EXHIBIT 10.1

 

CITIUS PHARMACEUTICALS, INC.

2014 STOCK INCENTIVE PLAN

(effective September 12, 2014, subject to stockholder approval)

 

1 General

 

1.1 Purpose. The purposes of the Citius Pharmaceuticals, Inc. 2014 Stock
Incentive Plan (the "Plan") is to promote the interests of Citius
Pharmaceuticals, Inc. (the "Company") and the stockholders of the Company by
providing (i) executive officers and other employees of the Company and its
Subsidiaries (as defined below), (ii) certain advisors who perform services for
the Company and its Subsidiaries and (iii) non-employee members of the Board of
Directors of the Company (the "Board") with appropriate incentives and rewards
to encourage them to enter into and continue in the employ and service of the
Company and to acquire a proprietary interest in the long-term success of the
Company, as well as to reward the performance of these individuals in fulfilling
their personal responsibilities for long- range and annual achievements.

 

1.2 Effective Date and Term. The Plan will become effective upon the date it is
approved by the stockholders of the Company (the "Effective Date"). Unless
terminated earlier by the Committee, the Plan will expire on the tenth (10th)
anniversary of the Effective Date.

 

1.3 Definitions. Capitalized terms in the Plan, unless defined elsewhere in the
Plan, shall be defined as set forth below:

 

162(m) Term. The term "162(m) Term" means the period starting on the date when
the Company's stockholders first approve this Plan and ending on the date of the
first meeting of the Company's stockholders that occurs in the fifth year
following the year in which the Company's stockholders first approve this Plan.

 

1934 Act. The term "1934 Act" shall mean the Securities Exchange Act of 1934, as
amended, including the rules and regulations promulgated thereunder and any
successor thereto.

 

Affiliated Company. The term "Affiliated Company" means any company,
partnership, association, organization or other entity controlled by,
controlling or under common control with the Company.

 

Award. The term "Award" means any award or benefit granted under the Plan,
including, without limitation, Options, SARs, Restricted Stock, Restricted Stock
Units, Other Stock-Based Awards and Cash-Based Awards.

 

Award Agreement. The term "Award Agreement" means a written Award grant
agreement under the Plan.

 

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Cash-Based Award. The term "Cash-Based Award" means a right or other interest
granted to an Eligible Grantee under Section 4.2(vi) of the Plan that may be
denominated or payable in cash, other than an Award pursuant to which the amount
of cash is determined by reference to the value of a specific number of shares
of Stock. For the avoidance of doubt, dividend equivalents constitute Cash-Based
Awards.

   

Change of Control. The term "Change of Control" shall be deemed to occur if and
when:

 

 

(i)any person, including a "person" as such term is used in Section 14(d)(2) of
the 1934 Act (a "Person"), is or becomes a beneficial owner (as such term is
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of the Company representing 50% or more of the combined voting power of the
Company's then outstanding securities;

 

 

 

 

(ii)individuals who, as of the Effective Date, constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the Effective Date whose election, or nomination for election by the Company's
stockholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding for this purpose
any such individual whose initial assumption of office occurs as a result of
either an actual or threatened election contest (as such terms are used in Rule
14a-11 of Regulation 14A promulgated under the 1934 Act) or other actual or
threatened solicitation of proxies or consents by or on behalf of a Person other
than the Board;

 

 

 

 

(iii)all or substantially all of the assets of the Company are sold, transferred
or distributed, or the Company is dissolved or liquidated; or

 

 

 

 

(iv)a reorganization, merger, consolidation or other corporate transaction
involving the Company (a "Transaction") is consummated, in each case, with
respect to which the stockholders of the Company immediately prior to such
Transaction do not, immediately after the Transaction, own more than 50% of the
combined voting power of the Company or other corporation resulting from such
Transaction in substantially the same respective proportions as such
stockholders' ownership of the voting power of the Company immediately before
such Transaction.

 

Notwithstanding the foregoing or any other provision of this Plan, the term
Change of Control shall not include a sale of assets, merger or other
transaction effected exclusively for the purpose of changing the domicile of the
Company.

 

Code. The term "Code" means the Internal Revenue Code of 1986, as amended. A
reference to any provision of the Code shall include reference to any successor
provision of the Code.

 

Committee. The term "Committee" means the committee of the Board described in
Section 2 hereof and any sub-committee established by such Committee pursuant to
Section 2.4.

 

Covered Employee. The term "Covered Employee" means an Employee who is, or who
is anticipated to become, between the time of grant and payment of the Award, a
"covered employee," as such term is defined in Section 162(m)(3) of the Code (or
any successor section thereof).

 

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Disability. The term "Disability" means "Disability" as defined in any Award
Agreement to which the Grantee is a party.

 

Eligible Grantee. The term "Eligible Grantee" shall mean any Employee,
Non-Employee Director or Key Advisor, as determined by the Committee in its sole
discretion.

   

Employee. The term "Employee" means an active employee of the Company or a
Subsidiary, but excluding any person who is classified by the Company or a
Subsidiary as a "contractor" or "consultant," no matter how characterized by the
Internal Revenue Service, other governmental agency or a court, or any employee
who is not actively employed, as determined by the Committee. Any change of
characterization of an individual by the Internal Revenue Service or any court
or government agency shall have no effect upon the classification of an
individual as an Employee for purposes of this Plan, unless the Committee
determines otherwise.

   

Fair Market Value. For purposes of determining the "Fair Market Value" of a
share of Stock as of any date, the "Fair Market Value" as of that date shall be,
unless otherwise determined by the Committee, the closing sale price during
regular trading hours of the Stock on the immediately preceding date on the
principal securities market in which shares of Stock is then traded; or, if
there were no trades on that date, the closing sale price during regular trading
hours of the Stock on the first trading day prior to that date. If the Stock is
not publicly traded at the time a determination of Fair Market Value is required
to be made hereunder, the determination of such amount shall be made by the
Committee in such manner as it deems appropriate.

 

Grantee. The term "Grantee" means an Employee, Non-Employee Director or Key
Advisor of the Company or a Subsidiary who has been granted an Award under the
Plan.

 

ISO. The term "ISO" means any Option intended to be and designated as an
incentive stock option within the meaning of Section 422 of the Code.

 

Key Advisor. The term "Key Advisor" means a consultant or other key advisor who
performs services for the Company or a Subsidiary.

 

Non-Employee Director. The term "Non-Employee Director" means a member of the
Board who is not an Employee.

 

NQSO. The term "NQSO" means any Option that is not designated as an ISO, or
which is designated by the Committee as an ISO but which subsequently fails or
ceases to qualify as an ISO.

 

Option. The term "Option" means a right, granted to an Eligible Grantee under
Section 4.2(i), to purchase shares of Stock. An Option may be either an ISO or
an NQSO.

 

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Other Stock-Based Award. The term "Other Stock-Based Award" means a right or
other interest granted to an Eligible Grantee under Section 4.2(v) of the Plan
that may be denominated or payable in, valued in whole or in part by reference
to, or otherwise based on, or related to, Stock, including but not limited to
(i) unrestricted Stock awarded as a bonus or upon the attainment of Performance
Goals or otherwise as permitted under the Plan, and (ii) a right granted to an
Eligible Grantee to acquire Stock from the Company containing terms and
conditions prescribed by the Committee.

 

Performance Goals. The term "Performance Goals" means performance goals based on
the attainment by the Company or any Subsidiary of the Company or any Affiliated
Company (or any division or business unit of any such entity), or any two or
more of the foregoing, of performance goals pre-established by the Committee in
its sole discretion, based on one or more of the following criteria (if
applicable, such criteria shall be determined in accordance with generally
accepted accounting principles ("GAAP") or based upon the Company's GAAP
financial statements): (i) the attainment of certain target levels of, or a
specified percentage increase in, revenues, earnings, income before taxes and
extraordinary items, net income, operating income, earnings before income tax,
earnings before interest, taxes, depreciation and amortization or a combination
of any or all of the foregoing; (ii) the attainment of certain target levels of,
or a percentage increase in, after-tax or pre-tax profits including, without
limitation, that attributable to continuing and/or other operations; (iii) the
attainment of certain target levels of, or a specified increase in, operational
cash flow; (iv) the achievement of a certain level of, reduction of, or other
specified objectives with regard to limiting the level of increase in, all or a
portion of, the Company's bank debt or other long-term or short-term public or
private debt or other similar financial obligations of the Company, which may be
calculated net of such cash balances and/or other offsets and adjustments as may
be established by the Committee; (v) earnings per share or the attainment of a
specified percentage increase in earnings per share or earnings per share from
continuing operations; (vi) the attainment of certain target levels of, or a
specified increase in return on capital employed or return on invested capital;
(vii) the attainment of certain target levels of, or a percentage increase in,
after- tax or pre-tax return on stockholders' equity; (viii) the attainment of
certain target levels of, or a specified increase in, economic value added
targets based on a cash flow return on investment formula; (ix) the attainment
of certain target levels in, or specified increases in, the fair market value of
the shares of the Company's common stock; (x) the growth in the value of an
investment in the Company's common stock; (xi) the attainment of a certain level
of, reduction of, or other specified objectives with regard to limiting the
level in or increase in, all or a portion of controllable expenses or costs or
other expenses or costs; (xii) gross or net sales, revenue and growth of sales
revenue (either before or after cost of goods, selling and general
administrative expenses, research and development expenses and any other
expenses or interest); (xiii) total stockholder return; (xiv) return on assets
or net assets; (xv) return on sales; (xvi) operating profit or net operating
profit; (xvii) operating margin; (xviii) gross or net profit margin; (xix) cost
reductions or savings; (xx) productivity; (xxi) operating efficiency; (xxii)
working capital; or (xxiii) market share; (xxiv) customer satisfaction; (xxv)
workforce diversity; (xxvi) results of clinical trials; (xxvii) acceptance of a
new drug application by a regulatory body; (xxviii) regulatory body approval for
commercialization of a product; (xxix) launch of a new drug; (xxx) completion of
out- licensing, in-licensing or disposition of product candidates or other
acquisition or disposition projects; and (xxxi) to the extent that an Award is
not intended to comply with Section 162(m) of the Code, other measures of
performance selected by the Board. Subject to the limitations in Section 4.2,
the Committee in its sole discretion may designate additional business criteria
on which the Performance Goals may be based or adjust, or modify or amend the
aforementioned business criteria. The relative weights of the criteria that
comprise the Performance Goals shall be determined by the Committee in its sole
discretion. In establishing the Performance Goals for a performance period, the
Committee may establish different Performance Goals for individual Grantees or
groups of Grantees. Subject to the limitations in Section 4.2(ix)(d), the
Committee in its sole discretion shall have the authority to make equitable
adjustments to the Performance Goals in recognition of unusual or non-recurring
events affecting the Company or any Subsidiary of the Company or any Affiliated
Company or the financial statements of the Company or any Subsidiary of the
Company or any Affiliated Company, in response to changes in applicable laws or
regulations, including changes in generally accepted accounting principles or
practices, or to account for items of gain, loss or expense determined to be
extraordinary or unusual in nature or infrequent in occurrence or related to the
disposal of a segment of a business, as applicable. Performance Goals may
include a threshold level of performance below which no Award will be earned, a
level of performance at which the target amount of an Award will be earned and a
level of performance at which the maximum amount of the Award will be earned.

 

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Restricted Stock. The term "Restricted Stock" means an Award of shares of Stock
to an Eligible Grantee under Section 4.2(iii) that may be subject to certain
restrictions and to a risk of forfeiture. Stock issued upon the exercise of
Options or SARs is not "Restricted Stock" for purposes of the plan, even if
subject to post-issuance transfer restrictions or forfeiture conditions. When
Restricted Stock vests, it ceases to be "Restricted Stock" for purposes of the
Plan.

 

Restricted Stock Unit. The term "Restricted Stock Unit" means a right granted to
an Eligible Grantee under Section 4.2(iv) to receive Stock or cash at the end of
a specified deferral period, which right may be conditioned on the satisfaction
of specified performance or other criteria.

 

Retirement. The term "Retirement" means any termination of employment or service
as an Employee, Non-Employee Director or Key Advisor as a result of retirement
in good standing under the rules of the Company or a Subsidiary, as applicable,
then in effect.

 

Rule 16b-3. The term "Rule 16b-3" means Rule 16b-3, as from time to time in
effect promulgated by the Securities and Exchange Commission under Section 16 of
the 1934 Act, including any successor to such Rule.

 

Stock. The term "Stock" means shares of the common stock, par value $0.001 per
share, of the Company.

 

Stock Appreciation Right or SAR. The term "Stock Appreciation Right" or "SAR"
means the right, granted to an Eligible Grantee under Section 4.2(ii), to be
paid an amount measured by the appreciation in the Fair Market Value of Stock
from the date of grant to the date of exercise of the right.

 

Subsidiary. The term "Subsidiary" means any present or future subsidiary
corporation of the Company within the meaning of Section 424(f) of the Code, and
any present or future business venture designated by the Committee in which the
Company has a significant interest, including, without limitation, any
subsidiary corporation in which the Company has at least a 50% ownership
interest, as determined in the discretion of the Committee.

 

2 Administration

 

2.1 Committee. The authority to manage the operation of and administer the Plan
shall be vested in a committee (the "Committee") in accordance with this Section
2. The Committee shall be selected by the Board, and shall consist solely of two
or more members of the Board who are non- employee directors within the meaning
of Rule 16b-3 and are outside directors within the meaning of Code Section
162(m). Unless otherwise determined by the Board, the Company's Compensation
Committee shall be designated as the "Committee" hereunder. If the Board, at any
time, consists of only one member, such sole member may take all actions granted
to the Committee hereunder.

 

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2.2 Powers of the Committee. The Committee's administration of the Plan shall be
subject to the following:

 

 

(i)

Subject to the provisions of the Plan, the Committee will have the authority and
discretion to select from among the Eligible Grantees those persons who shall
receive Awards, to determine the time or times of receipt, to determine the
types of Awards and the number of shares covered by the Awards, and to establish
the terms, conditions, performance criteria, restrictions, and other provisions
of such Awards;

 

 

 

 

(ii)

The Committee will have the authority and discretion to interpret the Plan, to
establish, amend, and rescind any rules and regulations relating to the Plan, to
determine the terms and provisions of any Award Agreement made pursuant to the
Plan, and to make all other determinations that may be necessary or advisable
for the administration of the Plan;

 

 

 

 

(iii)

Any interpretation of the Plan by the Committee and any decision made by it
under the Plan is final and binding on all persons; and

 

 

 

 

(iv)

In managing the operation of and administering the Plan, the Committee shall
take action in a manner that conforms to the articles of incorporation and
by-laws of the Company, and applicable state corporate law.

 

2.3 Prohibition Against Repricing. Notwithstanding any provision of the Plan to
the contrary, in no event shall any action be taken under the Plan that
constitutes a Repricing of any Option or SAR granted under the Plan, or of any
option or stock appreciation right granted under the any other plan of the
Company or of an acquired company, except with approval of the stockholders of
the Company.

 

2.4 Delegation of Authority. To the extent not inconsistent with applicable law,
the rules of the NASDAQ Stock Market or other provisions of the Plan, the
Committee may, at any time, allocate all or any portion of its responsibilities
and powers to any one or more of its members or, with respect to Awards made to
Employees other than executive officers, the Chief Executive Officer, including
without limitation, the power to designate Grantees hereunder and determine the
amount, timing and terms of Awards hereunder. Any such allocation or delegation
may be revoked by the Committee at any time.

 

2.5 Indemnification. Each person who is or shall have been a member of the
Committee, or the Board, shall be indemnified and held harmless by the Company
against and from any loss, cost, liability or expense that may be imposed upon
or reasonably incurred by him or her in connection with or resulting from any
claim, action, suit or proceeding to which he or she may be a party or in which
he or she may be involved by reason of any action taken in good faith or failure
to act in good faith under the Plan and against and from any and all amounts
paid by him or her in settlement thereof, with the Company's approval, or paid
by him or her in satisfaction of any judgment in any such action, suit or
proceeding against him or her, provided he or she shall give the Company an
opportunity, at its own expense, to handle and defend the same before he or she
undertakes to handle and defend it on his or her own behalf. The foregoing right
of indemnification shall be in addition to any other rights of indemnification
or elimination of liability to which such persons may be entitled under the
Company's articles of incorporation or by-laws, as a matter of law, or
otherwise, or any power that the Company may have to indemnify them or hold them
harmless.

 

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3 Available Shares of Stock Under the Plan

 

3.1 Shares Available for Awards. Subject to the adjustments described below, the
maximum number of shares of Stock reserved for the grant of Awards under the
Plan shall be 13,000,000. Of the maximum number of shares of Stock reserved for
the grant of Awards under the Plan, no more than 3,000,000 of such shares may be
issued pursuant to stock-settled Awards other than Options (that is, Restricted
Stock, Restricted Stock Units, SARs, Performance Awards, Other Stock-Based
Awards and dividend equivalent Awards, in each case to the extent settled in
shares of Common Stock).

 

3.2 Forfeited, Cancelled and Expired Awards. Awards granted under the Plan that
are forfeited, expire or are canceled or settled without issuance of Stock shall
not count against the maximum number of shares that may be issued under the Plan
as set forth in Section 3.1 and shall be available for future Awards under the
Plan. Notwithstanding the foregoing, any and all Stock that is (i) withheld or
tendered in payment of an Option exercise price; (ii) withheld by the Company to
satisfy any tax withholding obligation; (iii) covered by a SAR (to the extent
that it is settled in Stock, without regard to the number of shares of Stock
that are actually issued to the Grantee upon exercise); (iv) withheld by the
Company to satisfy any debt or other obligation owed to the Company or any
Subsidiary, and (v) any fractional shares of Common Stock that are cancelled
pursuant to the Plan, shall be considered issued pursuant to the Plan and shall
not be added to the maximum number of shares of Stock that may be issued under
the Plan as set forth in Section 3.1. but not limited to a change in the number
of shares of Stock outstanding, on account of (i) any stock dividend, stock
split, reverse stock split or any similar equity restructuring, or (ii) any
combination or exchange of equity securities, merger, consolidation,
recapitalization, reorganization, or divesture or any other similar event
affecting the Company's capital structure, to reflect such change in the
Company's capital structure, the Committee shall make appropriate equitable
adjustments to the maximum number of shares of Stock that may be issued under
the Plan as set forth in Section 3.1. In the event of any extraordinary
dividend, divestiture or other distribution (other than ordinary cash dividends)
of assets to stockholders, or any transaction or event described above, to the
extent necessary to prevent the enlargement or diminution of the rights of
Grantees, the Committee shall make appropriate equitable adjustments to the
number or kind of shares subject to an outstanding Award, the exercise price
applicable to an outstanding Award, and/or a Performance Goals. Any adjustments
under this Section 3.3 shall be consistent with Section 409A or 424 of the Code,
to the extent applicable, and made in a manner that does not adversely affect
the exemption provided pursuant to Rule 16b-3 or qualification under Section
162(m) of the Code, to the extent each may be applicable. The Company shall give
each Grantee notice of an adjustment to an Award hereunder and, upon notice,
such adjustment shall be final, binding and conclusive for all purposes.
Notwithstanding the foregoing, the Committee shall decline to adjust any Award
made to a Participant if such adjustment would violate applicable law.

 

3.4 Fractional Shares. The Company shall not be obligated to issue any
fractional shares of Stock in settlement of Awards granted under the Plan.
Except as otherwise provided in an Award Agreement or determined by the
Committee, (i) the total number of shares issuable pursuant to the exercise,
vesting or earning of an Award shall be rounded down to the nearest whole share,
and (ii) no fractional shares shall be issued. The Committee may, in its
discretion, determine that a fractional share shall be settled in cash.

 

4 Awards

 

4.1 General. The term of each Award shall be for such period as may be
determined by the Committee, subject to the limitations set forth below. Subject
to the terms of the Plan and any applicable Award Agreement, payments to be made
by the Company or any Subsidiary of the Company upon the grant, maturation, or
exercise of an Award may be made in such forms as the Committee shall determine
at the date of grant or thereafter, including, without limitation, cash, Stock,
or other property. In addition to the foregoing, the Committee may impose on any
Award or the exercise thereof, at the date of grant, such additional terms and
conditions not inconsistent with the provisions of the Plan, including, but not
limited to forfeiture and clawback provisions, as the Committee shall determine;
provided, however, that any such terms and conditions shall not be inconsistent
with Section 409A of the Code.

 

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4.2 Types of Awards. The Committee is authorized to grant the Awards described
in this Section 4.2, under such terms and conditions as deemed by the Committee
to be consistent with the purposes of the Plan. Such Awards may be granted with
value and payment contingent upon Performance Goals. Each Award shall be
evidenced by an Award Agreement containing such terms and conditions applicable
to such Award as the Committee shall determine.

 

 

(i)Options. The Committee is authorized to grant Options to Grantees on the
following terms and conditions:

 

 

a.Type of Award. The Award Agreement evidencing an Option shall designate the
Option as either an ISO or an NQSO, as determined in the discretion of the
Committee. At the time of the grant of Options, the Committee may place
restrictions on the exercisability or vesting of Options that shall lapse, in
whole or in Goals shall relate to periods of performance of at least one fiscal
year.

 

 

 

 

b.Exercise Price. The exercise price of each Option granted under this Section
4.2 shall be established by the Committee or shall be determined by a method
established by the Committee at the time the Option is granted; provided,
however, that the exercise price shall not be less than 100% of the Fair Market
Value of a share of Stock on the date of grant of the Award. No dividends or
dividend equivalents will be paid on shares of Stock subject to an Option.

 

 

 

 

c.Exercise. Upon satisfaction of the applicable conditions relating to vesting
and exercisability, as determined by the Committee and set forth in the Award
Agreement, and upon provision for the payment in full of the exercise price and
applicable taxes due, the Grantee shall be entitled to exercise the Option and
receive the number of shares of Stock issuable in connection with the Option
exercise provided, however, that no Option may be exercised more than ten years
after its grant date. Except as set forth in Section 4.3, no NQSO granted
hereunder may be exercised after the earlier of (A) the expiration of the NQSO
or (B) unless otherwise provided by the Committee in an Award Agreement, ninety
days after the severance of an NQSO holder's employment or service with the
Company or any Subsidiary The shares issued in connection with the Option
exercise may be subject to such conditions and restrictions as the Committee may
determine, from time to time. An Option may be exercised by any method as may be
permitted by the Committee from time to time, including but not limited to any
"net exercise" or other "cashless" exercise method.

 

 

 

 

d.Restrictions Relating to ISOs. In addition to being subject to the terms and
conditions of this Section 4.2(i), ISOs shall comply with all other requirements
under Section 422 of the Code. Accordingly, ISOs may be granted only to Eligible
Grantees who are employees (as described in Treasury Regulation Section
1.421-7(h)) of the Company or of any "Parent Corporation" (as defined in Code
Section 424(e)) or of any "Subsidiary Corporation" (as defined in Code Section
424(f)) on the date of grant. The aggregate Fair Market Value (determined as of
the time the ISO is granted) of the Stock with respect to which ISOs (under all
option plans of the Company and of any Parent Corporation and of any Subsidiary
Corporation) are exercisable for the first time by an Eligible Grantee during
any calendar year shall not exceed $100,000. ISOs shall not be transferable by
the Eligible Grantee otherwise than by will or the laws of descent and
distribution and shall be exercisable, during the Eligible Grantee's lifetime,
only by such Eligible Grantee. The Committee shall not grant ISOs to any
Employee who, at the time the ISO is granted, owns stock possessing (after the
application of the attribution rules of Section 424(d) of the Code) more than
ten percent (10%) of the total combined voting stock of the Company or of any
Parent Corporation or of any Subsidiary Corporation, unless the exercise price
of the ISO is fixed at not less than one hundred and ten percent (110%) of the
Fair Market Value of a share of Common Stock on the date of grant and the
exercise of such ISO is prohibited by its terms after the fifth (5th)
anniversary of the ISO's date of grant. In addition, no ISO shall be issued to
an Eligible Grantee in tandem with a NQSO issued to such Eligible Grantee in
accordance with Treasury Regulation Section 14a.422A-1, Q/A-39.

 

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(ii)SARs. The Committee is authorized to grant SARs to Grantees on the following
terms and conditions:

 

 

a.

In General. SARs may be granted independently or in tandem with an Option at the
time of grant of the related Option. An SAR granted in tandem with an Option
shall be exercisable only to the extent the underlying Option is exercisable.
Payment of an SAR may be made in cash, Stock, or a combination of the foregoing,
as specified in the Award Agreement or determined in the sole discretion of the
Committee. At the time of the grant of SARs, the Committee may place
restrictions on the exercisability or vesting of SARs that shall lapse, in whole
or in part, upon the attainment of Performance Goals; provided that such
Performance Goals shall relate to periods of performance of at least one fiscal
year.

 

 

 

 

b.

Term and Exercisability of SARs. SARs shall be exercisable over the exercise
period at such times and upon such conditions as the Committee may determine, as
reflected in the Award Agreement; provided, however, that no SAR may be
exercised more than ten years after its grant date. Except as set forth in
Section 4.3, no SAR granted hereunder may be exercised after the earlier of (A)
the expiration of the SAR or (B) unless otherwise provided by the Committee in
an Award Agreement, ninety days after the severance of an SAR holder's
employment or service with the Company or any Subsidiary.

 

 

 

 

c.

Payment. An SAR shall confer on the Grantee a right to receive an amount with
respect to each share of Stock subject thereto, upon exercise thereof, equal to
the excess of (A) the Fair Market Value of one share of Stock on the date of
exercise over (B) the grant price of the SAR (which in the case of an SAR
granted in tandem with an Option shall be equal to the exercise price of the
underlying Option, and which in the case of any other SAR shall be such price as
the Committee may determine but in no event shall be less than the Fair Market
Value of a share of Stock on the date of grant of such SAR). An SAR may be
exercised by giving written notice of such exercise to the Committee or its
designated agent. No dividends or dividend equivalents will be paid on shares of
Stock subject to an SAR.

 

 

(iii)Restricted Stock. The Committee is authorized to grant Restricted Stock to
Grantees on the following terms and conditions:

 

 

a.Issuance and Restrictions. Restricted Stock shall be subject to such
restrictions on transferability and other restrictions, if any, as the Committee
may impose at the date of grant, which restrictions may lapse separately or in
combination at such times, under such circumstances, in such installments, or
otherwise, as the Committee may determine. The Committee may place restrictions
on Restricted Stock that shall lapse, in whole or in part, upon the attainment
of Performance Goals; provided that such Performance Goals shall relate to
periods of performance of at least one fiscal year. Except to the extent
restricted under the Award Agreement relating to the Restricted Stock, a Grantee
granted Restricted Stock shall have all of the rights of a stockholder
including, without limitation, the right to vote Restricted Stock and the right
to receive dividends thereon.

 

 9

 

 

 

b.Certificates for Stock. Restricted Stock granted under the Plan may be
evidenced in such manner as the Committee shall determine. If certificates
representing Restricted Stock are registered in the name of the Grantee, such
certificates shall bear an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Restricted Stock, and the
Company may retain physical possession of the certificate.

 

 

 

 

c.Dividends. Except to the extent restricted under the applicable Award
Agreement, cash dividends paid on Restricted Stock shall be paid at the dividend
payment date subject to no restriction. Unless otherwise determined by the
Committee, Stock distributed in connection with a stock split or stock dividend
shall be subject to the transfer restrictions, forfeiture risks and vesting
conditions to the same extent as the Restricted Stock with respect to which such
Stock or other property has been distributed. Notwithstanding the foregoing, the
Committee may not provide for the current payment of dividends for Restricted
Stock subject to Performance Goals; for such Awards, dividends may accrue but
shall not be payable unless and until the Award vests upon satisfaction of the
applicable Performance Goals and all other applicable conditions to vesting.

 

 

(iv)Restricted Stock Units. The Committee is authorized to grant Restricted
Stock Units to Grantees, subject to the following terms and conditions:

 

 

a.

Conditions to Vesting. At the time of the grant of Restricted Stock Units, the
Committee may place restrictions on Restricted Stock Units that shall lapse, in
whole or in part, upon the attainment of Performance Goals; provided that such
Performance Goals shall relate to periods of performance of at least one fiscal
year.

 

 

 

 

b.

Benefit Upon Vesting. Unless otherwise provided in an Award Agreement, upon the
vesting of a Restricted Stock Unit, there shall be delivered to the Grantee,
within 30 days of the date on which such Award (or any portion thereof) vests,
the number of shares of Stock equal to the number of Restricted Stock Units
becoming so vested.

 

 

 

 

c.

Dividend Equivalents. To the extent provided in an Award Agreement, subject to
the requirements of Section 409A of the Code, an Award of Restricted Stock Units
may provide the Grantee with the right to receive dividend equivalent payments
with respect to Stock subject to the Award (both before and after the Stock
subject to the Award is earned, vested, or acquired), which payments may be
either made currently or credited to an account for the Grantee, and may be
settled in cash or Stock, as determined by the Committee. Any such settlements
and any such crediting of dividend equivalents may, at the time of grant of the
Restricted Stock Unit, be made subject to the transfer restrictions, forfeiture
risks, vesting and conditions of the Restricted Stock Units and subject to such
other conditions, restrictions and contingencies as the Committee shall
establish at the time of grant of the Restricted Stock Unit, including the
reinvestment of such credited amounts in Stock equivalents, provided that all
such conditions, restrictions and contingencies shall comply with the
requirements of Section 409A of the Code. Notwithstanding the foregoing in this
Section 4.2(iv)(c), dividend equivalents may accrue on unearned Restricted Stock
Units subject to Performance Goals but shall not be payable unless and until the
applicable Performance Goals are met and certified.

 

 10

 

  

 

(v)Other Stock-Based Awards. The Committee is authorized to grant Awards to
Grantees in the form of Other Stock-Based Awards, as deemed by the Committee to
be consistent with the purposes of the Plan. At the time of the grant of Other
Stock-Based Awards, the Committee may place restrictions on the payout or
vesting of Other Stock-Based Awards that shall lapse, in whole or in part, upon
the attainment of Performance Goals; provided that such Performance Goals shall
relate to periods of performance of at least one fiscal year. The Committee
shall determine the terms and conditions of such Awards at the date of grant.
Other Stock-Based Awards may not be granted with the right to receive dividend
equivalent payments.

 

 

 

 

(vi)Cash-Based Awards. The Committee is authorized to grant Awards to Grantees
in the form of Cash-Based Awards, as deemed by the Committee to be consistent
with the purposes of the Plan. At the time of the grant of Cash-Based Awards,
the Committee may place restrictions on the payout or vesting of Cash-Based
Awards that shall lapse, in whole or in part, upon the attainment of Performance
Goals. The Committee shall determine the terms and conditions of such Awards at
the date of grant.

 

 

 

 

(vii)Settlement of Options and SARs. Shares of Stock delivered pursuant to the
exercise of an Option or SAR shall be subject to such conditions, restrictions
and contingencies as the Committee may establish in the applicable Award
Agreement. Settlement of SARs may be made in shares of Stock (valued at their
Fair Market Value at the time of exercise), in cash, or in a combination
thereof, as determined in the discretion of the Committee and set forth in the
Award Agreement. The Committee, in its discretion, may impose such conditions,
restrictions and contingencies with respect to shares of Stock acquired pursuant
to the exercise of an Option or an SAR as the Committee determines to be
desirable.

 

 

 

 

(viii)Vesting; Additional Terms. Except as set forth in Section 4.3, other than
Options, SARs, Restricted Stock, Restricted Stock Units or Other Stock-Based
Awards conditioned upon the attainment of Performance Goals that relate to
performance periods of at least one fiscal year, Options, SARs, Restricted
Stock, Restricted Stock Units or Other Stock- Based Awards granted hereunder
shall vest as determined by the Committee and set forth in the Award Agreement.
The term of any Award granted under the Plan will not exceed ten years from the
date of grant.

 

 

 

 

(ix)

Qualified Performance-Based Compensation.

 

 

a.The Committee may determine that Restricted Stock, Restricted Stock Units,
Other Stock-Based Awards or Cash-Based Awards granted to a Covered Employee
shall be considered "qualified performance-based compensation" under section
162(m) of the Code, in which case the provisions of this Section 4.2(ix) shall
apply. As required pursuant to Section 162(m) of the Code and the regulations
promulgated thereunder, the Committee's authority to grant new awards that are
intended to qualify as performance-based compensation within the meaning of
Section 162(m) of the Code (other than qualifying Options and qualifying SARs)
shall terminate upon the first meeting of the Company's stockholders that occurs
in the fifth year following the year in which the Company's stockholders first
approve this Plan.

 

 11

 

 

 

b.When Awards are made under this Section 4.2(ix), the Committee shall establish
in writing (i) the objective Performance Goals that must be met, (ii) the period
during which performance will be measured, (iii) the maximum amounts that may be
paid if the Performance Goals are met, and (iv) any other conditions that the
Committee deems appropriate and consistent with the requirements of Section
162(m) of the Code for "qualified performance-based compensation." The
Performance Goals shall satisfy the requirements for "qualified
performance-based compensation," including the requirement that the achievement
of the goals be substantially uncertain at the time they are established and
that the Performance Goals be established in such a way that a third party with
knowledge of the relevant facts could determine whether and to what extent the
Performance Goals have been met. The Committee shall not have discretion to
increase the amount of compensation that is payable, but may reduce the amount
of compensation that is payable, pursuant to Awards identified by the Committee
as "qualified performance-based compensation."

 

 

 

 

c.Performance Goals must be pre-established by the Committee. A Performance Goal
is considered pre-established if it is established in writing not later than 90
days after the commencement of the period of service to which the Performance
Goal relates, provided that the outcome is substantially uncertain at the time
the Committee actually established the goal. However, in no event will a
Performance Goal be considered pre-established if it is established after 25% of
the period of service (as scheduled in good faith at the time the goal is
established) has elapsed.

 

 

 

 

d.The Committee in its sole discretion shall have the authority to make
equitable adjustments to the Performance Goals in recognition of unusual or
non-recurring events affecting the Company or any Subsidiary of the Company or
any Affiliated Company or the financial statements of the Company or any
Subsidiary of the Company or any Affiliated Company, in response to changes in
applicable laws or regulations, including changes in generally accepted
accounting principles or practices, or to account for items of gain, loss or
expense determined to be extraordinary or unusual in nature or infrequent in
occurrence or related to the disposal of a segment of a business, as applicable,
provided such adjustment occurs in writing not later than 90 days after the
commencement of the period of service to which the Performance Goal relates (and
in no event later than the date that 25% of the period of service has elapsed).
In addition, the Committee may specify that certain equitable adjustments to the
Performance Goals will be made during the applicable Performance Period,
provided such specification occurs in writing not later than 90 days after the
commencement of the period of service to which the Performance Goal relates (and
in no event later than the date that 25% of the period of service has elapsed).

 

 

 

 

e.The Committee shall certify the performance results for the performance period
specified in the Award Agreement after the performance period ends. The
Committee shall determine the amount, if any, to be paid pursuant to each Award
based on the achievement of the Performance Goals and the satisfaction of all
other terms of the Award Agreement. Subject to the provisions of Section 3.3
relating to capitalization adjustments, at such time as the Company may be
subject to the applicable provisions of Section 162(m) of the Code, a maximum of
2,500,000 shares of Stock subject to qualified performance-based compensation
may be granted to any Eligible Grantee during any calendar year during the
162(m) Term.

 

 

 

 

f.The Committee may provide in the Award Agreement that Awards under this
Section 4.2(ix) shall be payable, in whole or in part, in the event of the
Grantee's death or Disability, or under other circumstances consistent with the
Treasury regulations and rulings under Section 162(m) of the Code.

 

 12

 

  

4.3 Change of Control of the Company.

 

 

(i)The Committee may, at the time an Award is made or at any time prior to,
coincident with or after the time of a Change of Control:

 

 

a.

provide for the adjustment of any Performance Goals as the Committee deems
necessary or appropriate to reflect the Change of Control;

 

 

 

 

b.

provide for the cancellation of any Awards then outstanding if the surviving
entity or acquiring entity (or the surviving or acquiring entity's parent
company) in the Change of Control replaces the Awards with new rights of
substantially equivalent value, as determined by the Committee;

 

 

 

 

c.

provide that upon an involuntary termination of a Participant's employment as a
result of a Change of Control, any time periods shall accelerate, and any other
conditions relating to the vesting, exercise, payment or distribution of an
Award shall be waived; or

 

 

 

 

d.

provide that Awards shall be purchased for an amount of cash equal to the amount
that could have been obtained for the shares covered by a Restricted Stock Award
if it had been vested and or by an Option or SAR if it had been exercised at the
time of the Change of Control.

 

 

(ii)

Notwithstanding any other provisions of the Plan or an Award Agreement to the
contrary, the vesting, payment, purchase or distribution of an Award may not be
accelerated by reason of a Change of Control for any Grantee unless the
Grantee's employment is involuntarily terminated as a result of the Change of
Control as provided in the Award Agreement or in any other written agreement,
including an employment agreement, between us and the Grantee.

 

5 Operation

 

5.1 Duration. Grants may be made under the Plan through September 12, 2024. In
the event of Plan termination while Awards remain outstanding, the Plan shall
remain in effect as long as any Awards under it are outstanding, although no
further grants may be made following Plan termination.

 

5.2 Uncertificated Stock. Nothing contained in the Plan shall prohibit the
issuance of Stock on an uncertificated basis, to the extent allowed by the
Company's Articles of Incorporation and Bylaws, by applicable law and by the
applicable rules of any stock exchange.

 

 13

 

  

5.3 Tax Withholding. All distributions under the Plan are subject to withholding
of all applicable taxes, and the Committee may condition the delivery of any
shares or other benefits under the Plan on satisfaction of the applicable
withholding obligations. The Committee, in its discretion, and subject to such
requirements as the Committee may impose prior to the occurrence of such
withholding, may permit such withholding obligations to be satisfied through
cash payment by the Grantee, through the surrender of shares of Stock which the
Grantee already owns, through withholding from other compensation payable to the
Grantee or through the surrender of unrestricted shares of Stock to which the
Grantee is otherwise entitled under the Plan, but only to the extent of the
minimum amount required to be withheld under applicable law.

 

5.4 Use of Shares. Subject to the limitations on the number of shares of Stock
that may be delivered under the Plan, the Committee may use available shares of
Stock as the form of payment for compensation, grants or rights earned or due
under any other compensation plans or arrangements of the Company or a
Subsidiary, including the plans and arrangements of the Company or a Subsidiary
assumed in business combinations.

 

5.5 Nontransferability. Awards granted under the Plan, and during any period of
restriction on transferability, shares of Common Stock issued in connection with
the exercise of an Option or a SAR, or vesting of a Restricted Stock Award may
not be sold, pledged, hypothecated, assigned, margined or otherwise transferred
by a Grantee in any manner other than by will or the laws of descent and
distribution, unless and until the shares underlying such Award have been
issued, and all restrictions applicable to such shares have lapsed or have been
waived by the Committee. No Award or interest or right therein shall be subject
to the debts, contracts or engagements of a Grantee or his or her successors in
interest or shall be subject to disposition by transfer, alienation,
anticipation, pledge, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law, by judgment,
lien, levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy and divorce), and any attempted disposition thereof shall
be null and void, of no effect, and not binding on the Company in any way.
Notwithstanding the foregoing, the Committee may permit Options and/or shares
issued in connection with an Option or a SAR exercise that are subject to
restrictions on transferability, to be transferred one time and without payment
or consideration to a member of a Grantee's immediate family or to a trust or
similar vehicle for the benefit of a Grantee's immediate family members. During
the lifetime of a Grantee, all rights with respect to Awards shall be
exercisable only by such Grantee or, if applicable pursuant to the preceding
sentence, a permitted transferee.

 

5.6 Form and Time of Elections. Unless otherwise specified herein, each election
required or permitted to be made by any Grantee or other person entitled to
benefits under the Plan, and any permitted modification, or revocation thereof,
shall be in writing filed with the Committee at such times, in such form, and
subject to such restrictions and limitations, not inconsistent with the terms of
the Plan, as the Committee shall require.

 

5.7 Agreement with Company. An Award under the Plan shall be subject to such
terms and conditions, not inconsistent with the Plan, as the Committee shall, in
its sole discretion, prescribe. The terms and conditions of any Award to any
Grantee shall be reflected in such form of written document as is determined by
the Committee. A copy of such document shall be provided to the Grantee, and the
Committee may, but need not, require that the Grantee shall sign a copy of such
document. Such document is referred to in the Plan as an "Award Agreement"
regardless of whether any Grantee signature is required.

 

 14

 

 

5.8 Gender and Number. Where the context admits, words in any gender shall
include any other gender, words in the singular shall include the plural and the
plural shall include the singular.

 

5.9 Limitation of Implied Rights.

 

 

(iii)The Plan shall at all times be unfunded and neither a Grantee nor any other
person shall, by reason of participation in the Plan, acquire any right in or
title to any assets, funds or property of the Company or any Subsidiary
whatsoever, including, without limitation, any specific funds, assets, or other
property which the Company or any Subsidiary, in its sole discretion, may set
aside in anticipation of a liability under the Plan. Nothing contained in the
Plan and no action taken pursuant hereto shall create or be construed to create
a fiduciary relationship between the Company and any Grantee or any other
person. A Grantee shall have only a contractual right to the Stock or amounts,
if any, payable under the Plan, unsecured by any assets of the Company or any
Subsidiary, and nothing contained in the Plan shall constitute a guarantee that
the assets of the Company or any Subsidiary shall be sufficient to pay any
benefits to any person.

 

 

 

 

(iv)The Plan does not constitute a contract of employment or service, and
selection as a Grantee will not give any participating Employee, Non-Employee
Director or Key Advisor the right to be retained in the employ or service of the
Company or any Subsidiary, nor any right or claim to any benefit under the Plan,
unless such right or claim has specifically accrued under the terms of the Plan.
Except as otherwise provided in the Plan or the Award Agreement, no Award under
the Plan shall confer upon the holder thereof any rights as a stockholder of the
Company prior to the date on which the individual fulfills all conditions for
receipt of such rights.

 

5.10 Section 409A. It is intended that all Options and SARs granted under the
Plan shall be exempt from the provisions of Section 409A of the Code and that
all other Awards under the Plan, to the extent that they constitute
"non-qualified deferred compensation" within the meaning of Section 409A of the
Code, will comply with Section 409A of the Code (and any regulations and
guidelines issued thereunder). The Plan and any Award Agreements issued
hereunder may be amended in any respect deemed by the Board or the Committee to
be necessary in order to preserve compliance with Section 409A of the Code.
Notwithstanding anything in this Plan to the contrary, if required by Section
409A of the Code, if a Grantee is considered a "specified employee" for purposes
of Section 409A of the Code and if payment of any Award under this Plan is
required to be delayed for a period of six months after "separation from
service" within the meaning of Section 409A of the Code, payment of such Award
shall be delayed as required by Section 409A of the Code, and the accumulated
amounts with respect to such Award shall be paid in a lump sum payment within
ten days after the end of the six month period. If the Grantee dies during the
postponement period prior to the payment of benefits, the amounts withheld on
account of Section 409A of the Code shall be paid to the Grantee's beneficiary
within sixty (60) days after the date of the Grantee's death. For purposes of
Section 409A of the Code, each payment under the Plan shall be treated as a
separate payment. In no event shall a Grantee, directly or indirectly, designate
the calendar year of payment. To the extent that any provision of the Plan would
cause a conflict with the requirements of section 409A of the Code, or would
cause the administration of the Plan to fail to satisfy the requirements of
Section 409A of the Code, such provision shall be deemed null and void to the
extent permitted by applicable law. Notwithstanding anything in the Plan or any
Award Agreement to the contrary, each Grantee shall be solely responsible for
the tax consequences of Awards under the Plan, and in no event shall the Company
have any responsibility or liability if an Award does not meet any applicable
requirements of Section 409A of the Code. Although the Company intends to
administer the Plan to prevent taxation under Section 409A of the Code, the
Company does not represent or warrant that the Plan or any Award complies with
any provision of federal, state, local or other tax law.

 

 15

 

 

5.11 Regulations and Other Approvals.

 

 

(i)

The obligation of the Company to sell or deliver Stock with respect to any Award
granted under the Plan shall be subject to all applicable laws, rules and
regulations, including all applicable federal and state securities laws, and the
obtaining of all such approvals by governmental agencies as may be deemed
necessary or appropriate by the Committee.

 

 

 

 

(ii)

Each Award is subject to the requirement that, if at any time the Committee
determines, in its absolute discretion, that the listing, registration or
qualification of Stock issuable pursuant to the Plan is required by any
securities exchange or under any state or federal law, or the consent or
approval of any governmental regulatory body is necessary or desirable as a
condition of, or in connection with, the grant of an Award or the issuance of
Stock, no such Award shall be granted or payment made or Stock issued, in whole
or in part, unless listing, registration, qualification, consent or approval has
been effected or obtained free of any conditions not acceptable to the
Committee.

 

 

 

 

(iii)

In the event that the disposition of Stock acquired pursuant to the Plan is not
covered by a then current registration statement under the Securities Act and is
not otherwise exempt from such registration, such Stock shall be restricted
against transfer to the extent required by the Securities Act of 1933, as
amended, or regulations thereunder, and applicable state securities laws, and
the Committee may require a Grantee receiving Stock pursuant to the Plan, as a
condition precedent to receipt of such Stock, to represent to the Company in
writing that the Stock acquired by such Grantee is acquired for investment only
and not with a view to distribution.

 

 

 

 

(iv)

With respect to persons subject to section 16 of the 1934 Act, it is the intent
of the Company that the Plan and all transactions under the Plan comply with all
applicable provisions of Rule 16b-3.

 

 

 

 

(v)

All Awards under the Plan will be subject to any compensation, clawback and
recoupment policies that may be applicable to the employees of the Company, as
in effect from time to time and as approved by the Board or Committee, whether
or not approved before or after the Effective Date. Subject to the requirements
of applicable law, any such compensation, clawback and recoupment policies shall
apply to Awards made after the effective date of the policy.

 

5.12 Non-Employee Director Award Deferrals. The Committee may permit a Non-
Employee Director to defer receipt of the payment of cash or the delivery of
shares that would otherwise be due to such Non-Employee Director in connection
with any Restricted Stock, Restricted Stock Units, Other Stock-Based Awards or
Cash-Based Awards. If any such deferral election is permitted, the Committee
shall establish rules and procedures for such deferrals and may provide for
interest or other earnings to be paid on such deferrals, which rules and
procedures shall be consistent with applicable requirements of Section 409A of
the Code. Unless otherwise specified in a Non-Employee Director's valid
election, any deferred amount will be deferred until the earliest to occur of
the Non-Employee Director's death, separation from service, or Change of
Control; provided that any such deferral election is made by the Non-Employee
Director on or prior to December 31 of the calendar year preceding the calendar
year in which any such amounts are earned, or, if such Non-Employee Director is
newly eligible for purposes of Section 409A of the Code, then within 30 days
following the date he or she is first eligible, and then only with respect to
amounts earned after the date of the election.

 

 16

 

 

6 Amendment and Termination

 

The Plan may be terminated or amended by the Board at any time, except that the
following actions may not be taken without stockholder approval:

 

 

(i)

any increase in the number of shares that may be issued under the Plan (except
by certain adjustments provided for under the Plan);

 

 

 

 

(ii)

any change in the class of persons eligible to receive ISOs under the Plan;

 

 

 

 

(iii)

any change in the requirements of Sections 4.2(i)(b) and 4.2(ii)(c) hereof
regarding the exercise price of Options and the grant price of SARs;

 

 

 

 

(iv)

any repricing or cancellation and regrant of any Option or, if applicable, other
Award at a lower exercise, base or purchase price, whether in the form of an
amendment, cancellation or replacement grant, or a cash-out of underwater
options or any action that provides for Awards that contain a so-called "reload"
feature under which additional Options or other Awards are granted automatically
to the Grantee upon exercise of the original Option or Award; or

 

 

 

 

(v)

any other amendment to the Plan that would require approval of the Company's
stockholders under applicable law, regulation or rule or stock exchange listing
requirement.

 

Notwithstanding any of the foregoing, adjustments pursuant to Section 3 shall
not be subject to the foregoing limitations of this Section 6.

 

7 Governing Law

 

The Plan and all Award Agreements entered into under the Plan shall be construed
in accordance with and governed by the laws of the State of New York, except
that any principles or provisions of New York law that would apply the law of
another jurisdiction (other than applicable provisions of U.S. Federal law)
shall be disregarded. Notwithstanding the foregoing, matters with respect to
indemnification, delegation of authority under the Plan, and the legality of
shares of Stock issued under the Plan, shall be governed by the Nevada Revised
Statutes.

 

8 Severability

 

If any of the provision of this Plan is finally held to be invalid, illegal or
unenforceable (whether in whole or in part), such provision shall be deemed
modified to the extent, but only to the extent, of such invalidity, illegality
or unenforceability and the remaining provisions shall not be affected thereby;
provided that, if any such provision is finally held to be invalid, illegal or
unenforceable because it exceeds the maximum scope determined to be acceptable
to permit such provision to be enforceable, such provision shall be deemed
modified to the minimum extent necessary in order to make such provision
enforceable.

 

* * * * *

 

 

17