How to use this template

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How to use this template

• Description
• This template allows you to explain the
  rules/details of your plan, as well as introduce
  Solium as your new Administrator. Use the slides
  you find applicable and customize content
  according to your plan rules. Create slide notes
  to assist the presenter with the presentation of
  the information.
• Goal
• Inform plan participants of plan information and
  transition to Solium
• Timing
• Date of launch (Go LIVE date)
• Distribution
• Webinar, presentations, road shows, intranet
• Branding
• Use your branding, corporate PowerPoint template

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Plan Name

• Jane SmithDecember 15, 2008

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Agenda

• Section I Plan Overview
• Section II Plan Administration
• Section III Managing your portfolio through
  Shareworks
• Section IV Key Dates

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Section I

• Plan Overview

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Stock Market

• Why own stock?
• Benefit from Company success
• Receive voting rights (if applicable)
• Investment vehicle
• What is an option?
• A company grants an employee the right to
  purchase shares of the company at some time in
  the future at a specified price

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ltCompanygt Stock Price

• Stock Symbol ltstock symbolgt
• Exchange ltexchangegt
• Current price ltpricegt

Customization Tip Include graph of stock
performance for last 6 months, etc. to portray
the increase (or decrease) in stock performance
over time.
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Benefits of ltPlan Namegt

• Employee reward / incentive plan
• Opportunity to hold ltCompanygt stock
• ltCompanysgt success your success

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Grant Parameters

• Award schedule
• Grant price
• Vesting rules
• Expiry dates
• of options/awards
• Termination/extended leave rules

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Tax Implications
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Common Terms

• Company Proceeds (Total Option Cost)
• The amount you must pay back to the company for
  the options
• of options x grant price
• Stock Option Benefit
• The benefit (gain) is the difference between the
  Grant price and the Market price at the time of
  transaction
• of options x market price grant price
• Participant Proceeds
• The amount the participant receives after
  deductions are made, such as company proceeds,
  tax withholding, brokerage commission, and
  transaction fees
• In the money
• The market price at time of exercise is higher
  than the grant price
• Underwater
• The market price at time of exercise is lower
  than the grant price

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Exercise/Redemption Example

• 1,000 options granted at 10
• Exercised at market price of 20
• Tax withholding rate is 39
• Trade Proceeds
• 1,000 shares x 20/share 20,000
• Cost of Options (Company Proceeds)
• 1,000 shares x 10/share 10,000
• Stock Option Benefit (Trade Proceeds Cost of
  Options)
• 20,000 - 10,000 10,000
• Participant Proceeds
• 10,000 (39) 10,000 - 3,900 6,100
• Less applicable transaction, banking fees, and
  brokerage commission

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Blackout Periods
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Exercise Types

• Type 1 - Exercise and sell all shares on the
  market
• An optionee can take the options, convert them to
  stock and sell all of the stock immediately. The
  Stock Options and Awards module facilitates a
  "cashless exercise" where optionees convert their
  options into stock without having to put up
  personal funds. Payment to the company is made
  upon the settlement of the sale proceeds.
• Type 1.5 - Exercise options, sell just enough
  shares to pay for the options and hold the
  remaining shares
• An optionee can convert their options to stock,
  sell a portion of the stock and hold the
  remainder to sell at a later date. The Stock
  Options and Awards module facilitates a "cashless
  exercise" where optionees convert the necessary
  amount of options into stock without having to
  put up personal funds. The optionee will then be
  provided a share certificate for the remaining
  shares.
• Type 2 - Exercise options and hold the stock
• An optionee can convert the options to stock, and
  hold the stock. This is not a cashless exercise.
  The optionee must provide payment for the stock.
  Solium must receive a certified check from the
  optionee within three business days of the
  exercise and hold submission to proceed with the
  exercise and the production of a share
  certificate to the optionee.

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Order Types

• Market Order
• Sell your shares at the current market price
• Limit Order
• Specify the price you would like to sell your
  shares
• Valid for 30 calendar days if the market price
  does not meet the limit order price, the order
  will be cancelled

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Section II

• Plan Administrator

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New Plan Administrator

• Solium Capital Inc
• www.solium.com

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Benefits of Solium

• Login online to your Shareworks account anytime,
  anywhere
• Direct access to financial markets for seamless
  transactions
• Self-serve online statements
• View complete history of all transactions
• Automated alerts on vesting periods, expiry of
  awards, and blackouts
• Discounted brokerage fees
• No need for individual brokerage accounts
• Phone and email support
• Service Center hours are 8am to 8pm ET, Monday
  through Friday
• Available to answer your questions or support you
  through the exercise process

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Section III

• Managing your portfolio through Shareworks

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Step 1 Account Activation

• Open your Shareworks account online at
  www.solium.com/activate
• Complete short activation form requesting contact
  information
• Your Shareworks account details will be mailed to
  you

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Step 2 Login to Shareworks

• Log in at www.solium.com/login
• Enter Account Number and Password
• Review and Accept Agreement(s)
• Verify grant information

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Step 3 Manage Your Profile

• Go to the Personal Profile Passwords tab to
  manage your
• contact information such as mailing address,
  phone numbers, and personal email
• bank account information
• brokerage account information
• login and transaction passwords
• alternate login

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Exercising Your Options

• Step 1 - Parameters
• Enter the number of options you would like to
  exercise
• Select the type of exercise (Type 1, 1.5, 2)
• Step 2 - Delivery
• Choose how you would like to receive your
  proceeds (Direct Deposit, Bank Wire, Check by
  Mail)
• Step 3 - Specify Order Type
• Choose order type (Market or Limit)

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Exercising Your Options Contd

• Step 4 - Review Agreement
• Read and accept an Exercise Direction letter that
  outlines your exercise details
• Step 5 - Verify
• Verify your exercise details, instructions, and
  order information
• Enter your transaction password
• Step 6 - Confirmation
• Once exercise is completed, you will receive a
  confirmation number

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Fees

• Solium Transaction Fees
• XX transaction fee
• XX additional fee when placing Limit Orders
• XX additional fee when transacting through
  Soliums Service Center
• Brokerage Commission
• XX for trades lt 1000 shares
• 0.0X for trades gt 1000 shares

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Fees Contd

• Disbursement Fees
• Check by Mail - XX USD
• Bank Wire - XX USD
• Bank Wire (International) - XX USD

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Section IV

• Key Dates

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Key Dates

• Launch on Shareworks
• Activate accounts by

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Employee Action
Customization Tip If applicable, you may want to
includes steps that employees need to take, etc
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Contact Solium

• Online www.solium.com
• Email help_at_solium.com
• North America 1.877.380.7793
• International International code 1
  403.515.3909
• Hours 8am - 8pm ET, Monday - Friday

Customization Tip Adjust the time zone based on
your audience.
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Questions?