MIMVI, INC.

 

2010 STOCK INCENTIVE PLAN

 

(Amended and Restated Effective October 5, 2012)

 

 

 

 

 

 

 

 

1.             Purposes of the Plan. The purposes of the Mimvi, Inc. 2010 Stock
Incentive Plan are to attract and retain the best available personnel for
positions of substantial responsibility, to provide additional incentive to
persons who are selected to be participants in the Plan, and to promote the
success of the Company’s business. This Plan permits the grant of Non-qualified
Stock Options, Incentive Stock Options, Stock Appreciation Rights, Restricted
Stock, Restricted Stock Units, and Other Stock-Based Awards, each of which shall
be subject to such conditions based upon continued employment with or service to
the Company or its Subsidiaries, passage of time or satisfaction of performance
criteria as shall be specified pursuant to the Plan.

 

2.            Definitions. In addition to the terms defined elsewhere in this
Plan, as used herein, the following terms shall have the following meanings:

 

(a) “Administrator” means the Board or any of its Committees as shall be
administering the Plan, in accordance with Section 4 of the Plan.

 

(b) “Award” means a Stock Option, Stock Appreciation Right, Restricted Stock or
Restricted Stock Unit, or Other Stock-Based Award granted to a Participant
pursuant to the Plan, as such terms are defined in Section 7(a) herein.

 

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

 

(d) “Code” means the Internal Revenue Code of 1986, and the regulations
promulgated thereunder, as such is amended from time to time, and any reference
to a section of the Code shall include any successor provision of the Code.

 

(e) “Committee” means a committee appointed by the Board from among its members
to administer the Plan in accordance with Section 4.

 

(f) “Common Stock” means the common stock, par value $0.001 per share, of the
Company.

 

(g) “Company” means Mimvi, Inc., a Nevada corporation.

 

(h) “Consultant” means any person, including an advisor, engaged by the Company
or a Subsidiary to render services and who is compensated for such services;
provided such services are not in connection with the offer or sale of
securities in a capital-raising transaction and do not directly or indirectly
promote or maintain a market for the Company’s securities; and provided further
that the term “Consultant” shall not include Directors who are paid only a
director’s fee by the Company or who are not otherwise compensated by the
Company for their services as Directors.

 

(i) “Director” means a member of the Board.

 

(j) “Employee” means any person, including Officers and Directors, employed by
the Company or any Subsidiary of the Company. Neither service as a Director nor
payment of a director’s fee by the Company shall be sufficient to constitute
“employment” by the Company.

 

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(k) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

(l) “Officer” means a person who is an officer of the Company within the meaning
of Section 16 of the Exchange Act and the rules and regulations promulgated
thereunder.

 

(m) “Participant” means any Employee, Director or Consultant selected by the
Administrator to receive Awards.

 

(n) “Plan” means this 2010 Stock Incentive Plan, as amended from time to time.

 

(o) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any successor to Rule
16b-3, as in effect when discretion is being exercised with respect to the Plan.

 

(p) “Section 162(m)” means Section 162(m) of the Code and the regulations
thereunder, as amended.

 

(q) “Share” means a share of Common Stock, as adjusted in accordance with
Section 10 of the Plan.

 

(r) “Subsidiary” means any corporation or entity in which the Company owns or
controls, directly or indirectly, fifty percent (50%) or more of the voting
power or economic interests of such corporation or entity.

 

3.            Shares Subject to the Plan.

 

(a) Aggregate Limits. Subject to the provisions of Section 10 of the Plan, the
maximum aggregate number of Shares which may be issued pursuant to Awards
granted under the Plan is Fifteen Million (15,000,000) Shares (the “Fungible
Pool Limit”). The Shares subject to the Plan may be either Shares reacquired by
the Company, including Shares purchased in the open market, or authorized but
unissued Shares. Any Shares subject to an Award which for any reason expires or
terminates unexercised or is not earned in full shall be added back to the
Fungible Pool Limit and may again be made subject to an Award under the Plan.
The following Shares shall not be added back to the Fungible Pool Limit and
shall not again be made available for issuance as Awards under the Plan: (i)
Shares not issued or delivered as a result of the net settlement of an
outstanding Stock Appreciation Right, (ii) Shares used to pay the exercise price
or withholding taxes related to an outstanding Award, or (iii) Shares
repurchased on the open market with the exercise price proceeds received by the
Company upon the exercise of an Award.

 

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(b) Treatment of Awards. Each Share issued or to be issued in connection with
any Award shall be counted against the Fungible Pool Limit as one (1) Share. For
these purposes, the number of Shares taken into account with respect to a SAR
shall be the number of Shares underlying the SAR at grant, and not the final
number of Shares delivered upon exercise of the SAR. Any Shares previously the
subject of an Award that again become available for grant pursuant to Section
3(a) shall be added back to the Fungible Pool Limit in the same proportion, and
using the same multiplier, pursuant to which such Awards reduced the Shares in
the Fungible Pool Limit. The Administrator shall determine the appropriate
methodology for calculating the number of Shares issued pursuant to the Plan.

 

4.            Administration of the Plan.

 

(a) Procedure.

 

(i) Multiple Administrative Bodies. If permitted by Rule 16b-3, the Plan may be
administered by different bodies with respect to Directors, Officers who are not
Directors, and Employees who are neither Directors nor Officers.

 

(ii) Administration with Respect to Directors and Officers Subject to Section
16(b). With respect to Awards granted to Directors or to Employees who are also
Officers or Directors subject to Section 16(b) of the Exchange Act, the Plan
shall be administered by (A) the Board, if the Board may administer the Plan in
compliance with the requirements for grants under the Plan to be exempt
acquisitions under Rule 16b-3, or (B) a committee designated by the Board to
administer the Plan, which committee shall consist of “Non-Employee Directors”
within the meaning of Rule 16b-3. Once appointed, such Committee shall continue
to serve in its designated capacity until otherwise directed by the Board. From
time to time the Board may increase the size of the Committee and appoint
additional members, remove members (with or without cause) and substitute new
members, fill vacancies (however caused), and remove all members of the
Committee and thereafter directly administer the Plan, all to the extent
permitted by the requirements for grants under the Plan to be exempt
acquisitions under Rule 16b-3.

 

(iii) Administration with Respect to Covered Employees Subject to Section 162(m)
of the Code. With respect to Awards granted to Employees who are also “covered
employees” within the meaning of Section 162(m) of the Code and the regulations
thereunder, as amended, the Plan shall be administered by a committee designated
by the Board to administer the Plan, which committee shall be constituted to
satisfy the requirements applicable to Awards intended to qualify as
“performance-based compensation” under Section 162(m). Once appointed, such
Committee shall continue to serve in its designated capacity until otherwise
directed by the Board. From time to time the Board may increase the size of the
Committee and appoint additional members, remove members (with or without cause)
and substitute new members, fill vacancies (however caused), and remove all
members of the Committee and thereafter directly administer the Plan, all to the
extent permitted by the rules applicable to Awards intended to qualify as
“performance-based compensation” under Section 162(m).

 

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(iv) Administration with Respect to Other Persons. With respect to Awards
granted to Employees or Consultants who are neither Directors nor Officers of
the Company, the Plan shall be administered by (A) the Board or (B) a committee
designated by the Board, which committee may be constituted to satisfy the legal
requirements relating to the administration of stock option plans under state
corporate and securities laws and the Code. Once appointed, such Committee shall
serve in its designated capacity until otherwise directed by the Board. The
Board may increase the size of the Committee and appoint additional members,
remove members (with or without cause) and substitute new members, fill
vacancies (however caused), and remove all members of the Committee and
thereafter directly administer the Plan, all to the extent permitted by
applicable laws.

 

(b) Powers of the Administrator. Subject to the express provisions and
limitations set forth in this Plan, and in the case of a Committee, subject to
the specific duties delegated by the Board to such Committee, the Administrator
shall be authorized and empowered to do all things necessary or desirable, in
its sole discretion, in connection with the administration of this Plan,
including, without limitation, the following:

 

(i) to prescribe, amend and rescind rules and regulations relating to this Plan
and to define terms not otherwise defined herein;

 

(ii) to determine which persons are eligible to be Participants, to which of
such persons, if any, Awards shall be granted hereunder and the timing of any
such Awards, and to grant Awards;

 

(iii) to grant Awards to Participants and determine the terms and conditions
thereof, including the number of Shares subject to Awards and the exercise or
purchase price of such Shares and the circumstances under which Awards become
exercisable or vested or are forfeited or expire, which terms may but need not
be conditioned upon the passage of time, continued employment, the satisfaction
of performance criteria, the occurrence of certain events, or other factors;

 

(iv) to establish or verify the extent of satisfaction of any performance goals
or other conditions applicable to the grant, issuance, exercisability, vesting
and/or ability to retain any Award;

 

(v) to prescribe and amend the terms of the agreements or other documents
evidencing Awards made under this Plan (which need not be identical);

 

(vi) to determine whether, and the extent to which, adjustments are required
pursuant to Section 10;

 

(vii) to interpret and construe this Plan, any rules and regulations under this
Plan and the terms and conditions of any Award granted hereunder, and to make
exceptions to any such provisions in good faith and for the benefit of the
Corporation; and

 

(viii) to make all other determinations deemed necessary or advisable for the
administration of this Plan.

 

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(c) Delegation and Administration. The Administrator may delegate to one or more
separate committees (any such committee a “Subcommittee”) composed of one or
more directors of the Company (who may but need not be members of any Committee
comprising the Administrator) the ability to grant Awards and take the other
actions described in Section 4(b) with respect to Participants who are not
Officers, and such actions shall be treated for all purposes as if taken by the
Administrator. The Administrator may delegate to a Subcommittee of one or more
officers of the Company the ability to grant Awards and take the other actions
described in Section 4(b) with respect to Participants (other than any such
officers themselves) who are not directors or Officers, provided, however, that
the resolution so authorizing such officer(s) shall specify the total number of
rights or options such Subcommittee may so award, and such actions shall be
treated for all purposes as if taken by the Administrator. Any action by any
such Subcommittee within the scope of such delegation shall be deemed for all
purposes to have been taken by the Administrator, and references in this Plan to
the Administrator shall include any such Subcommittee. The Administrator may
delegate the administration of the Plan to an officer or officers of the
Company, and such administrator(s) may have the authority to execute and
distribute agreements or other documents evidencing or relating to Awards
granted by the Administrator under this Plan, to maintain records relating to
the grant, vesting, exercise, forfeiture or expiration of Awards, to process or
oversee the issuance of Shares upon the exercise, vesting and/or settlement of
an Award, to interpret the terms of Awards and to take such other actions as the
Administrator may specify. Any action by any such administrator within the scope
of its delegation shall be deemed for all purposes to have been taken by the
Administrator and references in this Plan to the Administrator shall include any
such administrator, provided that the actions and interpretations of any such
administrator shall be subject to review and approval, disapproval or
modification by the Administrator.

 

(d) Effect of Change in Status. The Committee shall have the discretion to
determine the effect upon an Award and upon an individual’s status as an
employee under the Plan (including whether a Participant shall be deemed to have
experienced a termination of employment or other change in status) and upon the
vesting, expiration or forfeiture of an Award in the case of (i) any individual
who is employed by an entity that ceases to be a Subsidiary of the Corporation,
(ii) any leave of absence approved by the Corporation or a Subsidiary, (iii) any
transfer between locations of employment with the Corporation or a Subsidiary or
between the Corporation and any Subsidiary or between any Subsidiaries, (iv) any
change in the Participant’s status from an employee to a consultant or member of
the Board, or vice versa, and (v) any employee who becomes employed by any
partnership, joint venture, corporation or other entity not meeting the
requirements of a Subsidiary.

 

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(e) Determinations of the Administrator. All decisions, determinations and
interpretations by the Administrator regarding this Plan shall be final and
binding on all Participants or other persons claiming rights under the Plan or
any Award, unless any such decision, determination or interpretation is
otherwise determined by the Board in which case the Board's determination shall
be final and binding. The Administrator shall consider such factors as it deems
relevant to making such decisions, determinations and interpretations including,
without limitation, the recommendations or advice of any director, officer or
employee of the Company and such attorneys, consultants and accountants as it
may select. A Participant or other holder of an Award may contest a decision or
action by the Administrator with respect to such person or Award only on the
grounds that such decision or action was arbitrary or capricious or was
unlawful, and any review of such decision or action shall be limited to
determining whether the Administrator’s decision or action was arbitrary or
capricious or was unlawful.

 

5.            Eligibility. Awards may be granted to any person who is a
Participant under this Plan; provided that ISOs may be granted only to employees
eligible under applicable Code provisions. If otherwise eligible, a Participant
who has been granted an Award may be granted additional Awards.

 

6.            Term of the Plan. The Plan was approved by the Board and became
effective on November 2, 2010, and was approved by the Company's stockholders on
November 2, 2010. The Plan shall remain available for the grant of Awards until
November 2, 2020 or such earlier date as the Board may determine. The expiration
of the Administrator’s authority to grant Awards under the Plan will not affect
the operation of the terms of the Plan or the Company’s and Participants’ rights
and obligations with respect to Awards granted on or prior to the expiration
date of the Plan.

 

7.            Plan Awards.

 

(a) Award Types. The Administrator, on behalf of the Company, is authorized
under this Plan to grant, award and enter into the following arrangements or
benefits under the Plan provided that their terms and conditions are not
inconsistent with the provisions of the Plan: Stock Options, Stock Appreciation
Rights, Restricted Stock, Restricted Stock Units, and Other Stock-Based Awards.
The Administrator, in its discretion, may determine that any Award granted
hereunder shall be a performance Award the grant, issuance, retention, vesting
and/or settlement of which is subject to satisfaction of one or more of the
Qualifying Performance Criteria specified in Section 8(e).

 

(i) Stock Options. A “Stock Option” is a right to purchase a number of Shares at
such exercise price, at such times, and on such other terms and conditions as
are specified in or determined pursuant to the document(s) evidencing the Award
(the “Option Agreement”). The Committee may grant Stock Options intended to be
eligible to qualify as incentive stock options (“ISOs”) pursuant to Section 422
of the Code and Stock Options that are not intended to qualify as ISOs
(“Non-qualified Stock Options”), as it, in its sole discretion, shall determine.

 

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(ii) Stock Appreciation Rights. A “Stock Appreciation Right” or “SAR” is a right
to receive, in cash or stock (as determined by the Administrator), value with
respect to a specific number of Shares equal to or otherwise based on the excess
of (i) the market value of a Share at the time of exercise over (ii) the
exercise price of the right, subject to such terms and conditions as are
expressed in the document(s) evidencing the Award (the “SAR Agreement”).

 

(iii) Restricted Stock. A “Restricted Stock” Award is an award of Shares, the
grant, issuance, retention and/or vesting of which is subject to such conditions
as are expressed in the document(s) evidencing the Award (the “Restricted Stock
Agreement”).

 

(iv) Restricted Stock Unit. A “Restricted Stock Unit” Award is an award of a
right to receive, in cash or stock (as determined by the Administrator) the
market value of one Share, the grant, issuance, retention and/or vesting of
which is subject to such conditions as are expressed in the document(s)
evidencing the Award (the “Restricted Stock Unit Agreement”).

 

(v) Other Stock-Based Awards. An “Other Stock-Based Award” is an award other
than those described in subsections (i) – (iv) above, that is denominated or
payable in, valued in whole or in part by reference to, or otherwise based on,
or related to, Common Stock or factors that may influence the value of Common
Stock, including, without limitation, convertible or exchangeable debt
securities, other rights convertible or exchangeable into Common Stock, purchase
rights for Common Stock, Awards with value and payment contingent upon
performance of the Company or business units thereof or any other factors
designated by the Administrator, and Awards valued by reference to the book
value of Common Stock or the value of securities of or the performance of
specified Subsidiaries or other business units. The Administrator shall
determine the terms and conditions of such Awards, which shall be expressed in
the document(s) evidencing the Award (the “Other Stock-Based Award Agreement”).

 

(b) Grants of Awards. An Award may consist of one of the foregoing arrangements
or benefits or two or more of them in tandem or in the alternative.

 

8.            Terms of Awards.

 

(a) Grant, Terms and Conditions of Stock Options and SARs. The Administrator may
grant Stock Options or SARs at any time and from time to time prior to the
expiration of the Plan to eligible Participants selected by the Administrator.
No Participant shall have any rights as a stockholder with respect to any Shares
subject to Stock Options or SARs hereunder until said Shares have been issued.
Each Stock Option or SAR shall be evidenced only by such agreements, notices
and/or terms or conditions documented in such form (including by electronic
communications) as may be approved by the Administrator. Each Stock Option grant
will expressly identify the Stock Option as an ISO or as a Non-qualified Stock
Option. In the absence of a designation, a Stock Option shall be treated as a
Non-qualified Stock Option. Stock Options or SARs granted pursuant to the Plan
need not be identical but each must contain or be subject to the following terms
and conditions:

 

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(i) Price. The purchase price (also referred to as the exercise price) under
each Stock Option or SAR granted hereunder shall be established by the
Administrator. The purchase price per Share shall not be less than 100% of the
market value of a Share on the date of grant. For purposes of the Plan, “market
value” shall mean the fair market value of the Company’s common stock determined
in good faith by the Administrator in a manner consistent with the requirements
of Section 409A of the Code. The exercise price of a Stock Option shall be paid
in cash or in such other form if and to the extent permitted by the
Administrator, including without limitation by delivery of already owned Shares,
withholding (either actually or by attestation) of Shares otherwise issuable
under such Stock Option and/or by payment under a broker-assisted sale and
remittance program acceptable to the Administrator.

 

(ii) Duration, Exercise and Termination of Stock Options and SARs. Each Stock
Option or SAR shall be exercisable at such time and in such installments during
the period prior to the expiration of the Stock Option or SAR as determined by
the Administrator. The Administrator shall have the right to make the timing of
the ability to exercise any Stock Option or SAR subject to continued employment,
the passage of time and/or such performance requirements as deemed appropriate
by the Administrator. At any time after the grant of a Stock Option, the
Administrator may reduce or eliminate any restrictions on the Participant’s
right to exercise all or part of the Stock Option. Each Stock Option or SAR must
expire within a period of not more than ten (10) years from the grant date. The
Option Agreement or SAR Agreement may provide for expiration prior to the end of
the stated term of the Award in the event of the termination of employment or
service of the Participant to whom it was granted.

 

(iii) Conditions and Restrictions Upon Securities Subject to Stock Options or
SARs. Subject to the express provisions of the Plan, the Administrator may
provide that the Shares issued upon exercise of a Stock Option or SAR shall be
subject to such further conditions or agreements as the Administrator in its
discretion may specify prior to the exercise of such Stock Option or SAR,
including, without limitation, conditions on vesting or transferability,
forfeiture or repurchase provisions. The obligation to make payments with
respect to SARs may be satisfied through cash payments or the delivery of
Shares, or a combination thereof as the Administrator shall determine. The
Administrator may establish rules for the deferred delivery of Common Stock upon
exercise of a Stock Option or SAR with the deferral evidenced by use of
Restricted Stock Units equal in number to the number of Shares whose delivery is
so deferred.

 

(iv) Other Terms and Conditions. Stock Options and SARs may also contain such
other provisions, which shall not be inconsistent with any of the foregoing
terms, as the Administrator shall deem appropriate.

 

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(v) ISOs. Stock Options intending to qualify as ISOs may only be granted to
employees of the Company or its related entities as who are eligible under
applicable Code provisions, as determined by the Administrator. If then required
by the Code for ISO treatment, an ISO granted to an Employee who, at the time
the ISO is granted, owns stock representing more than ten percent (10%) of the
voting power of all classes of stock of the Company or of its parent or
subsidiary corporation, must have an exercise price that is not less than 110%
of the market value of the Shares subject to the ISO, determined as of the date
of grant and a term not exceeding five (5) years. To the extent that the Option
Agreement specifies that a Stock Option is intended to be treated as an ISO, the
Stock Option is intended to qualify to the greatest extent possible as an
“incentive stock option” within the meaning of Section 422 of the Code, and
shall be so construed; provided, however, that any such designation shall not be
interpreted as a representation, guarantee or other undertaking on the part of
the Company that the Stock Option is or will be determined to qualify as an ISO.
If and to the extent that any Shares are issued under a portion of any Stock
Option that exceeds the $100,000 limitation of Section 422 of the Code, such
Shares shall not be treated as issued under an ISO notwithstanding any
designation otherwise. Certain decisions, amendments, interpretations and
actions by the Administrator and certain actions by a Participant may cause a
Stock Option to cease to qualify for the tax treatment applicable to ISOs
pursuant to the Code and by accepting a Stock Option the Participant agrees in
advance to such disqualifying action.

 

(b) Grant, Terms and Conditions of Restricted Stock and Restricted Stock Units.
The Administrator may grant Restricted Stock or Restricted Stock Units at any
time and from time to time prior to the expiration of the Plan to eligible
Participants selected by the Administrator. A Participant shall have rights as a
stockholder with respect to any Shares subject to a Restricted Stock Award
hereunder only to the extent specified in this Plan or the Restricted Stock
Agreement evidencing such Award. Awards of Restricted Stock or Restricted Stock
Units shall be evidenced only by such agreements, notices and/or terms or
conditions documented in such form (including by electronic communications) as
may be approved by the Administrator. Awards of Restricted Stock or Restricted
Stock Units granted pursuant to the Plan need not be identical but each must
contain or be subject to the following terms and conditions:

 

(i) Terms and Conditions. Each Restricted Stock Agreement and each Restricted
Stock Unit Agreement shall contain provisions regarding (a) the number of Shares
subject to such Award or a formula for determining such, (b) the purchase price
of the Shares, if any, and the means of payment for the Shares, (c) the
performance criteria, if any, and level of achievement versus these criteria
that shall determine the number of Shares granted, issued, retainable and/or
vested, (d) such terms and conditions on the grant, issuance, vesting and/or
forfeiture of the Shares as may be determined from time to time by the
Administrator, (e) restrictions on the transferability of the Shares and (f)
such further terms and conditions as may be determined from time to time by the
Administrator, in each case not inconsistent with this Plan.

 

(ii) Sale Price. Subject to the requirements of applicable law, the
Administrator shall determine the price, if any, at which Shares of Restricted
Stock or Restricted Stock Units shall be sold or awarded to a Participant, which
may vary from time to time and among Participants and which may be below the
market value of such Shares at the date of grant or issuance.

 

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(iii) Share Vesting. The grant, issuance, retention and/or vesting of Shares
under Restricted Stock or Restricted Stock Unit Awards shall be at such time and
in such installments as determined by the Administrator or under criteria
established by the Administrator. The Administrator shall have the right to make
the timing of the grant and/or the issuance, ability to retain and/or vesting of
Shares under Restricted Stock or Restricted Stock Unit Awards subject to
continued employment, passage of time and/or such performance criteria and level
of achievement versus these criteria as deemed appropriate by the Administrator,
which criteria may be based on financial performance and/or personal performance
evaluations. Notwithstanding anything to the contrary herein, the performance
criteria for any Restricted Stock or Restricted Stock Unit that is intended to
satisfy the requirements for “performance-based compensation” under Section
162(m) of the Code shall be a measure based on one or more Qualifying
Performance Criteria selected by the Administrator and specified at the time the
Restricted Stock or Restricted Stock Unit Award is granted. 

  

(iv) Termination of Employment. The Restricted Stock or Restricted Stock Unit
Agreement may provide for the forfeiture or cancellation of the Restricted Stock
or Restricted Stock Unit Award, in whole or in part, in the event of the
termination of employment or service of the Participant to whom it was granted.

 

(v) Restricted Stock Units. Except to the extent this Plan or the Administrator
specifies otherwise, Restricted Stock Units represent an unfunded and unsecured
obligation of the Company and do not confer any of the rights of a stockholder
until Shares are issued thereunder. Settlement of Restricted Stock Units upon
expiration of the deferral or vesting period shall be made in Shares or
otherwise as determined by the Administrator. Dividends or dividend equivalent
rights shall be payable in cash or in additional shares with respect to
Restricted Stock Units only to the extent specifically provided for by the
Administrator. Until a Restricted Stock Unit is settled, the number of Shares
represented by a Restricted Stock Unit shall be subject to adjustment pursuant
to Section 10. Any Restricted Stock Units that are settled after the
Participant’s death shall be distributed to the Participant’s designated
beneficiary(ies) or, if none was designated, the Participant’s estate.

 

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(c) Suspension or Termination of Awards. If at any time (including with respect
to Stock Options or SARs after a notice of exercise has been delivered) the
Administrator reasonably believes that a Participant has committed an act of
misconduct as described in this Section, the Administrator may suspend the
Participant’s right to exercise any Stock Option or SAR or suspend the vesting
of Shares under the Participant’s Restricted Stock or Restricted Stock Unit
Awards, as the case may be, pending a determination of whether an act of
misconduct has been committed. If the Administrator determines a Participant has
committed an act of embezzlement, fraud, dishonesty, nonpayment of any
obligation owed to the Company, breach of fiduciary duty or deliberate disregard
of Company rules resulting in loss, damage or injury to the Company, or if a
Participant makes an unauthorized disclosure of any Company trade secret or
confidential information, engages in any conduct constituting unfair
competition, induces any customer to breach a contract with the Company or
induces any principal for whom the Company acts as agent to terminate such
agency relationship, the Administrator may prohibit or restrict the Participant
and his or her successor(s) in interest from exercising any Stock Option or SAR
and may cause the Participant’s Restricted Stock or Restricted Stock Unit
Agreement to be restricted or forfeited and cancelled. Any determination by the
Administrator with respect to the foregoing shall be final, conclusive and
binding on all interested parties, unless any such determination is otherwise
determined by the Board in which case the Board's determination shall be final
and binding.

 

(d) Transferability. Unless the agreement or other document evidencing an Award
(or an amendment thereto authorized by the Administrator) expressly states that
the Award is otherwise transferable as provided hereunder, no Award granted
under this Plan, nor any interest in such Award, may be sold, assigned,
conveyed, gifted, pledged, hypothecated or otherwise transferred in any manner,
other than by will or the laws of descent and distribution. The Administrator
may grant an Award that is, or amend an outstanding Award to provide that the
Award is, transferable or assignable to the extent that, following a transfer or
assignment, exercise of the Award or resale of underlying securities by the
transferee could be registered under the Securities Act of 1933, as amended (the
"Securities Act") on Form S-8 (or any successor form used for employee benefit
plan registrations) under the Securities Act, as such form may be amended from
time to time, provided that following any such transfer or assignment the Award
will remain subject to substantially the same terms applicable to the Award
while held by the Participant to whom it was granted, as modified as the
Administrator shall determine appropriate, and as a condition to such transfer
the transferee shall execute an agreement agreeing to be bound by such terms;
provided, further, that an ISO may be transferred or assigned only to the extent
consistent with Section 422 of the Code. Any purported assignment, transfer or
encumbrance that does not qualify under this Section 8(d) shall be void and
unenforceable against the Company.

 

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(e) Qualifying Performance Criteria. For purposes of this Plan, the term
“Qualifying Performance Criteria” shall mean any one or more of the following
performance criteria, either individually, alternatively or in any combination,
applied to either the Company as a whole or to a business unit or Subsidiary,
either individually, alternatively or in any combination, and measured either
annually or cumulatively over a period of years, on an absolute basis or
relative to a pre-established target, to previous years’ results or to a
designated comparison group, in each case as specified by the Administrator in
the Award: (a) cash flow, (b) earnings per share, (c) earnings before interest,
taxes and amortization, (d) return on equity, (e) total stockholder return, (f)
share price performance, (g) return on capital, (h) return on assets or net
assets, (i) revenue, (j) income or net income, (k) operating income or net
operating income, (l) operating profit or net operating profit, (m) operating
margin or profit margin, (n) return on operating revenue, (o) return on invested
capital, (p) market segment share, (q) product release schedules, (r) new
product innovation, (s) product cost reduction through advanced technology, (t)
brand recognition/acceptance, (u) product ship targets, (v) customer
satisfaction, (w) strategic initiatives, or (x) acquisitions. The Administrator
may appropriately adjust any evaluation of performance under a Qualifying
Performance Criteria to exclude any of the following events that occurs during a
performance period: (i) asset write-downs, (ii) litigation or claim judgments or
settlements, (iii) the effect of changes in or provisions under tax law,
accounting principles or other such laws or provisions affecting reported
results, (iv) accruals for reorganization and restructuring programs, and (v)
any extraordinary non-recurring items as described in Accounting Principles
Board Opinion No. 30 and/or in management’s discussion and analysis of financial
condition and results of operations appearing in the Company’s annual report to
stockholders for the applicable year. Notwithstanding satisfaction of any
completion of any Qualifying Performance Criteria, to the extent specified at
the time of grant of an Award, the number of Shares, Stock Options, SARs,
Restricted Stock Units or other benefits granted, issued, retainable and/or
vested under an Award on account of satisfaction of such Qualifying Performance
Criteria may be reduced by the Administrator on the basis of such further
considerations as the Administrator in its sole discretion shall determine.

 

(f) Dividends. Unless otherwise provided by the Administrator, no adjustment
shall be made in Shares issuable under Awards on account of cash dividends that
may be paid or other rights that may be issued to the holders of Shares prior to
their issuance under any Award. The Administrator shall specify whether
dividends or dividend equivalent amounts shall be paid to any Participant with
respect to the Shares subject to any Award that have not vested or been issued
or that are subject to any restrictions or conditions on the record date for
dividends.

 

(g) Documents Evidencing Awards. The Administrator shall, subject to applicable
law, determine the date an Award is deemed to be granted. The Administrator or,
except to the extent prohibited under applicable law, its delegate(s) may
establish the terms of agreements or other documents evidencing Awards under
this Plan and may, but need not, require as a condition to any such agreement’s
or document’s effectiveness that such agreement or document be executed by the
Participant, including by electronic signature or other electronic indication of
acceptance, and that such Participant agree to such further terms and conditions
as specified in such agreement or document. The grant of an Award under this
Plan shall not confer any rights upon the Participant holding such Award other
than such terms, and subject to such conditions, as are specified in this Plan
as being applicable to such type of Award (or to all Awards) or as are expressly
set forth in the agreement or other document evidencing such Award.

 

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(h) Additional Restrictions on Awards. Either at the time an Award is granted or
by subsequent action, the Administrator may, but need not, impose such
restrictions, conditions or limitations as it determines appropriate as to the
timing and manner of any resales by a Participant or other subsequent transfers
by a Participant of any Shares issued under an Award, including without
limitation (a) restrictions under an insider trading policy, (b) restrictions
designed to delay and/or coordinate the timing and manner of sales by the
Participant or Participants, and (c) restrictions as to the use of a specified
brokerage firm for receipt, resales or other transfers of such Shares.

 

(i) Subsidiary Awards. In the case of a grant of an Award to any Participant
employed by a Subsidiary, such grant may, if the Administrator so directs, be
implemented by the Company issuing any subject Shares to the Subsidiary, for
such lawful consideration as the Administrator may determine, upon the condition
or understanding that the Subsidiary will transfer the Shares to the Participant
in accordance with the terms of the Award specified by the Administrator
pursuant to the provisions of the Plan. Notwithstanding any other provision
hereof, such Award may be issued by and in the name of the Subsidiary and shall
be deemed granted on such date as the Administrator shall determine.

 

9.            Withholding Taxes. To the extent required by applicable federal,
state, local or foreign law, the Administrator may and/or a Participant shall
make arrangements satisfactory to the Company for the satisfaction of any
withholding tax obligations that arise with respect to any Stock Option, SAR,
Restricted Stock or Restricted Stock Unit Award, or any sale of Shares. The
Company shall not be required to issue Shares or to recognize the disposition of
such Shares until such obligations are satisfied. To the extent permitted or
required by the Administrator, these obligations may or shall be satisfied by
having the Company withhold a portion of the Shares of stock that otherwise
would be issued to a Participant under such Award or by tendering Shares
previously acquired by the Participant.

 

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10.          Adjustments of and Changes in the Common Stock.

 

(a) The existence of outstanding Awards shall not affect in any way the right or
power of the Company or its stockholders to make or authorize any or all
adjustments, recapitalizations, reorganizations, exchanges, or other changes in
the Company’s capital structure or its business, or any merger or consolidation
of the Company or any issuance of Shares or other securities or subscription
rights thereto, or any issuance of bonds, debentures, preferred or prior
preference stock ahead of or affecting the Shares or other securities of the
Company or the rights thereof, or the dissolution or liquidation of the Company,
or any sale or transfer of all or any part of its assets or business, or any
other corporate act or proceeding, whether of a similar character or otherwise.
Further, except as expressly provided herein or by the Administrator, (i) the
issuance by the Company of shares of stock or any class of securities
convertible into shares of stock of any class, for cash, property, labor or
services, upon direct sale, upon the exercise of rights or warrants to subscribe
therefor, or upon conversion of shares or obligations of the Company convertible
into such shares or other securities, (ii) the payment of a dividend in property
other than Shares, or (iii) the occurrence of any similar transaction, and in
any case whether or not for fair value, shall not affect, and no adjustment by
reason thereof shall be made with respect to, the number of Shares subject to
Stock Options or other Awards theretofore granted or the purchase price per
Share, unless the Administrator shall determine, in its sole discretion, that an
adjustment is necessary or appropriate.

 

(b) If the number of outstanding Shares or other securities of the Company, or
both, for which Awards are then exercisable or as to which Awards may be granted
or settled shall at any time be increased or decreased by declaration of a stock
dividend, a stock split, a reverse stock split, a combination of shares or a
similar transaction, or if the outstanding Shares or other such securities are
changed or exchanged for a different kind of securities of the Company by a
recapitalization, reorganization or any similar equity restructuring transaction
affecting the Shares or such other securities of the Company, the Administrator
shall make appropriate adjustments to the number and kind of Shares or other
securities that are subject to this Plan and that are subject to or issuable
upon exercises of any Awards theretofore granted, and to the exercise or
settlement prices of such Awards. Any such adjustments shall appropriately
maintain the proportionate numbers of Shares or other securities subject to this
Plan or outstanding Awards. Any such adjustment to an outstanding Award
generally shall be made without changing the aggregate exercise or settlement
price, if any.

 

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(c) As used in this paragraph, an “Acquisition” shall mean (i) a reorganization,
merger or consolidation (not covered by Section 10(b)) as a result of which the
Company is not the surviving entity or as a result of which the outstanding
Shares are changed into or exchanged for cash, property or securities not of the
Company's issue, or a combination thereof, except for a merger or consolidation
with a wholly-owned subsidiary of the Company or a transaction effected
primarily to change the state of the Company's incorporation, or (ii) a sale or
exchange, or series of related sales or exchanges, by the Company of all or
substantially all of its assets, or by one or more of the Company’s Subsidiaries
of all or substantially all of the consolidated assets of the Company and its
Subsidiaries, or (iii) the acquisition in a single transaction (including
without limitation a merger, sale or exchange), or series of related
transactions, of outstanding Shares representing more than 80% in voting power
of the then outstanding Shares (assuming full conversion of all then convertible
securities of the Company and full cashless exercises of all warrants or options
which can then be exercised by cashless exercises). Subject to the following
sentence, upon the closing of such an Acquisition, or upon the dissolution and
liquidation of the Company, each outstanding Stock Option or SAR shall terminate
and each holder of an outstanding Stock Option or SAR shall, notwithstanding any
unfulfilled vesting requirement, be entitled prior to such closing or
liquidation to exercise the unexercised portion of such Stock Option or SAR. The
preceding sentence shall be subject to any different terms contained in the
grant of or agreement governing such Award and shall not be applicable with
respect to a Stock Option or SAR if provision shall be made in connection with
such Acquisition for the assumption of the Stock Option or SAR by, or the
substitution for such Stock Option or SAR of a new option or stock appreciation
right covering the stock of the surviving, successor or purchasing corporation
or a parent or subsidiary thereof with appropriate adjustments as to the number
and kind of shares or other property to be issued upon exercise of the Stock
Option or SAR and the exercise price, provided that with respect to an Incentive
Option such assumption or substitution is permitted (to preserve the
applicability to the Incentive Option of Section 421(a) of the Code) by Sections
422 and 424 of the Code. The grant or instrument evidencing any Option, SAR or
other Award may also provide for other accelerations of vesting requirements or
its exercise or settlement.

 

(d) Subject to the requirements of Section 155 of the Nevada General Corporation
Law, unless otherwise determined by the Administrator, no right to purchase or
receive fractional Shares shall result from any adjustment in a Stock Option,
SAR or other Award pursuant to this Section 10 and, in case of any such
adjustment, the Shares subject to the Stock Option, SAR or Award shall be
rounded down to the nearest whole share.

 

11.          Amendment and Termination of the Plan. The Board may amend, alter
or discontinue the Plan and the Administrator may to the extent permitted by the
Plan amend any agreement or other document evidencing an Award made under this
Plan; provided, however, that the Company shall submit for stockholder approval
any amendment (other than an amendment pursuant to the adjustment provisions of
Section 10) that otherwise would:

 

(a) Increase the maximum number of Shares for which Awards may be granted under
this Plan;

 

(b) Reduce the price at which Stock Options may be granted below the price
provided for in Section 8(a);

 

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(c) Extend the term of this Plan; or

 

(d) Change the class of persons eligible to be Participants.

 

In addition, no such amendment or alteration shall be made which would impair
the rights of any Participant, without such Participant’s consent, under any
Award theretofore granted; provided that no such consent shall be required with
respect to any amendment or alteration if the Administrator reasonably
determines that such amendment or alteration is not reasonably likely to
significantly diminish the benefits provided under such Award, or that any such
diminishment has been adequately compensated.

 

12.          Compliance with Applicable Law. This Plan, the grant and exercise
of Awards hereunder, and the obligation of the Company to sell, issue or deliver
Shares under such Awards, shall be subject to all applicable federal, state and
local laws, rules and regulations and to such approvals by any governmental or
regulatory agency as may be required. If the Company shall use reasonable
efforts to satisfy such related requirements: the Company shall not be required
to register in a Participant’s name or deliver any Shares prior to the
completion of any registration or qualification of such Shares under any
federal, state or local law or any ruling or regulation of any government body
which shall be necessary; to the extent the Company is unable to or the
Administrator reasonably deems it infeasible to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company’s
counsel to be necessary or advisable for the lawful issuance and sale of any
Shares hereunder, the Company shall be relieved of any liability with respect to
the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained; and no Stock Option shall be exercisable and no
Shares shall be issued and/or transferable under any other Award unless a
registration statement with respect to the Shares underlying such Stock Option
is effective and current or the Company has determined that such registration is
unnecessary.

 

13.           Liability of Company. The Company shall not be liable to a
Participant or other persons as to: (a) the non-issuance or sale of Shares as to
which the Company, despite its reasonably efforts, has been unable to obtain
from any regulatory body having jurisdiction the authority deemed by the
Company’s counsel to be necessary to the lawful issuance and sale of any Shares
hereunder; and (b) any tax consequence expected, but not realized, by any
Participant or other person due to the receipt, exercise or settlement of any
Stock Option or other Award granted hereunder.

 

14.          Non-Exclusivity of Plan. Neither the adoption of this Plan by the
Board nor the submission of this Plan to the stockholders of the Company for
approval shall be construed as creating any limitations on the power of the
Board or the Administrator to adopt such other incentive arrangements as either
may deem desirable, including, without limitation, the granting of Stock
Options, Stock Appreciation Rights, Restricted Stock or Restricted Stock Units
otherwise than under this Plan, and such arrangements may be either generally
applicable or applicable only in specific cases.

 

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15.          Unfunded Plan. Insofar as it provides for Awards, the Plan shall be
unfunded. Although bookkeeping accounts may be established with respect to
Participants who are granted Awards under this Plan, any such accounts will be
used merely as a bookkeeping convenience. The Company shall not be required to
segregate any assets which may at any time be represented by Awards, nor shall
this Plan be construed as providing for such segregation, nor shall the Company
or the Administrator be deemed to be a trustee of stock or cash to be awarded
under the Plan.

 

16.          Reservation of Shares. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

 

17.          Governing Law. This Plan shall be governed by and construed in
accordance with the laws of the State of Nevada (without giving effect to
conflicts of law principles).

 

18.          Section 409A of the Code. To the extent applicable, the Plan is
intended to comply with Section 409A of the Code. Unless the Administrator
determines otherwise, the Administrator shall interpret and administer the Plan
in accordance with Section 409A. The Administrator shall have the authority
unilaterally to accelerate or delay a payment to which the holder of any Award
may be entitled to the extent necessary or desirable to comply with, or avoid
adverse consequences under, Section 409A.

 

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