<PAGE>
EXHIBIT 4.07
1999 STOCK OPTION PLAN
<PAGE>
MACROMEDIA, INC.
1999 STOCK OPTION PLAN
As Adopted September 19, 1999
and Amended April 18, 2000
1. PURPOSE. The purpose of this Plan is to provide
incentives to attract, retain and motivate eligible persons whose present and
potential contributions are important to the success of the Company, its
Parent and Subsidiaries, by offering them an opportunity to participate in
the Company's future performance through awards of Options. Capitalized terms
not defined in the text are defined in Section 21, if they are not otherwise
defined in other sections of this Plan.
2. SHARES SUBJECT TO THE PLAN.
2.1 NUMBER OF SHARES AVAILABLE. Subject to
Sections 2.2 and 16, the total number of Shares reserved and available for
grant and issuance pursuant to this Plan will be 3,900,000 Shares. Subject to
Sections 2.2 and 16, Shares that are subject to: (a) issuance upon exercise
of an Option but cease to be subject to such Option for any reason other than
exercise of such Option; and (b) an Option granted hereunder but are
forfeited or are repurchased by the Company at the original issue price
because the Shares are Unvested Shares at the time of the Participant's
Termination, will again be available for grant and issuance in connection
with future Options under this Plan. At all times the Company shall reserve
and keep available a sufficient number of Shares as shall be required to
satisfy the requirements of all outstanding Options granted under this Plan.
2.2 ADJUSTMENT OF SHARES. If the number of
outstanding shares is changed by a stock dividend, recapitalization, stock
split, reverse stock split, subdivision, combination, reclassification or
similar change in the capital structure of the Company without consideration,
then (a) the number of Shares reserved for issuance under this Plan, and (b)
the Exercise Prices of and number of Shares subject to outstanding Options,
will be proportionately adjusted, subject to any required action by the Board
or the stockholders of the Company and compliance with applicable securities
laws; PROVIDED, HOWEVER, that fractions of a Share will not be issued but
will either be paid in cash at the Fair Market Value of such fraction of a
Share or will be rounded up to the nearest whole Share, as determined by the
Committee; and PROVIDED, FURTHER, that the Exercise Price of any Option may
not be decreased to below the par value of the Shares.
3. ELIGIBILITY. Options may be granted to employees,
officers, consultants, independent contractors and advisers of the Company or
any Parent or Subsidiary of the Company; PROVIDED such consultants,
contractors and advisers (a) are natural persons; (b) render bona fide
services; and (c) the services are not in connection with the offer and sale
of securities in a capital-raising transaction and do not directly or
indirectly promote or maintain a market for the Company's securities. A
person may be granted more than one Option under this Plan. Options awarded
to Insiders or other individuals who are officers of the Company may not
exceed in the aggregate forty percent (40%) of all Shares that are reserved
for grant under this Plan and employees who are not officers of the Company,
or any Parent or Subsidiary of the Company must receive at least sixty
percent (60%) of all Shares that are reserved for grant under this Plan.
4. ADMINISTRATION.
4.1 COMMITTEE AUTHORITY. This Plan will be
administered by the Committee or by the Board acting as the Committee.
Subject to the general purposes, terms and conditions of this Plan, and to
the direction of the Board, the Committee will have full power to implement
and carry out this Plan. Without limitation, the Committee will have the
authority to:
<PAGE>
(a) construe and interpret this Plan, any Stock Option
Agreement and any other agreement or document executed
pursuant to this Plan;
(b) prescribe, amend and rescind rules and regulations
relating to this Plan or any Option;
(c) select persons to receive Options;
(d) determine the form and terms of Options;
(e) determine the number of Shares subject to Options;
(f) determine whether Options will be granted singly, in
combination with, in tandem with, in replacement of, or
as alternatives to, other Options under this Plan or any
other incentive or compensation plan of the Company or
any Parent or Subsidiary of the Company;
(g) grant waivers of Plan or Option conditions;
(h) determine the vesting, exercisability and payment of
Options;
(i) correct any defect, supply any omission or reconcile any
inconsistency in this Plan, any Option or any Stock
Option Agreement;
(j) determine whether an Option has been earned; and
(k) make all other determinations necessary or advisable for
the administration of this Plan.
4.2 COMMITTEE DISCRETION. Any determination made
by the Committee with respect to any Option will be made in its sole
discretion at the time of grant of the Option or, unless in contravention of
any express term of this Plan or Option, at any later time, and such
determination will be final and binding on the Company and on all persons
having an interest in any Option under this Plan. The Committee may delegate
to one or more officers of the Company, each of whom are a member of the
Board, the authority to grant an Option under this Plan to Participants who
are not Insiders.
5. OPTIONS. Only nonqualified stock options that do not
qualify as incentive stock options within the meaning of Code Section 422(b)
may be granted under this Plan. The Committee may grant Options to eligible
persons and will determine (i) the number of Shares subject to the Option,
(ii) the Exercise Price of the Option, (iii) the period during which the
Option may be exercised, and (iv) all other terms and conditions of the
Option and, subject to the limits in Section 9 on the transferability of
Options, whether the Option or any interest therein may be transferred during
the Participant's lifetime, subject to the following:
5.1 FORM OF OPTION GRANT. Each Option granted
under this Plan will be evidenced by a Stock Option Agreement. The Stock
Option Agreement will be in such form and contain such provisions (which need
not be the same for each Participant) as the Committee may from time to time
approve, and which will comply with and be subject to the terms and
conditions of this Plan.
5.2 DATE OF GRANT. The date of grant of an Option
will be the date on which the Committee makes the determination to grant the
Option, unless a later date is otherwise specified by the Committee. The
Stock Option Agreement and a copy of this Plan will be delivered to the
Participant within a reasonable time after the granting of the Option.
5.3 EXERCISE PERIOD AND EXPIRATION DATE. Options
will be exercisable within the times or upon the occurrence of events
determined by the Committee as set forth in the Stock Option Agreement
governing such Option; PROVIDED, HOWEVER, that no Option will be exercisable
after the expiration of ten (10) years from the date the Option is granted.
The Committee also may provide for Options to become exercisable at one
<PAGE>
time or from time to time, periodically or otherwise, in such number of
Shares or percentage of Shares as the Committee determines.
5.4 EXERCISE PRICE. The Exercise Price of an
Option will be determined by the Committee when the Option is granted and may
not be less than Fair Market Value of the Shares on the date of grant.
Payment for the Shares purchased must be made in accordance with Section 6 of
this Plan.
5.5 METHOD OF EXERCISE. Options may be exercised
only by delivery to the Company of a written stock option exercise agreement
(the "EXERCISE AGREEMENT") in a form approved by the Committee (which need
not be the same for each Participant), stating the number of Shares being
purchased, the restrictions imposed on the Shares purchased under such
Exercise Agreement, if any, and such representations and agreements regarding
Holder's investment intent and access to information and other matters, if
any, as may be required or desirable by the Company to comply with applicable
securities laws, together with payment in full of the Exercise Price for the
number of Shares being purchased.
5.6 TERMINATION. Notwithstanding the exercise
periods set forth in the Stock Option Agreement, exercise of an Option will
always be subject to the following:
(a) If the Participant is Terminated for any reason except
death or Disability, then the Holder may exercise such
Holder's Options only to the extent that such Options
would have been exercisable upon the Termination Date no
later than ninety (90) days after the Termination Date
(or such shorter or longer time period not exceeding
five (5) years as may be determined by the Committee),
but in any event, no later than the expiration date of
the Options.
(b) If the Participant is Terminated because of
Participant's death or Disability (or the Participant
dies within three (3) months after a Termination), then
Holder's Options may be exercised only to the extent
that such Options would have been exercisable by Holder
on the Termination Date and must be exercised by the
Holder no later than twelve (12) months after the
Termination Date (or such shorter or longer time period
not exceeding five (5) years as may be determined by the
Committee) but in any event no later than the expiration
date of the Options.
5.7 LIMITATIONS ON EXERCISE. The Committee may
specify a reasonable minimum number of Shares that may be purchased on any
exercise of an Option, provided that the minimum number will not prevent a
Holder from exercising the Option for the full number of Shares for which it
is then exercisable.
5.8 MODIFICATION, EXTENSION OR RENEWAL. The
Committee may modify, extend or renew outstanding Options and authorize the
grant of new Options in substitution therefor, provided that any such action
may not, without the written consent of a Participant, impair any of such
Participant's rights under any Option previously granted. The Committee may
reduce the Exercise Price of outstanding Options without the consent of
Participants affected by a written notice to them; PROVIDED, HOWEVER, that
the Exercise Price may not be reduced below the minimum Exercise Price that
would be permitted under Section 5.4 of this Plan for Options granted on the
date the action is taken to reduce the Exercise Price; and provided, further,
that the Exercise Price shall not be reduced below the par value of the
Shares.
6. PAYMENT FOR SHARE PURCHASES.
6.1 PAYMENT. Payment for Shares purchased on
exercise of an Option may be made in cash (by check) or, where expressly
approved for the Participant by the Committee and where permitted by law:
(a) in case of exercise by the Participant, Participant's
guardian or legal representative or the authorized legal
representative of Participant's heirs or legatees after
Participant's death, by cancellation of indebtedness of
the Company to the Participant;
<PAGE>
(b) by surrender of shares that either: (1) have been owned
by Holder for more than six (6) months and have been
paid for within the meaning of SEC Rule 144 (and, if
such shares were purchased from the Company by use of a
promissory note, such note has been fully paid with
respect to such shares); or (2) were obtained by Holder
in the public market;
(c) by tender of a full recourse promissory note having such
terms as may be approved by the Committee and bearing
interest at a rate sufficient to avoid imputation of
income under Sections 483 and 1274 of the Code;
PROVIDED, HOWEVER, that a Holder who is not an employee
of the Company shall not be entitled to purchase Shares
with a promissory note unless the note is adequately
secured by collateral other than the Shares; and
provided, further, that the portion of the Exercise
Price equal to the par value of the Shares must be paid
in cash;
(d) in the case of exercise by the Participant,
Participant's guardian or legal representative or the
authorized legal representative of Participant's heirs
or legatees after Participant's death, by waiver of
compensation due or accrued to the Participant for
services rendered;
(e) by tender of property;
(f) provided that a public market for the Company's stock
exists:
(1) through a "same day sale" commitment from the
Holder and a broker-dealer that is a member of
the National Association of Securities Dealers
(an "NASD DEALER") whereby the Holder
irrevocably elects to exercise the Option and to
sell a portion of the Shares so purchased to pay
for the Exercise Price, and whereby the NASD
Dealer irrevocably commits upon receipt of such
Shares to forward the Exercise Price directly to
the Company; or
(2) through a "margin" commitment from the Holder
and a NASD Dealer whereby the Holder irrevocably
elects to exercise the Option and to pledge the
Shares so purchased to the NASD Dealer in a
margin account as security for a loan from the
NASD Dealer in the amount of the Exercise Price,
and whereby the NASD Dealer irrevocably commits
upon receipt of such Shares to forward the
Exercise Price directly to the Company; or
(g) by any combination of the foregoing.
6.2 LOAN GUARANTEES. The Committee may help the
Participant pay for Shares purchased under this Plan by authorizing a
guarantee by the Company of a third-party loan to the Participant.
7. WITHHOLDING TAXES.
7.1 WITHHOLDING GENERALLY. Whenever Shares
are to be issued on exercise of Options granted under this Plan, the Company
may require the Holder to remit to the Company an amount sufficient to
satisfy federal, state and local withholding tax requirements prior to the
delivery of any certificate or certificates for such Shares. If a payment in
satisfaction of an Option is to be made in cash, such payment will be net of
an amount sufficient to satisfy federal, state, and local withholding tax
requirements.
7.2 STOCK WITHHOLDING. When, under applicable tax
laws, a Participant incurs tax liability in connection with the exercise or
vesting of any Option that is subject to tax withholding and the Participant
is obligated to pay the Company the amount required to be withheld, the
Committee may in its sole discretion allow the Participant to satisfy the
minimum withholding tax obligation by electing to have the Company withhold
from the Shares to be issued that number of Shares having a Fair Market Value
equal to the minimum amount required to be withheld, determined on the date
that the amount of tax to be withheld is to be determined. All elections by a
Holder to have Shares withheld for this purpose will be made in accordance
with the requirements established by the Committee and be in writing in a
form acceptable to the Committee
<PAGE>
8. PRIVILEGES OF STOCK OWNERSHIP.
8.1 VOTING AND DIVIDENDS. No Holder will have any
of the rights of a stockholder with respect to any Shares until the Shares
are issued to the Holder. After Shares are issued to the Holder, the Holder
will be a stockholder and have all the rights of a stockholder with respect
to such Shares, including the right to vote and receive all dividends or
other distributions made or paid with respect to such Shares; provided,
however, that if the Shares are Unvested Shares, any new, additional or
different securities the Holder may become entitled to receive with respect
to the Shares by virtue of a stock dividend, stock split or any other change
in the corporate or capital structure of the Company will be subject to the
same restrictions as the Unvested Shares; provided, further that the Holder
will have no right to retain such dividends or distributions with respect to
Shares that are repurchased at the Holder's original Exercise Price pursuant
to Section 10.
8.2 FINANCIAL STATEMENTS. The Company will
provide financial statements to each Holder prior to such Holder's purchase
of Shares under this Plan, and to each Holder annually during the period such
Holder has Options outstanding; PROVIDED, HOWEVER, that the Company will not
be required to provide such financial statements to Holders whose services in
connection with the Company assure them access to equivalent information.
9. TRANSFERABILITY. Unless otherwise restricted by the
Committee, an Option shall be exercisable: (i) during the Participant's
lifetime only by (A) the Participant, (B) the Participant's guardian or legal
representative, (c) a Family Member of the Participant who has acquired the
Option by Permitted Transfer; and (ii) after Participant's death, by the
legal representative of the Participant's heirs or legatees.
10. RESTRICTIONS ON SHARES. At the discretion of the
Committee, the Company may reserve to itself and/or its assignee(s) in the
Stock Option Agreement a right to repurchase at the Holder's Exercise Price a
portion of or all Unvested Shares held by a Holder following such
Participant's Termination at any time within ninety (90) days after the later
of Participant's Termination Date and the date Holder purchases Shares under
this Plan, for cash and/or cancellation of purchase money indebtedness.
11. CERTIFICATES. All certificates for Shares or other
securities delivered under this Plan will be subject to such stock transfer
orders, legends and other restrictions as the Committee may deem necessary or
advisable, including restrictions under any applicable federal, state or
foreign securities law, or any rules, regulations and other requirements of
the SEC or any stock exchange or automated quotation system upon which the
Shares may be listed or quoted.
12. ESCROW; PLEDGE OF SHARES. To enforce any restrictions
on a Holder's Shares, the Committee may require the Holder to deposit all
certificates representing the Shares, together with stock powers or other
instruments of transfer approved by the Committee, appropriately endorsed in
blank, with the Company or an agent designated by the Company to hold in
escrow until such restrictions have lapsed or terminated, and the Committee
may cause a legend or legends referencing such restrictions to be placed on
the certificates. Any Holder who is permitted to execute a promissory note as
partial or full consideration for the purchase of Shares under this Plan will
be required to pledge and deposit with the Company all or part of the Shares
so purchased as collateral to secure the payment of Holder's obligation to
the Company under the promissory note; PROVIDED, HOWEVER, that the Committee
may require or accept other or additional forms of collateral to secure the
payment of such obligation and, in any event, the Company will have full
recourse against the Holder under the promissory note notwithstanding any
pledge of the Holder's Shares or other collateral. In connection with any
pledge of the Shares, Holder will be required to execute and deliver a
written pledge agreement in such form as the Committee will from time to time
approve. The Shares purchased with the promissory note may be released from
the pledge on a pro rata basis as the promissory note is paid.
13. EXCHANGE AND BUYOUT OF OPTIONS. The Committee may, at
any time or from time to time, authorize the Company, with the consent of the
respective Holders, to issue new Options in exchange for the surrender and
cancellation of any or all outstanding Options. The Committee may at any time
buy from a
<PAGE>
Holder an Option previously granted with payment in cash, Shares or other
consideration, based on such terms and conditions as the Committee and the
Holder may agree.
14. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An
Option will not be effective unless such Option is in compliance with all
applicable federal and state securities laws, rules and regulations of any
governmental body, and the requirements of any stock exchange or automated
quotation system upon which the Shares may then be listed or quoted, as they
are in effect on the date of grant of the Option and also on the date of
exercise or other issuance. Notwithstanding any other provision in this Plan,
the Company will have no obligation to issue or deliver certificates for
Shares under this Plan prior to: (a) obtaining any approvals from
governmental agencies that the Company determines are necessary or advisable;
and/or (b) completion of any registration or other qualification of such
Shares under any state or federal law or ruling of any governmental body that
the Company determines to be necessary or advisable. The Company will be
under no obligation to register the Shares with the SEC or to effect
compliance with the registration, qualification or listing requirements of
any state securities laws, stock exchange or automated quotation system, and
the Company will have no liability for any inability or failure to do so.
15. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any
Option granted under this Plan will confer or be deemed to confer on any
Participant any right to continue in the employ of, or to continue any other
relationship with, the Company or any Parent or Subsidiary of the Company or
limit in any way the right of the Company or any Parent or Subsidiary of the
Company to terminate Participant's employment or other relationship at any
time, with or without cause.
16. CORPORATE TRANSACTIONS.
16.1 ASSUMPTION OR REPLACEMENT OF OPTIONS BY
SUCCESSOR. In the event of (a) a merger or consolidation in which the Company
is not the surviving corporation (other than a merger or consolidation with a
wholly-owned subsidiary, a reincorporation of the Company in a different
jurisdiction, or other transaction in which there is no substantial change in
the stockholders of the Company and the Options granted under this Plan are
assumed or replaced by the successor corporation, which assumption will be
binding on all Participants), (b) a dissolution or liquidation of the
Company, (c) the sale of substantially all of the assets of the Company, or
(d) any other transaction which qualifies as a "corporate transaction" under
Section 424(a) of the Code wherein the stockholders of the Company give up
all of their equity interest in the Company (EXCEPT for the acquisition, sale
or transfer of all or substantially all of the outstanding shares of the
Company), any or all outstanding Options may be assumed or replaced by the
successor corporation, which assumption or replacement shall be binding on
all Holders. In the alternative, the successor corporation may substitute
equivalent Options or provide substantially similar considerations to Holders
as was provided to stockholders (after taking into account the existing
provisions of the Options). The successor corporation may also issue, in
place of Unvested Shares of the Company held by Holder, substantially similar
shares or other property subject to repurchase restrictions no less favorable
to the Holder.
16.2 EXPIRATION OF OPTIONS. In the event such
successor corporation, if any, refuses to assume or substitute the Options,
as provided above, pursuant to a transaction described in Subsection 16.1(a)
above, such Options shall expire on such transaction at such time and on such
conditions as the Board shall determine. In the event such successor
corporation, if any, refuses to assume or substitute the Options as provided
above, pursuant to a transaction described in Subsections 16.1(b), (c) or (d)
above, or there is no successor corporation, and if the Company ceases to
exist as a separate corporate entity, then, notwithstanding any contrary
terms in the Stock Option Agreement, the Options shall expire on a date at
least twenty (20) days after the Board gives written notice to Holders
specifying the terms and conditions of such termination.
16.3 OTHER TREATMENT OF OPTIONS. Subject to any
greater rights granted to Participants under the foregoing provisions of this
Section 16, in the event of the occurrence of any transaction described in
Section 16.1, any outstanding Options will be treated as provided in the
applicable agreement or plan of merger, consolidation, dissolution,
liquidation, sale of assets or other "corporate transaction."
<PAGE>
16.4 ASSUMPTION OF OPTIONS BY THE COMPANY. The
Company, from time to time, also may substitute or assume outstanding options
granted by another company, whether in connection with an acquisition of such
other company or otherwise, by either; (a) granting an Option under this Plan
in substitution of such other company's option; or (b) assuming such option
as if it had been granted under this Plan if the terms of such assumed option
could be applied to an Option granted under this Plan. Such substitution or
assumption will be permissible if the holder of the substituted or assumed
option would have been eligible to be granted an Option under this Plan if
the other company had applied the rules of this Plan to such grant. In the
event the Company assumes an option granted by another company, the terms and
conditions of such option will remain unchanged (EXCEPT that the exercise
price and the number and nature of Shares issuable upon exercise of any such
option will be adjusted appropriately pursuant to Section 424(a) of the
Code). In the event the Company elects to grant a new Option rather than
assuming an existing option, such new Option may be granted with a similarly
adjusted Exercise Price.
17. ADOPTION. This Plan will become effective on the date
that it is adopted by the Board (the "EFFECTIVE DATE").
18. TERM OF PLAN/GOVERNING LAW. Unless earlier terminated
as provided herein, this Plan will terminate ten (10) years from the
Effective Date. This Plan and all agreements hereunder shall be governed by
and construed in accordance with the internal laws of the State of
California, excluding that body of law pertaining to conflict of laws.
19. AMENDMENT OR TERMINATION OF PLAN. The Board may at
any time terminate or amend this Plan in any respect, including without
limitation amendment of any form of Stock Option Agreement or instrument to
be executed pursuant to this Plan.
20. NONEXCLUSIVITY OF THE PLAN. Neither the adoption of
this Plan by the Board, nor any provision of this Plan will be construed as
creating any limitations on the power of the Board to adopt such additional
compensation arrangements as it may deem desirable, including, without
limitation, the granting of stock options otherwise than under this Plan, and
such arrangements may be either generally applicable or applicable only in
specific cases.
21. DEFINITIONS. As used in this Plan, the following
terms will have the following meanings:
"BOARD" means the Board of Directors of the Company.
"COMMITTEE" means the Committee appointed by the
Board to administer the Plan, or if no committee is appointed, the Board.
"CODE" means the Internal Revenue Code of 1986, as
amended.
"COMPANY" means Macromedia, Inc., a corporation
organized under the laws of Delaware, or any successor corporation.
"DISABILITY" means a disability, whether temporary or
permanent, partial or total, within the meaning of Section 22(e)(3) of the
Code, as determined by the Committee.
"EXCHANGE ACT" means the Securities Exchange Act of
1934, as amended.
"EXERCISE PRICE" means the price at which a holder of
an Option may purchase the Shares issuable upon exercise of the Option.
"FAIR MARKET VALUE" means, as of any date, the value
of a share of the Company's Common Stock determined as follows:
<PAGE>
(a) if such Common Stock is then quoted on the Nasdaq
National Market, its last reported sales price on the
Nasdaq National Market or, if no such reported sale
takes place on such date, the average of the closing bid
and asked prices;
(b) if such Common Stock is publicly traded and is then
listed on a national securities exchange, the last
reported sale price or, if no such reported sale takes
place on such date, the average of the closing bid and
asked prices on the principal national securities
exchange on which the Common Stock is listed or admitted
to trading;
(c) if such Common Stock is publicly traded but is not
quoted on the Nasdaq National Market nor listed or
admitted to trading on a national securities exchange,
the average of the closing bid and asked prices on such
date, as reported by THE WALL STREET JOURNAL, for the
over-the-counter market; or
(d) if none of the foregoing is applicable, by the Board of
Directors of the Company in good faith.
"FAMILY MEMBER" includes any of the following:
(a) child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, former spouse, sibling, niece,
nephew, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law of the
Participant, including any such person with such
relationship to the Participant by adoption;
(b) any person (other than a tenant or employee) sharing the
Participant's household;
(c) a trust in which the persons in (a) and (b) have more
than fifty percent of the beneficial interest;
(d) a foundation in which the persons in (a) and (b) or the
Participant control the management of assets; or
(e) any other entity in which the persons in (a) and (b) or
the Participant own more than fifty percent of the
voting interest.
"HOLDER" means the following person to the extent such
person has or controls an interest in an Option at the time in question: (a) the
Participant; (b) the Participant's guardian or legal representative; (c) a
Family Member who is a transferee of an Option in a Permitted Transfer, and (d)
the authorized legal representative of such person's heirs or legatees after
such person's death.
"INSIDER" means an officer of the Company or any other
person whose transactions in the Company's Common Stock are subject to Section
16 of the Exchange Act.
"OPTION" means an Option of an option to purchase
Shares pursuant to Section 5.
"PARENT" means any corporation (other than the
Company) in an unbroken chain of corporations ending with the Company if, at
the time of granting of the Option under the Plan, each of such corporations
other than the Company owns stock possessing 50% or more of the total
combined voting power of all classes of stock in one of the other
corporations in such chain.
"PARTICIPANT" means a person who receives an Option
under this Plan.
"PERMITTED TRANSFER" means, as authorized by this
Plan and the Committee in an Option, any transfer effected by the Participant
during the Participant's lifetime of an interest in such Option but only such
transfers which are by gift or domestic relations order. A Permitted Transfer
does not include
<PAGE>
any transfer for value and neither of the following are transfers for value:
(a) a transfer of under a domestic relations order in settlement of marital
property rights or (b) a transfer to an entity in which more than fifty
percent of the voting interests are owned by Family Members or the
Participant in exchange for an interest in that entity.
"PLAN" means this Macromedia, Inc. 1999 Stock Option
Plan, as amended from time to time.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as
amended.
"SHARES" means shares of the Company's Common Stock
reserved for issuance under this Plan, as adjusted pursuant to Sections 2 and
16, and any successor security.
"STOCK OPTION AGREEMENT" means, with respect to each
Option, the signed written agreement between the Company and the Participant
setting forth the terms and conditions of the Option.
"SUBSIDIARY" means any corporation (other than the
Company) in an unbroken chain of corporations beginning with the Company if,
at the time of granting of the Option, each of the corporations other than
the last corporation in the unbroken chain owns stock possessing 50% or more
of the total combined voting power of all classes of stock in one of the
other corporations in such chain.
"TERMINATION" or "TERMINATED" means, for purposes of
this Plan with respect to a Participant, that the Participant has for any
reason ceased to provide services as an employee, officer, consultant,
independent contractor, or advisor to the Company or a Parent or Subsidiary
of the Company except for sick leave, military leave, or any other leave of
absence approved by the Committee, provided, that such leave is for a period
of not more than 90 days, unless reinstatement upon the expiration of such
leave is guaranteed by contract or statute. The Committee will have sole
discretion to determine whether a Participant has ceased to provide services
and the effective date on which the Participant ceased to provide services
(the "TERMINATION DATE").
"UNVESTED SHARES" means "Unvested Shares" as defined
in the Option Agreement.
"VESTED SHARES" means "Vested Shares" as defined in
the Option Agreement.
