EXHIBIT 10.1

BAKBONE SOFTWARE INCORPORATED

2003 EQUITY INCENTIVE PLAN

(amended and restated May 7, 2009 and

formerly known as BakBone Software Incorporated 2003 Stock Option Plan)

1. Purposes of the Plan. The purposes of this Plan are to attract and retain the
best available personnel, to provide additional incentives to Employees,
Directors and Consultants and to promote the success of the Company’s business.

2. Definitions. The following definitions shall apply as used herein and in the
individual Award Agreements except as defined otherwise in an individual Award
Agreement. In the event a term is separately defined in an individual Award
Agreement, such definition shall supersede the definition contained in this
Section 2.

(a) “Administrator” means the Board or any of the Committees appointed to
administer the Plan.

(b) “Affiliate” and “Associate” shall have the respective meanings ascribed to
such terms in Rule 12b-2 promulgated under the Exchange Act.

(c) “Applicable Laws” means the legal requirements relating to the Plan and the
Awards under applicable provisions of Canadian law, U.S. federal and state
securities laws, the corporate laws of Canada, the Code, the rules of any
applicable stock exchange or national market system, and the rules of any other
non-U.S. jurisdiction applicable to Awards granted to residents therein.

(d) “Assumed” means that pursuant to a Corporate Transaction either (i) the
Award is expressly affirmed by the Company or (ii) the contractual obligations
represented by the Award are expressly assumed (and not simply by operation of
law) by the successor entity or its Parent in connection with the Corporate
Transaction with appropriate adjustments to the number and type of securities of
the successor entity or its Parent subject to the Award and the exercise or
purchase price thereof which at least preserves the compensation element of the
Award existing at the time of the Corporate Transaction as determined in
accordance with the instruments evidencing the agreement to assume the Award.

(e) “Award” means the grant of an Option, SAR, Dividend Equivalent Right,
Restricted Stock, Restricted Stock Unit or other right or benefit under the
Plan.

(f) “Award Agreement” means the written agreement evidencing the grant of an
Award executed by the Company and the Grantee, including any amendments thereto.

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

 

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(h) “Cause” means, with respect to the termination by the Company or a Related
Entity of the Grantee’s Service, that such termination is for “Cause” as such
term (or word of like import) is expressly defined in a then-effective written
agreement between the Grantee and the Company or such Related Entity, or in the
absence of such then-effective written agreement and definition, is based on, in
the determination of the Administrator, the Grantee’s: (i) performance of any
act or failure to perform any act in bad faith and to the detriment of the
Company or a Related Entity; (ii) dishonesty, intentional misconduct or material
breach of any agreement with the Company or a Related Entity; or
(iii) commission of a crime involving dishonesty, breach of trust, or physical
or emotional harm to any person; provided, however, that with regard to any
agreement that defines “Cause” on the occurrence of or in connection with a
Corporate Transaction or a Change in Control, such definition of “Cause” shall
not apply until a Corporate Transaction or a Change in Control actually occurs.

(i) “Change in Control” means a change in ownership or control of the Company
effected through either of the following transactions:

(i) the direct or indirect acquisition by any person or related group of persons
(other than an acquisition from or by the Company or by a Company-sponsored
employee benefit plan or by a person that directly or indirectly controls, is
controlled by, or is under common control with, the Company) of beneficial
ownership (within the meaning of Rule 13d-3 of the Exchange Act) of securities
possessing more than fifty percent (50%) of the total combined voting power of
the Company’s outstanding securities pursuant to a tender or exchange offer made
directly to the Company’s shareholders which a majority of the Continuing
Directors who are not Affiliates or Associates of the offeror do not recommend
such shareholders accept, or

(ii) a change in the composition of the Board over a period of twelve
(12) months or less such that a majority of the Board members (rounded up to the
next whole number) ceases, by reason of one or more contested elections for
Board membership, to be comprised of individuals who are Continuing Directors.

(j) “Code” means the Internal Revenue Code of 1986, as amended.

(k) “Committee” means any committee composed of members of the Board appointed
by the Board to administer the Plan.

(l) “Common Stock” means the common stock of the Company.

(m) “Company” means BakBone Software Incorporated, a Canada corporation, or any
successor entity that adopts the Plan in connection with a Corporate
Transaction.

(n) “Consultant” means any person (other than an Employee or a Director, solely
with respect to rendering services in such person’s capacity as a Director) who
is engaged by the Company or any Related Entity to render consulting or advisory
services to the Company or such Related Entity.

(o) “Continuing Directors” means members of the Board who either (i) have been
Board members continuously for a period of at least twelve (12) months or
(ii) have been Board members for less than twelve (12) months and were elected
or nominated for election as Board members by at least a majority of the Board
members described in clause (i) who were still in office at the time such
election or nomination was approved by the Board.

 

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(p) “Corporate Transaction” means any of the following transactions, provided,
however, that the Administrator shall determine under parts (iv) and (v) whether
multiple transactions are related, and its determination shall be final, binding
and conclusive:

(i) a merger or consolidation in which the Company is not the surviving entity,
except for a transaction the principal purpose of which is to change the state
in which the Company is incorporated;

(ii) the sale, transfer or other disposition of all or substantially all of the
assets of the Company;

(iii) the complete liquidation or dissolution of the Company;

(iv) any reverse merger or series of related transactions culminating in a
reverse merger (including, but not limited to, a tender offer followed by a
reverse merger) in which the Company is the surviving entity but (A) the shares
of Common Stock outstanding immediately prior to such merger are converted or
exchanged by virtue of the merger into other property, whether in the form of
securities, cash or otherwise, or (B) in which securities possessing more than
fifty percent (50%) of the total combined voting power of the Company’s
outstanding securities are transferred to a person or persons different from
those who held such securities immediately prior to such merger or the initial
transaction culminating in such merger; or

(v) acquisition in a single or series of related transactions by any person or
related group of persons (other than the Company or by a Company-sponsored
employee benefit plan) of beneficial ownership (within the meaning of Rule 13d-3
of the Exchange Act) of securities possessing more than fifty percent (50%) of
the total combined voting power of the Company’s outstanding securities.

(q) “Covered Employee” means an Employee who is a “covered employee” under
Section 162(m)(3) of the Code.

(r) “Director” means a member of the Board or the board of directors of any
Related Entity.

(s) “Disability” means as defined under the long-term disability policy of the
Company or the Related Entity to which the Grantee provides services regardless
of whether the Grantee is covered by such policy. If the Company or the Related
Entity to which the Grantee provides service does not have a long-term
disability plan in place, “Disability” means that a Grantee is unable to carry
out the responsibilities and functions of the position held by the Grantee by
reason of any medically determinable physical or mental impairment for a period
of not less than ninety (90) consecutive days. A Grantee will not be considered
to have incurred a Disability unless he or she furnishes proof of such
impairment sufficient to satisfy the Administrator in its discretion.

 

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(t) “Dividend Equivalent Right” means a right entitling the Grantee to
compensation measured by dividends paid with respect to Common Stock.

(u) “Employee” means any person, including an Officer or Director, who is in the
employ of the Company or any Related Entity, subject to the control and
direction of the Company or any Related Entity as to both the work to be
performed and the manner and method of performance. The payment of a director’s
fee by the Company or a Related Entity shall not be sufficient to constitute
“employment” by the Company.

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

(w) “Fair Market Value” means, as of any date, the value of Common Stock
determined as follows:

(i) If the Common Stock is listed on one or more established stock exchanges or
national market systems, including without limitation the Toronto Stock
Exchange, The NASDAQ Global Select Market, The NASDAQ Global Market or The
NASDAQ Capital Market of The NASDAQ Stock Market LLC, its Fair Market Value
shall be the closing sales price for such stock (or the closing bid, if no sales
were reported) as quoted on the principal exchange or system on which the Common
Stock is listed (as determined by the Administrator) on the date of
determination (or, if no closing sales price or closing bid was reported on that
date, as applicable, on the last trading date such closing sales price or
closing bid was reported), as reported in The Wall Street Journal or such other
source as the Administrator deems reliable;

(ii) If the Common Stock is regularly quoted on an automated quotation system
(including the OTC Bulletin Board) or by a recognized securities dealer, its
Fair Market Value shall be the closing sales price for such stock as quoted on
such system or by such securities dealer on the date of determination, but if
selling prices are not reported, the Fair Market Value of a share of Common
Stock shall be the mean between the high bid and low asked prices for the Common
Stock on the date of determination (or, if no such prices were reported on that
date, on the last date such prices were reported), as reported in The Wall
Street Journal or such other source as the Administrator deems reliable; or

(iii) In the absence of an established market for the Common Stock of the type
described in (i) and (ii), above, the Fair Market Value thereof shall be
determined by the Administrator in good faith and in a manner consistent with
Applicable Laws.

(x) “Grantee” means an Employee, Director or Consultant who receives an Award
under the Plan.

(y) “Immediate Family” means any child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, former spouse, sibling, niece, nephew,
mother-in-law, father-in-law, son-in law, daughter-in-law, brother-in-law, or
sister-in-law, including adoptive relationships, any person sharing the
Grantee’s household (other than a tenant or employee), a trust in which these
persons (or the Grantee) have more than fifty percent (50%) of the beneficial
interest, a foundation in which these persons (or the Grantee) control the
management of assets, and any other entity in which these persons (or the
Grantee) own more than fifty percent (50%) of the voting interests.

 

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(z) “Incentive Stock Option” means an Option intended to qualify as an incentive
stock option within the meaning of Section 422 of the Code.

(aa) “Insider” means an individual who would be considered an “insider” of the
Company for purposes of the Ontario Act or Section 16 of the Exchange Act, and
the rules and regulations promulgated thereunder.

(bb) “Non-Statutory Stock Option” means an Option not intended to qualify as an
Incentive Stock Option.

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

(dd) “Ontario Act” means the Securities Act (Ontario).

(ee) “Option” means an option to purchase Shares pursuant to an Award Agreement
granted under the Plan.

(ff) “Parent” means a “parent corporation”, whether now or hereafter existing,
as defined in Section 424(e) of the Code.

(gg) “Performance-Based Compensation” means compensation qualifying as
“performance-based compensation” under Section 162(m) of the Code.

(hh) “Plan” means this 2003 Equity Incentive Plan, formerly known as the 2003
Stock Option Plan.

(ii) “Post-Termination Exercise Period” means the period specified in the Award
Agreement of not less than thirty (30) days commencing on the date of
termination (other than termination by the Company or any Related Entity for
Cause) of the Grantee’s Service, or such longer period as may be applicable upon
death or Disability.

(jj) “Related Entity” means any Parent or Subsidiary of the Company.

(kk) “Replaced” means that pursuant to a Corporate Transaction the Award is
replaced with a comparable stock award or a cash incentive program of the
Company, the successor entity (if applicable) or Parent of either of them which
preserves the compensation element of such Award existing at the time of the
Corporate Transaction and provides for subsequent payout in accordance with the
same (or a more favorable) vesting schedule applicable to such Award. The
determination of Award comparability shall be made by the Administrator and its
determination shall be final, binding and conclusive.

(ll) “Restricted Stock” means Shares issued under the Plan to the Grantee for
such consideration, if any, and subject to such restrictions on transfer, rights
of first refusal, repurchase provisions, forfeiture provisions, and other terms
and conditions as established by the Administrator.

 

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(mm) “Restricted Stock Units” means an Award which may be earned in whole or in
part upon the passage of time or the attainment of performance criteria
established by the Administrator and which may be settled for cash, Shares or
other securities or a combination of cash, Shares or other securities as
established by the Administrator.

(nn) “Rule 16b-3” means Rule 16b-3 promulgated under the Exchange Act or any
successor thereto.

(oo) “SAR” means a stock appreciation right entitling the Grantee to Shares or
cash compensation, as established by the Administrator, measured by appreciation
in the value of Common Stock.

(pp) “Service” means that the provision of services to the Company or a Related
Entity in any capacity of Employee, Director or Consultant is not interrupted or
terminated. In jurisdictions requiring notice in advance of an effective
termination as an Employee, Director or Consultant, Service shall be deemed
terminated upon the actual cessation of providing services to the Company or a
Related Entity notwithstanding any required notice period that must be fulfilled
before a termination as an Employee, Director or Consultant can be effective
under Applicable Laws. A Grantee’s Service shall be deemed to have terminated
either upon an actual termination of Service or upon the entity for which the
Grantee provides services ceasing to be a Related Entity. Service shall not be
considered interrupted in the case of (i) any approved leave of absence,
(ii) transfers among the Company, any Related Entity, or any successor, in any
capacity of Employee, Director or Consultant, or (iii) any change in status as
long as the individual remains in the service of the Company or a Related Entity
in any capacity of Employee, Director or Consultant (except as otherwise
provided in the Award Agreement). Notwithstanding the foregoing, except as
otherwise determined by the Administrator, in the event of any spin-off of a
Related Entity, service as an Employee, Director or Consultant for such Related
Entity following such spin-off shall be deemed to be Service for purposes of the
Plan and any Award under the Plan. An approved leave of absence shall include
sick leave, military leave, or any other authorized personal leave. For purposes
of each Incentive Stock Option granted under the Plan, if such leave exceeds
three (3) months, and reemployment upon expiration of such leave is not
guaranteed by statute or contract, then the Incentive Stock Option shall be
treated as a Non-Statutory Stock Option on the day three (3) months and one
(1) day following the expiration of such three (3) month period.

(qq) “Share” means a share of the Common Stock.

(rr) “Stock” means Common Stock.

(ss) “Subsidiary” means a “subsidiary corporation”, whether now or hereafter
existing, as defined in Section 424(f) of the Code.

3. Stock Subject to the Plan.

(a) Subject to the provisions of Section 10 below, the maximum aggregate number
of Shares which may be issued pursuant to all Awards is ten million three
hundred thirty-one thousand five hundred sixteen (10,331,516) Shares; provided,
however, that the maximum aggregate number of Shares which may be issued under
the Plan at any time shall be reduced by the number of

 

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Shares subject to any outstanding options granted pursuant to either the BakBone
Software Incorporated Stock Option Plan, as amended, or the BakBone Software
Incorporated 2002 Stock Option Plan. The Shares may be authorized, but unissued,
or reacquired Common Stock.

(b) Any Shares covered by an Award (or portion of an Award) which is forfeited,
canceled (including by reason of surrender under Section 8(f) below) or expires,
whether voluntarily or involuntarily, shall be deemed not to have been issued
for purposes of determining the maximum aggregate number of Shares which may be
issued under the Plan; provided, however, that Shares covered by Incentive Stock
Options surrendered pursuant to Section 8(f) shall not be available for future
grants of Incentive Stock Options under the Plan. Shares that actually have been
issued under the Plan pursuant to an Award shall not be returned to the Plan and
shall not become available for future issuance under the Plan, except that if
unvested Shares are forfeited or repurchased by the Company, such Shares shall
become available for future grant under the Plan.

4. Administration of the Plan.

(a) Plan Administrator.

(i) Administration with Respect to Directors and Officers. With respect to
grants of Awards to Directors or Employees (i) who are also Officers or
Directors of the Company or (ii) who would also be considered “insiders” for
purposes of the Ontario Act, the Plan shall be administered by (A) the Board or
(B) a Committee designated by the Board, which Committee shall be constituted in
such a manner as to satisfy the Applicable Laws and to permit such grants and
related transactions under the Plan to be exempt from Section 16(b) of the
Exchange Act in accordance with Rule 16b-3. Once appointed, such Committee shall
continue to serve in its designated capacity until otherwise directed by the
Board.

(ii) Administration With Respect to Consultants and Other Employees. With
respect to grants of Awards 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 shall be
constituted in such a manner as to satisfy the Applicable Laws. Once appointed,
such Committee shall continue to serve in its designated capacity until
otherwise directed by the Board.

(iii) Administration With Respect to Covered Employees. Notwithstanding the
foregoing, grants of Awards to any Covered Employee intended to qualify as
Performance-Based Compensation shall be made only by a Committee (or
subcommittee of a Committee) which is comprised solely of two or more Directors
eligible to serve on a committee making Awards qualifying as Performance-Based
Compensation. In the case of such Awards granted to Covered Employees,
references to the “Administrator” or to a “Committee” shall be deemed to be
references to such Committee or subcommittee.

(b) Multiple Administrative Bodies. The Plan may be administered by different
bodies with respect to Directors, Officers, Consultants, and Employees who are
neither Directors nor Officers.

 

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(c) Powers of the Administrator. Subject to Applicable Laws and the provisions
of the Plan (including any other powers given to the Administrator hereunder),
and except as otherwise provided by the Board, the Administrator shall have the
authority, in its discretion:

(i) to select the Employees, Directors and Consultants to whom Awards may be
granted from time to time hereunder;

(ii) to determine whether and to what extent Awards are granted hereunder;

(iii) to determine the number of Shares or the amount of other consideration to
be covered by each Award granted hereunder;

(iv) to approve forms of Award Agreements for use under the Plan;

(v) to determine the terms and conditions of any Award granted hereunder;

(vi) to establish additional terms, conditions, rules or procedures to
accommodate the rules or laws of applicable non-U.S. jurisdictions and to afford
Grantees favorable treatment under such rules or laws; provided, however, that
no Award shall be granted under any such additional terms, conditions, rules or
procedures with terms or conditions which are inconsistent with the provisions
of the Plan;

(vii) to amend the terms of any outstanding Award granted under the Plan,
provided that any amendment that would adversely affect the Grantee’s rights
under an outstanding Award shall not be made without the Grantee’s written
consent, provided, however, that an amendment or modification that may cause an
Incentive Stock Option to become a Non-Statutory Stock Option shall not be
treated as adversely affecting the rights of the Grantee. Notwithstanding the
foregoing, shareholder approval shall not be required for (A) the reduction or
increase of the exercise price or base appreciation amount (as applicable) of
any Option or SAR awarded under the Plan and (B) canceling an Option or SAR at a
time when its exercise price or base appreciation amount (as applicable) exceeds
(or is less than) the Fair Market Value of the underlying Shares, in exchange
for another Option, SAR, Restricted Stock, or other Award;

(viii) to construe and interpret the terms of the Plan and Awards, including
without limitation, any notice of award or Award Agreement, granted pursuant to
the Plan; and

(ix) to take such other action, not inconsistent with the terms of the Plan, as
the Administrator deems appropriate.

The express grant in the Plan of any specific power to the Administrator shall
not be construed as limiting any power or authority of the Administrator;
provided that the Administrator may not exercise any right or power reserved to
the Board. Any decision made, or action taken, by the Administrator or in
connection with the administration of this Plan shall be final, conclusive and
binding on all persons having an interest in the Plan.

 

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(d) Indemnification. In addition to such other rights of indemnification as they
may have as members of the Board or as Officers or Employees of the Company or a
Related Entity, members of the Board and any Officers or Employees of the
Company or a Related Entity to whom authority to act for the Board, the
Administrator or the Company is delegated shall be defended and indemnified by
the Company to the extent permitted by law on an after-tax basis against all
reasonable expenses, including attorneys’ fees, actually and necessarily
incurred in connection with the defense of any claim, investigation, action,
suit or proceeding, or in connection with any appeal therein, to which they or
any of them may be a party by reason of any action taken or failure to act under
or in connection with the Plan, or any Award granted hereunder, and against all
amounts paid by them in settlement thereof (provided such settlement is approved
by the Company) or paid by them in satisfaction of a judgment in any such claim,
investigation, action, suit or proceeding, except in relation to matters as to
which it shall be adjudged in such claim, investigation, action, suit or
proceeding that such person is liable for gross negligence, bad faith or
intentional misconduct; provided, however, that within thirty (30) days after
the institution of such claim, investigation, action, suit or proceeding, such
person shall offer to the Company, in writing, the opportunity at the Company’s
expense to defend the same.

5. Eligibility. Awards other than Incentive Stock Options may be granted to
Employees, Directors and Consultants. Incentive Stock Options may be granted
only to Employees of the Company or a Parent or a Subsidiary of the Company. An
Employee, Director or Consultant who has been granted an Award may, if otherwise
eligible, be granted additional Awards. Awards may be granted to such Employees,
Directors or Consultants who are residing in non-U.S. jurisdictions as the
Administrator may determine from time to time.

6. Terms and Conditions of Awards.

(a) Types of Awards. The Administrator is authorized under the Plan to award any
type of arrangement to an Employee, Director or Consultant that is not
inconsistent with the provisions of the Plan and that by its terms involves or
might involve the issuance of (i) Shares, (ii) cash or (iii) an Option, a SAR,
or similar right with a fixed or variable price related to the Fair Market Value
of the Shares and with an exercise or conversion privilege related to the
passage of time, the occurrence of one or more events, or the satisfaction of
performance criteria or other conditions. Such awards include, without
limitation, Options, SARs, sales or bonuses of Restricted Stock, Restricted
Stock Units or Dividend Equivalent Rights, and an Award may consist of one such
security or benefit, or two (2) or more of them in any combination or
alternative.

(b) Designation of Award. Each Award shall be designated in the Award Agreement.
In the case of an Option, the Option shall be designated as either an Incentive
Stock Option or a Non-Statutory Stock Option. However, notwithstanding such
designation, an Option will qualify as an Incentive Stock Option under the Code
only to the extent the $100,000 dollar limitation of Section 422(d) of the Code
is not exceeded. The $100,000 limitation of Section 422(d) of the Code is
calculated based on the aggregate Fair Market Value of the Shares subject to
Options designated as Incentive Stock Options which become exercisable

 

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for the first time by a Grantee during any calendar year (under all plans of the
Company or any Parent or Subsidiary of the Company). For purposes of this
calculation, Incentive Stock Options shall be taken into account in the order in
which they were granted, and the Fair Market Value of the Shares shall be
determined as of the grant date of the relevant Option. In the event that the
Code or the regulations promulgated thereunder are amended after the date the
Plan becomes effective to provide for a different limit on the Fair Market Value
of Shares permitted to be subject to Incentive Stock Options, then such
different limit will be automatically incorporated herein and will apply to any
Options granted after the effective date of such amendment.

(c) Conditions of Award. Subject to the terms of the Plan, the Administrator
shall determine the provisions, terms, and conditions of each Award including,
but not limited to, the Award vesting schedule, repurchase provisions, rights of
first refusal, forfeiture provisions, form of payment (cash, Shares, or other
consideration) upon settlement of the Award, payment contingencies, and
satisfaction of any performance criteria. The performance criteria established
by the Administrator may be based on any one of, or combination of, the
following: (i) increase in share price, (ii) earnings per share, (iii) total
shareholder return, (iv) operating margin, (v) gross margin, (vi) return on
equity, (vii) return on assets, (viii) return on investment, (ix) operating
income, (x) net operating income, (xi) pre-tax profit, (xii) cash flow,
(xiii) revenue, (xiv) expenses, (xv) earnings before interest, taxes and
depreciation, (xvi) economic value added and (xvii) market share. The
performance criteria may be applicable to the Company, Related Entities and/or
any individual business units of the Company or any Related Entity. Partial
achievement of the specified criteria may result in a payment or vesting
corresponding to the degree of achievement as specified in the Award Agreement.
In addition, the performance criteria shall be calculated in accordance with
generally accepted accounting principles, but excluding the effect (whether
positive or negative) of any change in accounting standards and any
extraordinary, unusual or nonrecurring item, as determined by the Administrator,
occurring after the establishment of the performance criteria applicable to the
Award intended to be performance-based compensation. Each such adjustment, if
any, shall be made solely for the purpose of providing a consistent basis from
period to period for the calculation of performance criteria in order to prevent
the dilution or enlargement of the Grantee’s rights with respect to an Award
intended to be performance-based compensation.

(d) Acquisitions and Other Transactions. The Administrator may issue Awards
under the Plan in settlement, assumption or substitution for, outstanding awards
or obligations to grant future awards in connection with the Company or a
Related Entity acquiring another entity, an interest in another entity or an
additional interest in a Related Entity whether by merger, stock purchase, asset
purchase or other form of transaction.

(e) Deferral of Award Payment. The Administrator may establish one or more
programs under the Plan to permit selected Grantees the opportunity to elect to
defer receipt of consideration upon exercise of an Award, satisfaction of
performance criteria, or other event that absent the election would entitle the
Grantee to payment or receipt of Shares or other consideration under an Award.
The Administrator may establish the election procedures, the timing of such
elections, the mechanisms for payments of, and accrual of interest or other
earnings, if any, on amounts, Shares or other consideration so deferred, and
such other terms, conditions, rules and procedures that the Administrator deems
advisable for the administration of any such deferral program.

 

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(f) Separate Programs. The Administrator may establish one or more separate
programs under the Plan for the purpose of issuing particular forms of Awards to
one or more classes of Grantees on such terms and conditions as determined by
the Administrator from time to time.

(g) Individual Limitations on Awards.

(i) Individual Option and SAR Limit. The maximum number of Shares with respect
to which Options and SARs may be granted to any Grantee in any fiscal year of
the Company shall be one million five hundred thousand (1,500,000) Shares. The
foregoing limitation shall be adjusted proportionately in connection with any
change in the Company’s capitalization pursuant to Section 10, below. To the
extent required by Section 162(m) of the Code or the regulations thereunder, in
applying the foregoing limitation with respect to a Grantee, if any Option or
SAR is canceled, the canceled Option or SAR shall continue to count against the
maximum number of Shares with respect to which Options and SARs may be granted
to the Grantee. For this purpose, the repricing of an Option (or in the case of
a SAR, the base amount on which the stock appreciation is calculated is reduced
to reflect a reduction in the Fair Market Value of the Common Stock) shall be
treated as the cancellation of the existing Option or SAR and the grant of a new
Option or SAR.

(ii) Additional Limit. Notwithstanding the provisions of Section 6(g)(i) or
Section 6(h), the total number of Shares which may be reserved for issuance to
any one Grantee under the Plan shall not exceed five percent (5%) of the total
number of issued and outstanding Shares (on a non-diluted basis) less Shares
reserved for issuance under any Award Agreement.

(h) Limitations on Awards to Insiders. The aggregate number of Shares issuable
pursuant to Awards under the Plan, together with all of the Company’s other
previously established or proposed share compensation arrangements, will not
result in either: (i) the number of Shares reserved for issuance pursuant to
awards granted to Insiders exceeding ten percent (10%) of the outstanding issue,
(ii) the issuance to Insiders, within a one-year period, of a number of Shares
exceeding ten percent (10%) of the outstanding issue, or (iii) the issuance to
any one Insider and such Insider’s Associates, within a one-year period, of a
number of Shares exceeding five percent (5%) of the outstanding issue.

(i) Early Exercise. The Award Agreement may, but need not, include a provision
whereby the Grantee may elect at any time while an Employee, Director or
Consultant to exercise any part or all of the Award prior to full vesting of the
Award. Any unvested Shares received pursuant to such exercise may be subject to
a repurchase right in favor of the Company or a Related Entity or to any other
restriction the Administrator determines to be appropriate.

(j) Term of Award. The term of each Award shall be the term stated in the Award
Agreement, provided, however, that the term shall be no more than ten (10) years
from the date of grant thereof. However, in the case of an Incentive Stock
Option granted to a Grantee who, at the time the Option is granted, owns stock
representing more than ten percent (10%) of the voting

 

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power of all classes of stock of the Company or any Parent or Subsidiary of the
Company, the term of the Incentive Stock Option shall be five (5) years from the
date of grant thereof or such shorter term as may be provided in the Award
Agreement. Notwithstanding the foregoing, the specified term of any Award shall
not include any period for which the Grantee has elected to defer the receipt of
the Shares or cash issuable pursuant to the Award.

(k) Transferability of Awards. Incentive Stock Options may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Grantee, only by the Grantee. Other Awards shall be transferable
(i) by will and by the laws of descent and distribution and (ii) during the
lifetime of the Grantee, to the extent and in the manner authorized by the
Administrator by gift or pursuant to a domestic relations order to members of
the Grantee’s Immediate Family. Notwithstanding the foregoing, the Grantee may
designate one or more beneficiaries of the Grantee’s Award in the event of the
Grantee’s death on a beneficiary designation form provided by the Administrator.

(l) Time of Granting Awards. The date of grant of an Award shall for all
purposes be the date on which the Administrator makes the determination to grant
such Award, or such other later date as is determined by the Administrator.

7. Award Exercise or Purchase Price, Consideration and Taxes.

(a) Exercise or Purchase Price. The exercise or purchase price, if any, for an
Award shall be as follows:

(i) In the case of an Incentive Stock Option:

(A) granted to an Employee who, at the time of the grant of such Incentive Stock
Option owns stock representing more than ten percent (10%) of the voting power
of all classes of stock of the Company or any Parent or Subsidiary of the
Company, the per Share exercise price shall be not less than one hundred ten
percent (110%) of the Fair Market Value per Share on the date of grant; or

(B) granted to any Employee other than an Employee described in the preceding
paragraph, the per Share exercise price shall be not less than one hundred
percent (100%) of the Fair Market Value per Share on the date of grant.

(ii) In the case of a Non-Statutory Stock Option, the per Share exercise price
shall be not less than one hundred percent (100%) of the Fair Market Value per
Share on the date of grant.

(iii) In the case of SARs, the base appreciation amount shall not be less than
one hundred percent (100%) of the Fair Market Value per Share on the date of
grant.

(iv) In the case of Awards intended to qualify as Performance-Based
Compensation, the exercise or purchase price, if any, shall be not less than one
hundred percent (100%) of the Fair Market Value per Share on the date of grant.

 

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(v) In the case of the sale of Shares, the per Share purchase price, if any,
shall be such price as is determined by the Administrator.

(vi) In the case of other Awards, such price as is determined by the
Administrator.

(vii) Notwithstanding the foregoing provisions of this Section 7(a), in the case
of an Award issued pursuant to Section 6(d), above, the exercise or purchase
price for the Award shall be determined in accordance with the provisions of the
relevant instrument evidencing the agreement to issue such Award.

(b) Consideration. Subject to Applicable Laws, the consideration to be paid for
the Shares to be issued upon exercise or purchase of an Award including the
method of payment, shall be determined by the Administrator. In addition to any
other types of consideration the Administrator may determine, the Administrator
is authorized to accept as consideration for Shares issued under the Plan the
following:

(i) cash;

(ii) check;

(iii) delivery of Grantee’s promissory note with such recourse, interest,
security, and redemption provisions as the Administrator determines as
appropriate (but only to the extent that the acceptance or terms of the
promissory note would not violate an Applicable Law);

(iv) surrender of Shares held for the requisite period, if any, necessary to
avoid a charge to the Company’s earnings for financial reporting purposes, or
delivery of a properly executed form of attestation of ownership of Shares as
the Administrator may require which have a Fair Market Value on the date of
surrender or attestation equal to the aggregate exercise price of the Shares as
to which said Award shall be exercised;

(v) with respect to Options, payment through a broker-dealer sale and remittance
procedure pursuant to which the Grantee (A) shall provide written instructions
to a Company designated brokerage firm to effect the immediate sale of some or
all of the purchased Shares and remit to the Company sufficient funds to cover
the aggregate exercise price payable for the purchased Shares and (B) shall
provide written directives to the Company to deliver the certificates for the
purchased Shares directly to such brokerage firm in order to complete the sale
transaction;

(vi) with respect to Options, payment through a “net exercise” such that,
without the payment of any funds, the Grantee may exercise the Option and
receive the net number of Shares equal to (i) the number of Shares as to which
the Option is being exercised, multiplied by (ii) a fraction, the numerator of
which is the Fair Market Value per Share (on such date as is determined by the
Administrator) less the Exercise Price per Share, and the denominator of which
is such Fair Market Value per Share (the number of net Shares to be received
shall be rounded down to the nearest whole number of Shares); or

 

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(vii) any combination of the foregoing methods of payment.

The Administrator may at any time or from time to time, by adoption of or by
amendment to the standard forms of Award Agreement described in
Section 4(c)(iv), or by other means, grant Awards which do not permit all of the
foregoing forms of consideration to be used in payment for the Shares or which
otherwise restrict one or more forms of consideration.

(c) Taxes. No Shares shall be delivered under the Plan to any Grantee or other
person until such Grantee or other person has made arrangements acceptable to
the Administrator for the satisfaction of any Canadian, Canadian province or
territory, U.S. federal, U.S. state, or local income and employment tax
withholding obligations, including, without limitation, obligations incident to
the receipt of Shares. Upon exercise or vesting of an Award the Company shall
withhold or collect from the Grantee an amount sufficient to satisfy such tax
obligations, including, but not limited to, by surrender of the whole number of
Shares covered by the Award sufficient to satisfy the minimum applicable tax
withholding obligations incident to the exercise or vesting of an Award (reduced
to the lowest whole number of Shares if such number of Shares withheld would
result in withholding a fractional Share with any remaining tax withholding
settled in cash).

8. Exercise of Award.

(a) Procedure for Exercise; Rights as a Shareholder.

(i) Any Award granted hereunder shall be exercisable at such times and under
such conditions as determined by the Administrator under the terms of the Plan
and specified in the Award Agreement.

(ii) An Award shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the Award
by the person entitled to exercise the Award and full payment for the Shares
with respect to which the Award is exercised has been made, including, to the
extent selected, use of the broker-dealer sale and remittance procedure to pay
the purchase price as provided in Section 7(b)(v).

(b) Exercise of Award Following Termination of Service. In the event of
termination of a Grantee’s Service for any reason other than Disability or death
(but not in the event of a Grantee’s change of status from Employee to
Consultant or from Consultant to Employee), such Grantee may, but only during
the Post-Termination Exercise Period (but in no event later than the expiration
date of the term of such Award as set forth in the Award Agreement), exercise
the portion of the Grantee’s Award that was vested at the date of such
termination or such other portion of the Grantee’s Award as may be determined by
the Administrator. The Grantee’s Award Agreement may provide that upon the
termination of the Grantee’s Service for Cause, the Grantee’s right to exercise
the Award shall terminate concurrently with the termination of Grantee’s
Service. In the event of a Grantee’s change of status from Employee to
Consultant, an Employee’s Incentive Stock Option shall convert automatically to
a Non-Statutory Stock Option on the day three (3) months and one day following
such change of status. To the extent that the Grantee’s Award was unvested at
the date of termination, or if the Grantee does not exercise the vested portion
of the Grantee’s Award within the Post-Termination Exercise Period, the Award
shall terminate.

 

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(c) Disability of Grantee. In the event of termination of a Grantee’s Service as
a result of his or her Disability, such Grantee may, but only within twelve (12)
months from the date of such termination (or such longer period as specified in
the Award Agreement but in no event later than the expiration date of the term
of such Award as set forth in the Award Agreement), exercise the portion of the
Grantee’s Award that was vested at the date of such termination; provided,
however, that if such Disability is not a “disability” as such term is defined
in Section 22(e)(3) of the Code, in the case of an Incentive Stock Option such
Incentive Stock Option shall automatically convert to a Non-Statutory Stock
Option on the day three (3) months and one day following such termination. To
the extent that the Grantee’s Award was unvested at the date of termination, or
if Grantee does not exercise the vested portion of the Grantee’s Award within
the time specified herein, the Award shall terminate.

(d) Death of Grantee. In the event of a termination of the Grantee’s Service as
a result of his or her death, or in the event of the death of the Grantee during
the Post-Termination Exercise Period or during the twelve (12) month period
following the Grantee’s termination of Service as a result of his or her
Disability, the Grantee’s estate or a person who acquired the right to exercise
the Award by bequest or inheritance may exercise the portion of the Grantee’s
Award that was vested as of the date of termination, within twelve (12) months
from the date of death (or such longer period as specified in the Award
Agreement but in no event later than the expiration of the term of such Award as
set forth in the Award Agreement). To the extent that, at the time of death, the
Grantee’s Award was unvested, or if the Grantee’s estate or a person who
acquired the right to exercise the Award by bequest or inheritance does not
exercise the vested portion of the Grantee’s Award within the time specified
herein, the Award shall terminate.

(e) Extension if Exercise Prevented by Law. Notwithstanding the foregoing, if
the exercise of an Award within the applicable time periods set forth in this
Section 8 is prevented by the provisions of Section 9 below, the Award shall
remain exercisable until one (1) month after the date the Grantee is notified by
the Company that the Award is exercisable, but in any event no later than the
expiration of the term of such Award as set forth in the Award Agreement and
only in a manner and to the extent permitted under Code Section 409A.

(f) Alternative Settlement of Options. As an alternative to the exercise of
Options as set forth in this Section 8, where the Shares are publicly traded,
the Administrator may from time to time in its sole discretion, permit Options
to be surrendered, unexercised, to the Company in consideration of the receipt
by the holder of such Options of an amount (the “Settlement Amount”) equal to
the excess, if any, of the aggregate Fair Market Value of the Shares able to be
purchased pursuant to the vested and exercisable portion of such Options on the
date of surrender, over the aggregate exercise price for those Shares pursuant
to those Options. The Settlement Amount shall be payable in cash, Shares or a
combination thereof, as the Administrator may from time to time in its
discretion determine.

 

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9. Conditions Upon Issuance of Shares.

(a) If at any time the Administrator determines that the delivery of Shares
pursuant to the exercise, vesting or any other provision of an Award is or may
be unlawful under Applicable Laws, the vesting or right to exercise an Award or
to otherwise receive Shares pursuant to the terms of an Award shall be suspended
until the Administrator determines that such delivery is lawful and shall be
further subject to the approval of counsel for the Company with respect to such
compliance. The Company shall have no obligation to effect any registration or
qualification of the Shares under Canadian, Canadian province or territory, U.S.
federal or U.S. state laws.

(b) As a condition to the exercise of an Award, the Company may require the
person exercising such Award to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any
present intention to sell or distribute such Shares if, in the opinion of
counsel for the Company, such a representation is required by any Applicable
Laws.

10. Adjustments Upon Changes in Capitalization. Subject to any required action
by the shareholders of the Company and Section 11 hereof, and to the terms of
any Award Agreement, 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 Awards have yet been granted or which have been returned to the
Plan, the exercise or purchase price of each such outstanding Award, the maximum
number of Shares with respect to which Awards may be granted to any Grantee in
any calendar year, as well as any other terms that the Administrator determines
require adjustment shall be proportionately adjusted for (i) any increase or
decrease in the number of issued Shares resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Shares, or
similar transaction affecting the Shares, (ii) any other increase or decrease in
the number of issued Shares effected without receipt of consideration by the
Company, or (iii) any other transaction with respect to Common Stock including a
corporate merger, consolidation, acquisition of property or stock, separation
(including a spin-off or other distribution of stock or property),
reorganization, liquidation (whether partial or complete) or any similar
transaction; provided, however that conversion of any convertible securities of
the Company shall not be deemed to have been “effected without receipt of
consideration.” In the event of any distribution of cash or other assets to
shareholders other than a normal cash dividend, the Administrator shall also
make such adjustments as provided in this Section 10 or substitute, exchange or
grant Awards to effect such adjustments (collectively “adjustments”). Any such
adjustments to outstanding Awards will be effected in a manner that precludes
the enlargement of rights and benefits under such Awards. In connection with the
foregoing adjustments, the Administrator may, in its discretion, prohibit the
exercise of Awards or other issuance of Shares, cash or other consideration
pursuant to Awards during certain periods of time. Except as the Administrator
determines, 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
hereof shall be made with respect to, the number or price of Shares subject to
an Award.

 

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11. Corporate Transactions and Changes in Control.

(a) Termination of Award to Extent Not Assumed in Corporate Transaction.
Provided that the Grantee is afforded an opportunity to exercise vested Awards
prior to the consummation of the Corporate Transaction, effective upon the
consummation of a Corporate Transaction, all outstanding Awards under the Plan
shall terminate. However, all such Awards shall not terminate to the extent they
are Assumed in connection with the Corporate Transaction.

(b) Acceleration of Award Upon Corporate Transaction or Change in Control. The
Administrator shall have the authority, exercisable either in advance of any
actual or anticipated Corporate Transaction or Change in Control or at the time
of an actual Corporate Transaction or Change in Control and exercisable at the
time of the grant of an Award under the Plan or any time while an Award remains
outstanding, to provide for the full or partial automatic vesting and
exercisability of one or more outstanding unvested Awards under the Plan and the
release from restrictions on transfer and repurchase or forfeiture rights of
such Awards in connection with a Corporate Transaction or Change in Control, on
such terms and conditions as the Administrator may specify. The Administrator
also shall have the authority to condition any such Award vesting and
exercisability or release from such limitations upon the subsequent termination
of the Service of the Grantee within a specified period following the effective
date of the Corporate Transaction or Change in Control. The Administrator may
provide that any Awards so vested or released from such limitations in
connection with a Change in Control, shall remain fully exercisable until the
expiration or sooner termination of the Award.

(c) Effect of Acceleration on Incentive Stock Options. Any Incentive Stock
Option accelerated under this Section 11 in connection with a Corporate
Transaction or Change in Control shall remain exercisable as an Incentive Stock
Option under the Code only to the extent the $100,000 dollar limitation of
Section 422(d) of the Code is not exceeded.

12. Effective Date and Term of Plan. The Plan was adopted by the Board on
April 24, 2003 and approved by the shareholders of the Company on July 17, 2003.
It shall continue in effect until April 23, 2013 unless sooner terminated. The
2009 amendment and restatement of the Plan shall become effective upon its
adoption by the Board on May 7, 2009. The amendments in this 2009 restatement of
the Plan are not intended to, and will not be treated as, (i) adversely
affecting any rights under or (ii) adding any new beneficial features to
outstanding options granted under the Plan prior to the effective date of the
Plan’s 2009 amendment and restatement; the terms of such options shall continue
to be governed by the applicable stock option agreements already governing such
awards and by the terms of the Plan prior to its 2009 amendment and restatement.

13. Amendment, Suspension or Termination of the Plan.

(a) The Board may at any time amend, suspend or terminate the Plan; provided,
however, that no such amendment shall be made prior to receipt of requisite
regulatory approval to the extent required by Applicable Laws, and provided
further that no such amendment shall be made without the approval of the
Company’s shareholders to the extent such approval is required by Applicable
Laws.

 

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(b) No Award may be granted during any suspension of the Plan or after
termination of the Plan.

(c) No suspension or termination of the Plan (including termination of the Plan
under Section 12, above) shall adversely affect any rights under Awards already
granted to a Grantee.

14. Reservation of Shares.

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

(b) 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.

15. No Effect on Terms of Employment/Consulting Relationship. The Plan shall not
confer upon any Grantee any right with respect to the Grantee’s Service, nor
shall it interfere in any way with his or her right or the right of the Company
or any Related Entity to terminate the Grantee’s Service at any time, including,
but not limited to, Cause, and with or without notice. The ability of the
Company or any Related Entity to terminate the employment of a Grantee who is
employed at will is in no way affected by its determination that the Grantee’s
Service has been terminated for Cause for the purposes of this Plan.

16. No Effect on Retirement and Other Benefit Plans. Except as specifically
provided in a retirement or other benefit plan of the Company or a Related
Entity, Awards shall not be deemed compensation for purposes of computing
benefits or contributions under any retirement plan of the Company or a Related
Entity, and shall not affect any benefits under any other benefit plan of any
kind or any benefit plan subsequently instituted under which the availability or
amount of benefits is related to level of compensation. The Plan is not a
“Pension Plan” or “Welfare Plan” under the Employee Retirement Income Security
Act of 1974, as amended.

17. Information to Grantees. To the extent required by Applicable Law, the
Company shall provide to each Grantee, during the period for which such Grantee
has one or more Awards outstanding, copies of financial statements at least
annually. The Company shall not be required to provide such information to
persons whose duties in connection with the Company assure them access to
equivalent information.

18. Unfunded Obligation. Grantees shall have the status of general unsecured
creditors of the Company. Any amounts payable to Grantees pursuant to the Plan
shall be unfunded and unsecured obligations for all purposes, including, without
limitation, Title I of the Employee Retirement Income Security Act of 1974, as
amended. Neither the Company nor any Related Entity shall be required to
segregate any monies from its general funds, or to create any trusts, or
establish any special accounts with respect to such obligations. The Company
shall retain at all times beneficial ownership of any investments, including
trust investments, which the Company may

 

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make to fulfill its payment obligations hereunder. Any investments or the
creation or maintenance of any trust or any Grantee account shall not create or
constitute a trust or fiduciary relationship between the Administrator, the
Company or any Related Entity and a Grantee, or otherwise create any vested or
beneficial interest in any Grantee or the Grantee’s creditors in any assets of
the Company or a Related Entity. The Grantees shall have no claim against the
Company or any Related Entity for any changes in the value of any assets that
may be invested or reinvested by the Company with respect to the Plan.

19. Construction. Captions and titles contained herein are for convenience only
and shall not affect the meaning or interpretation of any provision of the Plan.
Except when otherwise indicated by the context, the singular shall include the
plural and the plural shall include the singular. Use of the term “or” is not
intended to be exclusive, unless the context clearly requires otherwise.

20. Nonexclusivity of the Plan. Neither the adoption of the Plan by the Board,
the submission of the Plan to the shareholders of the Company for approval, nor
any provision of the Plan will be construed as creating any limitations on the
power of the Board to adopt such additional compensation arrangements as it may
deem desirable, including, without limitation, the granting of Awards otherwise
than under the Plan, and such arrangements may be either generally applicable or
applicable only in specific cases.

 

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