Exhibit 10.2

PROGENICS PHARMACEUTICALS, INC.

2005 STOCK INCENTIVE PLAN

(As amended and effective as of June 13, 2012)

 

1. PURPOSE

The purpose of the Progenics Pharmaceuticals, Inc. 2005 Stock Incentive Plan is
to further align the interests of employees, officers, non-employee directors
and other individual service providers with those of the stockholders by
providing incentive compensation opportunities tied to the performance of the
Common Stock and by promoting increased ownership of the Common Stock by such
individuals. The Plan is also intended to advance the interests of the Company
and its stockholders by attracting, retaining and motivating key personnel upon
whose judgment, initiative and effort the successful conduct of the Company’s
business is largely dependent.

 

2. DEFINITIONS

Wherever the following capitalized terms are used in the Plan, they shall have
the meanings specified below:

 

(a) Award means an award of a Stock Option, Stock Appreciation Right, Restricted
Stock Award, Stock Unit Award, Stock Award or Performance Award granted under
the Plan.

 

(b) Award Agreement means a written or electronic agreement entered into between
the Company and a Participant setting forth the terms and conditions of an
Award.

 

(c) Board means the Board of Directors of the Company.

 

(d) Change in Control shall have the meaning set forth in Section 13.2 hereof.

 

(e) Code means the Internal Revenue Code of 1986, as amended.

 

(f) Committee means the Compensation Committee of the Board or a successor
thereof, or any other committee of the Board appointed by the Board to
administer the Plan from time to time.

 

(g) Common Stock means the Company’s Common Stock, par value $.0013 per share.

 

(h) Company means Progenics Pharmaceuticals, Inc., a Delaware corporation.

 

(i) Date of Grant means the date on which an Award under the Plan is granted by
the Committee, or such later date as the Committee may specify to be the
effective date of an Award.

 

(j) Disability means a Participant being considered “disabled” within the
meaning of Section 409A(a)(2)(C) of the Code, unless otherwise provided in an
Award Agreement.

 

(k) Eligible Person means any person who is an employee, officer, director,
consultant, advisor or other individual service provider of the Company or any
Subsidiary, as determined by the Committee, or any person who is determined by
the Committee to be a prospective employee, officer, director, consultant,
advisor or other individual service provider of the Company or any Subsidiary.

 

(l) Exchange Act means the Securities Exchange Act of 1934, as amended.

 

(m) Fair Market Value with respect to the value of a share of Common Stock as of
a particular day, shall mean the last reported sale price (as reported on the
NASDAQ) of the Common Stock on such day (unless such day is not a trading day,
in which case, on the last trading day immediately preceding such day on which
the Common Stock is traded on the NASDAQ). If the Common Stock is not listed on
the NASDAQ, the Committee shall determine in good faith the Fair Market Value in
whatever manner it considers appropriate, taking into account to the extent
necessary the requirements of Section 409A of the Code.

 

(n) Incentive Stock Option means a Stock Option granted under Section 6 hereof
that is intended to meet the requirements of section 422 of the Code and the
regulations promulgated thereunder.

 

(o) NASDAQ means The Nasdaq Stock Market’s National Market.

 

(p) Nonqualified Stock Option means a Stock Option granted under Section 6
hereof that is not an Incentive Stock Option.

 

(q) Participant means any Eligible Person who holds an outstanding Award under
the Plan.

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(r) Performance Awards means an Award under Section 11 hereof entitling a
Participant to a payment in cash at the end of a performance period, if the
performance and other conditions established by the Committee are satisfied.

 

(s) Plan means this Progenics Pharmaceuticals, Inc. 2005 Stock Incentive Plan as
amended herein, and as may be amended from time to time, effective as provided
in Section 15.1 hereof.

 

(t) Restricted Stock Award means a grant of shares of Common Stock to an
Eligible Person under Section 8 hereof that are issued subject to such vesting
and transfer restrictions and such other conditions as are set forth in the Plan
and the applicable Award Agreement.

 

(u) Section 162(m) Award means any Award that is intended to qualify for the
“performance-based” compensation exception under section 162(m) of the Code and
the regulations promulgated thereunder.

 

(v) Service means a Participant’s employment or other service relationship with
the Company or any Subsidiary.

 

(w) Stock Appreciation Right means a contractual right granted to an Eligible
Person under Section 7 hereof entitling such Eligible Person to receive a
payment, representing the difference between the base price per share of the
right and the Fair Market Value of a share of Common Stock at such time, and
subject to such conditions, as are set forth in the Plan and the applicable
Award Agreement.

 

(x) Stock Award means a grant of shares of Common Stock to an Eligible Person
under Section 10 hereof entitling a Participant to shares of Common Stock that
are issued free of transfer restrictions and forfeiture conditions.

 

(y) Stock Option means a contractual right granted to an Eligible Person under
Section 6 hereof to purchase shares of Common Stock at such time and price, and
subject to such conditions, as are set forth in the Plan and the applicable
Award Agreement.

 

(z) Stock Unit Award means a contractual right granted to an Eligible Person
under Section 9 hereof representing notional unit interests equal in value to a
share of Common Stock to be paid and distributed at such times, and subject to
such conditions, as are set forth in the Plan and the applicable Award
Agreement.

 

(aa) Subsidiary means an entity (whether or not a corporation) that is wholly or
majority owned or controlled, directly or indirectly, by the Company, or any
other affiliate of the Company that is so designated, from time to time, by the
Committee; provided, however, that with respect to Incentive Stock Options, the
term “Subsidiary” shall include only an entity that qualifies under section
424(f) of the Code as a “subsidiary corporation” with respect to the Company.

 

3. ADMINISTRATION

Section 3.1 Committee Members. The Plan shall be administered by a Committee
comprised of no fewer than two members of the Board. It is intended that each
Committee member shall satisfy the requirements for (i) an “independent
director” under rules adopted by the NASDAQ, (ii) a “nonemployee director” for
purposes of such Rule 16b-3 under the Exchange Act and (iii) an “outside
director” under section 162(m) of the Code. No member of the Committee shall be
liable for any action or determination made in good faith by the Committee with
respect to the Plan or any Award hereunder.

Section 3.2 Committee Authority. The Committee shall have such powers and
authority as may be necessary or appropriate for the Committee to carry out its
functions as described in the Plan. Subject to the express limitations of the
Plan, the Committee shall have authority in its discretion to determine the
Eligible Persons to whom, and the time or times at which, Awards may be granted,
the number of shares, units or other rights subject to each Award, the exercise,
base or purchase price of an Award (if any), the time or times at which an Award
will become vested, exercisable or payable, the performance criteria,
performance goals and other conditions of an Award, the duration of the Award,
and all other terms of the Award. Subject to the terms of the Plan, the
Committee shall have the authority to amend the terms of an Award in any manner
that is not inconsistent with the Plan, provided that no such action shall
adversely affect the rights of a Participant with respect to an outstanding
Award without the Participant’s consent. The Committee shall also have
discretionary authority to interpret the Plan, to make all factual
determinations under the Plan, and to make all other determinations necessary or
advisable for Plan administration, including, without limitation, to correct any
defect, to supply any omission or to reconcile any inconsistency in the Plan or
any Award Agreement hereunder. The Committee may prescribe, amend, and rescind
rules and regulations relating to the Plan. The Committee’s determinations under
the Plan need not be uniform and may be made by the Committee selectively among
Participants and Eligible Persons, whether or not such persons are similarly
situated. The Committee shall, in its discretion, consider such factors as it
deems relevant in making its interpretations, determinations and actions under
the Plan including, without limitation, the recommendations or advice of any
officer or employee of the Company or such attorneys, consultants, accountants
or other advisors as it may select. All interpretations, determinations, and
actions by the Committee shall be final, conclusive, and binding upon all
parties.

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Section 3.3 Delegation of Authority. The Committee shall have the right, from
time to time, to delegate to one or more officers of the Company the authority
of the Committee to grant Awards under the Plan, subject to the requirements of
section 157(c) of the Delaware General Corporation Law (or any successor
provision) and such other limitations as the Committee shall determine. In no
event shall any such delegation of authority be permitted with respect to Awards
to any members of the Board or to any Eligible Person who is subject to Rule
16b-3 under the Exchange Act or who is a covered employee under section 162(m)
of the Code. The Committee shall also be permitted to delegate, to any
appropriate officer or employee of the Company, responsibility for performing
ministerial functions under the Plan. In the event that the Committee’s
authority is delegated to officers or employees in accordance with the
foregoing, all provisions of the Plan relating to the Committee shall be
interpreted in a manner consistent with the foregoing by treating any such
reference as a reference to such officer or employee for such purpose. Any
action undertaken in accordance with the Committee’s delegation of authority
hereunder shall have the same force and effect as if such action was undertaken
directly by the Committee and shall be deemed for all purposes of the Plan to
have been taken by the Committee.

Section 3.4 Grants to Non-Employee Directors. Any Awards or formula for granting
Awards under the Plan made to non-employee directors shall be approved by the
Board. With respect to awards granted to such directors, all rights, powers and
authorities vested in the Committee under the Plan shall instead be exercised by
the Board, and all provisions of the Plan relating to the Committee shall be
interpreted in a manner consistent with the foregoing by treating any such
reference as a reference to the Board for such purpose.

 

4. SHARES SUBJECT TO THE PLAN

Section 4.1 Share Limitation. Subject to adjustment pursuant to Section 4.2
hereof, the maximum aggregate number of shares of Common Stock which may be
issued under all Awards granted to Participants under the Plan shall be
8,450,000 shares. Shares of Common Stock issued under the Plan may be either
authorized but unissued shares or shares held in the Company’s treasury. Shares
of Common Stock subject to Awards of Stock Options or Stock Appreciation Rights
that are settled in Common Stock shall be counted against the maximum share
limitations of this Section 4.1 as one share of Common Stock for every share of
Common Stock subject thereto, regardless of the number of shares of Common Stock
actually issued to settle the Stock Option or Stock Appreciation Right upon
exercise. Shares of Common Stock subject to Awards of Restricted Stock Awards,
Stock Unit Awards, Stock Awards, or share-based Performance Awards, if any,
shall be counted against the maximum share limitations of this Section 4.1 as
1.2 shares of Common Stock for every share of Common Stock subject thereto. To
the extent that any Award under the Plan payable in shares of Common Stock is
forfeited, cancelled, returned to the Company for failure to satisfy vesting
requirements or upon the occurrence of other forfeiture events, or otherwise
terminates, in whole or in part, without payment being made thereunder, the
shares of Common Stock remaining subject thereto at the time of such forfeiture,
cancellation, return or other termination will no longer be counted against the
foregoing maximum share limitations and may again be made subject to Awards
under the Plan pursuant to such limitations. Awards under the Plan that are
settled in cash and not in shares of Common Stock shall not be counted against
the foregoing maximum share limitations. Shares that are withheld from an Award
by the Participant in payment of the exercise or purchase price or separately
surrendered by the Participant, or taxes relating to such an Award shall be
deemed to constitute delivered shares and will not be available for future
Awards under the Plan.

Section 4.2 Adjustments. If there shall occur any change with respect to the
outstanding shares of Common Stock by reason of any recapitalization,
reclassification, stock dividend, extraordinary dividend, stock split, reverse
stock split, or other distribution with respect to the shares of Common Stock,
or any merger, reorganization, consolidation, combination, spin-off or other
similar corporate change, or any other change affecting the Common Stock, the
Committee shall, in the manner and to the extent that it deems appropriate and
equitable to the Participants and consistent with the terms of the Plan, cause
an adjustment to be made in (i) the maximum numbers and kind of shares provided
in Section 4.1 hereof, (ii) the maximum numbers and kind of shares or units set
forth in Sections 6.1, 7.1, 8.1, 9.1 and 10.1 hereof, (iii) the numbers and kind
of shares of Common Stock, units, or other rights subject to then outstanding
Awards, (iv) the price for each share or unit or other right subject to then
outstanding Awards, (v) the performance measures or goals relating to an Award
and (vi) any other terms of an Award that are affected by the event to prevent
dilution or enlargement of a Participant’s rights under an Award.
Notwithstanding the foregoing, in the case of Incentive Stock Options, any such
adjustments shall, to the extent practicable, be made in a manner consistent
with the requirements of section 424(a) of the Code.

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5. PARTICIPATION AND AWARDS

Section 5.1 Designation of Participants. All Eligible Persons are eligible to be
designated by the Committee to receive Awards and become Participants under the
Plan. The Committee has the authority, in its discretion, to determine and
designate from time to time those Eligible Persons who are to be granted Awards,
the types of Awards to be granted and the number of shares of Common Stock or
units subject to Awards granted under the Plan. In selecting Eligible Persons to
be Participants and in determining the type and amount of Awards to be granted
under the Plan, the Committee shall consider any and all factors that it deems
relevant or appropriate.

Section 5.2 Determination of Awards. The Committee shall determine the terms and
conditions of all Awards granted to Participants in accordance with its
authority under Section 3.2 hereof. An Award may consist of one type of right or
benefit hereunder or of two or more such rights or benefits granted in tandem or
in the alternative. In the case of any fractional share or unit resulting from
the grant, vesting, payment or crediting of dividends or dividend equivalents
under an Award, the Committee shall have the discretionary authority to
(i) disregard such fractional share or unit, (ii) round such fractional share or
unit to the nearest lower or higher whole share or unit, or (iii) convert such
fractional share or unit into a right to receive a cash payment. To the extent
deemed necessary by the Committee, an Award shall be evidenced by an Award
Agreement as described in Section 14.1 hereof.

 

6. STOCK OPTIONS

Section 6.1 Grant of Stock Option. A Stock Option may be granted to any Eligible
Person selected by the Committee. Subject to the provisions of Section 6.7
hereof and section 422 of the Code, each Stock Option shall be designated, in
the discretion of the Committee, as an Incentive Stock Option or as a
Nonqualified Stock Option. The maximum number of shares of Common Stock that may
be subject to Stock Options granted to any Participant during any calendar year
shall be limited to 750,000 shares (subject to adjustment as provided in
Section 4.2 hereof).

Section 6.2 Exercise Price. The exercise price per share of a Stock Option shall
not be less than 100 percent of the Fair Market Value of the shares of Common
Stock on the Date of Grant, provided that the Committee may in its discretion
specify for any Stock Option an exercise price per share that is higher than the
Fair Market Value on the Date of Grant.

Section 6.3 Vesting of Stock Options. The Committee shall in its discretion
prescribe the time or times at which, or the conditions upon which, a Stock
Option or portion thereof shall become vested and/or exercisable. The
requirements for vesting and exercisability of a Stock Option may be based on
the continued Service of the Participant with the Company or a Subsidiary for a
specified time period (or periods) or on the attainment of a specified
performance goal (or goals) established by the Committee in its discretion. The
Committee may, in its discretion, accelerate the vesting or exercisability of
any Stock Option at any time.

Section 6.4 Term of Stock Options. The Committee shall in its discretion
prescribe in an Award Agreement the period during which a vested Stock Option
may be exercised, provided that the maximum term of a Stock Option shall be ten
years from the Date of Grant. A Stock Option may be earlier terminated as
specified by the Committee and set forth in an Award Agreement upon or following
the termination of a Participant’s Service with the Company or any Subsidiary,
including by reason of voluntary resignation, death, Disability, termination for
cause or any other reason. Except as otherwise provided in this Section 6 or in
an Award Agreement, no Stock Option may be exercised at any time during the term
thereof unless the Participant is then in the Service of the Company or one of
its Subsidiaries.

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Section 6.5 Stock Option Exercise; Tax Withholding. Subject to such terms and
conditions as shall be specified in an Award Agreement, a Stock Option may be
exercised in whole or in part at any time during the term thereof by notice in
the form required by the Company, together with payment of the aggregate
exercise price therefor and applicable withholding tax. Payment of the exercise
price shall be made in the manner set forth in an Award Agreement, unless
otherwise provided by the Committee: (i) in cash or by cash equivalent
acceptable to the Committee; (ii) by payment in shares of Common Stock that have
been held by the Participant for at least six months (or such period as the
Committee may deem appropriate for accounting purposes or otherwise), valued at
the Fair Market Value of such shares on the date of exercise; (iii) through an
open-market broker-assisted sales transaction pursuant to which the Company is
promptly delivered the amount of proceeds necessary to satisfy the exercise
price; (iv) by a combination of the foregoing methods; or (v) by such other
method as may be approved by the Committee and set forth in an Award
Agreement. In addition to and at the time of payment of the exercise price, the
Participant shall pay to the Company the full amount of any and all applicable
income tax, employment tax and other amounts required to be withheld in
connection with such exercise, payable under such of the methods described above
for the payment of the exercise price as may be approved by the Committee and
set forth in an Award Agreement.

Section 6.6 Limited Transferability of Nonqualified Stock Options. All Stock
Options shall be nontransferable except (i) upon the Participant’s death, in
accordance with Section 14.3 hereof or (ii) in the case of Nonqualified Stock
Options only, for the transfer of all or part of the Stock Option to a
Participant’s “family member” (as defined for purposes of the Form S-8
registration statement under the Securities Act of 1933), or as otherwise
permitted by the Committee, in each case as may be approved by the Committee in
its discretion at the time of proposed transfer. The transfer of a Nonqualified
Stock Option may be subject to such terms and conditions as the Committee may in
its discretion impose from time to time. Subsequent transfers of a Nonqualified
Stock Option shall be prohibited other than in accordance with Section 14.3
hereof.

Section 6.7 Additional Rules for Incentive Stock Options.

 

(i) Eligibility. An Incentive Stock Option may only be granted to an Eligible
Person who is considered an employee under Treasury Regulation §1.421-7(h) of
the Company or any Subsidiary.

 

(ii) Annual Limits. No Incentive Stock Option shall be granted to an Eligible
Person as a result of which the aggregate Fair Market Value (determined as of
the Date of Grant) of the stock with respect to which Incentive Stock Options
are exercisable for the first time in any calendar year under the Plan and any
other stock option plans of the Company or any Subsidiary would exceed $100,000,
determined in accordance with section 422(d) of the Code. This limitation shall
be applied by taking Incentive Stock Options into account in the order in which
granted.

 

(iii) Ten Percent Stockholders. If a Stock Option granted under the Plan is
intended to be an Incentive Stock Option, and if the Participant, at the time of
grant, owns stock possessing ten percent or more of the total combined voting
power of all classes of Common Stock of the Company or any Subsidiary, then
(A) the Stock Option exercise price per share shall in no event be less than 110
percent of the Fair Market Value of the Common Stock on the date of such grant
and (B) such Stock Option shall not be exercisable after the expiration of five
years following the date such Stock Option is granted.

 

(iv) Termination of Employment. An Award of an Incentive Stock Option may
provide that such Stock Option may be exercised not later than 3 months
following termination of employment of the Participant with the Company and all
Subsidiaries, or not later than one year following death or a permanent and
total disability within the meaning of section 22(e)(3) of the Code, as and to
the extent determined by the Committee to comply with the requirements of
section 422 of the Code.

 

(v) Other Terms and Conditions; Nontransferability. Any Incentive Stock Option
granted hereunder shall contain such additional terms and conditions, not
inconsistent with the terms of the Plan, as are deemed necessary or desirable by
the Committee, which terms, together with the terms of the Plan, shall be
intended and interpreted to cause such Incentive Stock Option to qualify as an
“incentive stock option” under section 422 of the Code. An Award Agreement for
an Incentive Stock Option may provide that such Stock Option shall be treated as
a Nonqualified Stock Option to the extent that certain requirements applicable
to “incentive stock options” under the Code shall not be satisfied. An Incentive
Stock Option shall by its terms be nontransferable other than by will or by the
laws of descent and distribution, and shall be exercisable during the lifetime
of a Participant only by such Participant.

 

(vi) Disqualifying Dispositions. If shares of Common Stock acquired by exercise
of an Incentive Stock Option are disposed of within two years following the Date
of Grant or one year following the transfer of such shares to the Participant
upon exercise, the Participant shall, promptly following such disposition,
notify the Company in writing of the date and terms of such disposition and
provide such other information regarding the disposition as the Company may
reasonably require.

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Section 6.8 Repricing of Stock Options Prohibited. Subject to the anti-dilution
adjustment provisions contained in Section 4.2 hereof, without the prior
approval of the Company’s stockholders, evidenced by a majority of votes cast,
neither the Committee nor the Board shall cause the cancellation, substitution
or amendment of a Stock Option that would have the effect of reducing the
exercise price of such a Stock Option previously granted under the Plan, or
otherwise approve any modification to such a Stock Option that would be treated
as a “repricing.”

 

7. STOCK APPRECIATION RIGHTS

Section 7.1 Grant of Stock Appreciation Rights. A Stock Appreciation Right may
be granted to any Eligible Person selected by the Committee. Stock Appreciation
Rights may be granted on a basis that allows for the exercise of the right by
the Participant or that provides for the automatic payment of the right upon a
specified date or event. The maximum number of shares of Common Stock that may
be subject to Stock Appreciation Rights granted to any Participant during any
calendar year shall be limited to 750,000 shares (subject to adjustment as
provided in Section 4.2 hereof).

Section 7.2 Freestanding Stock Appreciation Rights. A Stock Appreciation Right
may be granted without any related Stock Option. The Committee shall in its
discretion prescribe the time or times at which, or the conditions upon which, a
Stock Appreciation Right or portion thereof shall become vested and/or
exercisable. The requirements for vesting and exercisability of a Stock
Appreciation Right may be based on the continued Service of a Participant with
the Company or a Subsidiary for a specified time period (or periods) or on the
attainment of a specified performance goal (or goals) established by the
Committee in its discretion. A Stock Appreciation Right will be exercisable or
payable at such time or times as determined by the Committee, provided that the
maximum term of a Stock Appreciation Right shall be ten years from the Date of
Grant. The Committee may, in its discretion, accelerate the vesting or
exercisability of any Stock Appreciation Right at any time. The base price of a
Stock Appreciation Right granted without any related Stock Option shall be
determined by the Committee in its sole discretion; provided, however, that the
base price per share of any such freestanding Stock Appreciation Right shall not
be less than 100 percent of the Fair Market Value of the shares of Common Stock
on the Date of Grant.

Section 7.3 Tandem Stock Option/Stock Appreciation Rights. A Stock Appreciation
Right may be granted in tandem with a Stock Option, either at the time of grant
or at any time thereafter during the term of the Stock Option. A tandem Stock
Option/Stock Appreciation Right will entitle the holder to elect, as to all or
any portion of the number of shares subject to the Award, to exercise either the
Stock Option or the Stock Appreciation Right, resulting in the reduction of the
corresponding number of shares subject to the right so exercised as well as the
tandem right not so exercised. A Stock Appreciation Right granted in tandem with
a Stock Option hereunder shall have a base price per share equal to the per
share exercise price of the Stock Option, will be vested and exercisable at the
same time or times that a related Stock Option is vested and exercisable, and
will expire no later than the time at which the related Stock Option expires.

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Section 7.4 Payment of Stock Appreciation Rights. A Stock Appreciation Right
will entitle the holder, upon exercise or other payment of the Stock
Appreciation Right, as applicable, to receive an amount determined by
multiplying: (i) the excess of the Fair Market Value of a share of Common Stock
on the date of exercise or payment of the Stock Appreciation Right over the base
price of such Stock Appreciation Right, by (ii) the number of shares as to which
such Stock Appreciation Right is exercised or paid. Payment of the amount
determined under the foregoing may be made, as approved by the Committee and set
forth in the Award Agreement, in shares of Common Stock valued at their Fair
Market Value on the date of exercise or payment, in cash, or in a combination of
shares of Common Stock and cash, subject to applicable tax withholding
requirements.

Section 7.5 Repricing of Stock Appreciation Rights Prohibited. Subject to the
anti-dilution adjustment provisions contained in Section 4.2 hereof, without the
prior approval of the Company’s stockholders, evidenced by a majority of votes
cast, neither the Committee nor the Board shall cause the cancellation,
substitution or amendment of a Stock Appreciation Right that would have the
effect of reducing the base price of such a Stock Appreciation Right previously
granted under the Plan, or otherwise approve any modification to such a Stock
Appreciation Right that would be treated as a “repricing.”

 

8. RESTRICTED STOCK AWARDS

Section 8.1 Grant of Restricted Stock Awards. A Restricted Stock Award may be
granted to any Eligible Person selected by the Committee. The Committee may
require the payment by the Participant of a specified purchase price in
connection with any Restricted Stock Award. The Committee may grant Restricted
Stock Awards that are Section 162(m) Awards, as well as Restricted Stock Awards
that are not Section 162(m) Awards. The maximum number of shares of Common Stock
that may be subject to Restricted Stock Awards granted to a Participant during
any one calendar year shall be limited to 250,000 shares (subject to adjustment
as provided in Section 4.2 hereof).

Section 8.2 Vesting Requirements. The restrictions imposed on shares of Common
Stock granted under a Restricted Stock Award shall lapse in accordance with the
vesting requirements specified by the Committee in the Award Agreement. The
requirements for vesting of a Restricted Stock Award may be based on the
continued Service of the Participant with the Company or its Subsidiaries for a
specified time period (or periods) or on the attainment of a specified
performance goal (or goals) established by the Committee in its discretion. The
Committee may, in its discretion, accelerate the vesting of a Restricted Stock
Award at any time. In the case of any Restricted Stock Award that is a
Section 162(m) Award, any such performance-based vesting requirements shall be
based upon the performance criteria identified in Section 12.2 hereof, and the
terms of the Award shall otherwise comply with the requirements described in
Section 12.3 hereof. If the vesting requirements of a Restricted Stock Award
shall not be satisfied, the Award shall be forfeited and the shares of Common
Stock subject to the Award shall be returned to the Company. In the event that
the Participant paid any purchase price with respect to such forfeited shares,
unless otherwise provided by the Committee in an Award Agreement, the Company
will refund to the Participant the lesser of (i) such purchase price and
(ii) the Fair Market Value of such shares on the date of forfeiture.

Section 8.3 Restrictions. Shares granted under any Restricted Stock Award may
not be transferred, assigned or subject to any encumbrance, pledge, or charge
until all applicable restrictions are removed or have expired, unless otherwise
allowed by the Committee. Failure to satisfy any applicable restrictions shall
result in the shares subject to the Restricted Stock Award being forfeited and
returned to the Company. In the event that the Participant paid any purchase
price with respect to such forfeited shares, unless otherwise provided by the
Committee in an Award Agreement, the Company will refund to the Participant the
lesser of (i) such purchase price and (ii) the Fair Market Value of such shares
on the date of forfeiture. The Committee may require in an Award Agreement that
certificates representing the shares granted under a Restricted Stock Award bear
a legend making appropriate reference to the restrictions imposed, and that
certificates representing the shares granted or sold under a Restricted Stock
Award will remain in the physical custody of an escrow holder until all
restrictions are removed or have expired.

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Section 8.4 Rights as Stockholder. Subject to the foregoing provisions of this
Section 8 and the applicable Award Agreement, the Participant shall have all
rights of a stockholder with respect to the shares granted to the Participant
under a Restricted Stock Award, including the right to vote the shares and
receive all dividends and other distributions paid or made with respect thereto,
unless the Committee determines otherwise at the time the Restricted Stock Award
is granted. The Committee may provide in an Award Agreement for the payment of
dividends and distributions to the Participant at such times as paid to
stockholders generally or at the times of vesting or other payment of the
Restricted Stock Award.

Section 8.5 Section 83(b) Election. If a Participant makes an election pursuant
to section 83(b) of the Code with respect to a Restricted Stock Award, the
Participant shall file, within 30 days following the Date of Grant, a copy of
such election with the Company and with the Internal Revenue Service, in
accordance with the regulations under section 83 of the Code. The Committee may
provide in an Award Agreement that the Restricted Stock Award is conditioned
upon the Participant’s making or refraining from making an election with respect
to the Award under section 83(b) of the Code.

 

9. STOCK UNIT AWARDS

Section 9.1 Grant of Stock Unit Awards. A Stock Unit Award may be granted to any
Eligible Person selected by the Committee. The value of each stock unit under a
Stock Unit Award is equal to the Fair Market Value of the Common Stock on the
applicable date or time period of determination, as specified by the Committee.
The Committee may grant Stock Unit Awards that are Section 162(m) Awards, as
well as Stock Unit Awards that are not Section 162(m) Awards. The maximum number
of units that may be subject to Stock Unit Awards granted to a Participant
during any one calendar year shall be limited to 250,000 units (subject to
adjustment as provided in Section 4.2 hereof). A Stock Unit Award shall be
subject to such restrictions and conditions as the Committee shall determine. A
Stock Unit Award may be granted together with a dividend equivalent right with
respect to the shares of Common Stock subject to the Award, which may be
accumulated and may be deemed reinvested in additional stock units, as
determined by the Committee in its discretion.

Section 9.2 Vesting of Stock Unit Awards. On the Date of Grant, the Committee
shall, in its discretion, determine any vesting requirements with respect to a
Stock Unit Award, which shall be set forth in the Award Agreement. The
requirements for vesting of a Stock Unit Award may be based on the continued
Service of the Participant with the Company or its Subsidiaries for a specified
time period (or periods) or on the attainment of a specified performance goal
(or goals) established by the Committee in its discretion. The Committee may, in
its discretion, accelerate the vesting of a Stock Unit Award at any time. In the
case of any Stock Unit Award that is a Section 162(m) Award, any such
performance-based vesting requirements shall be based upon the performance
criteria identified in Section 12.2 hereof, and the terms of the Award shall
otherwise comply with the requirements described in Section 12.3 hereof. A Stock
Unit Award may also be granted on a fully vested basis, with a deferred payment
date as may be determined by the Committee or elected by the Participant in
accordance with the rules established by the Committee.

Section 9.3 Payment of Stock Unit Awards. A Stock Unit Award shall become
payable to a Participant at the time or times determined by the Committee and
set forth in the Award Agreement, which may be upon or following the vesting of
the Award. Payment of a Stock Unit Award may be made, at the discretion of the
Committee, in cash or in shares of Common Stock, or in a combination thereof,
subject to applicable tax withholding requirements. Any cash payment of a Stock
Unit Award shall be made based upon the Fair Market Value of the Common Stock,
determined on such date or over such time period as determined by the
Committee. In the case of a Participant who is a “specified employee” as defined
in Section 409A of the Code at the time of any payment of a Stock Unit Award
upon the Participant’s termination of Service, the payments under the Stock Unit
Award shall be deferred until the date that is six months following the
Participant’s termination of Service to the extent necessary to comply with
Section 409A of the Code, with the terms of such deferral and payment to be made
in the manner determined by the Committee and set forth in the Award Agreement.

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Section 9.4 No Rights as Stockholder. The Participant shall not have any rights
as a stockholder with respect to the shares subject to a Stock Unit Award until
such time as shares of Common Stock are delivered to the Participant pursuant to
the terms of the Award Agreement.

 

10. STOCK AWARDS

Section 10.1 Grant of Stock Awards. A Stock Award may be granted to any Eligible
Person selected by the Committee. A Stock Award may be granted for past
services, in lieu of bonus or other cash compensation, as directors’
compensation or for any other valid purpose as determined by the Committee. A
Stock Award granted to an Eligible Person represents shares of Common Stock that
are issued free of restrictions on transfer and free of forfeiture conditions
and to which such Eligible Person is entitled all incidents of ownership, except
as otherwise provided in the Plan and the Award Agreement. The Committee may, in
connection with any Stock Award, require the payment of a specified purchase
price. The Committee may grant Stock Awards that are Section 162(m) Awards, as
well as Stock Awards that are not Section 162(m) Awards. The maximum number of
shares of Common Stock that may be subject to Stock Awards granted to a
Participant during any one calendar year shall be limited to 250,000 shares
(subject to adjustment as provided in Section 4.2 hereof).

Section 10.2 Rights as Stockholder. Subject to the foregoing provisions of this
Section 10 and the applicable Award Agreement, upon the issuance of the shares
of Common Stock under a Stock Award, the Participant shall have all rights of a
stockholder with respect to the shares of Common Stock, including the right to
vote the shares and receive all dividends and other distributions paid or made
with respect thereto.

 

11. PERFORMANCE AWARDS

Section 11.1 Grant of Performance Awards. The Committee may grant Performance
Awards under the Plan, which shall represent the right to receive a payment in
cash if performance goals established by the Committee for a performance period
are satisfied. The Committee may grant Performance Awards that are
Section 162(m) Awards, as well as Performance Awards that are not Section 162(m)
Awards. At the time a Performance Award is granted, the Committee shall
determine, in its sole discretion, the applicable performance period and
performance goals to be achieved during the performance period, as well as such
other conditions as the Committee deems appropriate. The Committee may also
determine a target payment amount or a range of payment amounts for each
Award. The performance goals applicable to a Performance Award grant may be
subject to adjustments as the Committee shall deem appropriate to reflect
significant unforeseen events, such as changes in law, accounting practices or
unusual or nonrecurring items or occurrences. The Committee’s authority to make
such adjustments shall be subject to such limitations as the Committee deems
appropriate in the case of a Performance Award that is a Section 162(m)
Award. In the case of any Performance Award that is a Section 162(m) Award,
performance goals shall be based upon the performance criteria identified in
Section 12.2 hereof, and the terms of the Award shall otherwise comply with the
requirements described in Section 12.3 hereof. The maximum amount of cash
compensation that may be paid to a Participant during any one calendar year
under Performance Awards shall be $1 million.

Section 11.2 Payment of Performance Awards. At the end of the performance
period, the Committee shall determine the extent to which performance goals have
been attained, or a degree of achievement between minimum and maximum levels, in
order to establish the level of payment to be made, if any. Payments of
Performance Awards shall generally be made as soon as practicable following the
end of the performance period, subject to any tax withholding requirements. In
the case of a Participant who is a “specified employee” as defined in
Section 409A of the Code at the time of any payment of a Performance Award upon
the Participant’s termination of Service, the payments under the Performance
Award shall be deferred until the date that is six months following the
Participant’s termination of Service to the extent necessary to comply with
Section 409A of the Code, with the terms of such deferral and payment to be made
in the manner determined by the Committee and set forth in the Award Agreement.

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12. SECTION 162(M) AWARDS

Section 12.1 Awards. Awards of Stock Options and Stock Appreciation Rights
granted under the Plan are intended by their terms to qualify as Section 162(m)
Awards. Restricted Stock Awards, Stock Unit Awards, Stock Awards and Performance
Awards granted under the Plan may qualify as Section 162(m) Awards if the Awards
are granted or become payable or vested based upon pre-established performance
goals in accordance with this Section 12.

Section 12.2 Performance Criteria. In the case of a Restricted Stock Award,
Stock Unit Award, Stock Award or Performance Award that is intended to be a
Section 162(m) Award, the performance criteria upon which the grant, payment or
vesting may be based shall be limited to one or more of the following
performance measures, which may be applied with respect to the Company, any
Subsidiary or any business unit: (i) total stockholder return; (ii) stock price
increase; (iii) return on equity; (iv) return on capital; (v) return on
investment; (vi) earnings per share, diluted or basic; (vii) EBIT (earnings
before interest and taxes); (viii) EBITDA (earnings before interest, taxes,
depreciation and amortization); (ix) cash flow (including operating cash flow,
free cash flow, discounted cash flow, and cash flow in excess of costs of
capital); (x) net or gross revenue; (xi) operating expenses; (xii) gross or
operating margin; (xiii) execution of a corporate collaboration agreement
relating to a product candidate of the Company; (xiv) acceptance by the U.S.
Food and Drug Administration (“FDA”) or a comparable foreign regulatory
authority of a final New Drug Application, a Biologic License Application or
similar document; (xv) approval for marketing of a product candidate of the
Company by the FDA or a comparable foreign regulatory authority; (xvi) obtaining
a specified level of financing for the Company, as determined by the Committee,
including through government grants (or similar awards) and the issuance of
securities; and (xvii) commencement of a particular stage of clinical trials for
a product candidate of the Company. The foregoing performance criteria shall
have any reasonable definitions that the Committee may specify, which may
include or exclude any items specified by the Committee, including but not
limited to any or all of the following items: discontinued operations,
extraordinary, unusual or non-recurring items, effects of accounting changes,
effects of currency or interest rate fluctuations, effects of financing
activities (e.g., effect on earnings per share of issuing convertible debt
securities), changes in tax rates, expenses for restructuring or productivity
initiatives, litigation losses, non-operating items, effects of acquisitions or
divestitures and changes of law or regulation affecting the Company’s
business. The foregoing performance measures may be determined on an absolute
basis or relative to internal goals or relative to levels attained in prior
years, or related to other companies or indices, or as ratios expressing
relationships between two or more performance measures. In the case of Awards
that are not Section 162(m) Awards, the Committee may designate performance
criteria from among the foregoing or such other performance criteria as it shall
determine in its sole discretion.

Section 12.3 Section 162(m) Requirements. In the case of a Restricted Stock
Award, Stock Unit Award, Stock Award or Performance Award that is intended to be
a Section 162(m) Award, the Committee shall make such determinations with
respect to an Award as required by section 162(m) of the Code within 90 days
after the beginning of the performance period (or such other time period as is
required under section 162(m) of the Code). As and to the extent required by
section 162(m) of the Code, the terms of an Award that is a Section 162(m) Award
must state, in terms of an objective formula or standard, the method of
computing the amount of compensation payable under the Award, and must preclude
discretion to increase the amount of compensation payable under the terms of the
Award (but may allow the Committee discretion to decrease the amount of
compensation payable).

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13. CHANGE IN CONTROL

Section 13.1 Effect of Change in Control. The Committee may, at the time of the
grant of an Award and as set forth in an Award Agreement, provide for the effect
of a “Change in Control” on an Award. Such provisions may include any one or
more of the following: (i) the acceleration or extension of time periods for
purposes of exercising, vesting in, or realizing gain from any Award, (ii) the
elimination or modification of performance or other conditions related to the
payment or other rights under an Award, (iii) provision for the cash settlement
of an Award for an equivalent cash value, as determined by the Committee, or
(iv) such other modification or adjustment to an Award as the Committee deems
appropriate to maintain and protect the rights and interests of Participants
upon or following a Change in Control. To the extent necessary for compliance
with Section 409A of the Code, an Award Agreement shall provide that an Award
subject to the requirements of Section 409A that would otherwise become payable
upon a Change in Control shall only become payable to the extent that the
requirements for a “change in control” for purposes of Section 409A have been
satisfied.

Section 13.2 Definition of Change in Control. For purposes of the Plan, unless
otherwise defined in an Award Agreement, a “Change in Control” shall be deemed
to have occurred upon:

 

(i) a change in the composition of the Board such that during any period of two
consecutive years, individuals who at the beginning of such period constitute
the Board, and any new director (other than a director designated by a person
who has entered into an agreement with the Company to effect a transaction
described in clause (ii) or (iii) of this Section 13.2) whose election by the
Board or nomination for election by the Company’s stockholders was approved by a
vote of at least two-thirds 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 at
least a majority of the members thereof;

 

(ii) the consummation of a merger, consolidation, reorganization or similar
corporate transaction, whether or not the Company is the surviving corporation
in such transaction, in which outstanding shares of Common Stock are converted
into (A) shares of stock of another company, other than a conversion into shares
of voting common stock of the successor corporation (or a holding company
thereof) representing more than 50% of the voting power of all capital stock
thereof outstanding immediately after the merger or consolidation, or (B) other
securities (of either the Company or another company) or cash or other property;

 

(iii) any “Person” (as such term is used in Sections 13(d)(3) and 14(d)(2) of
the Exchange Act), except that such term shall not include (A) the Company,
(B) a trustee or other fiduciary holding securities under an employee benefit
plan of the Company, (C) an underwriter temporarily holding securities pursuant
to an offering of such securities, or (D) 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, who is or becomes the
“Beneficial Owner” (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company (not including in the securities
Beneficially Owned by such Person any securities acquired directly from the
Company) representing 30% or more of the voting power of all capital stock
thereof outstanding, excluding any Person who is an officer or director of the
Company or who becomes such a Beneficial Owner in connection with a transaction
described in clause (ii) of this Section 13.2; or

 

(iv) the consummation of (A) the sale or other disposition of all or
substantially all of the assets of the Company, or (B) a complete liquidation or
dissolution of the Company.

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14. GENERAL PROVISIONS

Section 14.1 Award Agreement. To the extent deemed necessary by the Committee,
an Award under the Plan shall be evidenced by an Award Agreement in a written or
electronic form approved by the Committee setting forth the number of shares of
Common Stock or units subject to the Award, the exercise price, base price, or
purchase price of the Award, the time or times at which an Award will become
vested, exercisable or payable and the term of the Award. The Award Agreement
may also set forth the effect on an Award of termination of Service under
certain circumstances. The Award Agreement shall be subject to and incorporate,
by reference or otherwise, all of the applicable terms and conditions of the
Plan, and may also set forth other terms and conditions applicable to the Award
as determined by the Committee consistent with the limitations of the
Plan. Award Agreements evidencing Incentive Stock Options shall contain such
terms and conditions as may be necessary to meet the applicable provisions of
section 422 of the Code. The grant of an Award under the Plan shall not confer
any rights upon the Participant holding such Award other than such terms, and
subject to such conditions, as are specified in the Plan as being applicable to
such type of Award (or to all Awards) or as are expressly set forth in the Award
Agreement. The Committee need not require the execution of an Award Agreement by
a Participant, in which case, acceptance of the Award by the Participant shall
constitute agreement by the Participant to the terms, conditions, restrictions
and limitations set forth in the Plan and the Award Agreement as well as the
administrative guidelines of the Company in effect from time to time.

Section 14.2 Forfeiture Events/Representations. The Committee may specify in an
Award Agreement at the time of the Award that the Participant’s rights, payments
and benefits with respect to an Award shall be subject to reduction,
cancellation, forfeiture or recoupment upon the occurrence of certain specified
events, in addition to any otherwise applicable vesting or performance
conditions of an Award. Such events shall include, but shall not be limited to,
termination of Service for cause, violation of material Company policies, breach
of noncompetition, confidentiality or other restrictive covenants that may apply
to the Participant, or other conduct by the Participant that is detrimental to
the business or reputation of the Company. The Committee may also specify in an
Award Agreement that the Participant’s rights, payments and benefits with
respect to an Award shall be conditioned upon the Participant making a
representation regarding compliance with noncompetition, confidentiality or
other restrictive covenants that may apply to the Participant and providing that
the Participant’s rights, payments and benefits with respect to an Award shall
be subject to reduction, cancellation, forfeiture or recoupment on account of a
breach of such representation.

Section 14.3 No Assignment or Transfer; Beneficiaries. Except as provided in
Section 6.6 hereof, Awards under the Plan shall not be assignable or
transferable by the Participant, except by will or by the laws of descent and
distribution, and shall not be subject in any manner to assignment, alienation,
pledge, encumbrance or charge. Notwithstanding the foregoing, the Committee may
provide in an Award Agreement that the Participant shall have the right to
designate a beneficiary or beneficiaries who shall be entitled to any rights,
payments or other benefits specified under an Award following the Participant’s
death. During the lifetime of a Participant, an Award shall be exercised only by
such Participant or such Participant’s guardian or legal representative. In the
event of a Participant’s death, an Award may, to the extent permitted by the
Award Agreement, be exercised by the Participant’s beneficiary as designated by
the Participant in the manner prescribed by the Committee or, in the absence of
an authorized beneficiary designation, by the legatee of such Award under the
Participant’s will or by the Participant’s estate in accordance with the
Participant’s will or the laws of descent and distribution, in each case in the
same manner and to the same extent that such Award was exercisable by the
Participant on the date of the Participant’s death.

Section 14.4 Deferrals of Payment. The Committee may in its discretion permit a
Participant to defer the receipt of payment of cash or delivery of shares of
Common Stock that would otherwise be due to the Participant by virtue of the
exercise of a right or the satisfaction of vesting or other conditions with
respect to an Award. If any such deferral is to be permitted by the Committee,
the Committee shall establish rules and procedures relating to such deferral in
a manner intended to comply with the requirements of Section 409A of the Code,
including, without limitation, the time when an election to defer may be made,
the time period of the deferral and the events that would result in payment of
the deferred amount, the interest or other earnings attributable to the deferral
and the method of funding, if any, attributable to the deferred amount.

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Section 14.5 Rights as Stockholder. A Participant shall have no rights as a
holder of shares of Common Stock with respect to any unissued securities covered
by an Award until the date the Participant becomes the holder of record of such
securities. Except as provided in Section 4.2 hereof, no adjustment or other
provision shall be made for dividends or other stockholder rights, except to the
extent that the Award Agreement provides for dividend payments or dividend
equivalent rights.

Section 14.6 Employment or Service. Nothing in the Plan, in the grant of any
Award or in any Award Agreement shall confer upon any Eligible Person or
Participant any right to continue in the Service of the Company or any of its
Subsidiaries, or interfere in any way with the right of the Company or any of
its Subsidiaries to terminate the employment or other service relationship of an
Eligible Person or Participant for any reason at any time.

Section 14.7 Securities Laws. No shares of Common Stock will be issued or
transferred pursuant to an Award unless and until all then applicable
requirements imposed by Federal and state securities and other laws, rules and
regulations and by any regulatory agencies having jurisdiction, and by any
exchanges upon which the shares of Common Stock may be listed, have been fully
met. As a condition precedent to the issuance of shares pursuant to the grant or
exercise of an Award, the Company may require the Participant to take any
reasonable action to meet such requirements. The Committee may impose such
conditions on any shares of Common Stock issuable under the Plan as it may deem
advisable, including, without limitation, restrictions under the Securities Act
of 1933, as amended, under the requirements of any exchange upon which such
shares of the same class are then listed, and under any blue sky or other
securities laws applicable to such shares. The Committee may also require the
Participant to represent and warrant at the time of issuance or transfer that
the shares of Common Stock are being acquired only for investment purposes and
without any current intention to sell or distribute such shares.

Section 14.8 Tax Withholding. The Participant shall be responsible for payment
of any taxes or similar charges required by law to be withheld from an Award or
an amount paid in satisfaction of an Award, which shall be paid by the
Participant on or prior to the payment or other event that results in taxable
income in respect of an Award. The Award Agreement may specify the manner in
which the withholding obligation shall be satisfied with respect to the
particular type of Award.

Section 14.9 Unfunded Plan. The adoption of the Plan and any reservation of
shares of Common Stock or cash amounts by the Company to discharge its
obligations hereunder shall not be deemed to create a trust or other funded
arrangement. Except upon the issuance of Common Stock pursuant to an Award, any
rights of a Participant under the Plan shall be those of a general unsecured
creditor of the Company, and neither a Participant nor the Participant’s
permitted transferees or estate shall have any other interest in any assets of
the Company by virtue of the Plan. Notwithstanding the foregoing, the Company
shall have the right to implement or set aside funds in a grantor trust, subject
to the claims of the Company’s creditors or otherwise, to discharge its
obligations under the Plan.

Section 14.10 Other Compensation and Benefit Plans. The adoption of the Plan
shall not affect any other stock incentive or other compensation plans in effect
for the Company or any Subsidiary, nor shall the Plan preclude the Company from
establishing any other forms of stock incentive or other compensation or benefit
program for employees of the Company or any Subsidiary. The amount of any
compensation deemed to be received by a Participant pursuant to an Award shall
not constitute includable compensation for purposes of determining the amount of
benefits to which a Participant is entitled under any other compensation or
benefit plan or program of the Company or any Subsidiary, including, without
limitation, under any bonus, pension, profit-sharing, life insurance, salary
continuation or severance benefits plan, except to the extent specifically
provided by the terms of any such plan.

Section 14.11 Plan Binding on Transferees. The Plan shall be binding upon the
Company, its transferees and assigns, and the Participant, the Participant’s
executor, administrator and permitted transferees and beneficiaries.

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Section 14.12 Severability. If any provision of the Plan or any Award Agreement
shall be determined to be illegal or unenforceable by any court of law in any
jurisdiction, the remaining provisions hereof and thereof shall be severable and
enforceable in accordance with their terms, and all provisions shall remain
enforceable in any other jurisdiction.

Section 14.13 Foreign Jurisdictions. The Committee may adopt, amend and
terminate such arrangements and grant such Awards, not inconsistent with the
intent of the Plan, as it may deem necessary or desirable to comply with any
tax, securities, regulatory or other laws of other jurisdictions with respect to
Awards that may be subject to such laws. The terms and conditions of such Awards
may vary from the terms and conditions that would otherwise be required by the
Plan solely to the extent the Committee deems necessary for such purpose.
Moreover, the Board may approve such supplements to or amendments, restatements
or alternative versions of the Plan, not inconsistent with the intent of the
Plan, as it may consider necessary or appropriate for such purposes, without
thereby affecting the terms of the Plan as in effect for any other purpose.

Section 14.14 Substitute Awards in Corporate Transactions. Nothing contained in
the Plan shall be construed to limit the right of the Committee to grant Awards
under the Plan in connection with the acquisition, whether by purchase, merger,
consolidation or other corporate transaction, of the business or assets of any
corporation or other entity. Without limiting the foregoing, the Committee may
grant Awards under the Plan to an employee or director of another corporation
who becomes an Eligible Person by reason of any such corporate transaction in
substitution for awards previously granted by such corporation or entity to such
person. The terms and conditions of the substitute Awards may vary from the
terms and conditions that would otherwise be required by the Plan solely to the
extent the Committee deems necessary for such purpose. Any shares of Common
Stock subject to these substitute Awards shall not be counted against any of the
maximum share limitations set forth in the Plan.

Section 14.15 Governing Law. The Plan and all rights hereunder shall be subject
to and interpreted in accordance with the laws of the State of Delaware, without
reference to the principles of conflicts of laws, and to applicable Federal
securities laws.

Section 14.16 Section 409A Compliance. To the extent applicable, it is intended
that the Plan and all Awards hereunder comply with the requirements of
Section 409A of the Code, and the Plan and all Award Agreements shall be
interpreted and applied by the Committee in a manner consistent with this intent
in order to avoid the imposition of any additional tax under Section 409A of the
Code. In the event that any provision of the Plan or an Award Agreement is
determined by the Committee to not comply with the applicable requirements of
Section 409A of the Code, the Committee shall have the authority to take such
actions and to make such interpretations or changes to the Plan or an Award
Agreement as the Committee deems necessary to comply with such requirements,
provided that the Committee shall act in a manner that is intended to preserve
the economic value of the Award to the Participant. Notwithstanding the
foregoing or anything elsewhere in the Plan or an Award Agreement to the
contrary, if a Participant is a “specified employee” as defined in Section 409A
of the Code at the time of termination of Service with respect to an Award, then
solely to the extent necessary to avoid the imposition of any additional tax
under Section 409A of the Code, the commencement of any payments or benefits
under the Award shall be deferred until the date that is six months following
the Participant’s termination of Service (or such other period as required to
comply with Section 409A).

 

15. EFFECTIVE DATE; AMENDMENT AND TERMINATION

Section 15.1 Effective Date. The Plan became effective following its adoption by
the Board and its approval by the Company’s stockholders on the date of the 2005
Annual Meeting of Stockholders. The term of the Plan shall be ten (10) years
from the date of such adoption by the Board, subject to Section 15.3 hereof. The
Plan as amended and restated herein became effective following its adoption by
the Board and its approval by the Company’s stockholders on the date of the 2007
Annual Meeting of Stockholders.

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Section 15.2 Amendment. The Board may at any time and from time to time and in
any respect, amend or modify the Plan. The Board may seek the approval of any
amendment or modification by the Company’s stockholders to the extent it deems
necessary or advisable in its discretion for purposes of compliance with section
162(m) or section 422 of the Code, the listing requirements of the NASDAQ or
other exchange or securities market or for any other purpose. No amendment or
modification of the Plan shall adversely affect any Award theretofore granted
without the consent of the Participant or the permitted transferee of the
Award. Notwithstanding the foregoing and notwithstanding anything to the
contrary in the Plan, the Board may amend the Plan and any outstanding Award
Agreement solely to comply with any new regulations or other guidance from the
Internal Revenue Service under section 409A of the Code without the consent of
the Participant or the permitted transferee of the Award.

Section 15.3 Termination. The Plan shall terminate on April 4, 2015, which is
the date immediately preceding the tenth anniversary of the date of the Plan’s
adoption by the Board. The Board may, in its discretion and at any earlier date,
terminate the Plan. Notwithstanding the foregoing, no termination of the Plan
shall adversely affect any Award theretofore granted without the consent of the
Participant or the permitted transferee of the Award.