EXHIBIT 10.1
SIRNA THERAPEUTICS, INC.
2005 PERFORMANCE INCENTIVE PLAN
1. PURPOSE OF PLAN

    The purpose of this Sirna Therapeutics, Inc. 2005 Performance Incentive Plan
(this “Plan”) of Sirna Therapeutics, Inc., a Delaware corporation (the
“Corporation”), is to promote the success of the Corporation and to increase
stockholder value by providing an additional means through the grant of awards
to attract, motivate, retain and reward selected employees and other eligible
persons.

2. ELIGIBILITY

    The Administrator (as such term is defined in Section 3.1) may grant awards
under this Plan only to those persons that the Administrator determines to be
Eligible Persons. An “Eligible Person” is any person who is either: (a) an
officer (whether or not a director) or employee of the Corporation or one of its
Subsidiaries; (b) a director of the Corporation or one of its Subsidiaries; or
(c) an individual consultant or advisor who renders or has rendered bona fide
services (other than services in connection with the offering or sale of
securities of the Corporation or one of its Subsidiaries in a capital-raising
transaction or as a market maker or promoter of securities of the Corporation or
one of its Subsidiaries) to the Corporation or one of its Subsidiaries and who
is selected to participate in this Plan by the Administrator; provided, however,
that a person who is otherwise an Eligible Person under clause (c) above may
participate in this Plan only if such participation would not adversely affect
either the Corporation’s eligibility to use Form S-8 to register under the
Securities Act of 1933, as amended (the “Securities Act”), the offering and sale
of shares issuable under this Plan by the Corporation or the Corporation’s
compliance with any other applicable laws. An Eligible Person who has been
granted an award (a “participant”) may, if otherwise eligible, be granted
additional awards if the Administrator shall so determine. As used herein,
“Subsidiary” means any corporation or other entity a majority of whose
outstanding voting stock or voting power is beneficially owned directly or
indirectly by the Corporation; and “Board” means the Board of Directors of the
Corporation.

3. PLAN ADMINISTRATION

  3.1   The Administrator. This Plan shall be administered by and all awards
under this Plan shall be authorized by the Administrator. The “Administrator”
means the Board or one or more committees appointed by the Board or another
committee (within its delegated authority) to administer all or certain aspects
of this Plan. Any such committee shall be comprised solely of one or more
directors or such number of directors as may be required under applicable law. A
committee may delegate some or all of its authority to another committee so
constituted. The Board or a committee comprised solely of directors may also
delegate, to the extent permitted by Section 157(c) of the Delaware General
Corporation Law and any other applicable law, to one or more officers of the
Corporation, its powers

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      under this Plan (a) to designate the officers and employees of the
Corporation and its Subsidiaries who will receive grants of awards under this
Plan, and (b) to determine the number of shares subject to, and the other terms
and conditions of, such awards. The Board may delegate different levels of
authority to different committees with administrative and grant authority under
this Plan. Unless otherwise provided in the Bylaws of the Corporation or the
applicable charter of any Administrator: (a) a majority of the members of the
acting Administrator shall constitute a quorum, and (b) the vote of a majority
of the members present assuming the presence of a quorum or the unanimous
written consent of the members of the Administrator shall constitute action by
the acting Administrator.         With respect to awards intended to satisfy the
requirements for performance-based compensation under Section 162(m) of the
Internal Revenue Code of 1986, as amended (the “Code”), this Plan shall be
administered by a committee consisting solely of two or more outside directors
(as this requirement is applied under Section 162(m) of the Code); provided,
however, that the failure to satisfy such requirement shall not affect the
validity of the action of any committee otherwise duly authorized and acting in
the matter. Award grants, and transactions in or involving awards, intended to
be exempt under Rule 16b-3 under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), must be duly and timely authorized by the Board or a
committee consisting solely of two or more non-employee directors (as this
requirement is applied under Rule 16b-3 promulgated under the Exchange Act). To
the extent required by any applicable listing agency, this Plan shall be
administered by a committee composed entirely of independent directors (within
the meaning of the applicable listing agency).     3.2   Powers of the
Administrator. Subject to the express provisions of this Plan, the Administrator
is authorized and empowered to do all things necessary or desirable in
connection with the authorization of awards and the administration of this Plan
(in the case of a committee or delegation to one or more officers, within the
authority delegated to that committee or person(s)), including, without
limitation, the authority to:

  (a)   determine eligibility and, from among those persons determined to be
eligible, the particular Eligible Persons who will receive an award under this
Plan;     (b)   grant awards to Eligible Persons, determine the price at which
securities will be offered or awarded and the number of securities to be offered
or awarded to any of such persons, determine the other specific terms and
conditions of such awards consistent with the express limits of this Plan,
establish the installments (if any) in which such awards shall become
exercisable or shall vest (which may include, without limitation, performance
and/or time-based schedules), or determine that no delayed exercisability or
vesting is required, establish any applicable performance targets, and establish
the events of termination or reversion of such awards;

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  (c)   approve the forms of award agreements (which need not be identical
either as to type of award or among participants);     (d)   construe and
interpret this Plan and any agreements defining the rights and obligations of
the Corporation, its Subsidiaries, and participants under this Plan, further
define the terms used in this Plan, and prescribe, amend and rescind rules and
regulations relating to the administration of this Plan or the awards granted
under this Plan;     (e)   cancel, modify, or waive the Corporation’s rights
with respect to, or modify, discontinue, suspend, or terminate any or all
outstanding awards, subject to any required consent under Section 8.6.5;     (f)
  accelerate or extend the vesting or exercisability or extend the term of any
or all such outstanding awards (in the case of options or stock appreciation
rights, within the maximum ten-year term of such awards) in such circumstances
as the Administrator may deem appropriate (including, without limitation, in
connection with a termination of employment or services or other events of a
personal nature) subject to any required consent under Section 8.6.5;     (g)  
adjust the number of shares of Common Stock subject to any award, adjust the
price of any or all outstanding awards or otherwise change previously imposed
terms and conditions, in such circumstances as the Administrator may deem
appropriate, in each case subject to Sections 4 and 8.6, and provided that in no
case (except due to an adjustment contemplated by Section 7 or any repricing
that may be approved by stockholders) shall such an adjustment constitute a
repricing (by amendment, cancellation and regrant, exchange or other means) of
the per share exercise or base price of any option or stock appreciation right;
    (h)   determine the date of grant of an award, which may be a designated
date after but not before the date of the Administrator’s action (unless
otherwise designated by the Administrator, the date of grant of an award shall
be the date upon which the Administrator took the action granting an award);    
(i)   determine whether, and the extent to which, adjustments are required
pursuant to Section 7 hereof and authorize the termination, conversion,
substitution or succession of awards upon the occurrence of an event of the type
described in Section 7;     (j)   acquire or settle (subject to Sections 7 and
8.6) rights under awards in cash, stock of equivalent value, or other
consideration; and     (k)   determine the fair market value of the Common Stock
or awards under this Plan from time to time and/or the manner in which such
value will be determined.

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  3.3   Binding Determinations. Any action taken by, or inaction of, the
Corporation, any Subsidiary, or the Administrator relating or pursuant to this
Plan and within its authority hereunder or under applicable law shall be within
the absolute discretion of that entity or body and shall be conclusive and
binding upon all persons. Neither the Board nor any Board committee, nor any
member thereof or person acting at the direction thereof, shall be liable for
any act, omission, interpretation, construction or determination made in good
faith in connection with this Plan (or any award made under this Plan), and all
such persons shall be entitled to indemnification and reimbursement by the
Corporation in respect of any claim, loss, damage or expense (including, without
limitation, attorneys’ fees) arising or resulting therefrom to the fullest
extent permitted by law and/or under any directors and officers liability
insurance coverage that may be in effect from time to time.     3.4   Reliance
on Experts. In making any determination or in taking or not taking any action
under this Plan, the Board or a committee, as the case may be, may obtain and
may rely upon the advice of experts, including employees and professional
advisors to the Corporation. No director, officer or agent of the Corporation or
any of its Subsidiaries shall be liable for any such action or determination
taken or made or omitted in good faith.     3.5   Delegation. The Administrator
may delegate ministerial, non-discretionary functions to individuals who are
officers or employees of the Corporation or any of its Subsidiaries or to third
parties.

4. SHARES OF COMMON STOCK SUBJECT TO THE PLAN; SHARE LIMITS

  4.1   Shares Available. Subject to the provisions of Section 7.1, the capital
stock that may be delivered under this Plan shall be shares of the Corporation’s
authorized but unissued Common Stock and any shares of its Common Stock held as
treasury shares. For purposes of this Plan, “Common Stock” shall mean the common
stock of the Corporation and such other securities or property as may become the
subject of awards under this Plan, or may become subject to such awards,
pursuant to an adjustment made under Section 7.1.     4.2   Share Limits. The
maximum number of shares of Common Stock that may be delivered pursuant to
awards granted to Eligible Persons under this Plan (the “Share Limit”) is equal
to the sum of (a) 5,749,745 shares, plus (b) the number of any shares subject to
stock options granted under the Corporation’s 2001 Stock Option Plan (the “2001
Plan”) and outstanding as of the date of stockholder approval of this Plan (the
“Stockholder Approval Date”) which expire, or for any reason are cancelled or
terminated, after the Stockholder Approval Date without being exercised;
provided that in no event shall the Share Limit exceed 12,035,091 shares (which
is the sum of the 5,749,745 shares set forth above, plus the maximum number of
shares subject to options previously granted and outstanding under the 2001 Plan
as of the Stockholder Approval Date).         The following limits also apply
with respect to awards granted under this Plan:

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  (a)   The maximum number of shares of Common Stock that may be delivered
pursuant to options qualified as incentive stock options granted under this Plan
is 5,000,000 shares, subject to the Plan limit set forth above.     (b)   The
maximum number of shares of Common Stock subject to those options and stock
appreciation rights that are granted during any calendar year to any individual
under this Plan is 750,000 shares.     (c)   Additional limits with respect to
Performance-Based Awards are set forth in Section 5.2.3.         Each of the
foregoing numerical limits is subject to adjustment as contemplated by
Section 4.3, Section 7.1, and Section 8.10.

  4.3   Awards Settled in Cash, Reissue of Awards and Shares. To the extent that
an award is settled in cash or a form other than shares of Common Stock, the
shares that would have been delivered had there been no such cash or other
settlement shall not be counted against the shares available for issuance under
this Plan. In the event that shares are delivered in respect of a dividend
equivalent, stock appreciation right, or other award, only the actual number of
shares delivered with respect to the award shall be counted against the share
limits of this Plan. Shares that are subject to or underlie awards which expire
or for any reason are cancelled or terminated, are forfeited, fail to vest, or
for any other reason are not paid or delivered under this Plan shall again be
available for subsequent awards under this Plan. Shares that are exchanged by a
participant or withheld by the Corporation as full or partial payment in
connection with any award under this Plan or the 2001 Plan (with respect to such
a payment in connection with any award under the 2001 Plan, only to the extent
such transaction occurs after the Effective Date), as well as any shares
exchanged by a participant or withheld by the Corporation or one of its
Subsidiaries to satisfy the tax withholding obligations related to any award
under this Plan or the 2001 Plan (with respect to such an exchange or
withholding in connection with any award under the 2001 Plan, only to the extent
such transaction occurs after the Effective Date), shall be available for
subsequent awards under this Plan. Refer to Section 8.10 for application of the
foregoing share limits with respect to assumed awards. The foregoing adjustments
to the share limits of this Plan are subject to any applicable limitations under
Section 162(m) of the Code with respect to awards intended as performance-based
compensation thereunder.     4.4   Reservation of Shares; No Fractional Shares;
Minimum Issue. The Corporation shall at all times reserve a number of shares of
Common Stock sufficient to cover the Corporation’s obligations and contingent
obligations to deliver shares with respect to awards then outstanding under this
Plan (exclusive of any dividend equivalent obligations to the extent the
Corporation has the right to settle such rights in cash). No fractional shares
shall be delivered under this Plan. The Administrator may pay cash in lieu of
any fractional shares in settlements of awards under this Plan. No fewer than
100 shares may be purchased on exercise of any award (or, in the case of stock
appreciation or purchase rights, no fewer than 100 rights may be exercised at
any one time)

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      unless the total number purchased or exercised is the total number at the
time available for purchase or exercise under the award.

5. AWARDS

  5.1   Type and Form of Awards. The Administrator shall determine the type or
types of award(s) to be made to each selected Eligible Person. Awards may be
granted singly, in combination or in tandem. Awards also may be made in
combination or in tandem with, in replacement of, as alternatives to, or as the
payment form for grants or rights under any other employee or compensation plan
of the Corporation or one of its Subsidiaries. The types of awards that may be
granted under this Plan are:

5.1.1 Stock Options. A stock option is the grant of a right to purchase a
specified number of shares of Common Stock during a specified period as
determined by the Administrator. An option may be intended as an incentive stock
option within the meaning of Section 422 of the Code (an “ISO”) or a
nonqualified stock option (an option not intended to be an ISO). The award
agreement for an option will indicate if the option is intended as an ISO;
otherwise it will be deemed to be a nonqualified stock option. The maximum term
of each option (ISO or nonqualified) shall be ten (10) years. The per share
exercise price for each option intended as an ISO shall be not less than 100% of
the fair market value of a share of Common Stock on the date of grant of the
option. The per share exercise price for each option, other than options
intended as ISOs, shall be determined by the Administrator at the time of grant
of the option. When an option is exercised, the exercise price for the shares to
be purchased shall be paid in full in cash or such other method permitted by the
Administrator consistent with Section 5.5.
5.1.2 Additional Rules Applicable to ISOs. To the extent that the aggregate fair
market value (determined at the time of grant of the applicable option) of stock
with respect to which ISOs first become exercisable by a participant in any
calendar year exceeds $100,000, taking into account both Common Stock subject to
ISOs under this Plan and stock subject to ISOs under all other plans of the
Corporation or one of its Subsidiaries (or any parent or predecessor corporation
to the extent required by and within the meaning of Section 422 of the Code and
the regulations promulgated thereunder), such options shall be treated as
nonqualified stock options. In reducing the number of options treated as ISOs to
meet the $100,000 limit, the most recently granted options shall be reduced
first. To the extent a reduction of simultaneously granted options is necessary
to meet the $100,000 limit, the Administrator may, in the manner and to the
extent permitted by law, designate which shares of Common Stock are to be
treated as shares acquired pursuant to the exercise of an ISO. ISOs may only be
granted to employees of the Corporation or one of its subsidiaries (for this
purpose, the term “subsidiary” is used as defined in Section 424(f) of the Code,
which generally requires an unbroken chain of ownership of at least 50% of the
total combined voting power of all classes of stock of each subsidiary in the
chain beginning with the Corporation and ending with the subsidiary in
question). There shall be imposed in any award agreement relating to ISOs such
other terms and conditions

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as from time to time are required in order that the option be an “incentive
stock option” as that term is defined in Section 422 of the Code. No ISO may be
granted to any person who, at the time the option is granted, owns (or is deemed
to own under Section 424(d) of the Code) shares of outstanding Common Stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Corporation, unless the exercise price of such option is at least
110% of the fair market value of the stock subject to the option and such option
by its terms is not exercisable after the expiration of five years from the date
such option is granted.
5.1.3 Stock Appreciation Rights. A stock appreciation right or “SAR” is a right
to receive a payment, in cash and/or Common Stock, equal to the excess of the
fair market value of a specified number of shares of Common Stock on the date
the SAR is exercised over the “base price” of the SAR as determined by the
Administrator and set forth in the applicable award agreement. The maximum term
of an SAR shall be ten (10) years.
5.1.4 Other Awards. The other types of awards that may be granted under this
Plan include: (a) stock bonuses, restricted stock, performance stock, stock
units, phantom stock, dividend equivalents, or similar rights to purchase or
acquire shares, whether at a fixed or variable price or ratio related to the
Common Stock, upon the passage of time, the occurrence of one or more events, or
the satisfaction of performance criteria or other conditions, or any combination
thereof; (b) any similar securities with a value derived from the value of or
related to the Common Stock and/or returns thereon; or (c) cash awards granted
consistent with Section 5.2 below.

  5.2   Section 162(m) Performance-Based Awards. Without limiting the generality
of the foregoing, any of the types of awards listed in Section 5.1.4 above may
be, and options and SARs granted with an exercise or base price not less than
the fair market value of a share of Common Stock at the date of grant
(“Qualifying Options” and “Qualifying SARS,” respectively) typically will be,
granted as awards intended to satisfy the requirements for “performance-based
compensation” within the meaning of Section 162(m) of the Code
(“Performance-Based Awards”). The grant, vesting, exercisability or payment of
Performance-Based Awards may depend (or, in the case of Qualifying Options or
Qualifying SARs, may also depend) on the degree of achievement of one or more
performance goals relative to a pre-established targeted level or level using
one or more of the Business Criteria set forth below (on an absolute or relative
basis) for the Corporation on a consolidated basis or for one or more of the
Corporation’s subsidiaries, segments, divisions or business units, or any
combination of the foregoing. Any Qualifying Option or Qualifying SAR shall be
subject only to the requirements of Section 5.2.1 and 5.2.3 in order for such
award to satisfy the requirements for “performance-based compensation” under
Section 162(m) of the Award. Any other Performance-Based Award shall be subject
to all of the following provisions of this Section 5.2.

5.2.1 Class; Administrator. The eligible class of persons for Performance-Based
Awards under this Section 5.2 shall be officers and employees of the

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Corporation or one of its Subsidiaries. The Administrator approving
Performance-Based Awards or making any certification required pursuant to
Section 5.2.4 must be constituted as provided in Section 3.1 for awards that are
intended as performance-based compensation under Section 162(m) of the Code.
5.2.2 Performance Goals. The specific performance goals for Performance-Based
Awards (other than Qualifying Options and Qualifying SARs) shall be, on an
absolute or relative basis, established based on one or more of the following
business criteria (“Business Criteria”) as selected by the Administrator in its
sole discretion: earnings per share, cash flow (which means cash and cash
equivalents derived from either net cash flow from operations or net cash flow
from operations, financing and investing activities), total stockholder return,
gross revenue, revenue growth, operating income (before or after taxes), net
earnings (before or after interest, taxes, depreciation and/or amortization),
return on equity or on assets or on net investment, cost containment or
reduction, or any combination thereof. These terms are used as applied under
generally accepted accounting principles or in the financial reporting of the
Corporation or of its Subsidiaries. To qualify awards as performance-based under
Section 162(m), the applicable Business Criterion (or Business Criteria, as the
case may be) and specific performance goal or goals (“targets”) must be
established and approved by the Administrator during the first 90 days of the
performance period (and, in the case of performance periods of less than one
year, in no event after 25% or more of the performance period has elapsed) and
while performance relating to such target(s) remains substantially uncertain
within the meaning of Section 162(m) of the Code. Performance targets shall be
adjusted to mitigate the unbudgeted impact of material, unusual or nonrecurring
gains and losses, accounting changes or other extraordinary events not foreseen
at the time the targets were set unless the Administrator provides otherwise at
the time of establishing the targets. The applicable performance measurement
period may not be less than three months nor more than 10 years.
5.2.3 Form of Payment; Maximum Performance-Based Award. Grants or awards under
this Section 5.2 may be paid in cash or shares of Common Stock or any
combination thereof. Grants of Qualifying Options and Qualifying SARs to any one
participant in any one calendar year shall be subject to the limit set forth in
Section 4.2(b). The maximum number of shares of Common Stock which may be
delivered pursuant to Performance-Based Awards (other than Qualifying Options
and Qualifying SARs, and other than cash awards covered by the following
sentence) that are granted to any one participant in any one calendar year shall
not exceed 750,000 shares, either individually or in the aggregate, subject to
adjustment as provided in Section 7.1. In addition, the aggregate amount of
compensation to be paid to any one participant in respect of all
Performance-Based Awards payable only in cash and not related to shares of
Common Stock and granted to that participant in any one calendar year shall not
exceed $1,000,000.00. Awards that are cancelled during the year shall be counted
against these limits to the extent permitted by Section 162(m) of the Code.
5.2.4 Certification of Payment. Before any Performance-Based Award under this
Section 5.2 (other than Qualifying Options and Qualifying SARs) is paid and

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to the extent required to qualify the award as performance-based compensation
within the meaning of Section 162(m) of the Code, the Administrator must certify
in writing that the performance target(s) and any other material terms of the
Performance-Based Award were in fact timely satisfied.
5.2.5 Reservation of Discretion. The Administrator will have the discretion to
determine the restrictions or other limitations of the individual awards granted
under this Section 5.2 including the authority to reduce awards, payouts or
vesting or to pay no awards, in its sole discretion, if the Administrator
preserves such authority at the time of grant by language to this effect in its
authorizing resolutions or otherwise.
5.2.6 Expiration of Grant Authority. As required pursuant to Section 162(m) of
the Code and the regulations promulgated thereunder, the Administrator’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 Corporation’s stockholders that occurs in the fifth year following the
year in which the Corporation’s stockholders first approve this Plan.

  5.3   Award Agreements. Each award shall be evidenced by a written award
agreement in the form approved by the Administrator and executed on behalf of
the Corporation and, if required by the Administrator, executed by the recipient
of the award. The Administrator may authorize any officer of the Corporation
(other than the particular award recipient) to execute any or all award
agreements on behalf of the Corporation. The award agreement shall set forth the
material terms and conditions of the award as established by the Administrator
consistent with the express limitations of this Plan.     5.4   Deferrals and
Settlements. Payment of awards may be in the form of cash, Common Stock, other
awards or combinations thereof as the Administrator shall determine, and with
such restrictions as it may impose. The Administrator may also require or permit
participants to elect to defer the issuance of shares or the settlement of
awards in cash under such rules and procedures as it may establish under this
Plan. The Administrator may also provide that deferred settlements include the
payment or crediting of interest or other earnings on the deferral amounts, or
the payment or crediting of dividend equivalents where the deferred amounts are
denominated in shares.     5.5   Consideration for Common Stock or Awards. The
purchase price for any award granted under this Plan or the Common Stock to be
delivered pursuant to an award, as applicable, may be paid by means of any
lawful consideration as determined by the Administrator, including, without
limitation, one or a combination of the following methods:

  •   services rendered by the recipient of such award;     •   cash, check
payable to the order of the Corporation, or electronic funds transfer;

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  •   notice and third party payment in such manner as may be authorized by the
Administrator;     •   the delivery of previously owned shares of Common Stock;
    •   by a reduction in the number of shares otherwise deliverable pursuant to
the award; or     •   subject to such procedures as the Administrator may adopt,
pursuant to a “cashless exercise” with a third party who provides financing for
the purposes of (or who otherwise facilitates) the purchase or exercise of
awards.

      In no event shall any shares newly-issued by the Corporation be issued for
less than the minimum lawful consideration for such shares or for consideration
other than consideration permitted by applicable state law. In the event that
the Administrator allows a participant to exercise an award by delivering shares
of Common Stock previously owned by such participant and unless otherwise
expressly provided by the Administrator, any shares delivered which were
initially acquired by the participant from the Corporation (upon exercise of a
stock option or otherwise) must have been owned by the participant at least six
months as of the date of delivery. Shares of Common Stock used to satisfy the
exercise price of an option shall be valued at their fair market value on the
date of exercise. The Corporation will not be obligated to deliver any shares
unless and until it receives full payment of the exercise or purchase price
therefor and any related withholding obligations under Section 8.5 and any other
conditions to exercise or purchase have been satisfied. Unless otherwise
expressly provided in the applicable award agreement, the Administrator may at
any time eliminate or limit a participant’s ability to pay the purchase or
exercise price of any award or shares by any method other than cash payment to
the Corporation.     5.6   Definition of Fair Market Value. For purposes of this
Plan, “fair market value” shall mean, unless otherwise determined or provided by
the Administrator in the circumstances, the last price for a share of Common
Stock as furnished by the National Association of Securities Dealers, Inc. (the
“NASD”) through the NASDAQ National Market Reporting System (the “National
Market”) for the date in question or, if no sales of Common Stock were reported
by the NASD on the National Market on that date, the last price for a share of
Common Stock as furnished by the NASD through the National Market for the next
preceding day on which sales of Common Stock were reported by the NASD. The
Administrator may, however, provide with respect to one or more awards that the
fair market value shall equal the last price for a share of Common Stock as
furnished by the NASD through the National Market available on the date in
question or the average of the high and low trading prices of a share of Common
Stock as furnished by the NASD through the National Market for the date in
question or the most recent trading day. If the Common Stock is no longer listed
or is no longer actively traded on the National Market as of the applicable
date, the fair market value of the Common Stock shall be the value as reasonably
determined by the Administrator for purposes of the award in the circumstances.
The Administrator also may adopt a different methodology for determining fair

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      market value with respect to one or more awards if a different methodology
is necessary or advisable to secure any intended favorable tax, legal or other
treatment for the particular award(s) (for example, and without limitation, the
Administrator may provide that fair market value for purposes of one or more
awards will be based on an average of closing prices (or the average of high and
low daily trading prices) for a specified period preceding the relevant date).

  5.7   Transfer Restrictions.

5.7.1 Limitations on Exercise and Transfer. Unless otherwise expressly provided
in (or pursuant to) this Section 5.7, by applicable law and by the award
agreement, as the same may be amended, (a) all awards are non-transferable and
shall not be subject in any manner to sale, transfer, anticipation, alienation,
assignment, pledge, encumbrance or charge; (b) awards shall be exercised only by
the participant; and (c) amounts payable or shares issuable pursuant to any
award shall be delivered only to (or for the account of) the participant.
5.7.2 Exceptions. The Administrator may permit awards to be exercised by and
paid to, or otherwise transferred to, other persons or entities pursuant to such
conditions and procedures, including limitations on subsequent transfers, as the
Administrator may, in its sole discretion, establish in writing. Any permitted
transfer shall be subject to compliance with applicable federal and state
securities laws.
5.7.3 Further Exceptions to Limits on Transfer. The exercise and transfer
restrictions in Section 5.7.1 shall not apply to:

  (a)   transfers to the Corporation,     (b)   the designation of a beneficiary
to receive benefits in the event of the participant’s death or, if the
participant has died, transfers to or exercise by the participant’s beneficiary,
or, in the absence of a validly designated beneficiary, transfers by will or the
laws of descent and distribution,     (c)   subject to any applicable
limitations on ISOs, transfers to a family member (or former family member)
pursuant to a domestic relations order if approved or ratified by the
Administrator,     (d)   if the participant has suffered a disability, permitted
transfers or exercises on behalf of the participant by his or her legal
representative, or     (e)   the authorization by the Administrator of “cashless
exercise” procedures with third parties who provide financing for the purpose of
(or who otherwise facilitate) the exercise of awards consistent with applicable
laws and the express authorization of the Administrator.

  5.8   International Awards. One or more awards may be granted to Eligible
Persons who provide services to the Corporation or one of its Subsidiaries
outside of the United States. Any awards granted to such persons may be granted
pursuant to

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      the terms and conditions of any applicable sub-plans, if any, appended to
this Plan and approved by the Administrator.

6. EFFECT OF TERMINATION OF SERVICE ON AWARDS

  6.1   General. The Administrator shall establish the effect of a termination
of employment or service on the rights and benefits under each award under this
Plan and in so doing may make distinctions based upon, inter alia, the cause of
termination and type of award. If the participant is not an employee of the
Corporation or one of its Subsidiaries and provides other services to the
Corporation or one of its Subsidiaries, the Administrator shall be the sole
judge for purposes of this Plan (unless a contract or the award otherwise
provides) of whether the participant continues to render services to the
Corporation or one of its Subsidiaries and the date, if any, upon which such
services shall be deemed to have terminated.     6.2   Events Not Deemed
Terminations of Service. Unless the express policy of the Corporation or one of
its Subsidiaries, or the Administrator, otherwise provides, the employment
relationship shall not be considered terminated in the case of (a) sick leave,
(b) military leave, or (c) any other leave of absence authorized by the
Corporation or one of its Subsidiaries, or the Administrator; provided that
unless reemployment upon the expiration of such leave is guaranteed by contract
or law, such leave is for a period of not more than 90 days. In the case of any
employee of the Corporation or one of its Subsidiaries on an approved leave of
absence, continued vesting of the award while on leave from the employ of the
Corporation or one of its Subsidiaries may be suspended until the employee
returns to service, unless the Administrator otherwise provides or applicable
law otherwise requires. In no event shall an award be exercised after the
expiration of the term set forth in the award agreement.     6.3   Effect of
Change of Subsidiary Status. For purposes of this Plan and any award, if an
entity ceases to be a Subsidiary of the Corporation a termination of employment
or service shall be deemed to have occurred with respect to each Eligible Person
in respect of such Subsidiary who does not continue as an Eligible Person in
respect of another entity within the Corporation or another Subsidiary that
continues as such after giving effect to the transaction or other event giving
rise to the change in status.

7. ADJUSTMENTS; ACCELERATION

  7.1   Adjustments. Upon or in contemplation of: any reclassification,
recapitalization, stock split (including a stock split in the form of a stock
dividend) or reverse stock split (“stock split”); any merger, combination,
consolidation, or other reorganization; any spin-off, split-up, or similar
extraordinary dividend distribution in respect of the Common Stock (whether in
the form of securities or property); any exchange of Common Stock or other
securities of the Corporation, or any similar, unusual or extraordinary
corporate transaction in respect of the Common Stock; or a sale of all or
substantially all the business or assets of the Corporation as an entirety; then
the Administrator shall, in such manner, to such

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      extent (if any) and at such time as it deems appropriate and equitable in
the circumstances:

  (a)   proportionately adjust any or all of (1) the number and type of shares
of Common Stock (or other securities) that thereafter may be made the subject of
awards (including the specific share limits, maximums and numbers of shares set
forth elsewhere in this Plan), (2) the number, amount and type of shares of
Common Stock (or other securities or property) subject to any or all outstanding
awards, (3) the grant, purchase, or exercise price (which term includes the base
price of any SAR or similar right) of any or all outstanding awards, (4) the
securities, cash or other property deliverable upon exercise or payment of any
outstanding awards, or (5) (subject to Section 8.8.3(a)) the performance
standards applicable to any outstanding awards, or     (b)   make provision for
a cash payment or for the assumption, substitution or exchange of any or all
outstanding share-based awards or the cash, securities or property deliverable
to the holder of any or all outstanding share-based awards, based upon the
distribution or consideration payable to holders of the Common Stock upon or in
respect of such event.

      The Administrator may adopt such valuation methodologies for outstanding
awards as it deems reasonable in the event of a cash or property settlement and,
in the case of options, SARs or similar rights, but without limitation on other
methodologies, may base such settlement solely upon the excess if any of the per
share amount payable upon or in respect of such event over the exercise or base
price of the award. With respect to any award of an ISO, the Administrator may
make such an adjustment that causes the option to cease to qualify as an ISO
without the consent of the affected participant.         In any of such events,
the Administrator may take such action prior to such event to the extent that
the Administrator deems the action necessary to permit the participant to
realize the benefits intended to be conveyed with respect to the underlying
shares in the same manner as is or will be available to stockholders generally.
In the case of any stock split or reverse stock split, if no action is taken by
the Administrator, the proportionate adjustments contemplated by clause (a)
above shall nevertheless be made.     7.2   Possible Acceleration of Awards.
Without limiting the generality of the Administrator’s power pursuant to
Section 3.2, the Administrator may, in its discretion, provide that any
outstanding option or SAR shall become fully vested, that any share of
restricted stock then outstanding shall fully vest free of restrictions, and
that any other award granted under this Plan that is then outstanding shall be
payable to the holder of such award upon or in connection with a dissolution of
the Corporation or other event described in Section 7.1 that the Corporation
does not survive (or does not survive as a public company in respect of its
Common Stock) or upon or in connection with such change in control circumstances
as the Administrator may provide. The Administrator may take such action with
respect to all awards then outstanding or only with respect

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      to certain specific awards identified by the Administrator in the
circumstances. If the vesting of an award has been accelerated expressly in
anticipation of an event or upon stockholder approval of an event and the
Administrator later determines that the event will not occur, the Administrator
may rescind the effect of the acceleration as to any then outstanding and
unexercised or otherwise unvested awards. Any acceleration of awards pursuant to
this Section 7 shall comply with applicable legal requirements and, if necessary
to accomplish the purposes of the acceleration or if the circumstances require,
may be deemed by the Administrator to occur a limited period of time not greater
than 30 days before the event. Without limiting the generality of the foregoing,
the Administrator may deem an acceleration to occur immediately prior to the
applicable event. The portion of any ISO accelerated in connection with an event
shall remain exercisable as an ISO only to the extent the applicable $100,000
limitation on ISOs is not exceeded. To the extent exceeded, the accelerated
portion of the option shall be exercisable as a nonqualified stock option under
the Code.

  7.3   Early Termination of Awards. Upon a dissolution of the Corporation or
other event described in Section 7.1 that the Corporation does not survive (or
does not survive as a public company in respect of its Common Stock), each
then-outstanding award (whether or not vested, exercisable and/or payable),
shall terminate upon the related dissolution event or other event referred to in
Section 7.1, as applicable, subject to any provision that has been expressly
made by the Administrator, through a plan of reorganization or otherwise, for
the survival, substitution, assumption, exchange or other continuation or
settlement of such award and provided that, in the case of options and SARs that
will not survive, be substituted for, assumed, exchanged, or otherwise continued
or settled in the transaction, the holder of such award shall be given
reasonable advance notice of the impending termination and a reasonable
opportunity to exercise his or her vested and outstanding options and SARs in
accordance with their terms before the termination of such awards (except that
in no case shall more than ten days’ notice of the impending termination be
required).

8. OTHER PROVISIONS

  8.1   Compliance with Laws. This Plan, the granting and vesting of awards
under this Plan, the offer, issuance and delivery of shares of Common Stock, the
acceptance of promissory notes and/or the payment of money under this Plan or
under awards are subject to compliance with all applicable federal and state
laws, rules and regulations (including but not limited to state and federal
securities law, federal margin requirements) and to such approvals by any
listing, regulatory or governmental authority as may, in the opinion of counsel
for the Corporation, be necessary or advisable in connection therewith. The
person acquiring any securities under this Plan will, if requested by the
Corporation or one of its Subsidiaries, provide such assurances and
representations to the Corporation or one of its Subsidiaries as the
Administrator may deem necessary or desirable to assure compliance with all
applicable legal and accounting requirements.     8.2   Employment Status. No
person shall have any claim or rights to be granted an award (or additional
awards, as the case may be) under this Plan, subject to any

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      express contractual rights (set forth in a document other than this Plan)
to the contrary.     8.3   No Employment/Service Contract. Nothing contained in
this Plan (or in any other documents under this Plan or in any award) shall
confer upon any Eligible Person or other participant any right to continue in
the employ or other service of the Corporation or one of its Subsidiaries,
constitute any contract or agreement of employment or other service or affect an
employee’s status as an employee at will, nor shall interfere in any way with
the right of the Corporation or one of its Subsidiaries to change a person’s
compensation or other benefits, or to terminate his or her employment or other
service, with or without cause. Nothing in this Section 8.3, however, is
intended to adversely affect any express independent right of such person under
a separate employment or service contract other than an award agreement.     8.4
  Plan Not Funded. Awards payable under this Plan shall be payable in shares or
from the general assets of the Corporation, and no special or separate reserve,
fund or deposit shall be made to assure payment of such awards. No participant,
beneficiary or other person shall have any right, title or interest in any fund
or in any specific asset (including shares of Common Stock, except as expressly
otherwise provided) of the Corporation or one of its Subsidiaries by reason of
any award hereunder. Neither the provisions of this Plan (or of any related
documents), nor the creation or adoption of this Plan, nor any action taken
pursuant to the provisions of this Plan shall create, or be construed to create,
a trust of any kind or a fiduciary relationship between the Corporation or one
of its Subsidiaries and any participant, beneficiary or other person. To the
extent that a participant, beneficiary or other person acquires a right to
receive payment pursuant to any award hereunder, such right shall be no greater
than the right of any unsecured general creditor of the Corporation.     8.5  
Tax Withholding. Upon any exercise, vesting, or payment of any award or upon the
disposition of shares of Common Stock acquired pursuant to the exercise of an
ISO prior to satisfaction of the holding period requirements of Section 422 of
the Code, the Corporation or one of its Subsidiaries shall have the right at its
option to:

  (a)   require the participant (or the participant’s personal representative or
beneficiary, as the case may be) to pay or provide for payment of at least the
minimum amount of any taxes which the Corporation or one of its Subsidiaries may
be required to withhold with respect to such award event or payment; or     (b)
  deduct from any amount otherwise payable in cash to the participant (or the
participant’s personal representative or beneficiary, as the case may be) the
minimum amount of any taxes which the Corporation or one of its Subsidiaries may
be required to withhold with respect to such cash payment.

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      In any case where a tax is required to be withheld in connection with the
delivery of shares of Common Stock under this Plan, the Administrator may in its
sole discretion (subject to Section 8.1) grant (either at the time of the award
or thereafter) to the participant the right to elect, pursuant to such rules and
subject to such conditions as the Administrator may establish, to have the
Corporation reduce the number of shares to be delivered by (or otherwise
reacquire) the appropriate number of shares, valued in a consistent manner at
their fair market value or at the sales price in accordance with authorized
procedures for cashless exercises, necessary to satisfy the minimum applicable
withholding obligation on exercise, vesting or payment. In no event shall the
shares withheld exceed the minimum whole number of shares required for tax
withholding under applicable law. The Corporation may, with the Administrator’s
approval, accept one or more promissory notes from any Eligible Person in
connection with taxes required to be withheld upon the exercise, vesting or
payment of any award under this Plan; provided that any such note shall be
subject to terms and conditions established by the Administrator and the
requirements of applicable law.     8.6   Effective Date, Termination and
Suspension, Amendments.

8.6.1 Effective Date. This Plan is effective as of April 22, 2005, the date of
its approval by the Board (the “Effective Date”). This Plan shall be submitted
for and subject to stockholder approval no later than twelve months after the
Effective Date. Unless earlier terminated by the Board, this Plan shall
terminate at the close of business on the day before the tenth anniversary of
the Effective Date. After the termination of this Plan either upon such stated
expiration date or its earlier termination by the Board, no additional awards
may be granted under this Plan, but previously granted awards (and the authority
of the Administrator with respect thereto, including the authority to amend such
awards) shall remain outstanding in accordance with their applicable terms and
conditions and the terms and conditions of this Plan.
8.6.2 Board Authorization. The Board may, at any time, terminate or, from time
to time, amend, modify or suspend this Plan, in whole or in part. No awards may
be granted during any period that the Board suspends this Plan.
8.6.3 Stockholder Approval. To the extent then required by applicable law or any
applicable listing agency or required under Sections 162, 422 or 424 of the Code
to preserve the intended tax consequences of this Plan, or deemed necessary or
advisable by the Board, any amendment to this Plan shall be subject to
stockholder approval.
8.6.4 Amendments to Awards. Without limiting any other express authority of the
Administrator under (but subject to) the express limits of this Plan, the
Administrator by agreement or resolution may waive conditions of or limitations
on awards to participants that the Administrator in the prior exercise of its
discretion has imposed, without the consent of a participant, and (subject to
the requirements of Sections 3.2 and 8.6.5) may make other changes to the terms
and conditions of awards. Any amendment or other action that would constitute a
repricing of an award is subject to the limitations set forth in Section 3.2(g).

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8.6.5 Limitations on Amendments to Plan and Awards. No amendment, suspension or
termination of this Plan or amendment of any outstanding award agreement shall,
without written consent of the participant, affect in any manner materially
adverse to the participant any rights or benefits of the participant or
obligations of the Corporation under any award granted under this Plan prior to
the effective date of such change. Changes, settlements and other actions
contemplated by Section 7 shall not be deemed to constitute changes or
amendments for purposes of this Section 8.6.

  8.7   Privileges of Stock Ownership. Except as otherwise expressly authorized
by the Administrator or this Plan, a participant shall not be entitled to any
privilege of stock ownership as to any shares of Common Stock not actually
delivered to and held of record by the participant. No adjustment will be made
for dividends or other rights as a stockholder for which a record date is prior
to such date of delivery.     8.8   Governing Law; Construction; Severability.

8.8.1 Choice of Law. This Plan, the awards, all documents evidencing awards and
all other related documents shall be governed by, and construed in accordance
with the laws of the State of Delaware.
8.8.2 Severability. If a court of competent jurisdiction holds any provision
invalid and unenforceable, the remaining provisions of this Plan shall continue
in effect.
8.8.3 Plan Construction.

  (a)   Rule 16b-3. It is the intent of the Corporation that the awards and
transactions permitted by awards be interpreted in a manner that, in the case of
participants who are or may be subject to Section 16 of the Exchange Act,
qualify, to the maximum extent compatible with the express terms of the award,
for exemption from matching liability under Rule 16b-3 promulgated under the
Exchange Act. Notwithstanding the foregoing, the Corporation shall have no
liability to any participant for Section 16 consequences of awards or events
under awards if an award or event does not so qualify.     (b)   Section 162(m).
Awards under Section 5.1.4 to persons described in Section 5.2 that are either
granted or become vested, exercisable or payable based on attainment of one or
more performance goals related to the Business Criteria, as well as Qualifying
Options and Qualifying SARs granted to persons described in Section 5.2, that
are approved by a committee composed solely of two or more outside directors (as
this requirement is applied under Section 162(m) of the Code) shall be deemed to
be intended as performance-based compensation within the meaning of Section
162(m) of the Code unless such committee provides otherwise at the time of grant
of the award. It is the further intent of the

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      Corporation that (to the extent the Corporation or one of its Subsidiaries
or awards under this Plan may be or become subject to limitations on
deductibility under Section 162(m) of the Code) any such awards and any other
Performance-Based Awards under Section 5.2 that are granted to or held by a
person subject to Section 162(m) will qualify as performance-based compensation
or otherwise be exempt from deductibility limitations under Section 162(m).

  8.9   Captions. Captions and headings are given to the sections and
subsections of this Plan solely as a convenience to facilitate reference. Such
headings shall not be deemed in any way material or relevant to the construction
or interpretation of this Plan or any provision thereof.     8.10   Stock-Based
Awards in Substitution for Stock Options or Awards Granted by Other Corporation.
Awards may be granted to Eligible Persons in substitution for or in connection
with an assumption of employee stock options, SARs, restricted stock or other
stock-based awards granted by other entities to persons who are or who will
become Eligible Persons in respect of the Corporation or one of its
Subsidiaries, in connection with a distribution, merger or other reorganization
by or with the granting entity or an affiliated entity, or the acquisition by
the Corporation or one of its Subsidiaries, directly or indirectly, of all or a
substantial part of the stock or assets of the employing entity. The awards so
granted need not comply with other specific terms of this Plan, provided the
awards reflect only adjustments giving effect to the assumption or substitution
consistent with the conversion applicable to the Common Stock in the transaction
and any change in the issuer of the security. Any shares that are delivered and
any awards that are granted by, or become obligations of, the Corporation, as a
result of the assumption by the Corporation of, or in substitution for,
outstanding awards previously granted by an acquired company (or previously
granted by a predecessor employer (or direct or indirect parent thereof) in the
case of persons that become employed by the Corporation or one of its
Subsidiaries in connection with a business or asset acquisition or similar
transaction) shall not be counted against the Share Limit or other limits on the
number of shares available for issuance under this Plan.     8.11  
Non-Exclusivity of Plan. Nothing in this Plan shall limit or be deemed to limit
the authority of the Board or the Administrator to grant awards or authorize any
other compensation, with or without reference to the Common Stock, under any
other plan or authority.     8.12   No Corporate Action Restriction. The
existence of this Plan, the award agreements and the awards granted hereunder
shall not limit, affect or restrict in any way the right or power of the Board
or the stockholders of the Corporation to make or authorize: (a) any adjustment,
recapitalization, reorganization or other change in the capital structure or
business of the Corporation or any Subsidiary, (b) any merger, amalgamation,
consolidation or change in the ownership of the Corporation or any Subsidiary,
(c) any issue of bonds, debentures, capital, preferred or prior preference stock
ahead of or affecting the capital stock (or the

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      rights thereof) of the Corporation or any Subsidiary, (d) any dissolution
or liquidation of the Corporation or any Subsidiary, (e) any sale or transfer of
all or any part of the assets or business of the Corporation or any Subsidiary,
or (f) any other corporate act or proceeding by the Corporation or any
Subsidiary. No participant, beneficiary or any other person shall have any claim
under any award or award agreement against any member of the Board or the
Administrator, or the Corporation or any employees, officers or agents of the
Corporation or any Subsidiary, as a result of any such action.     8.13   Other
Company Benefit and Compensation Programs. Payments and other benefits received
by a participant under an award made pursuant to this Plan shall not be deemed a
part of a participant’s compensation for purposes of the determination of
benefits under any other employee welfare or benefit plans or arrangements, if
any, provided by the Corporation or any Subsidiary, except where the
Administrator expressly otherwise provides or authorizes in writing. Awards
under this Plan may be made in addition to, in combination with, as alternatives
to or in payment of grants, awards or commitments under any other plans or
arrangements of the Corporation or its Subsidiaries.

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