Exhibit 10.1

EL CAPITAN PRECIOUS METALS, INC.
2005 STOCK INCENTIVE PLAN

 
1.    Purpose. The purpose of the 2005 Stock Incentive Plan (the “Plan”) of El
Capitan Precious Metals, Inc. (the “Company”) is to increase stockholder value
and to advance the interests of the Company by furnishing a variety of economic
incentives (“Incentives'”) designed to attract, retain and motivate employees,
certain key consultants and directors of the Company. Incentives may consist of
opportunities to purchase or receive shares of Common Stock, $0.01 par value per
share, of the Company (“Common Stock”) on terms determined under this Plan.
 
2.    Administration. The Plan shall be administered by the board of directors
of the Company (the “Board of Directors”) or by a stock option or compensation
committee (the “Committee”) of the Board of Directors. The Committee shall
consist of not less than two directors of the Company and shall be appointed
from time to time by the Board of Directors. Each member of the Committee shall
be (i) a “non-employee director” within the meaning of Rule 16b-3 of the
Securities Exchange Act of 1934 (including the regulations promulgated
thereunder, the “1934 Act”) (a “Non-Employee Director”), and (ii) shall be an
“outside director” within the meaning of Section 162(m) under the Internal
Revenue Code of 1986, as amended (the “Code”) and the regulations promulgated
thereunder. The Committee shall have complete authority to award Incentives
under the Plan, to interpret the Plan, and to make any other determination which
it believes necessary and advisable for the proper administration of the Plan.
The Committee’s decisions and matters relating to the Plan shall be final and
conclusive on the Company and its participants. If at any time there is no stock
option or compensation committee, the term “Committee”, as used in the Plan,
shall refer to the Board of Directors.
 
3.    Eligible Participants. Officers of the Company, employees of the Company
or its subsidiaries, members of the Board of Directors, and consultants or other
independent contractors who provide services to the Company or its subsidiaries
shall be eligible to receive Incentives under the Plan when designated by the
Committee. Participants may be designated individually or by groups or
categories (for example, by pay grade) as the Committee deems appropriate.
Participation by officers of the Company or its subsidiaries and any performance
objectives relating to such officers must be approved by the Committee.
Participation by others and any performance objectives relating to others may be
approved by groups or categories (for example, by pay grade) and authority to
designate participants who are not officers and to set or modify such targets
may be delegated.
 
4.    Types of Incentives. Incentives under the Plan may be granted in any one
or a combination of the following forms: (a) incentive stock options and
non-statutory stock options (section 6); (b) stock appreciation rights (“SARs”)
(section 7); (c) stock awards (section 8); (d) restricted stock (section 8); and
(e) performance shares (section 9).
 
5.    Shares Subject to the Plan.
 
5.1.    Number of Shares. Subject to adjustment as provided in Section 10.6, the
number of shares of Common Stock which may be issued under the Plan shall not
exceed 16,000,000 shares of Common Stock. Shares of Common Stock that are issued
under the Plan or are subject to outstanding Incentives will be applied to
reduce the maximum number of shares of Common Stock remaining available for
issuance under the Plan.
 
5.2.    Cancellation. To the extent that cash in lieu of shares of Common Stock
is delivered upon the exercise of an SAR pursuant to Section 7.4, the Company
shall be deemed, for purposes of applying the limitation on the number of
shares, to have issued the greater of the number of shares of Common Stock which
it was entitled to issue upon such exercise or on the exercise of any related
option. In the event that a stock option or SAR granted hereunder expires or is
terminated or canceled unexercised as to any shares of Common Stock, such shares
may again be issued under the Plan either pursuant to stock options, SARs or
otherwise. In the event that shares of Common Stock are issued as restricted
stock or pursuant to a stock award and thereafter are forfeited or reacquired by
the Company pursuant to rights reserved upon issuance thereof, such forfeited
and reacquired shares may again be issued under the Plan, either as restricted
stock, pursuant to stock awards or otherwise. The Committee may also determine
to cancel, and agree to the cancellation of, stock options in order to make a
participant eligible for the grant of a stock option at a lower price than the
option to be canceled.
 

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5.3.    Type of Common Stock. Common Stock issued under the Plan in connection
with stock options, SARs, performance shares, restricted stock or stock awards,
may be authorized and unissued shares or treasury stock, as designated by the
Committee.
 
6.    Stock Options. A stock option is a right to purchase shares of Common
Stock from the Company. Each stock option granted by the Committee under this
Plan shall be subject to the following terms and conditions:
 
6.1.    Price. The option price per share shall be determined by the Committee,
subject to adjustment under Section 10.6.
 
6.2.    Number. The number of shares of Common Stock subject to the option shall
be determined by the Committee, subject to adjustment as provided in Section
10.6. The number of shares of Common Stock subject to a stock option shall be
reduced in the same proportion that the holder thereof exercises a SAR if any
SAR is granted in conjunction with or related to the stock option.
Notwithstanding the foregoing, no person shall receive grants of Stock Options
under the Plan that exceed 2,000,000 shares during any one fiscal year of the
Company. 
 
6.3.    Duration and Time for Exercise. Subject to earlier termination as
provided in Section 10.4, the term of each stock option shall be determined by
the Committee but shall not exceed ten years and one day from the date of grant.
Each stock option shall become exercisable at such time or times during its term
as shall be determined by the Committee at the time of grant. The Committee may
accelerate the exercisability of any stock option. Subject to the foregoing and
with the approval of the Committee, all or any part of the shares of Common
Stock with respect to which the right to purchase has accrued may be purchased
by the Company at the time of such accrual or at any time or times thereafter
during the term of the option at such price and on such terms as the Company and
the optionee shall mutually agree; provided, however, that any shares so
repurchased shall not be available for re-issuance under the Plan.
 
6.4.    Manner of Exercise. A stock option may be exercised, in whole or in
part, by giving written notice to the Company, specifying the number of shares
of Common Stock to be purchased and accompanied by the full purchase price for
such shares. The option price shall be payable (a) in United States dollars upon
exercise of the option and may be paid by cash, uncertified or certified check
or bank draft; (b) at the discretion of the Committee, by delivery of shares of
Common Stock in payment of all or any part of the option price, which shares
shall be valued for this purpose at the Fair Market Value on the date such
option is exercised; or (c) at the discretion of the Committee, by instructing
the Company to withhold from the shares of Common Stock issuable upon exercise
of the stock option shares of Common Stock in payment of all or any part of the
exercise price and/or any related withholding tax obligations, which shares
shall be valued for this purpose at the Fair Market Value or in such other
manner as may be authorized from time to time by the Committee. The shares of
Common Stock delivered by the participant pursuant to Section 6.4(b) must have
been held by the participant for a period of not less than six months prior to
the exercise of the option, unless otherwise determined by the Committee. Prior
to the issuance of shares of Common Stock upon the exercise of a stock option, a
participant shall have no rights as a stockholder.
 
6.5.    Incentive Stock Options. Notwithstanding anything in the Plan to the
contrary, the following additional provisions shall apply to the grant of stock
options which are intended to qualify as Incentive Stock Options (as such term
is defined in Section 422 of the Code):
 
 (a)    The aggregate Fair Market Value (determined as of the time the option is
granted) of the shares of Common Stock with respect to which Incentive Stock
Options are exercisable for the first time by any participant during any
calendar year (under all of the Company’s plans) shall not exceed $100,000. The
determination will be made by taking incentive stock options into account in the
order in which they were granted. If such excess only applies to a portion of an
Incentive Stock Option, the Committee, in its discretion, will designate which
shares will be treated as shares to be acquired upon exercise of an Incentive
Stock Option.
 
(b)    Any Incentive Stock Option certificate authorized under the Plan shall
contain such other provisions as the Committee shall deem advisable, but shall
in all events be consistent with and contain all provisions required in order to
qualify the options as Incentive Stock Options.
 
(c)    All Incentive Stock Options must be granted within ten years from the
earlier of the date on which this Plan was adopted by Board of Directors.
 
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(d)    Unless sooner exercised, all Incentive Stock Options shall expire no
later than 10 years after the date of grant.
 
(e)    The option price for Incentive Stock Options shall be not less than the
Fair Market Value of the Common Stock subject to the option on the date of
grant.
 
(f)    If Incentive Stock Options are granted to any participant who, at the
time such option is granted, would own (within the meaning of Section 422 of the
Code) stock possessing more than 10% of the total combined voting power of all
classes of stock of the employer corporation or of its parent or subsidiary
corporation, (i) the option price for such Incentive Stock Options shall be not
less than 110% of the Fair Market Value of the Common Stock subject to the
option on the date of grant and (ii) such Incentive Stock Options shall expire
no later than five years after the date of grant.
 
7.    Stock Appreciation Rights. An SAR is a right to receive, without payment
to the Company, a number of shares of Common Stock, cash or any combination
thereof, the amount of which is determined pursuant to the formula set forth in
Section 7.4. An SAR may be granted (a) with respect to any stock option granted
under this Plan, either concurrently with the grant of such stock option or at
such later time as determined by the Committee (as to all or any portion of the
shares of Common Stock subject to the stock option), or (b) alone, without
reference to any related stock option. Each SAR granted by the Committee under
this Plan shall be subject to the following terms and conditions:
 
7.1.    Number. Each SAR granted to any participant shall relate to such number
of shares of Common Stock as shall be determined by the Committee, subject to
adjustment as provided in Section 10.6. In the case of an SAR granted with
respect to a stock option, the number of shares of Common Stock to which the SAR
pertains shall be reduced in the same proportion that the holder of the option
exercises the related stock option.
 
7.2.    Duration. Subject to earlier termination as provided in Section 10.4,
the term of each SAR shall be determined by the Committee but shall not exceed
ten years and one day from the date of grant. Unless otherwise provided by the
Committee, each SAR shall become exercisable at such time or times, to such
extent and upon such conditions as the stock option, if any, to which it relates
is exercisable. The Committee may in its discretion accelerate the
exercisability of any SAR.
 
7.3.    Exercise. An SAR may be exercised, in whole or in part, by giving
written notice to the Company, specifying the number of SARs which the holder
wishes to exercise. Upon receipt of such written notice, the Company shall,
within 90 days thereafter, deliver to the exercising holder certificates for the
shares of Common Stock or cash or both, as determined by the Committee, to which
the holder is entitled pursuant to Section 7.4.
 
7.4.    Payment. Subject to the right of the Committee to deliver cash in lieu
of shares of Common Stock (which, as it pertains to officers and directors of
the Company, shall comply with all requirements of the 1934 Act), the number of
shares of Common Stock which shall be issuable upon the exercise of an SAR shall
be determined by dividing:
 
(a)    the number of shares of Common Stock as to which the SAR is exercised
multiplied by the amount of the appreciation in such shares (for this purpose,
the “appreciation” shall be the amount by which the Fair Market Value of the
shares of Common Stock subject to the SAR on the exercise date exceeds (1) in
the case of an SAR related to a stock option, the purchase price of the shares
of Common Stock under the stock option or (2) in the case of an SAR granted
alone, without reference to a related stock option, an amount which shall be
determined by the Committee at the time of grant, subject to adjustment under
Section 10.6); by
 
(b)    the Fair Market Value of a share of Common Stock on the exercise date.
 
In lieu of issuing shares of Common Stock upon the exercise of a SAR, the
Committee may elect to pay the holder of the SAR cash equal to the Fair Market
Value on the exercise date of any or all of the shares which would otherwise be
issuable. No fractional shares of Common Stock shall be issued upon the exercise
of an SAR; instead, the holder of the SAR shall be entitled to receive a cash
adjustment equal to the same fraction of the Fair Market Value of a share of
Common Stock on the exercise date or to purchase the portion necessary to make a
whole share at its Fair Market Value on the date of exercise.
 
8.    Stock Awards and Restricted Stock. A stock award consists of the transfer
by the Company to a participant of shares of Common Stock, without other payment
therefor, as additional compensation for services to the Company. A share of
restricted stock consists of shares of Common Stock which are sold or
transferred by the Company to a participant at a price determined by the
Committee (which price shall be at least equal to the minimum price required by
applicable law for the issuance of a share of Common Stock) and subject to
restrictions on their sale or other transfer by the participant. The transfer of
Common Stock pursuant to stock awards and the transfer and sale of restricted
stock shall be subject to the following terms and conditions:
 
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8.1.    Number of Shares. The number of shares to be transferred or sold by the
Company to a participant pursuant to a stock award or as restricted stock shall
be determined by the Committee.
 
8.2.    Sale Price. The Committee shall determine the price, if any, at which
shares of restricted stock shall be sold to a participant, which may vary from
time to time and among participants and which may be below the Fair Market Value
of such shares of Common Stock at the date of sale.
 
8.3.    Restrictions. All shares of restricted stock transferred or sold
hereunder shall be subject to such restrictions as the Committee may determine,
including, without limitation any or all of the following:
 
(a)    a prohibition against the sale, transfer, pledge or other encumbrance of
the shares of restricted stock, such prohibition to lapse at such time or times
as the Committee shall determine (whether in annual or more frequent
installments, at the time of the death, disability or retirement of the holder
of such shares, or otherwise);
 
(b)    a requirement that the holder of shares of restricted stock forfeit, or
(in the case of shares sold to a participant) resell back to the Company at his
or her cost, all or a part of such shares in the event of termination of his or
her employment or consulting engagement during any period in which such shares
are subject to restrictions;
 
(c)    such other conditions or restrictions as the Committee may deem
advisable.
 
8.4.    Escrow. In order to enforce the restrictions imposed by the Committee
pursuant to Section 8.3, the participant receiving restricted stock shall enter
into an agreement with the Company setting forth the conditions of the grant.
Shares of restricted stock shall be registered in the name of the participant
and deposited, together with a stock power endorsed in blank, with the Company.
Each such certificate shall bear a legend in substantially the following form:
 
The transferability of this certificate and the shares of Common Stock
represented by it are subject to the terms and conditions (including conditions
of forfeiture) contained in the 2005 Stock Incentive Plan of El Capitan Precious
Metals, Inc. (the “Company”), and an agreement entered into between the
registered owner and the Company. A copy of the Plan and the agreement is on
file in the office of the secretary of the Company.
 
8.5.    End of Restrictions. Subject to Section 10.5, at the end of any time
period during which the shares of restricted stock are subject to forfeiture and
restrictions on transfer, such shares will be delivered free of all restrictions
to the participant or to the participant's legal representative, beneficiary or
heir.
 
8.6.    Stockholder. Subject to the terms and conditions of the Plan, each
participant receiving restricted stock shall have all the rights of a
stockholder with respect to shares of stock during any period in which such
shares are subject to forfeiture and restrictions on transfer, including without
limitation, the right to vote such shares. Dividends paid in cash or property
other than Common Stock with respect to shares of restricted stock shall be paid
to the participant currently.
 
9.    Performance Shares. A performance share consists of an award which shall
be paid in shares of Common Stock, as described below. The grant of performance
share shall be subject to such terms and conditions as the Committee deems
appropriate, including the following:
 
9.1.    Performance Objectives. Each performance share will be subject to
performance objectives for the Company or one of its operating units to be
achieved by the end of a specified period. The number of performance shares
granted shall be determined by the Committee and may be subject to such terms
and conditions, as the Committee shall determine. If the performance objectives
are achieved, each participant will be paid in shares of Common Stock or cash.
If such objectives are not met, each grant of performance shares may provide for
lesser payments in accordance with formulas established in the award.
 
9.2.    Not Stockholder. The grant of performance shares to a participant shall
not create any rights in such participant as a stockholder of the Company, until
the payment of shares of Common Stock with respect to an award.
 
9.3.    No Adjustments. No adjustment shall be made in performance shares
granted on account of cash dividends which may be paid or other rights which may
be issued to the holders of Common Stock prior to the end of any period for
which performance objectives were established.
 
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9.4.    Expiration of Performance Share. If any participant's employment or
consulting engagement with the Company is terminated for any reason other than
normal retirement, death or disability prior to the achievement of the
participant's stated performance objectives, all the participant's rights on the
performance shares shall expire and terminate unless otherwise determined by the
Committee. In the event of termination of employment or consulting by reason of
death, disability, or normal retirement, the Committee, in its own discretion
may determine what portions, if any, of the performance shares should be paid to
the participant.
 
10.    General.
 
10.1.    Effective Date. The Plan will become effective upon its approval by the
Board of Directors.
 
10.2.    Duration. The Plan shall remain in effect until all Incentives granted
under the Plan have either been satisfied by the issuance of shares of Common
Stock or the payment of cash or been terminated under the terms of the Plan and
all restrictions imposed on shares of Common Stock in connection with their
issuance under the Plan have lapsed. No Incentives may be granted under the Plan
after the tenth anniversary of the date the Plan is approved by the Board of
Directors.
 
10.3.    Non-transferability of Incentives. No stock option, SAR, restricted
stock or performance award may be transferred, pledged or assigned by the holder
thereof (except, in the event of the holder's death, by will or the laws of
descent and distribution to the limited extent provided in the Plan or the
Incentive), or pursuant to a qualified domestic relations order as defined by
the Code or Title I of the Employee Retirement Income Security Act, or the rules
thereunder, and the Company shall not be required to recognize any attempted
assignment of such rights by any participant. Notwithstanding the preceding
sentence, stock options may be transferred by the holder thereof to Employee’s
spouse, children, grandchildren or parents (collectively, the “Family Members”),
to trusts for the benefit of Family Members, to partnerships or limited
liability companies in which Family Members are the only partners or
shareholders, or to entities exempt from federal income taxation pursuant to
Section 501(c)(3) of the Internal Revenue Code of 1986, as amended. During a
participant’s lifetime, a stock option may be exercised only by him or her, by
his or her guardian or legal representative or by the transferees permitted by
the preceding sentence.
 
10.4.    Effect of Termination or Death. In the event that a participant ceases
to be an employee of or consultant to the Company for any reason, including
death or disability, any Incentives may be exercised or shall expire at such
times as may be determined by the Committee.
 
10.5.    Additional Condition. Notwithstanding anything in this Plan to the
contrary: (a) the Company may, if it shall determine it necessary or desirable
for any reason, at the time of award of any Incentive or the issuance of any
shares of Common Stock pursuant to any Incentive, require the recipient of the
Incentive, as a condition to the receipt thereof or to the receipt of shares of
Common Stock issued pursuant thereto, to deliver to the Company a written
representation of present intention to acquire the Incentive or the shares of
Common Stock issued pursuant thereto for his or her own account for investment
and not for distribution; and (b) if at any time the Company further determines,
in its sole discretion, that the listing, registration or qualification (or any
updating of any such document) of any Incentive or the shares of Common Stock
issuable pursuant thereto is necessary on any securities exchange or under any
federal or state securities or blue sky law, or that the consent or approval of
any governmental regulatory body is necessary or desirable as a condition of, or
in connection with the award of any Incentive, the issuance of shares of Common
Stock pursuant thereto, or the removal of any restrictions imposed on such
shares, such Incentive shall not be awarded or such shares of Common Stock shall
not be issued or such restrictions shall not be removed, as the case may be, in
whole or in part, unless such listing, registration, qualification, consent or
approval shall have been effected or obtained free of any conditions not
acceptable to the Company.
 
10.6.    Adjustment. In the event of any recapitalization, stock dividend, stock
split, combination of shares or other change in the Common Stock, the number of
shares of Common Stock then subject to the Plan, including shares subject to
restrictions, options or achievements of performance shares, shall be adjusted
in proportion to the change in outstanding shares of Common Stock. In the event
of any such adjustments, the purchase price of any option, the performance
objectives of any Incentive, and the shares of Common Stock issuable pursuant to
any Incentive shall be adjusted as and to the extent appropriate, in the
discretion of the Committee, to provide participants with the same relative
rights before and after such adjustment.
 
10.7.    Incentive Plans and Agreements. Except in the case of stock awards, the
terms of each Incentive shall be stated in a plan or agreement approved by the
Committee. The Committee may also determine to enter into agreements with
holders of options to reclassify or convert certain outstanding options, within
the terms of the Plan, as Incentive Stock Options or as non-statutory stock
options and in order to eliminate SARs with respect to all or part of such
options and any other previously issued options.
 
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10.8.    Withholding.
 
(a)    The Company shall have the right to withhold from any payments made under
the Plan or to collect as a condition of payment, any taxes required by law to
be withheld. At any time when a participant is required to pay to the Company an
amount required to be withheld under applicable income tax laws in connection
with a distribution of Common Stock or upon exercise of an option or SAR, the
participant may satisfy this obligation in whole or in part by electing (the
“Election”) to have the Company withhold from the distribution shares of Common
Stock having a value up to the minimum amount of withholding taxes required to
be collected on the transaction. The value of the shares to be withheld shall be
based on the Fair Market Value of the Common Stock on the date that the amount
of tax to be withheld shall be determined (“Tax Date”).
 
(b)    Each Election must be made prior to the Tax Date. The Committee may
disapprove of any Election, may suspend or terminate the right to make
Elections, or may provide with respect to any Incentive that the right to make
Elections shall not apply to such Incentive. An Election is irrevocable.
 
10.9.    No Continued Employment, Engagement or Right to Corporate Assets. No
participant under the Plan shall have any right, because of his or her
participation, to continue in the employ of the Company for any period of time
or to any right to continue his or her present or any other rate of
compensation. Nothing contained in the Plan shall be construed as giving an
employee, a consultant, such persons' beneficiaries or any other person any
equity or interests of any kind in the assets of the Company or creating a trust
of any kind or a fiduciary relationship of any kind between the Company and any
such person.
 
10.10.    Deferral Permitted. Payment of cash or distribution of any shares of
Common Stock to which a participant is entitled under any Incentive shall be
made as provided in the Incentive. Payment may be deferred at the option of the
participant if provided in the Incentive.
 
10.11.    Amendment of the Plan. The Board may amend, suspend or discontinue the
Plan at any time; provided, however, that no amendments to the Plan will be
effective without approval of the shareholders of the Company if shareholder
approval of the amendment is then required pursuant to Section 422 of the Code
or the rules of any stock exchange or Nasdaq or similar regulatory body.
 
10.12.    Sale, Merger, Exchange or Liquidation. Unless otherwise provided in
the agreement for an Incentive, in the event of an acquisition of the Company
through the sale of substantially all of the Company's assets or through a
merger, exchange, reorganization or liquidation of the Company or a similar
event as determined by the Committee (collectively a “transaction”), the
Committee shall be authorized, in its sole discretion, to take any and all
action it deems equitable under the circumstances, including but not limited to
any one or more of the following:

(1)  providing that the Plan and all Incentives shall terminate and the holders
of (i) all outstanding vested options shall receive, in lieu of any shares of
Common Stock they would be entitled to receive under such options, such stock,
securities or assets, including cash, as would have been paid to such
participants if their options had been exercised and such participant had
received Common Stock immediately prior to such transaction (with appropriate
adjustment for the exercise price, if any), (ii) performance shares and/or SARs
that entitle the participant to receive Common Stock shall receive, in lieu of
any shares of Common Stock each participant was entitled to receive as of the
date of the transaction pursuant to the terms of such Incentive, if any, such
stock, securities or assets, including cash, as would have been paid to such
participant if such Common Stock had been issued to and held by the participant
immediately prior to such transaction, and (iii) any Incentive under this
Agreement which does not entitle the participant to receive Common Stock shall
be equitably treated as determined by the Committee.

(2) providing that participants holding outstanding vested Common Stock based
Incentives shall receive, with respect to each share of Common Stock issuable
pursuant to such Incentives as of the effective date of any such transaction, at
the determination of the Committee, cash, securities or other property, or any
combination thereof, in an amount equal to the excess, if any, of the Fair
Market Value of such Common Stock on a date within ten days prior to the
effective date of such transaction over the option price or other amount owed by
a participant, if any, and that such Incentives shall be cancelled, including
the cancellation without consideration of all options that have an exercise
price below the per share value of the consideration received by the Company in
the transaction.

(3) providing that the Plan (or replacement plan) shall continue with respect to
Incentives not cancelled or terminated as of the effective date of such
transaction and provide to participants holding such Incentives the right to
earn their respective Incentives on a substantially equivalent basis (taking
into account the transaction and the number of shares or other equity issued by
such successor entity) with respect to the equity of the entity succeeding the
Company by reason of such transaction.

(4) providing that all unvested, unearned or restricted Incentives, including
but not limited to restricted stock for which restrictions have not lapsed as of
the effective date of such transaction, shall be void and deemed terminated, or,
in the alternative, for the acceleration or waiver of any vesting, earning or
restrictions on any Incentive.
 
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The Board may restrict the rights of participants or the applicability of this
Section 10.12 to the extent necessary to comply with Section 16(b) of the
Securities Exchange Act of 1934, the Internal Revenue Code or any other
applicable law or regulation. The grant of an Incentive award pursuant to the
Plan shall not limit in any way the right or power of the Company to make
adjustments, reclassifications, reorganizations or changes of its capital or
business structure or to merge, exchange or consolidate or to dissolve,
liquidate, sell or transfer all or any part of its business or assets.

10.13.    Definition of Fair Market Value. For purposes of this Plan, the “Fair
Market Value” of a share of Common Stock at a specified date shall, unless
otherwise expressly provided in this Plan, be the amount which the Committee or
the Board of Directors determines in good faith to be 100% of the fair market
value of such a share as of the date in question; provided, however, that
notwithstanding the foregoing, if such shares are listed on a U.S. securities
exchange or are quoted on the Nasdaq National Market or Nasdaq Small-Cap Market
(“Nasdaq”), then Fair Market Value shall be determined by reference to the last
sale price of a share of Common Stock on such U.S. securities exchange or Nasdaq
on the applicable date. If such U.S. securities exchange or Nasdaq is closed for
trading on such date, or if the Common Stock does not trade on such date, then
the last sale price used shall be the one on the date the Common Stock last
traded on such U.S. securities exchange or Nasdaq.

 
Approved by the Board of Directors on July 30, 2008
 
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