Amendment to Compaq Computer Corporation 1985 Non-Qualified Stock Option Plan (Adopted September 3, 2001)

Summary

This amendment updates the Compaq Computer Corporation 1985 Non-Qualified Stock Option Plan. It allows employees whose employment ends within one year after a Change in Control, under certain qualifying conditions, to exercise their stock options for up to three years after termination or until the original expiration date, whichever comes first. The amendment also clarifies how "Change in Control" and "Qualifying Termination" are defined for these purposes. The changes apply to options granted before September 1, 2001.

EX-10.5 7 h91517ex10-5.txt AMEND. TO NON-QUALIFIED STOCK OPTION PLAN EXHIBIT 10.5 ADOPTED SEPTEMBER 3, 2001 AMENDMENT OF COMPAQ COMPUTER CORPORATION 1985 NON-QUALIFIED STOCK OPTION PLAN RESOLVED, that pursuant to Section 6 of the Compaq Computer Corporation 1985 Non-Qualified Stock Option Plan (the "Plan"), the Plan is amended effective as of September 4, 2001, with respect to Options granted prior to September 1, 2001, as follows: 5. Section 5(e) of the Plan is hereby amended by adding the following proviso to the first sentence of Section 5(e)(i): ; provided, however that if, within one year following an occurrence of a Change in Control, the Optionee's employment is terminated in a Qualifying Termination (as defined in subparagraph (v) below), the Optionee shall have the right to exercise all outstanding Options until the earlier of (1) the third anniversary of such termination of employment or (2) the date such Options would have expired had it not been for such termination of employment. For purposes of applying the immediately preceding proviso with respect to treatment of Options in the event of a Qualifying Termination, the definition of a Change in Control set forth in Section 9.03 shall be revised by substituting the phrase "a merger or consolidation of the Company with any other corporation is consummated" for the phrase "the stockholders of the Company approve a merger or consolidation of the Company with any other corporation" in clause (iii) of said Section 9.03. 6. Section 5(e)(v) is hereby amended by adding the following after the last sentence thereof: For purposes of subparagraph (i) above, the term "Qualifying Termination" shall have the meaning ascribed to such term in the Optionee's individual employment or severance agreement with the Company or its Subsidiaries. If the Optionee is not a party to an individual employment or severance agreement with the Company or its Subsidiaries, the term "Qualifying Termination" shall have the meaning ascribed to the term "Qualified Termination" in the Compaq Computer Corporation employee severance plan in which such Optionee is eligible to participate.