INTEL CORPORATION
1988 EXECUTIVE LONG TERM
STOCK OPTION PLAN
(Amended and Restated Effective as of July 16, 1997)
1. PURPOSE
The purpose of this amended and restated Intel Corporation 1988
Executive Long Term Stock Option Plan (the 'Plan') is to advance
the interests of Intel Corporation, a Delaware corporation
and its subsidiaries (hereinafter collectively 'Intel' or the
'Corporation'), by stimulating the efforts of certain key employees
employed by Intel and heightening the desire of such key
employees to continue in employment with Intel. The stock options
granted pursuant to this Plan are non-qualified stock options and shall
not be incentive stock options, as defined in Section 422 of the
Internal Revenue Code of 1986, as amended (the 'Code'). This amended
and restated Plan includes the individual grant limitations required by
Section 162(m) of the Code for the option income of certain
individuals to be tax deductible by the Corporation.
2. DEFINITIONS
(a) 'Board of Directors' means the Board of Directors of the
Corporation.
(b) 'Committee' means the Compensation Committee appointed by
the Board of Directors in accordance with Section 11.
(c) 'Disablement' means a physical condition arising from an illness or
injury which renders an individual incapable of performing work.
The determination of the Corporation as to an individual's
Disablement shall be made in accordance with the standards and
procedures of the Corporation's then-current Long-Term Disability
Plan and shall be conclusive on all of the parties.
(d) 'Plan' means the Intel Corporation 1988 Executive Long Term Stock
Option Plan, as amended and restated herein.
(e) 'Retirement' shall have the meaning specified by the Committee
in the terms of an option grant or, in the absence of any such
term, shall mean retirement from active employment with Intel (i)
at or after age 55 and with the approval of the Committee or (ii)
at or after age 65. The determination of the Committee as to
an individual's Retirement shall be conclusive on all parties.
(f) 'Subsidiary' means any corporation in an unbroken chain of
corporations beginning with Intel Corporation where each of the
corporations in the unbroken chain other than the last
corporation owns stock possessing 50 percent or more of the
total combined voting power of all classes of stock in one of the
other corporations in such chain.
(g) 'Immediate Family' means the spouse, children and grandchildren
of the Participant (as defined in Section 3 hereof).
3. PARTICIPANTS
'Participants' in the Plan shall be those key employees who have been
employed by Intel for at least two years and to whom options may be
granted from time to time by the Committee.
No option shall be granted to any employee if immediately after the
grant of such option such employee would own stock, including stock
subject to outstanding options held by him or her, amounting to more
than five percent (5%) of the total combined voting power or value of
all classes of stock of the Corporation or any Subsidiary. Options may
not be granted to non-employee directors or members of the Committee.
4. EFFECTIVE DATE AND TERMINATION OF PLAN
This Plan was last approved by the Corporation's stockholders on
May 4, 1994. The Plan was amended and restated by the Board of
Directors in certain non-material respects on March 26, 1997. The
Plan was amended and restated by the Board of Directors on July 16,
1997, to provide for limited transferability of options.
The Plan shall remain available for the grant of options until all
shares of stock available for grant under this Plan shall have
been acquired through exercise of options or until September 19,
1998 whichever is earlier. The Plan may be terminated at such
earlier time as the Board of Directors may determine. Termination
of the Plan will not affect the rights and obligations arising
under options theretofore granted and then in effect.
5. SHARES SUBJECT TO THE PLAN AND TO OPTIONS
The stock subject to options authorized to be granted under the
Plan shall consist of 80,000,000 shares (as adjusted automatically
by the Plan's terms effective July 13, 1997, to reflect a stock split
effected in the form of a stock distribution) of the Corporation's
common stock, par value $.001 ('Common Stock'), or the number and
kind of shares of stock or other securities which shall be
substituted or adjusted for such shares as provided in Section 8.
Such shares may be authorized and unissued shares of the Corporation's
Common Stock. All or any shares of stock subject to an option
which for any reason terminates unexercised may again be made subject
to an option under the Plan.
6. GRANT, TERMS AND CONDITIONS OF OPTIONS
Options may be granted at any time and from time to time prior to the
termination of the Plan, to certain key employees of Intel selected
by the Committee. However, no Participant shall be granted options
in any year, to purchase shares of common stock in excess of one
percent (1%) of the number of shares of the Corporation's Common
Stock outstanding on January 1, 1994. In addition, no Participant or
optionholder shall have any rights as a stockholder with respect to
any shares of stock subject to option hereunder until said shares have
been issued. Each option may be evidenced by a written stock option
agreement and/or such other written arrangements as may be approved
from time to time by the Committee. Options granted pursuant to
the Plan need not be identical but each option much contain and
be subject to the following terms and conditions:
(a) Price:
----- The purchase price under each option shall be
established by the Committee. In no event will the option
price be less than the fair market value of the stock on
the date of grant. The option price must be paid in full at
the time of exercise. The price may be paid in cash or, as
acceptable to the Committee, by loan (as described in
Section 7), by arrangement with a broker where payment of the
option price is made pursuant to an irrevocable direction to
the broker to deliver all or part of the proceeds from the sale
of the option shares to the Corporation, by the surrender of
shares of Common Stock of the Corporation owned by the
Participant exercising the option and having a fair market
value on the date of exercise equal to the option price or in any
combination of the foregoing.
(b) Duration and Exercise or Termination of Option:
---------------------------------------------- Each option shall
be exercisable in such manner and at such times as the Committee
shall determine. However, each option granted must expire
within a period of not more than ten (10) years from the grant date.
(c) Suspension or Termination of Option:
----------------------------------- If at any time (including
after a notice of exercise has been delivered) the Chief
Executive Officer, President, Chief Operating Officer, Vice
President for Human Resources, General Counsel or any of their
designees (any such person, an 'Authorized Officer') reasonably
believes that a Participant or optionholder has committed an act
of misconduct as described in this Section, the Authorized
Officer may suspend the Participant's or optionholder's
rights to exercise any option pending a determination of
whether an act of misconduct has been committed.
If the Board of Directors or an Authorized Officer determines
a Participant or optionholder has committed an act of
embezzlement, fraud, dishonesty, nonpayment of any obligation
owed to Intel, breach of fiduciary duty or deliberate
disregard of Intel rules resulting in loss, damage or injury
to Intel, or if a Participant or optionholder makes an
unauthorized disclosure of any Intel trade secret or
confidential information, engages in any conduct constituting
unfair competition, induces any Intel customer to breach a
contract with Intel or induces any principal for whom Intel
acts as agent to terminate such agency relationship, neither
the Participant nor optionholder nor his or her estate shall be
entitled to exercise any option whatsoever. In making such
determination, the Board of Directors or an Authorized Officer
shall act fairly and shall give the Participant an opportunity
to appear and present evidence on his or her behalf at a hearing
before a committee of the Board of Directors. For any
Participant who is an 'executive officer' for purposes of
Section 16 of the Securities Exchange Act of 1934 (the
'Exchange Act'), the determination of the Board of Directors or
of the Authorized Officer shall be subject to the approval of the
Committee.
(d) Termination of Employment:
------------------------- Subject to Section 6(b), unless the
Committee specifies otherwise, upon the termination of the
Participant's employment, his or her rights to exercise an option
then held shall be only as follows:
(1) Death.
----- Upon the death of a Participant while in employ of
Intel, the Participant's rights will be exercisable by his
or her estate or beneficiary at any time during the twelve
months next succeeding the date of death.
If the Participant's option has been held by the Participant
for a minimum of four (4) years at the time of death,
then the number of shares exercisable by the estate or
beneficiary of the deceased Participant will be the total
number of unexercised shares, whether or not exercisable,
under such option on the date of the Participant's death.
If the Participant's option has been held for a period of
less than four (4) years at the time of death, then the
number of shares exercisable by the estate or beneficiary
of the deceased Participant will be the total number of
shares which were exercisable under such option on the
date of the Participant's death.
If a Participant should die within thirty (30) days of his
or her termination of employment with Intel, an option will
be exercisable by his or her estate or beneficiary at any
time during the twelve (12) months succeeding the date of
termination, but only to the extent of the number of shares
as to which such option was exercisable as of the date of
such termination. A Participant's estate shall mean his or
her legal representative or other person who so acquires the
right to exercise the option.
(2) Disablement.
----------- Upon the Disablement of any Participant, the
Participant's rights to options may be exercised for at any
time during the twelve (12) months after termination. If
the Participant's option has been held for a minimum of four
years, then the number of shares exercisable by the
Participant will be the total number of unexercised shares,
whether or not exercisable, under such option on the date of
the Participant's termination. If the Participant's option
has been held for a period of less than four (4) years,
then the number of shares exercisable by the Participant
will be the total number of shares which were exercisable
under such option on the date of the Participant's termination.
(3) Retirement.
---------- Upon Retirement of a Participant, the
Participant's rights to options may be exercised at any time
during the twelve (12) months after Retirement. The
number of shares exercisable will be the total number of
shares which were exercisable under the Participant's option
on the date of his or her Retirement.
(4) Other Reasons.
------------- Upon termination of a Participant's employment
for any reason other than those stated above, a Participant
may, within thirty (30) days following such termination
exercise the option to the extent such option was exercisable
on the date of termination.
For purposes of this Section 6(d), unless the Committee specifies
otherwise, a Participant's employment shall not be deemed
terminated (i) if, within sixty (60) days such Participant is
rehired by Intel, (ii) if Participant is transferred from the
Corporation to any Subsidiary or from any one Subsidiary to
another or from a Subsidiary to the Corporation, or (iii) at the
discretion of the Committee, during any period of a Participant's
leave of absence, provided that the Committee may delay the
Participant's rights to exercise options as a result of such leave
of absence. In addition, a Participant's employment with any
partnership, joint venture or corporation not meeting the
requirements of a Subsidiary in which the Corporation or a
Subsidiary is a party and which is designated by the Committee
as subject to this provision, shall be considered employment for
purposes of this Section 6(d).
(e) Transferability of Option: Unless otherwise provided by the
Committee and subject to the establishment of procedures by
the Committee, each option shall be transferable only:
(1) by will or the laws of descent and distribution, or
(2) by gift to the Immediate Family, partnerships whose only
partners are the Participant or members of the Immediate
Family, limited liability companies whose only shareholders
are the Participant or members of the Immediate Family, and
trusts established solely for the benefit of the Participant
or members of the Immediate Family.
The transferees described in this subsection (e) of Section
6 shall be referred to as 'Permitted Transferees'.
Options are transferable only to the extent the options are
exercisable at the time of transfer. Any purported
assignment, transfer or encumbrance that does not qualify
under subsections (1) and (2) above shall be void and
unenforceable against the Corporation.
The terms of stock options granted pursuant to this Plan
shall apply to the beneficiaries, executors and
administrators of the Participant and to Permitted
Transferees (including the beneficiaries, executors and
administrators of Permitted Transferees), including the right
to agree to any amendment of the applicable option agreement,
except that options transferred to Permitted Transferees
shall not be transferable except by will or the laws of
descent and distribution.
(f) Cancellation:
------------ The Committee may, at any time prior to
exercise and subject to consent of the Participant, cancel
any options previously granted and may or may not substitute
in their place options at a different price and different
type under different terms or in different amounts.
(g) Conditions and Restrictions Upon Securities Subject to
------------------------------------------------------
Options:
------- Subject to the express provisions of the Plan,
the Committee may provide that the shares of Common Stock
issued upon exercise of an option shall be subject to such
further conditions or agreements as the Committee in its
discretion may specify prior to the exercise of such option,
including without limitation, conditions on vesting or
transferability, forfeiture or repurchase provisions and
method of payment for the shares issued upon exercise
(including the actual or constructive surrender of Common
Stock already owned by the Participant or optionholder).
The Committee may establish rules for the deferred delivery
of Common Stock upon exercise of an option with the deferral
evidenced by use of 'Stock Units' equal in number to the
number of shares of Common Stock whose delivery is so
deferred. A 'Stock Unit' is a bookkeeping entry
representing an amount equivalent to the fair market value
of one share of Common Stock. Unless the Committee specifies
otherwise, Stock Units represent an unfunded and unsecured
obligation of the Corporation. Settlement of Stock Units
upon expiration of the deferral period shall be made in
Common Stock or otherwise as determined by the Committee.
The amount of Common Stock, or other settlement medium, to be
so distributed may be increased by an interest factor
or by dividend equivalents. Until a Stock Unit is so settled,
the number of shares of Common Stock represented by a Stock
Unit shall be subject to adjustment pursuant to Section 8.
Any Stock Units that are settled after the holder's death
shall be distributed to the holder's designated
beneficiary(ies) or, if none was designated, the holder's
estate.
(h) Other Terms and Conditions:
-------------------------- Options may also contain such
other provisions, which shall not be inconsistent with any of
the foregoing terms, as the Committee shall deem
appropriate. No option, however, nor anything contained in
the Plan shall confer upon any Participant any right to
continue in Intel's employ or service nor limit in any way
Intel's right to terminate his or her employment at any time.
7. LOANS
The Corporation may make loans, at the request of the Participant
and in the sole discretion of the Board or its Committee, for
the purpose of enabling the Participant to exercise options granted
under the Plan and to pay the tax liability resulting from an option
exercise under the Plan. The Board or its Committee shall have
full authority to determine the terms and conditions of such loans.
Such loans may be secured by the shares received upon exercise of
such option.
8. ADJUSTMENT OF AND CHANGES IN THE STOCK
In the event that the number of shares of Common Stock of the
Corporation shall be increased or decreased through
reclassification, combination of shares, a stock split or the
payment of a stock dividend, or otherwise, then each share of
common stock of the Corporation which has been authorized for
issuance under the Plan, whether such share is then currently
subject to or may become subject to an option under the
Plan, shall be proportionately adjusted to reflect such increase
or decrease. Outstanding options shall also be amended as to price
and other terms if necessary to reflect the foregoing events.
In the event there shall be any other change in the number or
kind of the outstanding shares of Common Stock of the Corporation,
or any stock or other securities into which such Common Stock
shall have been changed, or for which it shall have been exchanged,
whether by reason of merger, consolidation or otherwise, then if
the Committee shall, in its sole discretion, determine that such
change equitably requires an adjustment to shares currently subject
to options or which may become subject to options under the Plan,
or to prices or terms of outstanding options, such adjustment shall
be made in accordance with such determination. In addition, in the
event of such change described in this paragraph, the Board of
Directors may accelerate the time or times at which any option may
be exercised and may provide for cancellation of such accelerated
options which are not exercised within a time prescribed by the
Board of Directors in its sole discretion.
No right to purchase fractional shares shall result from any
adjustment in options pursuant to this Section. In case of any
such adjustment, the shares subject to the option shall be
rounded down to the nearest whole share. Notice of any adjustment
shall be given by the Corporation to each Participant or
optionholder which shall have been so adjusted and such adjustment
(whether or not notice is given) shall be effective and binding for
all purposes of the Plan.
9. LISTING OR QUALIFICATION OF STOCK
In the event that the Board of Directors determines in its
discretion that the listing or qualification of the Plan shares on
any securities exchange or quotation or trading system or under any
applicable law or governmental regulation is necessary as a
condition to the issuance of such shares under the option, the
option may not be exercised in whole or in part unless such listing,
qualification, consent or approval has been unconditionally obtained.
10. WITHHOLDING
To the extent required by applicable federal, state, local or
foreign law, a Participant or optionholder shall make arrangements
satisfactory to the Corporation for the satisfaction of any
withholding tax obligations that arise by reason of an option
exercise. The Corporation shall not be required to issue shares or
to recognize the disposition of such shares until such obligations
are satisfied. The Committee may permit these obligations to be
satisfied by having the Corporation withhold a portion of the shares
of stock that otherwise would be issued to him or her upon exercise
of the option, or to the extent permitted, by tendering shares
previously acquired.
11. ADMINISTRATION AND AMENDMENT OF THE PLAN
The Plan shall be administered by the Committee which shall consist
of at least two persons appointed by the Board of Directors. The
Board of Directors shall fill vacancies and may from time to time
remove or add members. All members of the Committee will
be 'non-employee directors' as defined in Rule 16b-3 under the
Exchange Act and 'outside directors' as defined under Section
162(m) of the Code, but in each case only when required to exempt
any grant intended to qualify for an exemption under
such provisions. Notwithstanding the foregoing, unless otherwise
restricted by the Board of Directors, the Committee may appoint one
or more separate committees (any such committee, a 'Subcommittee')
composed of one or more directors of Intel (who may but need not be
members of the Committee) and may delegate to any such
Subcommittee(s) the authority to grant options under the Plan to
Participants, to determine all terms of such options, and/or to
administer the Plan or any aspect of it. Any action by any such
Subcommittee within the scope of such delegation shall be deemed for
all purposes to have been taken by the Committee. The Committee
shall act pursuant to a majority vote or majority written consent.
Subject to the express provisions of this Plan, the Committee
shall be authorized and empowered to do all things necessary
or desirable in connection with the administration of this Plan,
including, without limitation: (a) to prescribe, amend and
rescind rules and regulations relating to this Plan and to
define terms not otherwise defined herein; (b) to determine
which persons are Participants (as defined in Section 3 hereof),
to which of such Participants, if any, an option shall be granted
hereunder and the timing of any such option grants; (c) to
determine the number of shares of Common Stock subject to an option
and the exercise or purchase price of such shares; (d) to establish
and verify the extent of satisfaction of any conditions to
exercisability applicable to an option; (e) to waive conditions to
and/or accelerate exercisability of an option, either
automatically upon the occurrence of specified events (including in
connection with a change of control of the Corporation) or
otherwise in its discretion; (f) to prescribe and amend the terms
of option grants made under this Plan (which need not be
identical); (g) to determine whether, and the extent to which,
adjustments are required pursuant to Section 8 hereof; and (h) to
interpret and construe this Plan, any rules and regulations under
the Plan and the terms and conditions of any option granted
hereunder, and to make exceptions to any such provisions in good
faith and for the benefit of the Corporation.
All decisions, determinations and interpretations by the Committee
regarding the Plan, any rules and regulations under the Plan
and the terms and conditions of any option granted hereunder,
shall be final and binding on all Participants and optionholders.
The Committee shall consider such factors as it deems relevant,
in its sole and absolute discretion, to making such decisions,
determinations and interpretations including, without
limitation, the recommendations or advice of any officer or other
employee of the Corporation and such attorneys, consultants and
accountants as it may select. The interpretation and construction
of any provision of the Plan by the Board of Directors shall
be final and conclusive. The Board of Directors may periodically
adopt rules and regulations for carrying out the Plan, and amend
the Plan as desired, without further action by the Corporation's
stockholders except to the extent required by applicable law.
12. TIME OF GRANTING OPTIONS
The effective date of such option shall be the date on which the
grant was made. Within a reasonable time thereafter, Intel will
deliver the option to the Participant.