11. Period of Limitations . No legal action shall be brought and no cause of action shall be asserted by or on behalf of the Company or any Affiliate of the Company against Indemnitee, Indemnitee’s spouse, heirs, executors, or personal or legal representatives after the expiration of two years from the date of accrual of such cause of action, or such longer period as may be required by state law under the circumstances. Any claim or cause of action of the Company or its Affiliate shall be extinguished and deemed released unless asserted by the timely filing and notice of a legal action within such period; provided, however, that if any shorter period of limitations is otherwise applicable to any such cause of action, the shorter period shall govern.

12. Amendment of this Agreement . No supplement, modification, or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be binding unless in the form of a writing signed by the party against whom enforcement of the waiver is sought, and no such waiver shall operate as a waiver of any other provisions hereof (whether or not similar), nor shall such waiver constitute a continuing waiver. Except as specifically provided herein, no failure to exercise or any delay in exercising any right or remedy hereunder shall constitute a waiver thereof.

13. Subrogation and Other Sources of Payment . In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and shall do everything that may be necessary to secure such rights, including the execution of such documents necessary to enable the Company effectively to bring suit to enforce such rights. Nothing hereunder is intended to affect any right of contribution of or against the Company in the event the Company and any

 

9


other person or persons have co-equal obligations to indemnify or advance expenses to Indemnitee. The Company’s obligation to indemnify or advance Expenses hereunder to the Indemnitee, in connection with or by reason of Indemnitee’s service at the request of the Company as a director, officer, employee, agent, or fiduciary of another entity or enterprise, shall be reduced by any amount that the Indemnitee has actually received as indemnification or advancement of Expenses from such other entity or enterprise with respect to the Proceeding for which indemnification or advancement of Expenses is sought.

14. No Duplication of Payments . The Company shall not be liable under this Agreement to make any payment in connection with any claim made against Indemnitee to the extent Indemnitee has otherwise received payment (under any insurance policy, Bylaw, or otherwise) of the amounts otherwise indemnifiable hereunder.

15. Binding Effect . This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and their respective successors (including any direct or indirect successor by purchase, merger, consolidation, or otherwise to all or substantially all of the business and/or assets of the Company), assigns, spouses, heirs, and personal and legal representatives. The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation, or otherwise) to all, substantially all, or a substantial part, of the business and/or assets of the Company, by written agreement in form and substance satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity, even though he may have ceased to serve in such capacity at the time of any Proceeding, and shall inure to the benefit of the heirs, executors and administrators of such a person.

16. Severability . If any provision (or portion thereof) of this Agreement shall be held by a court of competent jurisdiction to be invalid, void, or otherwise unenforceable, the remaining provisions shall remain enforceable to the fullest extent permitted by law. Furthermore, to the fullest extent possible, the provisions of this Agreement (including, without limitation, each portion of this Agreement containing any provision held to be invalid, void, or otherwise unenforceable, that is not itself invalid, void, or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, void, or unenforceable.

17. Governing Law . This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware applicable to contracts made and to be performed in such State without giving effect to its principles of conflicts of laws.

18. Notices . All notices, demands, and other communications required or permitted hereunder shall be made in writing and shall be deemed to have been duly given if delivered

 

10


by hand, against receipt, or mailed, postage prepaid, certified or registered mail, return receipt requested, and addressed to the Company at:

Alphabet Inc.

1600 Amphitheatre Parkway

Mountain View, California 94043

Attention: Secretary

and to Indemnitee at:

 

Name:  

 

  
Address:  

 

  

Notice of change of address shall be effective only when given in accordance with this Section. All notices complying with this Section shall be deemed to have been received on the date of hand delivery or on the third business day after mailing.

19. Counterparts . This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

[Signature Page Follows]

 

11


IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this Agreement as of the day specified above.

 

ALPHABET INC.,
a Delaware corporation
By:  

 

  Kent Walker
  Assistant Secretary

INDEMNITEE

 

 

 

12

Exhibit 10.5

ALPHABET INC.

DEFERRED COMPENSATION PLAN

Amended and Restated Effective as of October 2, 2015


TABLE OF CONTENTS

 

     Page  

Article I Definitions

     1   

Article II Participation

     4   

Article III Deferral Elections

     4   

Article IV Accounts

     5   

Article V Vesting

     5   

Article VI Distributions

     6   

Article VII Administration

     7   

Article VIII Miscellaneous

     10   

 

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ALPHABET INC. DEFERRED COMPENSATION PLAN

(Amended and Restated Effective as of October 2, 2015)

RECITALS

1. Google Inc. (“Google”) established the Google Inc. Deferred Compensation Plan, effective as of July 1, 2011 (as amended effective October 1, 2011), for the purpose of providing a tax deferral opportunity for employees on its U.S. payroll.

2. On October 2, 2015, Google became a wholly-owned subsidiary of Alphabet Inc. (“Alphabet”) and Alphabet assumed the Plan, amending and restating it as set forth herein.

3. Under the Plan, the Company is obligated to pay vested accrued benefits to the Plan participants and their beneficiaries.

4. Benefits under the Plan shall be payable solely from the general assets of the Company.

5. The Company intends that the amounts deferred by Participants and any notional earnings thereon, at all times be subject to the claims of the general creditors of the Company.

6. The Company intends that the Plan shall not be construed to provide income to Participants under the Plan prior to actual payment of the accrued benefits under the Plan.

7. Under the terms of the Plan, the Company has established a committee that administers the Plan which is authorized to administer the Plan as set forth herein.

NOW THEREFORE, Alphabet hereby amends and restates the Plan as follows, effective as of October 2, 2015, as hereinafter set forth.

ARTICLE I

DEFINITIONS

 

1.1 Definitions .

Whenever the following words and phrases are used in this Plan, with the first letter capitalized, they shall have the meanings specified below:

“Account” means, for each Participant, the bookkeeping account maintained by the Committee that is credited with amounts equal to the portion of the Participant’s Compensation that he or she elects to defer, and adjustments to reflect deemed earnings and losses pursuant to Section 4.1(b). Accounts are not actually invested in any Notional Investment Fund(s) and Participants do not have any real or beneficial ownership in any Notional Investment Fund(s). A Participant’s Account is solely a device for the measurement and determination of the amounts to be paid to the Participant pursuant to the Plan and shall not constitute or be treated as a trust fund of any kind.

“Beneficiary” means the beneficiary last designated (or deemed designated) by a Participant in accordance with procedures established by the Committee from time to time to receive the benefits


specified hereunder in the event of the Participant’s death. If, at the time of the Participant’s death, the Participant has no properly designated Beneficiary, then the Beneficiary shall be deemed to have been designated as Beneficiaries by the Participant in the following order of precedence: (i) the surviving spouse, if then living; (ii) his or her child(ren) in equal shares, if then living; (iii) his or her parents in equal shares, if then living; (iv) his or her siblings, in equal shares, if then living; (v) his or her estate. If a Beneficiary who is entitled to payment dies before receiving distribution of the amount to which he or she is entitled, then the amount shall be payable to the representative of the Beneficiary’s estate.

“Board of Directors” or “Board” means the Board of Directors of Alphabet.

“Bonus” means any cash payments made at the discretion of the Company to an Employee, while the Employee is an active Employee, as remuneration under a designated Company bonus plan(s), other then under a Quarterly Sales Bonus plan or program, and that is paid through the Company’s United States payroll. Bonus for purposes of the Plan shall be determined without regard to any reduction (i) for any salary deferral contributions to a plan described in Section 125, Section 132(f) or Section 401(k) of the Code or (ii) pursuant to any deferral election in accordance with Article III of the Plan.

“Change in Control” means a change in the ownership, or effective control, of a corporation, or in the ownership of a substantial portion of the assets of a corporation, within the meaning of Treasury Regulation Section 1.409A-3(i)(5) or other guidance issued by the Secretary of the Treasury or Internal Revenue Service pursuant to Section 885(e) of the American Jobs Creation Act of 2004.

“Code” means the Internal Revenue Code of 1986, as amended. Reference to a section of the Code includes such section and any comparable section or sections of any future legislation that amends, supplements or supersedes such section.

“Committee” means the Committee that administers the Plan in accordance with Article VII.

“Company” means Alphabet, any successor corporation of Alphabet, or any wholly owned subsidiaries or controlled group members of Alphabet, as defined in Section 414(b), (c) or (m) of the Code, which is designated as a participating company by the Committee.

“Compensation” means Bonus and/or Quarterly Sales Bonus payments.

“Eligible Employee” means an Employee whom the Company contemporaneously regards, classifies or treats as a U.S. domestic regular employee scheduled to work twenty (20) or more hours per week for at least five (5) months in any calendar year. An Eligible Employee does not include any individuals who the Company contemporaneously regards, classifies or treats as (i) leased employees (whether or not within the meaning of Section 414(n) of the Code), staffing, payroll or temporary agency employees, independent contractors, or consultants, even if such persons are later determined by a court, regulatory body or administrative agency to be or have been common law employees of the Company; (ii) interns; or (iii) variable part-time employees. An Eligible Employee must be deemed as actively employed by the Committee on such date as the Committee shall specify, which date shall be no later then the first day of the Open Enrollment Period. The Committee may exclude an otherwise Eligible Employee from participation in the Plan as it deems advisable in its sole and absolute discretion.

“Employee” means a common law employee of the Company who is regularly performing services in the United States or is on the Company’s United States payroll.

 

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“Investment Return” means, for each Notional Investment Fund, an amount equal to the rate of gain or loss on the assets of such Notional Investment Fund (net of applicable fund and investment charges) as of each Valuation Date.

“Notional Investment Fund(s)” means the investment fund or funds selected by the Committee for hypothetical investment of Accounts. In its sole discretion, the Committee may permit Participants to designate one or more Notional Investment Fund(s) for the hypothetical investment of their Accounts under the Plan. The Committee may change, discontinue, or add to the Notional Investment Fund(s) made available under the Plan at any time in its sole discretion.

“Open Enrollment Period” means the annual period established by the Committee during which Eligible Employees may elect to enroll in the Plan or to change elections relating to the rate at which they wish to defer Compensation under the Plan.

“Participant” means any Eligible Employee who elects to defer Compensation in accordance with Section 3.1.

“Payment Date” means the first full calendar quarter coinciding with or beginning after the earliest of (i) the Scheduled Withdrawal specified by the Participant pursuant to Section 6.1, (ii) the date that is six (6) months following his or her Separation from Service, or (iii) the date of his or her death.

“Plan” means the Alphabet Inc. Deferred Compensation Plan set forth herein, now in effect, or as amended from time to time.

“Plan Year” means the calendar year.

“Quarterly Sales Bonus” means any compensation that is actually awarded by the Company at its discretion to an Employee, while the Employee is an active Employee, as remuneration under a Company designated sales commission or bonus plan or program and that is paid through the Company’s United States payroll. Quarterly Sales Bonus(es) for purposes of the Plan shall be determined without regard to any reduction (i) for any salary deferral contributions to a plan described in Section 125, Section 132(f) or Section 401(k) of the Code or (ii) pursuant to any deferral election in accordance with Article III of the Plan.

“Separation from Service” means a separation from service within the meaning of Treasury Regulation Section 1.409A-1(h) or other guidance issued by the Secretary of the Treasury or Internal Revenue Service pursuant to Section 885(e) of the American Jobs Creation Act of 2004, except that a Participant’s death shall not be considered a Separation from Service under this Plan.

“Treasury Regulations” means regulations issued by the United States Secretary of the Treasury.

“Valuation Date” means the last day of each Plan Year or such other dates as specified by the Committee.

 

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ARTICLE II

PARTICIPATION

 

2.1 Participation .

An Eligible Employee shall become a Participant in the Plan by electing to defer a portion of his or her Compensation in accordance with Section 3.1.

ARTICLE III

DEFERRAL ELECTIONS

 

3.1 Elections to Defer Compensation .

(a) General Rule . Each Eligible Employee may elect to defer Compensation by filing an election with the Committee that conforms to the requirements of this Section 3.1.

(b) Amount of Deferrals . The amount of Compensation that an Eligible Employee may elect to defer is as follows:

(1) Any whole-number percentage of Bonus up to one hundred percent (100%); and/or

(2) Any whole-number percentage of Quarterly Sales Bonus up to one hundred percent (100%),

provided, however, that no election shall be effective to reduce Compensation paid to an Eligible Employee for a calendar year to an amount that is less than the amount necessary to pay (i) applicable employment taxes payable with respect to amounts deferred hereunder, (ii) amounts necessary to satisfy any other benefit plan deferral elections or withholding obligations, (iii) any resulting income taxes required to be withheld with respect to Compensation that cannot be so deferred, and (iv) any amounts necessary to satisfy any wage garnishment or similar type of obligations.

(c) Election to Defer Bonus . An Eligible Employee may elect to defer Bonus for any performance periods that begin during any Plan Year by filing an election, on a form provided by the Committee, to defer Bonus. Such an election must be filed during the Open Enrollment Period that precedes the Plan Year during which the relevant performance periods begin. Any such election shall become irrevocable on the December 15 preceding the Plan Year to which the deferral election relates. An election under this subsection shall not be effective for any Plan Year for which the Participant is not an Eligible Employee as of the beginning of such Plan Year. Notwithstanding anything else in this Section to the contrary, an Eligible Employee may elect to make an initial deferral election with respect to short-term deferrals (within the meaning of Treasury Regulation Section 1.409A-1(b)(4)) in accordance with Treasury Regulation Section 1.409A-2(a)(4) by filing an election, in such time, manner and form as prescribed by the Committee.

(d) Election to Defer Quarterly Sales Bonus . An Eligible Employee may elect to defer Quarterly Sales Bonus for performance periods that begin during any Plan Year by filing an election, on a form provided by the Committee, to defer such Quarterly Sales Bonus. Such an election must be filed during the Open Enrollment Period that precedes the Plan Year during which the relevant performance

 

- 4 -


periods begin. Any such election shall become irrevocable on the December 15 preceding the Plan Year to which the deferral election relates. An election under this subsection shall not be effective for any Plan Year for which the Participant is not an Eligible Employee as of the beginning of such Plan Year.

(e) Notional Investment Fund(s) . To the extent permitted by the Committee, at the time that an Eligible Employee elects to defer Bonus or Quarterly Sales Bonus for any performance periods that begin during any Plan Year, he or she may designate the Notional Investment Fund(s) for the hypothetical investment of his or her Account on the form provided by the Committee and may make subsequent changes to his or her selections in accordance with procedures established by the Committee. Details regarding the applicable Notional Investment Funds will separately be made available to the eligible employee at the time of the election or subsequent change. There is no guarantee that any particular Notional Investment Fund, or that a minimum number of Notional Investment Funds, will be available at the time of any particular election or otherwise.

ARTICLE IV

ACCOUNTS

 

4.1 Participant Accounts .

The Committee shall establish and maintain an Account for each Participant under the Plan. A Participant’s Account shall be credited as follows:

(a) As of the date on which payment of a Bonus or Quarterly Sales Bonus payment would have been made, or as soon as administratively practicable thereafter, the Committee shall credit the Participant’s Account with an amount equal to Bonus or Quarterly Sales Bonus deferred by the Participant in accordance with the Participant’s election.

(b) As of each Valuation Date, the Participant’s Account shall be adjusted for gains or losses based on the Investment Return.

ARTICLE V

VESTING

 

5.1 Compensation Deferrals .

A Participant’s Account attributable to Compensation deferred by a Participant pursuant to the terms of this Plan, together with any amounts credited to the Participant’s Account under Section 4.1(b) with respect to such deferrals, shall be one hundred percent (100%) vested at all times.

 

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ARTICLE VI

DISTRIBUTIONS

 

6.1 Scheduled Withdrawals .

(a) Scheduled Withdrawals . A Participant must, in connection with his or her Compensation deferral election for a Plan Year, specify a withdrawal date (a “Scheduled Withdrawal”) of all of his or her Account attributable to Compensation deferred for such Plan Year, including any amounts credited with respect to such deferrals pursuant to Section 4.1(b), subject to the following restrictions:

(1) An election of a Scheduled Withdrawal made during any Open Enrollment Period must specify a payment date that is either three (3) years, four (4) years or five (5) years following the end of the Plan Year in which ends the last Bonus performance period and/or Quarterly Sales Bonus period to which a deferral election made during such Open Enrollment Period would apply. Notwithstanding the foregoing, any amount deferred pursuant to a deferral election made pursuant to Section 3.1(c) of the Plan and in accordance with Treasury Regulation Section 1.409A-2(a)(4) with respect to a short-term deferral (within the meaning of Treasury Regulation Section 1.409A-1(b)(4)) may only specify a payment date that is five (5) years following the end of the Plan Year in which ends the last Bonus performance period to which such a deferral election with respect to short-term deferrals would apply. The election to take a Scheduled Withdrawal shall be made by completing a form approved by and filed with the Committee

(2) The amount payable to a Participant as of any Payment Date specified in connection with an election of a Scheduled Withdrawal shall in all cases be one hundred percent (100%) of the Compensation deferred for the Plan Year with respect to which the election of the specific payment date applies, as adjusted for earnings and losses pursuant to Section 4.1(b), determined as of the most recent Valuation Date as is administratively feasible preceding the Scheduled Withdrawal date.

(3) Payment of a Scheduled Withdrawal shall be made in a single lump sum on the Payment Date.

 

6.2 Distribution of Amounts Upon Separation from Service .

In the event that a Participant has a Separation from Service prior to the payment of a Scheduled Withdrawal, the portion of the Participant’s Account that has not yet been paid pursuant to any election to receive a Scheduled Withdrawal in accordance with Section 6.1(a)(1) – other than an election made in accordance with Treasury Regulation Section 1.409A-2(a)(4) with respect to a short-term deferral (within the meaning of Treasury Regulation Section 1.409A-1(b)(4)) – shall be paid to the Participant in a single lump sum on the Payment Date following the Participant’s Separation from Service.

 

6.3 Distributions Upon Death of Participant .

If the Participant dies prior to receiving the entire portion of his or her Account, such portion remaining at the time of the Participant’s death shall be paid to his or her Beneficiary in a single lump sum on the Payment Date following the Participant’s death.

 

6.4 Distribution Upon Change in Control .

(a) Notwithstanding any other Plan provision, the entire vested portion of a Participant’s Account shall be paid to the Participant upon a Change of Control, in the form of a single lump sum.

 

6.5 Reduction of Account Balance; Continued Crediting of Earnings .

At the time of any distribution or withdrawal under this Plan, the Participant’s Account shall be reduced by the amount of the distribution or withdrawal. Except as provided in Section 6.9, a Participant’s Account (as may be so reduced) shall continue to be credited with earnings or debited for losses pursuant to Section 4.1(b) until all vested amounts credited to the Account have been distributed or withdrawn.

 

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6.6 Timing of Distributions .

Subject to Section 6.8, any distribution or withdrawal to be made on a specified date under this Plan (including, for the avoidance of doubt, a Payment Date) may be made as soon as administratively feasible after that date; provided, however, that actual distribution or withdrawal shall in any event be made by the later of (i) the last day of the calendar year of the specified date or (ii) the fifteenth day of the third calendar month following the specified date, provided that the Participant may not directly or indirectly designate the calendar year in which actual distribution or withdrawal is to be made.

 

6.7 Distributions in Cash .

All distributions and withdrawals shall be made in cash.

 

6.8 Delay Due to Effect of Deduction Limitation .

If the Company reasonably anticipates that its deduction with respect to any amounts to be paid to a Participant under this Plan for a taxable year of the Company would not be permitted due to the application of Section 162(m) of the Code, then all such amounts whose deduction would be barred by Section 162(m) shall instead be paid to the Participant or his or her Beneficiary (in the event of the Participant’s death) (i) in the case of a Scheduled Withdrawal, during the first taxable year of the Company in which the Company reasonably anticipates that the deduction with respect to such payment will not be barred by Section 162(m), or (ii) in the case of a payment triggered by the Participant’s Separation from Service, during the first full calendar quarter beginning at least six (6) months after the date of the Participant’s Separation from Service Any amount for which payment is delayed pursuant to this Subsection shall continue to be adjusted for earnings and losses in accordance with Section 4.1(b).

 

6.9 Inability to Locate Participant .

In the event that the Committee is unable to locate a Participant or Beneficiary within two (2) years following the date a payment is scheduled to be made, the amounts then credited to the Participant’s Account shall be forfeited. If, after such forfeiture but within five (5) years following the date the payment was scheduled to be made, the Participant or Beneficiary claims such benefit, such benefit (calculated immediately prior to the forfeiture) shall be reinstated without interest or earnings. After five (5) years following the date the payment was scheduled to be made, if the Participant or Beneficiary cannot be located and/or does not claim such benefit, such benefit shall be permanently forfeited.

ARTICLE VII

ADMINISTRATION

 

7.1 Committee .

The Committee shall serve at the pleasure of the Company’s compensation committee and shall consist of five (5) members. The members comprising the Committee shall be selected as follows: two (2) shall be members of the Company’s human resources department, two (2) shall be members of the Company’s finance department, and one (1) shall be a member of the Company’s legal department, each designated by the head of his or her department. A member of the Committee may resign by delivering a written notice of resignation to the other Committee members. A member will be deemed to have

 

- 7 -


resigned upon his or her termination of employment with the Company. Vacancies in the membership of the Committee shall be filled promptly by the head of department with the vacant position. No Committee member shall be removed during the period beginning one (1) month before and ending one (1) year after a Change in Control.

 

7.2 Committee Action .

The Committee shall act at meetings by affirmative vote of a majority of its members. Any action permitted to be taken at a meeting may be taken without a meeting if a written consent to the action is signed or electronic consent is provided by all members of the Committee and such written consent is filed with the minutes of the proceedings of the Committee. A member of the Committee shall not vote or act upon any matter that relates solely to himself or herself as a Participant. The chair (and any other member or members of the Committee designated by the chair) may (i) without the consent of any other members of the Committee, take action on any day-to-day matter regarding the Plan, and any other action or type of action as the Committee by resolution may authorize, and (ii) execute any certificate or other written direction on behalf of the Committee.

 

7.3 Powers and Duties of the Committee .

(a) The Committee, on behalf of the Participants and their Beneficiaries, shall enforce the Plan in accordance with its terms, shall be charged with the general administration of the Plan and shall have all powers necessary to accomplish its purposes, including, but not by way of limitation, the following:

(1) To select the fund(s) to be the Notional Investment Fund(s);

(2) To construe and interpret the terms and provisions of the Plan;

(3) To determine who is an Eligible Employee and to exclude an otherwise Eligible Employee from participation in the Plan as the Committee deems advisable in its sole and absolute discretion;

(4) To amend, modify, suspend or terminate the Plan in accordance with Section 8.5;

(5) To compute and certify the amount of benefits payable to Participants and their Beneficiaries;

(6) To maintain all records that may be necessary for the administration of the Plan;

(7) To provide for the disclosure of all information and the filing or provision of all reports and statements to Participants, Beneficiaries or governmental agencies as shall be required by law;

(8) To make and publish such rules and procedures for the administration of the Plan as are not inconsistent with the terms hereof;

(9) To appoint any agent, and to delegate to such agent such powers and duties in connection with the administration of the Plan as the Committee may from time to time prescribe;

(10) To determine which entities other than Alphabet is a Company;

 

- 8 -


(11) To take all actions that it is authorized or directed to take under this Plan document; and

(12) To take all further actions that Committee deems advisable or necessary in administration of the Plan.

 

7.4 Construction and Interpretation .

The provisions of this Plan shall be construed, interpreted and administered in a manner whereby all provisions comply with the conditions of Section 409A(2),(3) and (4) of the Code and Section 885 of the American Jobs Creation Act of 2004 and any regulations or other guidance issued thereunder by the United States Secretary of the Treasury or the Internal Revenue Service. Subject to the preceding sentence, the Committee shall have full discretion to construe and interpret the terms and provisions of this Plan, which interpretation or construction shall be final and binding on all parties, including but not limited to the Company and any Participant or Beneficiary. The Committee shall administer the terms and provisions of the Plan in a uniform and nondiscriminatory manner and in full accordance with any and all laws applicable to the Plan.

 

7.5 Information .

To enable the Committee to perform its functions, the Company shall supply full and timely information to the Committee on all matters relating to the Compensation of all Participants, their death or other cause of termination, and such other pertinent facts as the Committee may reasonably require.

 

7.6 Compensation, Expenses and Indemnity .

(a) The members of the Committee shall serve without compensation for their services hereunder.

(b) The Committee is authorized at the expense of the Company to employ such legal counsel and other agents as it may deem advisable to assist in the performance of its duties hereunder. Expenses and fees in connection with the administration of the Plan shall be paid by the Company.

(c) To the extent permitted by applicable state law, the Company shall indemnify and hold harmless the Committee and each member thereof, the Board and any delegate of the Committee who is an employee of the Company against any and all expenses, liabilities and claims, including legal fees to defend against such liabilities and claims arising out of their discharge in good faith of responsibilities under or incident to the Plan, other than expenses and liabilities arising out of willful misconduct or gross negligence. This indemnity shall not preclude such further indemnities as may be available under insurance purchased by the Company or provided by the Company under any bylaw, agreement or otherwise, as such indemnities are permitted under applicable law.

 

7.7 Periodic Statements .

Under procedures established by the Committee, a Participant (or his or her Beneficiary, in the case of a deceased Participant) shall receive a statement with respect to the Participant’s Account at least annually.

 

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7.8 Disputes .

(a) A person who believes that he or she is being denied a benefit to which he or she is entitled under the Plan (hereinafter referred to as “Claimant”) may file a written request for such benefit with the Committee, setting forth his or her claim. The Committee shall review the claim and any documents or information provided by Claimant. The Committee shall provide to Claimant, within a reasonable time (generally within ninety (90) days), a written response to his or her claim which may approve the Claimant’s request (in whole or in part) or may deny the Claimant’s request (in whole or in part). Claimant must file a claim with the Committee and receive the Committee’s written decision prior to proceeding with any action described in subsection (b) below.

(b) Subject to the initial review provided for in the foregoing subsection (a), all disputes, claims or controversies relating to, arising out of or in connection with this Plan shall be subject to binding arbitration administered by Judicial Arbitration and Mediation Services, Inc. (“JAMS”), pursuant to its then-current Employment Arbitration Rules & Procedures, venued in the County of Santa Clara, California and before an arbitrator who is licensed to practice law in the State of California.

ARTICLE VIII

MISCELLANEOUS

 

8.1 Unsecured General Creditor .

Participants and their Beneficiaries, heirs, successors, and assigns shall have no legal or equitable rights, claims, or interests in any specific property or assets of the Company. No assets of the Company shall be held in any way as collateral security for the fulfilling of the obligations of the Company under this Plan. Any and all of the Company’s assets shall be, and remain, the general unpledged, unrestricted assets of the Company and shall be subject to the claims of the Company’s general creditors. The Company’s obligation under the Plan shall be merely that of an unfunded and unsecured promise of the Company to pay money in the future, and the rights of the Participants and Beneficiaries shall be no greater than those of unsecured general creditors. Notwithstanding the foregoing, the Company may, but need not, establish a rabbi trust or enter into another arrangement to aid it in meeting its obligations hereunder without affecting the status of the Plan as an unfunded plan.

 

8.2 Restriction Against Assignment .

The Committee shall direct distribution of all amounts payable hereunder only to the person or persons designated by the Plan and not to any other person or entity. Except as provided in Section 8.3, no part of a Participant’s Account shall be liable for the debts, contracts, or engagements of any Participant, his or her Beneficiary, or successors in interest, nor shall a Participant’s Account be subject to execution by levy, attachment, or garnishment or by any other legal or equitable proceeding, nor shall any such person have any right to alienate, anticipate, sell, transfer, commute, pledge, encumber, or assign any benefits or payments hereunder in any manner whatsoever. If any Participant, Beneficiary or successor in interest is adjudicated bankrupt or purports to anticipate, alienate, sell, transfer, assign, commute, pledge, encumber or charge any distribution or payment from the Plan, voluntarily or involuntarily, the Committee, in its sole and absolute discretion, may cancel such distribution or payment (or any part thereof) to or for the benefit of such Participant, Beneficiary or successor in interest in such manner as the Committee shall direct.

 

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8.3 Distribution Pursuant to a Domestic Relations Order .

The Committee shall direct distribution of all or a portion of a Participant’s Account to an individual other than a Participant or Beneficiary as necessary to fulfill a domestic relations order, as defined in Section 414(p)(1)(B) of the Code, but only if such order directs that distribution to such individual be made in an immediate single lump sum.

 

8.4 Withholding .

There shall be deducted from each distribution made under the Plan or other compensation payable to the Participant or Beneficiary all taxes that are required to be withheld by the Company in respect to such distribution. The Company shall have the right to reduce any distribution (or compensation), and the Committee shall have the right to direct reduction of any distribution, by the amount of cash sufficient to provide the amount of said taxes.

 

8.5 Amendment, Modification, Suspension or Termination .

(a) The Committee may amend, modify, suspend or terminate the Plan in whole or in part, except that no amendment, modification, suspension or termination shall have any retroactive effect to reduce the value or vested percentage of any amounts allocated to a Participant’s Account at the time of the amendment, modification, suspension or termination, and provided that a termination or suspension of the Plan or any Plan amendment or modification that will significantly increase costs to the Company shall be approved by the Board; and

(b) In the event that this Plan is terminated, amounts credited to a Participant’s Account (regardless of whether such amounts had become vested) shall be distributed to the Participant or, in the event of his or her death, his or her Beneficiary, as follows:

1. If the termination is under circumstances described in Treasury Regulation Sections 1.409A-3(j)(4)(ix)(A) (relating to termination upon a corporate dissolution or with approval of a bankruptcy court), 1.409A-3(j)(4)(ix)(B) (relating to plan termination upon a Change in Control) or 1.409A-3(j)(4)(ix)(C) (relating to a termination unrelated to a downturn in financial health of a service recipient), and the conditions for accelerated distribution to the Participant (or Beneficiary) under the applicable regulation are satisfied, distribution of all such amounts shall be made at the earliest permissible time or times that satisfy the applicable regulation.

2. If the termination is not under circumstances described in Treasury Regulation Sections 1.409A-3(j)(4)(ix)(A), 1.409A-3(j)(4)(ix)(B) or 1.409A-3(j)(4)(ix)(C), or the conditions for accelerated distribution to the Participant (or Beneficiary) under any such section are not met, distribution shall be made at the times and in the form as provided under the Plan without regard to the termination of the Plan.

 

8.6 Governing Law .

Except for the arbitration clause in Section 7.8(b), which shall be governed by the FEDERAL ARBITRATION ACT (9 U.S.C. SECTION 1, ET SEQ.), this Plan shall be construed, governed and administered in accordance with the laws of the State of California, without reference to rules of conflict of law.

 

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8.7 Receipt .

Any payment to a Participant or the Participant’s Beneficiary in accordance with the provisions of the Plan shall, to the extent thereof, be in full satisfaction of all claims against the Committee and the Company.

 

8.8 Payments on Behalf of Persons under Incapacity .

In the event that any amount becomes payable under the Plan to a person who, in the sole judgment of the Committee, is considered by reason of physical or mental condition to be unable to give a valid receipt therefore, the Committee may direct that such payment be made to any person found by the Committee, in its sole judgment, to have assumed the care of such person. Any payment made pursuant to such determination shall constitute a full release and discharge of the Committee and the Company.

 

8.9 No Employment Rights .

Participation in this Plan shall not confer upon any person any right to be employed by, or continued as an employee of, the Company or any other right not expressly provided hereunder. The Company expressly reserves the right to discharge any of its employees at any time, with or without cause.

 

8.10 Headings Not Part of Plan .

Headings and subheadings in this Plan are inserted for convenience of reference only and are not to be considered in the construction of the provisions hereof.

 

8.11 Severability .

If any provision of this Plan is held invalid or unenforceable, its invalidity or unenforceability will not affect any other provision of this Plan, and the Plan will be construed and enforced as if such provision had not been included.

 

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Exhibit 14.1

Code of Conduct

Preface

Employees of Alphabet and its subsidiaries and controlled affiliates (“Alphabet”) should do the right thing – follow the law, act honorably, and treat each other with respect.

We expect all of our employees and Board members to know and follow this Code of Conduct. Failure to do so can result in disciplinary action, including termination of employment. Any waivers of this Code for directors or executive officers must be approved by our Board.

Never retaliate against anyone who reports or participates in an investigation of a possible violation of the Code.

If you are employed by a subsidiary or controlled affiliate of Alphabet, please comply with your employer’s code of conduct. If your employer doesn’t have its own code of conduct, if you have a question or concern about this Code or believe that someone may be violating it, or if you want to remain anonymous, you can make a report of a suspected violation or concern through our Helpline.

I. Avoid Conflicts of Interest

A conflict of interest may arise any time competing loyalties could cause you to pursue a personal benefit for you, your friends, or your family at the expense of Alphabet or our customers. Avoid conflicts of interest and circumstances that reasonably appear to be a conflict. Sometimes a situation that previously didn’t present a conflict of interest may develop into one.

When faced with a potential conflict, ask yourself:

 

    Would this activity create an actual or apparent incentive for me to benefit myself, my friends, or my family?

 

    Would this activity harm my reputation or hurt my ability to do my job?

 

    Would this activity embarrass Alphabet or me if it showed up in the press?

If the answer to any of these questions is “yes,” the relationship or situation is likely to constitute a conflict of interest, and you should avoid it.

II. Ensure Financial Integrity and Responsibility

Ensure that money is appropriately spent, our financial records are complete and accurate, and our internal controls are honored.


If your job involves the financial recording of our transactions, make sure that you’re familiar with all relevant policies, including those relating to revenue recognition.

Never interfere with the auditing of financial records. Similarly, never falsify any company record or account.

If you suspect or observe any irregularities relating to financial integrity or fiscal responsibility, no matter how small, immediately report them.

III. Obey the Law

Comply with all applicable legal requirements and understand the major laws and regulations that apply to your work. A few specific laws are easy to violate unintentionally and so are worth pointing out here. If you have any questions about these laws or other laws governing our work, please consult the Helpline or our legal counsel.

 

  1. Trade Controls

Various trade laws control where we can send or receive our products and services. These laws are complex and apply to:

 

    importing and exporting goods to or from the United States and other countries

 

    exporting services or providing services to non-U.S. persons

 

    exporting technical data, especially data originating in the U.S.

If you are involved in sending or making available products, services, software, equipment, or technical data from one country to another, work with your manager to ensure that the transaction stays within the bounds of applicable laws.

 

  2. Competition Laws

Be sure you follow all laws designed to promote free and fair competition and protect consumers. These laws generally prohibit 1) arrangements with competitors that restrain trade, 2) abuse of market power to unfairly disadvantage competitors, and 3) misleading or harming consumers. Some of these laws carry civil and criminal penalties for individuals and companies.

 

  3. Insider Trading Laws

Do not use non-public information to buy or sell stock, or to pass it along to others so that they may do so. That could constitute the crime of insider trading.


Familiarize yourself with Alphabet’s Insider Trading Policy. It describes policies that address the risks of insider trading, such as:

 

    a prohibition on hedging Alphabet stock

 

    periodic blackout windows when you may not trade Alphabet stock

 

  4. Anti-Bribery Laws

Various laws that prohibit bribery in different settings. Our rule is simple – don’t bribe anybody, at any time, for any reason.

Non-government relationships. Be careful when you give gifts and pay for meals, entertainment or other business courtesies on behalf of Alphabet. Avoid the possibility that the gift, entertainment or other business courtesy could be perceived as a bribe. Provide such business courtesies infrequently and, when you do, to keep their value moderate.

Dealings with government officials. Various laws prohibit seeking to influence official action by offering or giving anything of value to government officials, candidates for public office, employees of government-owned or -controlled companies, public international organizations, or political parties. Avoid not only traditional gifts, but also things like meals, entertainment, travel, political or charitable contributions, and job offers for government officials’ relatives. With pre-approval, it may be permissible to make infrequent and moderate expenditures for gifts and business entertainment for government officials that are directly tied to promoting our products or services (e.g., a modest meal at a day-long demonstration of our products).

IV. Conclusion

We rely on one another’s good judgment to uphold a high standard of integrity for ourselves and our company. We expect all Board members and employees to be guided by both the letter and the spirit of this Code.

Adopted October 2, 2015

Exhibit 99.1

DESCRIPTION OF CAPITAL STOCK

The following summary of the rights of our Class A Common Stock, Class B Common Stock, Class C Capital Stock, and preferred stock (collectively, the “Alphabet securities”) does not purport to be complete. This summary is subject to and qualified by the provisions of our Amended and Restated Certificate of Incorporation (“Certificate of Incorporation”), Amended and Restated Bylaws (“Bylaws”), the terms of our Class C Undertaking (as defined below), and certain Transfer Restriction Agreements (as defined below), copies of which are incorporated herein by reference. Additionally, the Delaware General Corporation Law (“DGCL”), as amended, also affects the terms of our capital stock.

Our Certificate of Incorporation provides for (1) the Class A Common Stock, which has one vote per share; (2) the Class B Common Stock, which has 10 votes per share; and (3) the Class C Capital Stock, which has no voting rights unless otherwise required by law. Our Certificate of Incorporation also provides for 100,000,000 shares of preferred stock.

Our authorized capital stock consists of 15,100,000,000 shares, each with a par value of $0.001 per share, of which:

 

    9,000,000,000 shares are designated as Class A Common Stock;

 

    3,000,000,000 shares are designated as Class B Common Stock;

 

    3,000,000,000 shares are designated as Class C Capital Stock; and

 

    100,000,000 shares are designated as preferred stock.

At October 2, 2015 there were 291,261,461 shares of Class A Common Stock issued and outstanding, 50,940,307 shares of Class B Common Stock issued and outstanding and 345,482,241 shares of Class C Capital Stock issued and outstanding. At that date, there were no shares of preferred stock outstanding.

Capital Stock

Voting Rights

Holders of shares of Class A Common Stock and Class B Common Stock have identical rights, except that holders of shares of Class A Common Stock are entitled to one vote per share and holders of shares of Class B Common Stock are entitled to 10 votes per share. Holders of shares of Class A Common Stock and Class B Common Stock vote together as a single class on all matters (including the election of directors) submitted to a vote of stockholders, unless otherwise required by law.

Holders of shares of Class C Capital Stock have no voting rights, unless otherwise required by law.

The DGCL could require the holders of any of the shares of Class A Common Stock, Class B Common Stock, or Class C Capital Stock to vote separately as a single class in the following circumstances:

 

    If we amended our Certificate of Incorporation to increase or decrease the par value of the shares of a class of stock, then the holders of the shares of that class would be required to vote separately to approve the proposed amendment.

 

    If we amended our Certificate of Incorporation in a manner that altered or changed the powers, preferences, or special rights of the shares of a class of stock so as to affect them adversely, then the holders of the shares of that class would be required to vote separately to approve the proposed amendment.


As permitted by the DGCL and as set forth in our Certificate of Incorporation, the holders of shares of Class A Common Stock, Class B Common Stock, and Class C Capital Stock do not have the right to vote separately as a single class if the number of authorized shares of such class is increased or decreased. Rather, the number of authorized shares of Class A Common Stock, Class B Common Stock, and Class C Capital Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the voting power of the issued and outstanding shares of Class A Common Stock and Class B Common Stock, voting together as a single class.

We have not provided for cumulative voting for the election of directors.

Dividends

Subject to preferences that may apply to any shares of preferred stock outstanding at the time, the holders of shares of Class A Common Stock, Class B Common Stock, and Class C Capital Stock will be entitled to share equally, on a per share basis, in any dividends that our Board of Directors may determine to issue from time to time. In the event that a dividend is paid in the form of shares of Class A Common Stock or Class B Common Stock, or rights to acquire shares of Class A Common Stock or Class B Common Stock, (1) the holders of shares of Class A Common Stock shall receive Class A Common Stock, or rights to acquire shares of Class A Common Stock, as the case may be; (2) the holders of shares of Class B Common Stock shall receive shares of Class B Common Stock, or rights to acquire shares of Class B Common Stock, as the case may be; and (3) the holders of shares of Class C Capital Stock shall receive shares of Class C Capital Stock, or rights to acquire shares of Class C Capital Stock, as the case may be.

Liquidation Rights

Upon our liquidation, dissolution or winding-up, the holders of shares of Class A Common Stock and Class B Common Stock shall be entitled to share equally in all assets remaining after the payment of any liabilities and the liquidation preferences on any outstanding preferred stock. Immediately prior to the earlier of (1) any distribution of our assets in connection with a liquidation, dissolution, or winding-up, or (2) any record date established to determine the holders of our capital stock entitled to receive such distribution, each share of Class C Capital Stock shall automatically be converted into one share of Class A Common Stock.

Conversion

Shares of Class A Common Stock are not convertible into any other shares of our capital stock.

Other than in connection with a liquidation as described above, shares of Class C Capital Stock are not convertible into any other shares of our capital stock.

Each share of Class B Common Stock is convertible at any time at the option of the holder into one share of Class A Common Stock upon written notice to our transfer agent. In addition, each share of Class B Common Stock shall convert automatically into one share of Class A Common Stock upon any transfer, whether or not for value, except for certain transfers described in our Certificate of Incorporation, including the following:

 

    Transfers between Larry Page and Sergey Brin, Google’s co-founders, subject to the requirements of the Transfer Restriction Agreements (as described below).

 

    Transfers for tax and estate planning purposes, including to trusts, corporations, and partnerships established or controlled by a holder of Class B Common Stock.

In addition, partnerships or limited liability companies that held more than 5% of the total outstanding shares of Class B Common Stock as of the closing of Google’s initial public offering in 2004 may distribute their shares of Class B Common Stock to their respective partners or members (who may further distribute the shares of Class B Common Stock to their respective partners or members) without triggering a conversion to shares of Class A Common Stock. Such distributions must be conducted in accordance with the ownership interests of such partners or members and the terms of any agreements binding the partnership or limited liability company.

The death of any holder of shares of Class B Common Stock who is a natural person will result in the conversion of his or her shares of Class B Common Stock, and any shares held by his or her permitted entities, into shares of Class

 

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A Common Stock. However, subject to the terms of the Transfer Restriction Agreements, either of Larry or Sergey may transfer voting control of his shares of Class B Common Stock and those held by his permitted entities to the other contingent or effective upon his death without triggering a conversion into shares of Class A Common Stock, but the shares of Class B Common Stock so transferred will convert to Class A Common Stock nine months after the death of the transferring founder.

Once transferred and converted into shares of Class A Common Stock, shares of Class B Common Stock shall not be reissued.

No class of our capital stock may be subdivided or combined unless the other classes of capital stock are concurrently subdivided or combined in the same proportion and in the same manner.

Equal Status

Except as expressly provided in our Certificate of Incorporation, shares of Class A Common Stock and Class B Common Stock have the same rights and privileges and rank equally, share ratably and are identical in all respects as to all matters. In the event of any merger, consolidation, or other business combination requiring the approval of our stockholders entitled to vote thereon (whether or not we are the surviving entity), the holders of shares of Class A Common Stock shall have the right to receive, or the right to elect to receive, the same form of consideration as the holders of shares of Class B Common Stock, and the holders of shares of Class A Common Stock shall have the right to receive, or the right to elect to receive, at least the same amount of consideration on a per share basis as the holders of shares of Class B Common Stock. In the event of any (1) tender or exchange offer to acquire any shares of Class A Common Stock or Class B Common Stock by any third party pursuant to an agreement to which we are a party, or (2) any tender or exchange offer by us to acquire any shares of Class A Common Stock or Class B Common Stock, the holders of shares of Class A Common Stock shall have the right to receive, or the right to elect to receive, the same form of consideration as the holders of shares of Class B Common Stock, and the holders of shares of Class A Common Stock shall have the right to receive, or the right to elect to receive, at least the same amount of consideration on a per share basis as the holders of shares of Class B Common Stock.

Except as expressly provided in our Certificate of Incorporation, shares of Class C Capital Stock have the same rights and privileges and rank equally, share ratably and are identical in all respects to the shares of Class A Common Stock and Class B Common Stock as to all matters. In the event of any merger, consolidation, or other business combination requiring the approval of our stockholders entitled to vote thereon (whether or not we are the surviving entity), the holders of shares of Class C Capital Stock shall receive the same amount and form of consideration on a per share basis as the consideration, if any, received by holders of shares of Class A Common Stock in connection with such merger, consolidation or combination (and if holders of shares of Class A Common Stock are entitled to make an election as to the amount or form of consideration that such holders shall receive in any such merger, consolidation or combination with respect to their shares of Class A Common Stock, then the holders of shares of Class C Capital Stock shall be entitled to make the same election as to their shares of Class C Capital Stock). In the event of any (1) tender or exchange offer to acquire any shares of Class A Common Stock or Class B Common Stock by any third party pursuant to an agreement to which we are a party, or (2) any tender or exchange offer by us to acquire any shares of Class A Common Stock or Class B Common Stock, the holders of shares of Class C Capital Stock shall receive the same amount and form of consideration on a per share basis as the consideration received by holders of shares of Class A Common Stock (and if holders of shares of Class A Common Stock are entitled to make an election as to the amount or form of consideration that such holders shall receive in any such tender or exchange offer with respect to their shares of Class A Common Stock, then the holders of shares of Class C Capital Stock shall be entitled to make the same election as to their shares of Class C Capital Stock).

Class C Settlement Agreement

In connection with the adjustment of Google’s capital structure by establishing the Google Class C Capital Stock, and the dividend of one share of Google Class C Capital Stock for each share of Google Class A Common Stock and Google Class B Common Stock outstanding on March 27, 2014 (the “Class C dividend”), on October 28, 2013, the Delaware Court of Chancery approved a settlement entered into by Google, the Board of Directors of Google and the plaintiffs in the class action litigation involving the authorization to distribute Google Class C Capital Stock captioned In Re: Google Inc. Class C Shareholder Litigation, Civil Action No. 7469-CS. The parties subsequently filed a Revised Stipulation of Compromise and Settlement with the Court, which issued an Order and Final

 

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Judgment on November 6, 2013 that fully approved the parties’ settlement agreement (the “Google Class C Settlement”). Additionally, on October 2, 2015, we entered into a Class C Undertaking pertaining to the Google Class C Settlement, pursuant to which Alphabet will undertake, with respect to the Alphabet securities, to be bound by the restrictions, undertakings and all continuing obligations and to benefit from the rights of the Google Class C Settlement Agreement that are applicable to Google as if Alphabet were Google (the “Class C Undertaking”).

The terms of the Class C Undertaking require us to: (i) ensure that the Transfer Restriction Agreements (defined below) entered into by Larry, our Chief Executive Officer; Sergey, our President; and Eric E. Schmidt, our Executive Chairman; and certain of their respective affiliates cannot be waived or amended unless such amendment or waiver is first considered and recommended by a committee of two or more of the independent directors of our Board of Directors who do not hold Class B Common Stock, and then approved by every member of our Board of Directors, excluding Larry and Sergey; (ii) ensure that any waiver or amendment of the Transfer Restriction Agreements will be publicly disclosed at least 30 days before such waiver or amendment takes effect on a Form 8-K, Form 10-Q or Form 10-K; (iii) effective for three years from the Class C dividend payment date, prior to issuing more than 10 million shares of Class C Capital Stock as consideration in an acquisition or other business combination (excluding assumptions or conversions of equity for employees of acquired or combined companies), have our independent directors consider the effects of issuing such shares on our holders of Class A Common Stock and upon the company as a whole; and (iv) when the aggregate voting power of Larry and Sergey falls below 15% of the cumulative voting power of all our shareholders, have our Board of Directors consider in good faith whether it is no longer in our best interests to maintain a class of nonvoting stock and, if it so determines, take steps to cause the Class C Capital Stock to convert into Class A Common Stock.

Transfer Restriction Agreements

On October 2, 2015, we entered into a transfer restriction agreement with each of Larry, Sergey, Eric and certain of their respective affiliates (collectively, the “Transfer Restriction Agreements”). They are intended to limit the ability of Larry, Sergey, and Eric to sell their Alphabet stock in a manner that does not reduce their voting power. Under the Transfer Restriction Agreements, the parties are bound, without any modification, by the same restrictions, undertakings and obligations that are imposed under the transfer restriction agreements, related joinders and other documentation entered into with Google on March 25, 2014 in connection with the Google Class C Settlement (the “Google Transfer Restriction Agreements”).

Pursuant to the Transfer Restriction Agreements, none of Larry, Sergey, Eric, or certain of their respective affiliates that are party to the agreements (generally, trusts and other estate planning vehicles through which Larry, Sergey, and Eric hold all or a portion of their shares of Class A Common Stock, Class B Common Stock or Class C Capital Stock) may sell, assign, transfer, convey or hypothecate any shares of Class C Capital Stock if, as a result of such sale, transfer, conveyance or hypothecation, they, together with certain of their respective affiliates, would own more shares of Class B Common Stock than shares of Class C Capital Stock. If at any time either Larry, Sergey, or Eric, in each case together with certain of his respective affiliates, owns more shares of Class B Common Stock than shares of Class C Capital Stock, then Larry, Sergey, or Eric, as the case may be, and his respective affiliates, will be deemed to have automatically converted that number of shares of Class B Common Stock into shares of Class A Common Stock such that after such conversion he and his affiliates own an equal number of shares of Class B Common Stock as he and his affiliates own of shares of Class C Capital Stock. The required maximum ratio of shares of Class B Common Stock to shares of Class C Capital Stock owned by Larry, Sergey and Eric is subject to adjustment in connection with certain dividends, stock splits, distributions or recapitalizations.

Larry, Sergey, Eric, and certain of their respective affiliates that are party to the Transfer Restriction Agreements may transfer shares of Class B Common Stock to their affiliates as permitted by the terms of our Certificate of Incorporation only if, immediately following such transfer, Larry, Sergey, or Eric, as the case may be, and his respective affiliates, would own an aggregate number of shares of Class B Common Stock equal to or less than the number of shares of Class C Capital Stock that he and his affiliates own. Additionally, Larry, Sergey, Eric, and certain of their respective affiliates that are party to the Transfer Restriction Agreements may transfer shares of Class C Capital Stock to their affiliates only if, immediately following such transfer, Larry, Sergey, or Eric, as the case may be, and his respective affiliates, would own an aggregate number of shares of Class B Common Stock equal to or less than the number of shares of Class C Capital Stock that he and his affiliates own. However, each of Larry and his affiliates that are party to his Transfer Restriction Agreement and Sergey and his affiliates that are

 

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party to his Transfer Restriction Agreement may not transfer shares of Class B Common Stock to another person in a transfer that does not result in the automatic conversion of such shares of Class B Common Stock into Class A Common Stock pursuant to the terms of the Certificate of Incorporation unless Larry or Sergey, as the case may be, and his respective affiliates, transfer, in the same manner and to the same extent, an equal number of shares of Class C Capital Stock to the transferee.

In the event of (1) any merger, consolidation, or other business combination requiring the approval of the holders of our capital stock (whether or not Alphabet is the surviving entity), or the acquisition of all or substantially all of our assets, (2) any tender or exchange offer by any third party to acquire a majority of the shares of Class A Common Stock, Class B Common Stock or Class C Capital Stock, or (3) any tender or exchange offer by us to acquire any shares of Class A Common Stock, Class B Common Stock, or Class C Capital Stock, none of Larry, Sergey, Eric, and certain of their respective affiliates that are party to the Transfer Restriction Agreements may sell, transfer or exchange, directly or indirectly, any shares of Class A Common Stock, Class B Common Stock, or Class C Capital Stock in connection with such transaction or in a related transaction for (a) with respect to their shares of Class A Common Stock or Class B Common Stock, an amount per share greater than the holders of shares of Class A Common Stock receive in such transaction or a form of consideration different from the form that the holders of shares of Class A Common Stock would receive, or may elect to receive, in such transaction; or (b) with respect to their shares of Class C Capital Stock, an amount per share greater than the holders of shares of Class C Capital Stock receive in such transaction or a form of consideration different from the form that the holders of shares of Class C Capital Stock would receive, or may elect to receive, in such transaction (the “Founder Equal Treatment Provision”).

With respect to Larry, Sergey, and certain of their respective affiliates, the applicable Transfer Restriction Agreements generally terminate when they collectively hold less than 34% of our total outstanding voting power. However, the Founder Equal Treatment Provision never terminates.

With respect to Eric and certain of his affiliates, the applicable Transfer Restriction Agreement generally terminates when they collectively hold less than 2% of our total outstanding voting power. However, the Founder Equal Treatment Provision never terminates.

As required under the terms of the Class C Settlement Agreement, the Transfer Restriction Agreements may only be amended or waived if such amendment or waiver is (i) first considered and recommended by a committee of two or more independent directors of our Board of Directors who do not hold Class B Common Stock and (ii) then approved by every member of our Board of Directors, excluding Larry and Sergey. Any Transfer Restriction Agreement amendment or waiver will be publicly disclosed by Alphabet on a Form 8-K, Form 10-Q or Form 10-K at least 30 days before such amendment or waiver takes effect.

Preferred Stock

We are authorized to issue, without approval by our stockholders, up to a total of 100,000,000 shares of preferred stock in one or more series. Our Board of Directors may establish the number of shares to be included in each such series and may fix the designations, preferences, powers, and other rights, and any qualifications, limitations or restrictions of the shares of a series of preferred stock. Our Board of Directors could authorize the issuance of preferred stock with voting or conversion rights that could dilute the voting power or rights of the holders of Class A Common Stock, Class B Common Stock and Class C Capital Stock. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions and other corporate purposes, could, among other things, have the effect of delaying, deferring or preventing a change in control of Alphabet and might harm the market price of our Class A Common Stock or Class C Capital Stock.

The particular terms of any series of preferred stock offered by us may include:

 

    the number of shares of the preferred stock being offered;

 

    the title and liquidation preference per share of the preferred stock;

 

    the purchase price of the preferred stock;

 

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    the dividend rate or method for determining the dividend rate;

 

    the dates on which dividends will be paid;

 

    whether dividends on the preferred stock will be cumulative or noncumulative and, if cumulative, the dates from which dividends shall commence to accumulate;

 

    any redemption or sinking fund provisions applicable to the preferred stock;

 

    any securities exchange on which the preferred stock may be listed; and

 

    any additional dividend, liquidation, redemption, sinking fund and other rights and restrictions applicable to the preferred stock.

Holders of preferred stock will be entitled to receive, when, as and if declared by our Board of Directors, cash dividends at the rates and on the dates established by such series of preferred stock. Dividend rates may be fixed or variable or both. Different series of preferred stock may be entitled to dividends at different dividend rates or based upon different methods of determination. Each dividend will be payable to the holders of record as they appear on our stock books on record dates determined by our Board of Directors. Dividends on preferred stock may be cumulative or noncumulative. If our Board of Directors fails to declare a dividend on any preferred stock for which dividends are noncumulative, then the right to receive that dividend will be lost, and we will have no obligation to pay the dividend for that dividend period, whether or not dividends are declared for any future dividend period.

Any series of preferred stock may be redeemable in whole or in part at our option. In addition, any series of preferred stock may be subject to mandatory redemption pursuant to a sinking fund.

Anti-Takeover Effects of Our Certificate of Incorporation and Bylaws and of Delaware Law

Certain provisions of our Certificate of Incorporation and Bylaws and of the DGCL could have the effect of delaying, deferring, or discouraging another party from acquiring control of us. In particular, our capital structure concentrates ownership of our voting stock in the hands of Larry, Sergey, and Eric. These provisions, which are summarized below, are expected to discourage coercive takeover practices and inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control of us to first negotiate with our Board of Directors. However, these provisions could also have the effect of discouraging others from attempting hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our Class A Common Stock or Class C Capital Stock that often result from actual or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes in our management. It is possible that these provisions could make it more difficult to accomplish transactions that stockholders may otherwise deem to be in their best interests.

Three Classes of Stock

As discussed above, our Class B Common Stock has 10 votes per share, while our Class A Common Stock has one vote per share and our Class C Capital Stock has no voting rights (unless otherwise required by law). As a result of their ownership of a substantial portion of our Class B Common Stock, Larry and Sergey currently have the ability to elect all of our directors and to determine the outcome of most matters submitted for a vote of our stockholders. This concentrated voting control could discourage others from initiating any potential merger, takeover, or other change of control transaction that other stockholders may view as beneficial.

Because the Class C Capital Stock has no voting rights (except as required by law), the issuance of Class C Capital Stock will not result in voting dilution to the holders of shares Class A Common Stock or Class B Common Stock. As a result, the issuance of Class C Capital Stock could prolong the duration of Larry and Sergey’s current relative ownership of our voting power and their ability to elect all of our directors and to determine the outcome of most matters submitted to a vote of our stockholders.

 

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So long as Larry and Sergey have the ability to determine the outcome of most matters submitted to a vote of our stockholders, third parties may be deterred in their willingness to make an unsolicited merger, takeover, or other change of control proposal, or to engage in a proxy contest for the election of directors. As a result, our three classes of stock may have the effect of depriving our stockholders of an opportunity to sell their shares at a premium over prevailing market prices and make it more difficult to replace our directors and management.

Special Approval for Change in Control Transactions

In the event a person seeks to acquire us by means of a merger or consolidation transaction, a purchase of all or substantially all of our assets, or an issuance of our voting securities representing more than 2% of our outstanding shares at the time of issuance and that results in any person or group owning more than 50% of our outstanding voting power, then these types of acquisition transactions must be approved by our stockholders at an annual or special meeting. At this meeting, we must obtain the approval of stockholders representing the greater of:

 

    a majority of the voting power of our outstanding capital stock; and

 

    60% of the voting power of the shares of capital stock present in person or represented by proxy at the stockholder meeting and entitled to vote.

Limits on Ability of Stockholders to Act by Written Consent

We have provided in our Certificate of Incorporation and Bylaws that our stockholders may not act by written consent. This limit on the ability of our stockholders to act by written consent may lengthen the amount of time required to take stockholder actions. As a result, no stockholder, regardless of how large its holdings of our stock are, would be able to amend our Bylaws or remove directors without holding a stockholders meeting.

Undesignated Preferred Stock

The ability to authorize undesignated preferred stock makes it possible for our Board of Directors to issue preferred stock with voting or other rights or preferences that could impede the success of any attempt to acquire us. These and other provisions may have the effect of deferring or preventing hostile takeovers or delaying or preventing changes in control or management of our company.

Requirements for Advance Notification of Stockholder Nominations and Proposals

Our Bylaws establish advance notice procedures with respect to stockholder proposals and the nomination of candidates for election as directors, other than nominations made by or at the direction of our Board of Directors or a committee of our Board of Directors. The Bylaws do not give our Board of Directors the power to approve or disapprove stockholder nominations of candidates or proposals regarding business to be conducted at a special or annual meeting of the stockholders. However, our Bylaws may have the effect of precluding the conduct of certain business at a meeting if the proper procedures are not followed. These provisions may also discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of our company.

Delaware Anti-Takeover Statute

We are subject to Section 203 of the DGCL regulating corporate takeovers. In general, Section 203 prohibits a publicly-held Delaware corporation from engaging, under certain circumstances, in a business combination with an interested stockholder for a period of three years following the date the person became an interested stockholder unless:

 

    prior to the date of the transaction, the Board of Directors of the corporation approved either the business combination or the transaction which resulted in the stockholder becoming an interested stockholder;

 

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    upon completion of the transaction that resulted in the stockholder becoming an interested stockholder, the stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction commenced, excluding for purposes of determining the number of shares outstanding (1) shares owned by persons who are directors and also officers and (2) shares owned by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

 

    on or subsequent to the date of the transaction, the business combination is approved by the Board of Directors and authorized at an annual or special meeting of stockholders, and not by written consent, by the affirmative vote of at least 66  2 3 % of the outstanding voting stock which is not owned by the interested stockholder.

Generally, a business combination includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. An interested stockholder is a person who owns 15% or more of a corporation’s outstanding voting securities, or is an affiliate or associate of the corporation and within three years prior to the determination of interested stockholder status, did own 15% or more of a corporation’s outstanding voting securities, and affiliates and associates of such person. The existence of this provision may have an anti-takeover effect with respect to transactions our Board of Directors does not approve in advance. Section 203 may also discourage attempts that might result in a premium over the market price for the shares of capital stock held by stockholders.

 

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