Blue Sphere Corp.

 

Global Share Incentive Plan (2010)

 

1.          Name And Purpose.

 

1.1           This plan, which has been adopted by the Board of Directors of the
Company, Blue Sphere Corp., as amended from time to time, shall be known as the
Blue Sphere Corp. Global Share Incentive Plan (2010) (the “Plan”).

 

1.2           The purposes of the Plan are to attract and retain the best
available personnel for positions of substantial responsibility, to provide
additional incentive to Service Providers of the Company and its affiliates and
subsidiaries, if any, and to promote the Company's business by providing such
individuals with opportunities to receive Awards pursuant to the Plan and to
strengthen the sense of common interest between such individuals and the
Company's Stockholders.

 

1.3           Awards granted under the Plan to Service Providers in various
jurisdictions may be subject to specific terms and conditions for such grants
may be set forth in one or more separate appendix to the Plan, as may be
approved by the Board of Directors of the Company from time to time.

 

2.          Definitions

 

“Administrator” shall mean the Board of Directors or a Committee.

 

“Appendix” shall mean any appendix to the Plan adopted by the Board of Directors
containing country-specific or other special terms relating to Awards including
additional terms with respect to grants of restricted stock and other
equity-based Awards.

 

“Award” shall mean a grant of Options or allotment of Shares or other
equity-based award hereunder. All Awards shall be confirmed by an Award
Agreement, and subject to the terms and conditions of such Award Agreement.

 

“Award Agreement” shall mean a written instrument setting forth the terms
applicable to a particular Award.

 

“Board of Directors” shall mean the board of directors of the Company.

 

“Cause” shall have the meaning ascribed to such term or a similar term as set
forth in the Participant’s employment agreement or the agreement governing the
provision of services by a non-employee Service Provider, or, in the absence of
such a definition: (i) conviction (or plea of nolo contendere) of any felony or
crime involving moral turpitude or affecting the Company; (ii) repeated and
unreasonable refusal to carry out a reasonable and lawful directive of the
Company or of Participant’s supervisor which involves the business of the
Company or its affiliates and was capable of being lawfully performed; (iii)
fraud or embezzlement of funds of the Company or its affiliates; (iv) any breach
by a director of his / her fiduciary duties or duties of care towards the
Company; and (v) any disclosure of confidential information of the Company or
breach of any obligation not to compete with the Company or not to violate a
restrictive covenant.

 

“Committee” shall mean a compensation committee or other committee as may be
appointed and maintained by the Board of Directors, in its discretion, to
administer the Plan, to the extent permissible under applicable law, as amended
from time to time.

 

 

 

 

“Company” shall mean Blue Sphere Corp., a Nevada Corporation, and its successors
and assigns.

 

“Consultant” means any entity or individual who (either directly or, in the case
of an individual, through his or her employer) is an advisor or consultant to
the Company or its subsidiary or affiliate.

 

“Corporate Charter” shall mean the Certificate of Incorporation and By-laws of
the Company, and any subsequent amendments or replacements thereto.

 

“Disability” shall have the meaning ascribed to such term or a similar term in
the Participant's employment agreement (where applicable), or in the absence of
such a definition, the inability of the Participant, in the opinion of a
qualified physician acceptable to the Company, to perform the major duties of
the Participant’s position with the Company because of the sickness or injury of
the Participant for a consecutive period of 90 days.

 

“Fair Market Value” shall mean, as of any date, the value of Shares, determined
as follows:

 

(i) If the Shares are listed on any established stock exchange or traded on the
Nasdaq National Market or the Nasdaq Small Cap Market, the Fair Market Value of
a Share of common stock of the Company shall be the closing sales price for such
stock (or the closing bid, if no sales were reported) as quoted on such exchange
or market (or the exchange or market with the greatest volume of trading in the
common stock) on the last market trading day prior to the day of determination,
as reported in the Wall Street Journal or such other source as the Board deems
reliable.

 

(ii) In the absence of such markets for the Shares, the Fair Market Value shall
be determined in good faith by the Board.

 

“IPO” shall mean an initial offering of the Company’s Shares to the public in an
underwritten offering under an applicable registration statement.

 

“Options” shall mean options to purchase Shares awarded under the Plan.

 

“Participant” shall mean a recipient of an Award hereunder who executes an Award
Agreement.

 

“Restricted Stock” means an Award of Shares under this Plan that is subject to
the terms and conditions of Section 7.

 

“Service Provider” shall mean an employee, director, office holder or Consultant
of the Company or its subsidiary or affiliate.

 

“Shares” shall mean shares of common stock, par value US$ 0.0001 per share, of
the Company.

 

“Transaction” shall have the meaning set forth in Section 10.2.

 

3.          Administration of the Plan.

 

3.1           The Plan will be administered by the Administrator. If the
Administrator is a Committee, such Committee will consist of such number of
members of the board of directors of the Company (not less than two in number),
as may be determined from time to time by the Board of Directors. The Board of
Directors shall appoint such members of the Committee, may from time to time
remove members from, or add members to, the Committee, and shall fill vacancies
in the Committee however caused.

 

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3.2           The Committee, if appointed, shall select one of its members as
its Chairman and shall hold its meetings at such times and places as it shall
determine. Actions at a meeting of the Committee at which a majority of its
members are present or acts approved in writing by all members of the Committee
shall be the valid acts of the Committee. The Committee shall appoint a
secretary, who shall keep records of its meetings and shall make such rules and
regulations for the conduct of its business and the implementation of the Plan,
as it shall deem advisable, subject to the directives of the Board of Directors
and in accordance with applicable law.

 

3.3           Subject to the general terms and conditions of the Plan, and in
particular Section 3.4 below, the Administrator shall have full authority in its
discretion, from time to time and at any time, to determine (i) eligible
Participants, (ii) the number of Options or Shares to be covered by each Award,
(iii) the time or times at which the Award shall be granted, (iv) the vesting
schedule and other terms and conditions applying to Awards, (v) the form(s) of
written agreements applying to Awards, and (vi) any other matter which is
necessary or desirable for, or incidental to, the administration of the Plan and
the granting of Awards. The Board of Directors may, in its sole discretion,
delegate some or all of the powers listed above to the Committee, to the extent
permitted by applicable law, its Corporate Charter or other applicable law,
rules and regulations.

 

3.4           No member of the Board of Directors or of the Committee shall be
liable for any action or determination made in good faith with respect to the
Plan or any Award granted hereunder. Subject to the Company’s decision and to
all approvals legally required, each member of the Board or the Committee shall
be indemnified and held harmless by the Company against any cost or expense
(including counsel fees) reasonably incurred by him or her, or any liability
(including any sum paid in settlement of a claim with the approval of the
Company) arising out of any act or omission to act in connection with the Plan
unless arising out of such member’s own willful misconduct or bad faith, to the
fullest extent permitted by applicable law. Such indemnification shall be in
addition to any rights of indemnification the member may have as a director or
otherwise under the Company’s Corporate Charter, any agreement, any vote of
stockholders or disinterested directors, insurance policy or otherwise.

 

3.5           The interpretation and construction by the Administrator of any
provision of the Plan or of any Option hereunder shall be final and conclusive.
In the event that the Board appoints a Committee, the interpretation and
construction by the Committee of any provision of the Plan or of any Option
hereunder shall be conclusive unless otherwise determined by the Board of
Directors. To avoid doubt, the Board of Directors may at any time exercise any
powers of the Administrator, notwithstanding the fact that a Committee has been
appointed.

 

3.6           The Administrator shall have the authority to adopt, alter and
repeal such administrative rules, guidelines and practices governing the Plan
and perform all acts, including the delegation of its responsibilities (to the
extent permitted by applicable law and applicable stock exchange rules), as it
shall, from time to time, deem advisable; to construe and interpret the terms
and provisions of the Plan and any Award issued under the Plan (and any
agreements relating thereto); and to otherwise supervise the administration of
the Plan. The Administrator may correct any defect, supply any omission or
reconcile any inconsistency in the Plan or in any agreement relating thereto in
the manner and to the extent it shall deem necessary to effectuate the purpose
and intent of the Plan. Notwithstanding the foregoing, no action of the
Administrator under this Section ‎3.6 not otherwise provided for herein or in an
Award Agreement shall reduce the vested rights of any Participant without the
Participant’s consent.

 

3.7           Without limiting the generality of the foregoing, the
Administrator may adopt special appendices and/or guidelines and provisions for
persons who are residing in or employed in, or subject to, the taxes of, any
domestic or foreign jurisdictions, to comply with applicable laws, regulations,
or accounting, listing or other rules with respect to such domestic or foreign
jurisdictions.

 

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4.Eligible Participants.

 

4.1           No Award may be granted pursuant to the Plan to any person serving
as a member of the Committee or to any other Director of the Company at the time
of the grant, unless such grant is approved in the manner prescribed for the
approval of compensation of directors under applicable law.

 

4.2           Subject to the limitation set forth in Section ‎4.1 above and any
restriction imposed by applicable law, Awards may be granted to any Service
Provider of the Company, whether or not a director of the Company or its
affiliates. The grant of an Award to a Participant hereunder shall neither
entitle such Participant to receive an additional Award or participate in other
incentive plans of the Company, nor disqualify such Participant from receiving
any additional Award or participating in other incentive plans of the Company.

 

5.Reserved Shares.

 

The Company shall determine the number of Shares reserved hereunder from time to
time, and such number may be increased or decreased by the Company from time to
time. Any Shares under the Plan, in respect of which the right hereunder of a
Participant to purchase the same shall for any reason terminate, expire or
otherwise cease to exist, shall again be available for grant as Awards under the
Plan. Any Shares that remain unissued and are not subject to Awards at the
termination of the Plan shall cease to be reserved for purposes of the Plan.
Until termination of the Plan the Company shall at all times reserve a
sufficient number of Shares to meet the requirements of the Plan.

 

6.Award Agreement.

 

6.1           The Board of Directors in its discretion may award to Participants
Awards available under the Plan. The terms of the Award will be set forth in the
Award Agreement. The date of grant of each Award shall be the date specified by
the Board of Directors at the time such award is made, or in the absence of such
specification, the date of approval of the award by the Board of Directors.

 

6.2           The Award Agreement shall state, inter alia, the number of Options
or Shares or equity-based units covered thereby, the type of Option or
Share-based or other grant awarded, any special terms applying to such Award (if
any), including the terms of any country-specific or other applicable Appendix,
as determined by the Board of Directors.

 

7.Restricted Stock and Other Equity-Based Awards.

 

7.1           Eligibility. Restricted Stock may be issued to all Participants
either alone or in addition to other Awards granted under the Plan. The
Administrator shall determine the eligible Participants to whom, and the time or
times at which, grants of Restricted Stock will be made, the number of shares to
be awarded, the purchase price (if any) to be paid by the Participant (subject
to Section 7.2), the time or times at which such Awards may be subject to
forfeiture (if any), the vesting schedule (if any) and rights to acceleration
thereof, and all other terms and conditions of the Awards. The Administrator may
condition the grant or vesting of Restricted Stock upon the attainment of
specified performance targets or such other factors as the Administrator may
determine, in its sole discretion. Unless otherwise determined by the
Administrator , the Participant shall not be permitted to sell or transfer
shares of Restricted Stock awarded under this Plan during a period set by the
Administrator (if any) (the “Restriction Period”) commencing with the date of
such Award, as set forth in the applicable Award agreement.

 

7.2           Terms. A Participant selected to receive Restricted Stock shall
not have any rights with respect to such Award, unless and until such
Participant has delivered a fully executed copy of the Award Agreement
evidencing the Award to the Company and has otherwise complied with the
applicable terms and conditions of such Award. The purchase price of Restricted
Stock shall be determined by the Administrator, but shall not be less than as
permitted under applicable law. Awards of Restricted Stock must be accepted
within a period of 60 days (or such shorter period as the Administrator may
specify at grant) after the grant date, by executing an Award Agreement and by
paying whatever price (if any) the Administrator has designated thereunder.

 

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7.3           Legend. Each Participant receiving Restricted Stock shall be
issued a share certificate in respect of such shares of Restricted Stock, unless
the Administrator elects to use another system, such as book entries by the
transfer agent, as evidencing ownership of Restricted Stock. Such certificate
shall be registered in the name of such Participant, and shall bear an
appropriate legend referring to the terms, conditions, and restrictions
applicable to such Award, substantially in the following form (as well as other
legend required by the Administrator pursuant to Section 19.3 below):

 

“The anticipation, alienation, attachment, sale, transfer, assignment, pledge,
encumbrance or charge of the shares represented hereby are subject to the terms
and conditions (including forfeiture) of the Blue Sphere Corp. Global Incentive
Plan (2009), and an Award Agreement entered into between the registered owner
and the Company dated ____________. Copies of such Plan and Award agreement are
on file at Blue Sphere Corp.”

 

7.4           Custody. The Administrator may require that any share certificates
evidencing such shares be held in custody by the Company until the restrictions
thereon shall have lapsed, and that, as a condition of any Restricted Stock
Award, the Participant shall have delivered a duly signed share transfer deed,
endorsed in blank, relating to the Shares covered by such Award.

 

7.5           Rights as Stockholder. Except as provided in this Section and
Section 7.4 above and as otherwise determined by the Administrator and set forth
in the Award Agreement, the Participant shall have, with respect to the shares
of Restricted Stock, all of the rights of a holder of Shares including, without
limitation, the right to receive any dividends, the right to vote such shares
and, subject to and conditioned upon the full vesting of shares of Restricted
Stock, the right to tender such shares. Notwithstanding the foregoing, the
payment of dividends shall be deferred until, and conditioned upon, the
expiration of the applicable Restriction Period, unless the Administrator, in
its sole discretion, specifies otherwise at the time of the Award.

 

7.6           Lapse of Restrictions. If and when the Restriction Period expires
without a prior forfeiture of the Restricted Stock subject to such Restriction
Period, the certificates for such shares shall be delivered to the Participant.
All legends shall be removed from said certificates at the time of delivery to
the Participant except as otherwise required by applicable law. Notwithstanding
the foregoing, actual certificates shall not be issued to the extent that book
entry recordkeeping is used.

 

7.7            Other Equity-Based Awards. Other equity-based awards (including,
without limitation, restricted stock units and performance share awards) may be
granted either alone or in addition to or other Awards granted under the Plan to
all eligible Participants pursuant to such terms and conditions as the
Administrator may determine, including without limitation, in one or more
appendix adopted by the administrator and appended to this Plan.

 

8.Exercise of Options.

 

8.1           Options shall be exercisable pursuant to the terms under which
they were awarded and subject to the terms and conditions of the Plan and any
applicable Appendix, as specified in the Award Agreement.

 

8.2           The exercise price for each share to be issued upon exercise of an
Option shall be such price as is determined by the Board in its discretion,
provided that the price per Share is not less than the par value of each Share.

 

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8.3           An Option, or any part thereof, shall be exercisable by the
Participant's signing and returning to the Company at its principal office (and
to the Trustee, where applicable), a “Notice of Exercise” in such form and
substance as may be prescribed by the Board of Directors from time to time,
together with full payment for the Shares underlying such Option.

 

8.4           Each payment for Shares under an Option shall be in respect of a
whole number of Shares, shall be effected in cash or by check payable to the
order of the Company, or such other method of payment acceptable to the Company
as determined by the Administrator, and shall be accompanied by a notice stating
the number of Shares being paid for thereby.

 

8.5           Until the Shares are issued (as evidenced by the appropriate entry
in the share register of the Company or of a duly authorized transfer agent of
the Company) a Participant shall have no right to vote or right to receive
dividends or any other rights as a shareholder shall exist with respect to such
Shares, notwithstanding the exercise of the Option. The Company shall issue (or
cause to be issued) such Shares promptly after the Option is exercised. No
adjustment will be made for a dividend or other right the record date for which
is prior to the date the Shares are issued, except as provided in Section ‎9 of
the Plan.

 

8.6           To the extent permitted by law, if the Share is traded on a
national securities exchange, The Nasdaq Share Market or quoted on a national
quotation system sponsored by the National Association of Securities Dealers or
otherwise publicly traded or quoted, payment for the Shares underlying an Option
may be made all or in part by the delivery (on a form prescribed by the Company)
of an irrevocable direction to a securities broker approved by the Company to
sell Shares and to deliver all or part of the sales proceeds to the Company in
payment of the exercise price (or the relevant portion thereof, as applicable)
and any withholding taxes, or on such other terms and conditions as may be
acceptable to the Administrator. No Shares shall be issued until payment has
been made or provided for, as provided herein.

 

9.Termination of Relationship as Service Provider.

 

9.1            Effect of Termination; Exercise after Termination. Unless
otherwise determined by the Administrator, if a Participant ceases to be a
Service Provider, such Participant may exercise any outstanding Options within
such period of time as is specified in the Award Agreement or the Plan to the
extent that the Options are vested on the date of termination (but in no event
later than the expiration of the term of the Option as set forth in the Option
Agreement). If, on the date of termination, any Options are unvested, the Shares
covered by the unvested portion of the Option shall revert to the Plan. If,
after termination, the Participant does not exercise the vested Options within
the time specified in the Award Agreement or the Plan, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

 

In the absence of a provision specifying otherwise in the relevant Award
Agreement, then:

 

(a)          in the event that the Participant ceases to be a Service Provider
for any reason other than termination for Cause, or as a result of the
Participant’s death or Disability: (i) the vested Options shall remain
exercisable until the earlier of: (i) a period of three (3) months from the Date
of Termination; or (ii) expiration of the term of the Option as set forth in
Section 13; and (ii) all Restricted Stock still subject to restriction under the
applicable Restriction Period, as set forth in the Award Agreement, shall be
forfeited;

 

(b)          in the event that the Participant ceases to be a Service Provider
as a result of the Participant’s death or Disability: (i) the vested Options
shall remain exercisable until the earlier of: (i) a period of one (1) year from
the Date of Termination; or (ii) expiration of the term of the Option as set
forth in Section ‎13; and (ii) all Restricted Stock still subject to restriction
under the applicable Restriction Period, as set forth in the Award Agreement,
shall be forfeited;

 

(c)          in the event that the Participant ceases to be a Service Provider
for Cause, (i) all Options will terminate immediately upon the date of such
termination for Cause, such that the unvested portion of the Options will not
vest, and the vested portion of the Options will no longer be exercisable; and
(ii) all Restricted Stock still subject to restriction under the applicable
Restriction Period as of the Date of Termination, as set forth in the Award
Agreement, shall be forfeited.

 

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9.2           Date of Termination.         For purposes of the Plan and any
Option or Option Agreement, and unless otherwise set forth in the relevant Award
Agreement, the “Date of Termination” (whether for Cause or otherwise) shall be
the effective date of termination of the Participant's employment or engagement
as a Service Provider.

 

9.3           Leave of Absence. Unless the Administrator provides otherwise,
vesting of Awards granted hereunder shall be suspended during any unpaid leave
of absence.

 

9.4           Change of Status. A Service Provider shall not cease to be
considered as such in the case of any (a) leave of absence approved by the
Company, or (b) transfers between locations of the Company or between the
Company, and its parent, subsidiary, affiliate, or any successor thereof; or (c)
changes in status (employee to director, employee to consultant, etc.) provided
that such change does not affect the specific terms applying to the Service
Provider’s Award.

 

10.Adjustments.

 

Upon the occurrence of any of the following described events, a Participant's
rights to purchase Shares under the Plan shall be adjusted as hereinafter
provided:

 

10.1        Changes in Capitalization. Subject to any required action by the
stockholders of the Company, the number of Shares covered by each outstanding
Award, and the number of Shares which have been authorized for issuance under
the Plan but as to which no Options or other Award have yet been granted or
which have been returned to the Plan upon cancellation or expiration of an
Option or other Award, as well as the price per Share covered by each such
outstanding Option, shall be proportionately adjusted for any increase or
decrease in the number of issued Shares resulting from a share split, reverse
share split, share dividend, combination or reclassification of the Shares, or
any other increase or decrease in the number of issued Shares effected without
receipt of consideration by the Company. The conversion of any convertible
securities of the Company shall not be deemed to have been “effected without
receipt of consideration.” Such adjustment shall be made by the Board, whose
determination in that respect shall be final, binding and conclusive. Except as
expressly provided herein, no issuance by the Company of shares of any class, or
securities convertible into shares of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of Shares
subject to an Option or other Award.

 

10.2         Merger, Acquisition, or Asset Sale.

 

   (a)   In the event of (i) a merger or consolidation of the Company with or
into another corporation resulting in such other corporation being the surviving
entity or the direct or indirect parent of the Company or resulting in the
Company being the surviving entity and any other person or entity owning fifty
percent (50%) or more of the outstanding voting power of the Company's
securities by virtue of the transaction, (ii) an acquisition of all or
substantially all of the shares of the Company, or (iii) the sale of all or
substantially all of the assets of the Company (each such event, a
“Transaction”), the unexercised or restricted portion of each outstanding Award
shall be assumed or an equivalent Award or right substituted, by the successor
corporation or an affiliate of the successor corporation, as shall be determined
by such entity, subject to the subsequent sentence in this Section ‎10.2‎(a) and
the remaining terms of the Plan. In the event that the successor corporation or
a parent or subsidiary of the successor corporation does not provide for such an
assumption or substitution of Options, the Administrator may determine, at its
sole discretion, that all or a portion of the outstanding and unvested Options
shall become exercisable in full on a date no later than ten (10) days prior to
the date of consummation of the Transaction, provided that unless otherwise
determined by the Administrator, the exercise of all Options that otherwise
would not have been exercisable in the absence of a Transaction, shall be
contingent upon the actual consummation of the Transaction.

 

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(b)   For the purposes of this Section ‎10.2, an Option shall be considered
assumed or substituted if, following a Transaction, the option confers the right
to purchase or receive, for each Share subject to the Option immediately prior
to the Transaction, the consideration (whether stock, cash, or other securities
or property) received in the merger or sale of assets by holders of Shares of
the Company for each Share held on the effective date of the Transaction (and if
holders were offered a choice of consideration, the type of consideration
determined by the Administrator, at its sole discretion); provided, however,
that if the consideration received in the Transaction is not solely common stock
or ordinary shares (or the equivalent) of the successor corporation or its
direct or indirect parent, the Administrator may, with the consent of the
successor corporation, provide for the per share consideration to be received
upon the exercise of the Option to be solely common stock or ordinary shares (or
the equivalent) of the successor corporation or its direct or indirect parent
equal in fair market value to the per share consideration received by holders of
Shares in the Transaction, as determined by the Administrator.

 

(c)   In the event that the Board of Directors determines in good faith that, in
the context of a Transaction, certain Options have no monetary value and thus do
not entitle the holders of such Options to any consideration under the terms of
the Transaction, the Board of Directors may determine that such Options shall
terminate effective as of the effective date of the Transaction.

 

(d)   It is the intention that the Administrator’s authority to make
determinations, adjustments and clarifications in connection with the treatment
of Awards shall be interpreted as widely as possible, to allow the Administrator
maximal power and flexibility to interpret and implement the provisions of the
Plan in the event of Transaction, provided that the Administrator shall
determine in good faith that a Participant’s rights are not thereby adversely
affected without the Participant’s express written consent. Without derogating
from the generality of the foregoing, the Administrator shall have the
authority, at its sole discretion, to determine that the treatment of Options,
whether vested or unvested, in a Transaction may differ among individual
Participants or groups of Participants, provided that the overall economic
impact of the different approaches determined by the Administrator shall be
substantively equivalent as of the date of the closing of the Transaction.

 

11.Non-Transferability of Options and Shares.

 

11.1       No Option may be transferred other than by will or by the laws of
descent and distribution, and during the Participant's lifetime an Option may be
exercised only by such Participant.

 

11.2       Restricted Stock may not be assigned, transferred, pledged or
mortgaged, other than by will or laws of descent and distribution, prior to the
date on which the date on which any applicable restriction, performance or
deferred period lapses. Shares for which full payment has not been made, may not
be assigned, transferred, pledged or mortgaged, other than by will or laws of
descent and distribution. For avoidance of doubt, the foregoing shall not be
deemed to restrict the transfer of an Participant's rights in respect of Options
or Shares purchasable pursuant to the exercise thereof upon the death of such
Participant to such Participant’s estate or other successors by operation of law
or will, whose rights therein shall be governed by Section 9.1(a) hereof, and as
may otherwise be determined by the Administrator. Further restrictions on the
transfer of Shares are set forth below in Section 21 below.

 

12.Term and Amendment of the Plan.

 

12.1         The Plan shall expire on the date which is ten (10) years from the
date of its adoption by the Board of Directors (except as to Options outstanding
on that date).

 

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12.2         Notwithstanding any other provision of the Plan, the Board (or a
duly authorized Committee thereof) may at any time, and from time to time,
amend, in whole or in part, any or all of the provisions of the Plan (including
any amendment deemed necessary to ensure that the Company may comply with any
regulatory requirement), or suspend or terminate it entirely, retroactively or
otherwise; provided, however, that, except (x) to correct obvious drafting
errors or as otherwise required by law or (y) as specifically provided herein,
the rights of a Participant with respect to Awards granted prior to such
amendment, suspension or termination, may not be reduced without the consent of
such Participant. The Administrator may amend the terms of any Award theretofore
granted, prospectively or retroactively, but except (x) to correct obvious
drafting errors or as otherwise required by law or applicable accounting rules,
or (y) as specifically provided herein, no such amendment or other action by the
Committee shall reduce the rights of any Participant with respect to Awards
without the Participant’s consent.

 

13.Term of Option.

 

Unless otherwise explicitly provided in an Award Agreement, if any Option, or
any part thereof, has not been exercised and the Shares covered thereby not paid
for within ten (10) years after the date on which the Option was granted, as set
forth in the Award Agreement (or any other period set forth in the instrument
granting such Option pursuant to Section 6), such Option, or such part thereof,
and the right to acquire such Shares shall terminate, all interests and rights
of the Participant in and to the same shall expire, and, in the event that in
connection therewith any Shares are held in trust as aforesaid, such trust shall
expire.

 

14.Continuance of Engagement.

 

Neither the Plan nor any offer of Shares or Options to a Participant shall
impose any obligation on the Company or a related company thereof, to continue
the employment or engagement of any Participant as a Service Provider, and
nothing in the Plan or in any Option granted pursuant thereto shall confer upon
any Participant any right to continue to serve as a Service Provider of the
Company or a related company thereof or restrict the right of the Company or a
related company thereof to terminate such employment or engagement at any time.

 

15.Governing Law.

 

The Plan and all instruments issued thereunder or in connection therewith, shall
be governed by, and interpreted in accordance with, the laws of the State of
Delaware.

 

16.Application of Funds.

 

The proceeds received by the Company from the sale of Shares pursuant to Options
granted under the Plan will be used for general corporate purposes of the
Company or any related company thereof.

 

17.Taxes.

 

17.1         Any tax consequences arising from the grant, or vesting or exercise
of any Award, from the payment for Shares covered thereby, or from any other
event or act (of the Company, and/or its affiliates, or the Participant),
hereunder, shall be borne solely by the Participant. The Company and/or its
affiliates shall withhold taxes according to the requirements under the
applicable laws, rules, and regulations, including withholding taxes at source.
Furthermore, the Participant shall agree to indemnify the Company and/or its
affiliates and hold them harmless against and from any and all liability for any
such tax or interest or penalty thereon, including without limitation,
liabilities relating to the necessity to withhold, or to have withheld, any such
tax from any payment made to the Participant. The Company or any of its
affiliates may make such provisions and take such steps as it may deem necessary
or appropriate for the withholding of all taxes required by law to be withheld
with respect to Awards granted under the Plan and the exercise thereof,
including, but not limited, to (i) deducting the amount so required to be
withheld from any other amount (or Shares issuable) then or thereafter to be
provided to the Participant, including by deducting any such amount from a
Participant’s salary or other amounts payable to the Participant, to the maximum
extent permitted under law and/or (ii) requiring the Participant to pay to the
Company or any of its affiliates the amount so required to be withheld as a
condition of the issuance, delivery, distribution or release of any Shares
and/or (iii) by causing the exercise and sale of any Options or Shares held by
on behalf of the Participant to cover such liability, up to the amount required
to satisfy minimum statutory withholding requirements. In addition, the
Participant will be required to pay any amount due in excess of the tax withheld
and transferred to the tax authorities, pursuant to applicable tax laws,
regulations and rules.

 

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17.2         The receipt of an Award and/or the acquisition of Shares issued
upon the exercise of the Options may result in tax consequences. The description
of tax consequences set forth in the Plan or any Appendix hereto does not
purport to be complete, up to date or to take into account any special
circumstances relating to a Participant.

 

17.3         THE PARTICIPANT IS ADVISED TO CONSULT WITH A TAX ADVISOR WITH
RESPECT TO THE TAX CONSEQUENCES OF RECEIVING OR EXERCISING ANY AWARD IN LIGHT OF
HIS OR HER PARTICULAR CIRCUMSTANCES.

 

18.Market Stand-Off

 

If so requested by the Company or any representative of the underwriters (the
“Managing Underwriter”) in connection with any registration of the offering of
any securities of the Company under the securities laws of any jurisdiction, the
Participant shall not sell or otherwise transfer any Shares or other securities
of the Company during a 180-day period or such other period as may be requested
in writing by the Managing Underwriter and agreed to in writing by the Company
(the “Market Standoff Period”) following the effective date of registration
statement of the Company filed under such securities laws. The Company may
require the Participant to execute a form of undertaking to this effect or
impose stop transfer instructions with respect to securities subject to the
foregoing restrictions until the end of such Market Standoff Period.

 

19.Conditions Upon Issuance of Shares.

 

19.1         Legal Compliance. Shares shall not be issued pursuant to the
exercise of an Option or with respect to any other Award unless the exercise of
such Option or grant of such Award and the issuance and delivery of such Shares
shall comply with applicable laws and shall be further subject to the approval
of counsel for the Company with respect to such compliance. The inability of the
Company to obtain authority from any regulatory body having jurisdiction, which
authority is deemed by the Company’s counsel to be necessary to the lawful
issuance and sale of any Shares hereunder, shall relieve the Company of any
liability in respect of the failure to issue or sell such Shares as to which
such requisite authority shall not have been obtained.

 

19.2          Investment Representations. As a condition to the exercise of an
Option or receipt of an Award, the Board may require the person exercising such
Option or receiving such Award to represent and warrant at the time of any such
exercise or the time of receipt of the Award that the Shares are being purchased
only for investment and without any present intention to sell or distribute such
Shares, and make other representations as may be required under applicable
securities laws if, in the opinion of counsel for the Company, such
representations are required, all in form and content specified by the Board.

 

19.3         Legend. The Administrator may require each person receiving Shares
pursuant to an Award granted under the Plan to represent to and agree with the
Company in writing that the Participant is acquiring the shares without a view
to distribution thereof and such other securities law related representations as
the Administrator shall request. In addition to any legend required by the Plan,
the certificates for such shares may include any legend which the Administrator
deems appropriate to reflect any applicable restrictions on transfer. All
certificates for Shares delivered under the Plan shall be subject to such stock
transfer orders and other restrictions as the Administrator may deem advisable
under the rules, regulations and other requirements of any relevant securities
authority, any stock exchange upon which the Shares are then listed or any
national securities association system upon whose system the Shares are then
quoted, any applicable securities law, and any applicable corporate law, and the
Administrator may cause a legend or legends to be put on any such certificates
to make appropriate reference to such restrictions.

 

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20.Proxy

 

The Company, at its sole discretion, may require that as a condition of grant of
an Award or of exercise of an Option, the Participant be required to grant an
irrevocable proxy to any appropriate person designated by the Company, to vote
all Shares obtained by the Participant pursuant to an Award at all general
meetings of Company, and to sign all written resolutions, waivers, consents etc.
of the shareholders of the Company on behalf of the Participant, including the
right to waive on behalf of the Participant all minimum notice requirements for
meetings of shareholders of the Company. Such proxy shall remain in effect until
the consummation of an IPO, and shall be irrevocable as the rights of third
parties, including investors in the Company, depend upon such proxy. The proxy
shall be personal to the Participant and shall not survive the transfer of the
Participant’s Shares to a third-party transferee; provided, however, that upon a
transfer of the Participant’s Shares to such a transferee (subject to the terms
and conditions of the Plan concerning any such transfer), the transferee may be
required to grant an irrevocable proxy to such appropriate person as the
Company, in giving its approval to the transfer, so requires. The proxy may be
contained in the Award Agreement of each Participant or otherwise as the
Committee determines. If contained in the Award Agreement, no further document
shall be required to implement such proxy, and the signature of the Participant
on the Award Agreement shall indicate approval of the proxy thereby granted. The
holder of the proxy shall be indemnified and held harmless by the Company
against any cost or expense (including counsel fees) reasonably incurred by
him/her, or any liability (including any sum paid in settlement of a claim with
the approval of the Company) arising out of any act or omission to act in
connection with the voting of the proxy unless arising out of his/her own fraud,
bad faith or gross negligence, to the extent permitted by applicable law. Such
indemnification shall be in addition to any rights of indemnification the holder
of the proxy may have as a director, officer or otherwise under the Company's
Certificate of Incorporation, by laws or any agreement, any vote of shareholders
or directors, insurance policy or otherwise.

 

21.Additional Restrictions on Transfers of Shares.

 

[Until such time as the Shares are registered for trade to the public, a
Participant shall not be permitted to transfer, sell, assign, pledge,
hypothecate, or otherwise encumber or dispose of in any way (for the purposes of
this Section 21, a “Transfer”) to one or more third parties pursuant to an
understanding with such third parties any Shares, except as otherwise provided
in this Plan, the applicable Award Agreement or as required under applicable
law.

 

22.Miscellaneous.

 

Whenever applicable in the Plan, the singular and the plural, and the masculine,
feminine and neuter shall be freely interchangeable, as the context requires.
The Section headings or titles shall not in any way control the construction of
the language herein, such headings or titles having been inserted solely for the
purpose of simplified reference. Words such as “herein”, “hereof”, “hereto”,
“hereinafter”, “hereby”, and “hereinabove” when used in the Plan refer to the
Plan as a whole, including any applicable Appendices, unless otherwise required
by context.

 

*                    *                 *

 

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