Exhibit 10.02

 

BUILDABLOCK CORP.

2012 EQUITY INCENTIVE PLAN

 

The purpose of the Buildablock Corp. 2012 Equity Incentive Plan (the “Plan”) is
to advance the interests of Buildablock Corp. (the “Company”) by linking the
interests of the members of the Board, Employees and Consultants to those of the
Company’s stockholders and by providing such individuals an incentive to
continue to work towards and contribute to the success and progress of the
Company. The Plan is further intended to provide flexibility to the Company in
its ability to motivate, attract, and retain the services of members of the
Board, Employees and Consultants.

 

Article I.
DEFINITIONS

 

As used in the Plan, the following terms will have the meanings set forth below:

 

1.1           “Administrator” shall mean the entity that conducts the general
administration of the Plan as provided in Article XI. With reference to the
duties of the Committee under the Plan which have been delegated to one or more
persons pursuant to Section 11.3, the term “Administrator” shall refer to such
person(s) unless the Committee has revoked such delegation.

 

1.2           “Award” shall mean an Incentive Stock Option, Nonqualified Stock
Option, Restricted Stock, Restricted Stock Unit, Performance Shares, Performance
Share Units, and Stock Appreciation Rights which may be awarded or granted under
the Plan (collectively, “Awards”).

 

1.3           “Award Agreement” shall mean a written agreement or other
instrument as approved from time to time by the Committee implementing the grant
of each Award. An Agreement may be in the form of an agreement to be executed by
both the Holder and the Company (or an authorized representative of the Company)
or certificates, notices or similar instruments as approved by the Committee.

 

1.4           “Award Limit” shall mean 1,000,000 shares of Common Stock, as
adjusted pursuant to Section 12.3; provided, however, that each share of Common
Stock subject to an Award shall be counted as one share against the Award Limit.

 

1.5           “Board” shall mean the Board of Directors of the Company.

 

 

 

 

1.6           “Change in Control” shall mean the occurrence of any of the
following transactions or events occurring on or after the Effective Date:

  

(a)          any “person” (as defined below) or “group” (as defined in Section
13(d)(3) of the Exchange Act and the rules thereunder), together with all
affiliates of such person or group, shall become the “beneficial owner” (as
determined pursuant to Rule 13d-3 under the Exchange Act) of securities entitled
to vote generally in the election of directors (“voting securities”) of the
Company that represent 50% or more of the combined voting power of the Company’s
then outstanding voting securities, other than an Exempt Person; provided,
however, that, notwithstanding the foregoing, a Change in Control shall not
occur under this subsection (a) by reason of a person or group (together with
the affiliates thereof) becoming the beneficial owner of 50% or more of the
outstanding voting securities of the Company solely as a result of an
acquisition of voting securities by the Company which, by reducing the number of
voting securities outstanding, increases the proportionate number of voting
securities beneficially owned by such person or group (together with the
affiliates thereof) to 50% or more of the voting securities of the Company then
outstanding; and, provided, further, that if a person or group (together with
the affiliates thereof) shall become the beneficial owner of 50% or more of the
voting securities of the Company then outstanding solely as a result of an
acquisition of voting securities by the Company and shall, after such
acquisition by the Company, become the beneficial owner of additional voting
securities of the Company (other than pursuant to a dividend or distribution
paid or made by the Company in voting securities or pursuant to a split or
subdivision of the outstanding voting securities), then a Change in Control
shall occur under this subsection (a) unless, upon becoming the beneficial owner
of such additional voting securities, such person or group (together with the
affiliates thereof) does not beneficially own 50% or more of the voting
securities then outstanding;

 

(b)          during any 12-month period beginning on or after the Effective
Date, individuals who, at the beginning of such period, constitute the Board
(the “Incumbent Board”) cease for any reason to constitute at least a majority
of the Board; provided, however, that any individual becoming a director during
such 12-month period whose election, or nomination for election by the Company’s
stockholders, was approved by a vote of at least a majority of the directors
then comprising the Incumbent Board shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office occurs as a
result of an actual or threatened election contest with respect to the election
or removal of directors or other actual or threatened solicitation of proxies or
consents by or on behalf of a person other than the Board;

 

(c)          the consummation by the Company (whether directly involving the
Company or indirectly involving the Company through one or more intermediaries)
of: (x) a merger, consolidation, reorganization, or business combination or (y)
a sale or other disposition of all or substantially all of the Company’s assets
in any single transaction or series of related transactions or (z) the
acquisition of assets or stock of another entity, in each case, if, as a result
of the transaction, the Company’s voting securities outstanding immediately
before the transaction (or the securities into which such voting securities are
converted as a result of the transaction) fail to represent, directly or
indirectly, more than 50% of the combined voting power of the outstanding voting
securities of the Company (or the person that, as a result of the transaction,
controls, directly or indirectly, the Company or owns, directly or indirectly,
all or substantially all of the Company’s assets or otherwise succeeds to the
business of the Company (the Company or such person, the “Successor Entity”))
immediately after the transaction; and

 

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(d)          the Company’s stockholders approve a liquidation or dissolution of
the Company

 

For purposes of subsection (a) above, the calculation of voting power shall be
made as if the date on which the ownership of such person or group is measured
were a record date for a vote of the Company’s stockholders, and for purposes of
subsection (c) above, the calculation of voting power shall be made as if the
date of the consummation of the transaction were a record date for a vote of the
Company’s stockholders. For all purposes of this Plan, any calculation of the
number of securities outstanding at any particular time, including for purposes
of determining the particular percentage of such outstanding voting securities
of which any person or group is the beneficial owner, shall be made in
accordance with the last sentence of Rule 13d-3(d)(1)(i) of the General Rules
and Regulations under the Exchange Act. For purposes of this definition of
“Change in Control,” “person” means any individual, corporation, partnership,
limited liability company, joint venture, trust, unincorporated organization,
association or other entity.

 

1.7           “Code” shall mean the Internal Revenue Code of 1986, as amended
from time to time.

 

1.8           “Committee” shall mean the Compensation Committee of the Board.

 

1.9           “Common Stock” shall mean common stock of the Company; par value
$0.00001 per share.

 

1.10         “Company” shall mean Buildablock Corp., a Florida Corporation.

 

1.11         “Consultant” shall mean any consultant or adviser if: (a) the
consultant or adviser is a natural person, (b) the consultant or adviser renders
bona fide services to the Company or any Subsidiary; and (c) the services
rendered by the consultant or adviser 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.

 

1.12         “DRO” shall mean a domestic relations order as defined by the Code
or Title I of the Employee Retirement Income security Act of 1974, as amended
from time to time, or the rules thereunder.

 

1.13         “Effective Date” shall mean the date the Plan is approved by the
Company’s Board of Directors.

 

1.14         “Employee” shall mean any officer or other employee (as defined in
accordance with Section 3401(c) of the Code) of the Company, or of any
Subsidiary.

 

1.15         “Exchange Act” shall mean the Securities Exchange Act of 1934, as
amended from time to time.

 

1.16         “Exempt Person” shall mean any of the following:

 

(a)          a trustee or other fiduciary holding securities under any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
person controlled by the Company or by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any person controlled by the
Company,

 

(b)          Gary Oberman, Bartek Bulzak, or any persons or entities owned or
controlled by such persons, including 3324019 Canada Inc. and 8040387 Canada
Inc.

 

(c)          the Company or a Subsidiary, and

 

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(d)          a person that is owned, directly or indirectly, by the stockholders
of the Company in substantially the same proportions as their beneficial
ownership of the voting securities of the Company.

 

No person who is an officer, director or employee of an Exempt Person shall be
deemed, solely by reason of such person’s status or authority as such, to be the
beneficial owner of any securities that are beneficially owned, including,
without limitation, in a fiduciary capacity, by an Exempt Person or by any other
such officer, director or employee of an Exempt Person.

 

1.17         “Fair Market Value” means, as of any date, the value of a share of
Common Stock is determined as follows:

 

(a)          If the Common Stock is then listed or admitted to trading on a NYSE
or NASDAQ market system or a stock exchange which reports closing sale prices,
the Fair Market Value shall be the closing price of the stock on the grant date.

 

(b)          If the Common Stock is not then listed or admitted to trading on a
NYSE or NASDAQ market system or a stock exchange which reports closing sale
prices, the Fair Market Value shall be the closing price of the common stock on
the over-the-counter bulletin board, on the grant date.

 

(c)          If neither (a) nor (b) is applicable as of the grant date, then the
Fair Market Value shall be determined by the Administrator in good faith using
any reasonable method of evaluation, which determination shall be conclusive and
binding on all interested parties.

 

1.18         “Fiscal Year” means the fiscal year of the Company.

 

1.19         “Holder” shall mean a person who has been granted an Award.

 

1.20         “Incentive Stock Option” shall mean an option which conforms to the
applicable provisions of Section 422 of the Code and which is designated as an
Incentive Stock Option by the Administrator.

 

1.21         “Non-Employee Director” shall mean a member of the Board who is not
an Employee.

 

1.22         “Non-Qualified Stock Option” shall mean an Option which is not
designated as an Incentive Stock Option by the Administrator.

 

1.23         “Option” shall mean a stock option granted under Article IV of the
Plan. An Option granted under the Plan shall, as determined by the
Administrator, be either a Non-Qualified Stock Option or an Incentive Stock
Option; provided, however, that Options granted to Consultants shall be
Non-Qualified Stock Options.

 

1.24         “Performance Criteria” means the criteria (and adjustments) that
the Administrator selects for an Award for purposes of establishing the
Performance Goal or Performance Goals for a Performance Period.

 

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1.25         “Performance Goals” means, for a Performance Period, one or more
goals established in writing by the Administrator for the Performance Period
based upon one or more Performance Criteria. Depending on the Performance
Criteria used to establish such Performance Goals, the Performance Goals may be
expressed in terms of overall Company performance or the performance of a
division, business unit, or an individual. The achievement of each Performance
Goal shall be determined in accordance with GAAP to the extent applicable.

 

1.26         “Performance Period” means one or more periods of time, which may
be of varying and overlapping durations, as the Committee may select, over which
the attainment of one or more Performance Goals will be measured for the purpose
of determining a Holder’s right to, and the payment of a performance based
Award.

 

1.27         “Performance Shares” shall mean Common Stock awarded under Article
X of the Plan.

 

1.28         “Performance Share Units” shall mean rights to receive Common Stock
awarded under Article X of the Plan.

 

1.29         “Plan” shall mean the Buildablock Corp. 2012 Equity Incentive.

 

1.30         “Restricted Stock” shall mean Common Stock awarded under Article
VII of the Plan that is subject to repurchase or forfeiture.

 

1.31         “Restricted Stock Units” shall mean rights to receive Common Stock
awarded under Article VIII of the Plan.

 

1.32         “Rule 16b-3” shall mean Rule 16b-3 promulgated under the Exchange
Act, as such Rule may be amended from time to time.

 

1.33         “Securities Act” shall mean the Securities Act of 1933, as amended
from time to time.

 

1.34         “Stock Appreciation Right” shall mean a stock appreciation right
granted under Article IX of the Plan.

 

1.35         “Subsidiary” means any entity (other than the Company), whether
domestic or foreign, in an unbroken chain of entities beginning with the Company
if each of the entities other than the last entity in the unbroken chain
beneficially owns, at the time of the determination, securities or interests
representing more than fifty percent (50%) of the total combined voting power of
all classes of securities or interests in one of the other entities in such
chain.

 

1.36         “Subsidiary Corporation” shall mean any corporation in an unbroken
chain of corporations beginning with the Company if each of the corporations
other than the last corporation in the unbroken chain then owns stock possessing
fifty percent (50%) or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.

 

1.37         “Substitute Award” shall mean an Option granted under this Plan
upon the assumption of, or in substitution for, outstanding equity awards
previously granted by a company or other entity in connection with a corporate
transaction, such as a merger, combination, consolidation or acquisition of
property or stock; provided, however, that in no event shall the term
“Substitute Award” be construed to refer to an award made in connection with the
cancellation and repricing of an Option.

 

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1.38         “Termination of Consultancy” shall mean the time when the
engagement of a Holder as a Consultant to the Company or a Subsidiary is
terminated for any reason, with or without cause, including, without limitation,
by resignation, discharge, death or retirement, but excluding terminations where
there is a simultaneous commencement of employment or service with the Company
or any Subsidiary. The Administrator, in its discretion, shall determine the
effect of all matters and questions relating to Termination of Consultancy,
including, without limitation, the question of whether a Termination of
Consultancy resulted from a discharge for cause. Notwithstanding any other
provision of the Plan, the Company or any Subsidiary has an absolute and
unrestricted right to terminate a Consultant’s service at any time for any
reason whatsoever, with or without cause, except to the extent expressly
provided otherwise in writing. For purposes of the Plan, the engagement of a
Holder as a Consultant to a Subsidiary shall be deemed to be terminated in the
event that the Subsidiary engaging such Holder ceases to remain a Subsidiary
following any merger, sale of stock or other corporate transaction or event
(including, without limitation, a spin-off).

 

1.39         “Termination of Directorship” shall mean the time when a Holder who
is a Non-Employee Director ceases to be a Director for any reason, including,
without limitation, a termination by resignation, failure to be elected, death
or retirement. The Administrator, in its discretion, shall determine the effect
of all matters and questions relating to Termination of Directorship with
respect to Non-Employee Directors.

 

1.40         “Termination of Employment” shall mean the time when the
employee-employer relationship between a Holder and the Company or any
Subsidiary is terminated for any reason, with or without cause, including,
without limitation, a termination by resignation, discharge, death, disability
or retirement; but excluding: (a) terminations where there is a simultaneous
reemployment or continuing employment of a Holder by the Company or any
Subsidiary, and (b) terminations which are followed by the simultaneous
establishment of a consulting relationship by the Company or a Subsidiary with
the former employee. The Administrator, in its discretion, shall determine the
effect of all matters and questions relating to Termination of Employment,
including, without limitation, the question of whether a Termination of
Employment resulted from a discharge for cause; provided, however, that, with
respect to Incentive Stock Options, unless the Administrator otherwise provides
in the terms of the Award Agreement or otherwise, a leave of absence, change in
status from an employee to an independent contractor or other change in the
employee-employer relationship shall constitute a Termination of Employment if,
and to the extent that, such leave of absence, change in status or other change
interrupts employment for the purposes of Section 422(a)(2) of the Code and the
then applicable regulations and revenue rulings under said Section. For purposes
of the Plan, a Holder’s employee-employer relationship shall be deemed to be
terminated in the event that the Subsidiary employing such Holder ceases to
remain a Subsidiary following any merger, sale of stock or other corporate
transaction or event (including, without limitation, a spin-off).

 

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Article II.
SHARES SUBJECT TO PLAN

 

2.1           Shares Subject to Plan.

 

(a)          Subject to Section 12.3 and Section 2.1(b), the aggregate number of
shares of Common Stock that may be issued or transferred pursuant to Awards
under the Plan shall be equal to 2,000,000 shares (the “Authorized Shares”).

 

(b)          If any shares of Common Stock subject to an Award are forfeited or
expire or such Award is settled for cash (in whole or in part), the shares of
Common Stock subject to such Award shall, to the extent of such forfeiture,
expiration or cash settlement, again be available for future grants of Awards
under the Plan. Notwithstanding the provisions of this Section 2.1(b), no shares
may again be optioned, granted or awarded if such action would cause an
Incentive Stock Option to fail to qualify as an incentive stock option under
Section 422 of the Code.

 

2.2           Stock Distributed. Any Common Stock distributed pursuant to an
Award shall consist, in whole or in part, of authorized and unissued Common
Stock, shares of Common Stock held in treasury or shares of Common Stock
purchased on the open market.

 

2.3           Limitation on Number of Shares Subject to Awards. Notwithstanding
any provision in the Plan to the contrary, and subject to Article XII, the
maximum number of shares of Common Stock with respect to one or more Awards that
may be granted to any one Employee, Non-Employee Director or Consultant during
any calendar year shall not exceed the Award Limit.

 

Article III.
GRANTING OF AWARDS

 

3.1           Award Agreement. Each Award shall be evidenced by an Award
Agreement. Award Agreements evidencing Incentive Stock Options shall contain
such terms and conditions as may be necessary to meet the applicable provisions
of Section 422 of the Code.

 

3.2           At-Will Employment. Nothing in the Plan or in any Award Agreement
hereunder shall confer upon any Holder any right to continue in the employ of,
or as a Consultant for, the Company or any Subsidiary, or as a Director of the
Company, or shall interfere with or restrict in any way the rights of the
Company and any Subsidiary, which rights are hereby expressly reserved, to
discharge any Holder at any time for any reason whatsoever, with or without
cause, except to the extent expressly provided otherwise in a written employment
agreement between the Holder and the Company or any Subsidiary.

 

Article IV.
GRANTING OF OPTIONS

 

4.1           Eligibility. Any Employee, Consultant or Non-Employee Director
selected by the Administrator pursuant to Section 4.4(a)(i) shall be eligible to
be granted an Option.

 

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4.2           Disqualification for Stock Ownership. No person may be granted an
Incentive Stock Option under the Plan if such person, at the time the Incentive
Stock Option is granted, owns stock possessing more than 10% of the total
combined voting power of all classes of stock of the Company or any then
existing Subsidiary Corporation or parent corporation (as defined in Section
424(e) of the Code) unless such Incentive Stock Option conforms to the
applicable provisions of Section 422 of the Code

 

4.3           Qualification of Incentive Stock Options. No Incentive Stock
Option shall be granted to any person who is not an Employee of the Company or a
Subsidiary Corporation.

 

4.4           Granting of Options.

 

(a)          The Administrator shall from time to time, in its discretion, and,
subject to applicable limitations of the Plan:

 

(i)          Select from among the Employees, Consultants, and Non-Employee
Directors (including Employees, Consultants, and Non-Employee Directors who have
previously received Awards under the Plan) such of them as in its opinion should
be granted Options;

 

(ii)         Subject to the Award Limit, determine the number of shares to be
subject to such Options granted to the selected Employees, Consultants, or
Non-Employee Directors;

 

(iii)        Subject to Section 4.2 and Section 4.3, determine whether such
Options are to be Incentive Stock Options or Non-Qualified Stock Options; and

 

(iv)        Determine the terms and conditions of such Options, consistent with
the Plan;

 

(b)          Upon the selection of an Employee, Consultant or Non-Employee
Director to be granted an Option, the Administrator shall instruct the Secretary
of the Company to issue the Option and may impose such conditions on the grant
of the Option as it deems appropriate.

 

(c)          Any Incentive Stock Option granted under the Plan may be modified
by the Administrator, with the consent of the Holder, to disqualify such Option
from treatment as an “incentive stock option” under Section 422 of the Code.

 

Article V.
TERMS OF OPTIONS

 

5.1           Option Price. The price per share of Common Stock subject to each
Option granted to Employees, Non-Employee Director and Consultants shall be set
by the Administrator; provided, however, that:

 

(a)          In the case of Incentive Stock Options, such price shall not be
less than 100% of the Fair Market Value of a share of Common Stock on the date
the Option is granted (or the date the Option is modified, extended or renewed
for purposes of Section 424(h) of the Code); and

 

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(b)          In the case of Incentive Stock Options granted to an individual
then owning (within the meaning of Section 424(d) of the Code) more than 10% of
the total combined voting power of all classes of stock of the Company or any
Subsidiary Corporation or parent corporation thereof (as defined in Section
424(e) of the Code), such price shall not be less than 110% of the Fair Market
Value of a share of Common Stock on the date the Option is granted (or the date
the Option is modified, extended or renewed for purposes of Section 424(h) of
the Code).

 

5.2           Option Term. The term of an Option granted to an Employee,
Non-Employee Director or Consultant shall be set by the Administrator in its
discretion; provided, however, that the term shall not be more than ten (10)
years from the date the Option is granted, or five (5) years from the date the
Option is granted if the Option is an Incentive Stock Option granted to an
individual then owning (within the meaning of Section 424(d) of the Code) more
than 10% of the total combined voting power of all classes of stock of the
Company or any Subsidiary Corporation or parent corporation thereof (as defined
in Section 424(e) of the Code). Except as limited by requirements of Section
409A or Section 422 of the Code and regulations and rulings thereunder, the
Administrator may extend the term of any outstanding Option in connection with
any Termination of Employment, Termination of Directorship or Termination of
Consultancy of the Holder, or amend any other term of condition of such Option
relating to such a Termination of Employment, Termination of Directorship or
Termination of Consultancy.

 

5.3           Option Vesting.

 

(a)          The period during which the right to exercise, in whole or in part,
an Option vests in the Holder shall be set by the Administrator and the
Administrator may determine that an Option may not be exercised in whole or in
part for a specified period after it is granted. At any time after grant of an
Option, the Administrator may, in its discretion and subject to whatever terms
and conditions it selects, accelerate the period during which an Option vests.

 

(b)          No portion of an Option granted to an Employee, Non-Employee
Director or Consultant which is unexercisable at Termination of Employment,
Termination of Directorship or Termination of Consultancy, as applicable, shall
thereafter become exercisable, except as may be otherwise provided by the
Administrator either in the Award Agreement or by action of the Administrator
following the grant of the Option.

 

(c)          To the extent that the aggregate fair market value of stock with
respect to which “incentive stock options” (within the meaning of Section 422 of
the Code, but without regard to Section 422(d) of the Code) are exercisable for
the first time by a Holder during any calendar year under the Plan, and all
other plans of the Company and any Subsidiary Corporation or parent corporation
thereof (as defined in Section 424(e) of the Code), exceeds $100,000, the
Options shall be treated as Non-Qualified Stock Options to the extent required
by Section 422 of the Code. The rule set forth in the preceding sentence shall
be applied by taking Options and other “incentive stock options” into account in
the order in which they were granted. For purposes of this Section 5.3(c), the
fair market value of stock shall be determined as of the time the Option or
other “incentive stock options” with respect to such stock is granted.

 

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Article VI.
EXERCISE OF OPTIONS

 

6.1           Partial Exercise. An exercisable Option may be exercised in whole
or in part. However, an Option shall not be exercisable with respect to
fractional shares and the Administrator may require that, by the terms of the
Option, a partial exercise be with respect to a minimum number of shares.

 

6.2           Manner of Exercise. All or a portion of an exercisable Option
shall be deemed exercised upon delivery of all of the following to the Secretary
of the Company, or such other person or entity designated by the Administrator,
or his, her or its office, as applicable:

 

(a)          A written notice complying with the applicable rules established by
the Administrator stating that the Option, or a portion thereof, is exercised.
Such rules may provide that for administrative convenience an Option may not be
exercised during such period (not exceeding 10 days) as is specified in advance
by the Administrator. The notice shall be signed by the Holder or other person
then entitled to exercise the Option or such portion of the Option;

 

(b)          Such representations and documents as the Administrator, in its
discretion, deems necessary or advisable to effect compliance with all
applicable provisions of the Securities Act and any other federal, state or
foreign securities laws or regulations. The Administrator may, in its
discretion, also take whatever additional actions it deems appropriate to effect
such compliance including, without limitation, placing legends on share
certificates and issuing stop-transfer notices to agents and registrars;

 

(c)          In the event that the Option shall be exercised pursuant to Section
12.1 by any person or persons other than the Holder, appropriate proof of the
right of such person or persons to exercise the Option; and

 

(d)          Full cash payment to the Secretary of the Company for the shares
with respect to which the Option, or portion thereof, is exercised. However, the
Administrator may, in its discretion, (i) allow payment, in whole or in part,
through the delivery of shares of Common Stock which have been owned by the
Holder for at least six months, duly endorsed for transfer to the Company with a
Fair Market Value on the date of delivery equal to the aggregate exercise price
of the Option or exercised portion thereof; (ii) allow payment, in whole or in
part, through the surrender of shares of Common Stock then issuable upon
exercise of the Option having a Fair Market Value on the date of Option exercise
equal to the aggregate exercise price of the Option or exercised portion
thereof; (iii) allow payment, in whole or in part, through the delivery of
property of any kind which constitutes good and valuable consideration; (iv)
allow payment, in whole or in part, through the delivery of a notice that the
Holder has placed a market sell order with a broker with respect to shares of
Common Stock then issuable upon exercise of the Option, and the broker timely
pays a sufficient portion of the net proceeds of the sale to the Company in
satisfaction of the Option exercise price or (v) allow payment through any
combination of the consideration provided in the foregoing subparagraphs (i),
(ii), (iii) and (iv); provided, however, that the payment in the manner
prescribed in the preceding paragraphs shall not be permitted to the extent that
the Administrator determines that payment in such manner shall result in an
extension or maintenance of credit, an arrangement for the extension of credit,
or a renewal or an extension of credit in the form of a personal loan to or for
any Director or executive officer of the Company that is prohibited by Section
13(k) of the Exchange Act or other applicable law.

 

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6.3           Conditions to Issuance of Stock Certificates. The Company shall
not be required to issue or deliver any certificate or certificates for shares
of stock purchased upon the exercise of any Option or portion thereof prior to
fulfillment of all of the following conditions:

 

(a)          The completion of any registration or other qualification of such
shares under any federal, state or foreign law, or under the rulings or
regulations of the Securities and Exchange Commission or any other governmental
regulatory body which the Administrator shall, in its discretion, deem necessary
or advisable;

 

(b)          The obtaining of any approval or other clearance from any federal,
state or foreign governmental agency which the Administrator shall, in its
discretion, determine to be necessary or advisable;

 

(c)          The lapse of such reasonable period of time following the exercise
of the Option as the Administrator may establish from time to time for reasons
of administrative convenience; and

 

(d)          The receipt by the Company of full payment for such shares,
including payment of any applicable withholding tax, which in the discretion of
the Administrator may be in the form of consideration used by the Holder to pay
for such shares under Section 6.2(d).

 

6.4           Rights as Stockholders. Holders shall not be, nor have any of the
rights or privileges of, stockholders of the Company in respect of any shares
purchasable upon the exercise of any part of an Option unless and until
certificates representing such shares have been issued by the Company to such
Holders.

 

6.5           Ownership and Transfer Restrictions. The Administrator, in its
discretion, may impose such restrictions on the ownership and transferability of
the shares purchasable upon the exercise of an Option as it deems appropriate.
Any such restriction shall be set forth in the respective Award Agreement and
may be referred to on the certificates evidencing such shares. The Holder shall
give the Company prompt notice of any disposition of shares of Common Stock
acquired by exercise of an Incentive Stock Option within (a) two years from the
date of granting (including the date the Option is modified, extended or renewed
for purposes of Section 424(h) of the Code) such Option to such Holder, or (b)
one year after the transfer of such shares to such Holder.

 

6.6           Additional Limitations on Exercise of Options. Holders may be
required to comply with any timing or other restrictions with respect to the
settlement or exercise of an Option, including a window-period limitation, as
may be imposed in the discretion of the Administrator.

 

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Article VII.
AWARD OF RESTRICTED STOCK

 

7.1           Eligibility. Subject to the Award Limit, Restricted Stock may be
awarded to any Employee, Non-Employee Director or Consultant who the
Administrator determines should receive such an Award.

 

7.2           Award of Restricted Stock.

 

(a)          The Administrator may from time to time, in its discretion:

 

(i)          Select from among the Employees, Non-Employee Directors or
Consultants (including Employees, Non-Employee Directors or Consultants who have
previously received Awards under the Plan) such of them as in its opinion should
be awarded Restricted Stock; and

 

(ii)         Determine the purchase price, if any, and other terms and
conditions applicable to such Restricted Stock, consistent with the Plan.

 

(b)          The Administrator shall establish the purchase price, if any, and
form of payment for Restricted Stock; provided, however, that such purchase
price shall be no less than the par value of the Common Stock to be purchased,
unless otherwise permitted by applicable state law. In all cases, legal
consideration shall be required for each issuance of Restricted Stock.

 

(c)          Upon the selection of an Employee, Non-Employee Director or
Consultant to be awarded Restricted Stock, the Administrator shall instruct the
Secretary of the Company to issue such Restricted Stock and may impose such
conditions on the issuance of such Restricted Stock as it deems appropriate.

 

7.3           Rights as Stockholders. Subject to Section 7.4, upon delivery of
the shares of Restricted Stock to the escrow holder pursuant to Section 7.6, the
Holder shall have, unless otherwise provided by the Administrator, all the
rights of a stockholder with respect to said shares, subject to the restrictions
in his or her Award Agreement, including the right to receive all dividends and
other distributions paid or made with respect to the shares; provided, however,
that, in the discretion of the Administrator, any extraordinary distributions
with respect to the Common Stock shall be subject to the restrictions set forth
in Section 7.4.

 

7.4           Restriction. All shares of Restricted Stock issued under the Plan
(including any shares received by Holders thereof with respect to shares of
Restricted Stock as a result of stock dividends, stock splits or any other form
of recapitalization) shall, in the terms of each individual Award Agreement, be
subject to such restrictions as the Administrator shall provide, which
restrictions may include, without limitation, restrictions concerning voting
rights and transferability and restrictions based on duration of employment,
directorship or consultancy with the Company, Company performance and individual
performance; provided, however, by action taken after the Restricted Stock is
issued, the Administrator may, on such terms and conditions as it may determine
to be appropriate, remove any or all of the restrictions imposed by the terms of
the Award Agreement. Restricted Stock may not be sold or encumbered until all
restrictions are terminated or expire. If no consideration was paid by the
Holder upon issuance, a Holder’s rights in unvested Restricted Stock shall
lapse, and such Restricted Stock shall be surrendered to the Company without
consideration, upon Termination of Employment, Termination of Directorship or
Termination of Consultancy, as applicable; provided, however, that the
Administrator in its discretion may provide that such rights shall not lapse in
the event of a Termination of Employment, Termination of Directorship or
Termination of Consultancy, as applicable, following a Change in Control or
because of the Holder’s retirement, death or disability or termination without
cause.

 

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7.5           Repurchase of Restricted Stock. The Administrator shall provide in
the terms of each individual Award Agreement that the Company shall have the
right to repurchase from the Holder the Restricted Stock then subject to
restrictions under the Award Agreement immediately upon a Termination of
Employment, Termination of Directorship or Termination of Consultancy, as
applicable, at a cash price per share equal to the price paid by the Holder for
such Restricted Stock; provided, however, that the Administrator in its
discretion may provide that such rights shall not lapse in the event of a
Termination of Employment, Termination of Directorship or Termination of
Consultancy, as applicable, following a Change in Control or because of the
Holder’s retirement, death or disability or termination without cause.

 

7.6           Escrow. The Secretary of the Company or such other escrow holder
as the Administrator may appoint shall retain physical custody of each
certificate representing Restricted Stock until all of the restrictions imposed
under the Award Agreement with respect to the shares evidenced by such
certificate expire or shall have been removed.

 

7.7           Legend. In order to enforce the restrictions imposed upon shares
of Restricted Stock hereunder, the Administrator shall cause a legend or legends
to be placed on certificates representing all shares of Restricted Stock that
are still subject to restrictions under Award Agreements, which legend or
legends shall make appropriate reference to the conditions imposed thereby.

 

7.8           Section 83(b) Election. If a Holder makes an election under
Section 83(b) of the Code, or any successor section thereto, to be taxed with
respect to the Restricted Stock as of the date of transfer of the Restricted
Stock rather than as of the date or dates upon which the Holder would otherwise
be taxable under Section 83(a) of the Code, the Holder shall deliver a copy of
such election to the Company immediately after filing such election with the
Internal Revenue Service.

 

Article VIII.
RESTRICTED STOCK UNITS

 

8.1           Eligibility. Subject to the Award Limit, one or more Restricted
Stock Unit Awards may be granted to any Employee, Non-Employee Director or
Consultant whom the Administrator determines should receive such an Award.

 

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8.2           Restricted Stock Units. Any Employee, Non-Employee Director or
Consultant selected by the Administrator may be granted an award of Restricted
Stock Units in the manner determined from time to time by the Administrator. The
Administrator is authorized to make awards of Restricted Stock Units in such
amounts and subject to such terms and conditions as determined by the
Administrator. The Administrator shall specify the date or dates on which the
Restricted Stock Units shall become fully vested and nonforfeitable, and may
specify such conditions to vesting as it deems appropriate, and may specify that
such Restricted Stock Units become fully vested and nonforfeitable pursuant to
the satisfaction of one or more Performance Goals or other specific performance
goals as the Administrator determines to be appropriate at the time of the
grant, in each case on a specified date or dates or over any period or periods
determined by the Administrator. The Administrator shall specify the
distribution dates applicable to each award of Restricted Stock Units which
shall be no earlier than the vesting dates or events of the award and may be
determined at the election of the Employee, Non-Employee Director or Consultant,
subject to compliance with Section 409A of the Code. On the distribution dates,
the Company shall issue to the Holder one unrestricted, fully transferable share
of Common Stock for each Restricted Stock Unit distributed.

 

8.3           Term. The term of a Restricted Stock Unit Award shall be set by
the Administrator in its discretion.

 

8.4           Exercise or Purchase Price. The Administrator may establish the
exercise or purchase price of shares distributed pursuant to a Restricted Stock
Unit Award; provided, however, that such price shall not be less than the par
value of a share of Common Stock, unless otherwise permitted by applicable state
law.

 

8.5           Exercise Upon Termination of Employment, Termination of
Directorship or Termination of Consultancy. A Restricted Stock Unit Award is
exercisable or distributable only while the Holder is an Employee, Non-Employee
Director or Consultant.

 

Article IX.
STOCK APPRECIATION RIGHTS

 

9.1           Grant of Stock Appreciation Rights. A Stock Appreciation Right may
be granted to any Employee, Non-Employee Director or Consultant selected by the
Administrator. A Stock Appreciation Right may be granted: (a) in connection and
simultaneously with the grant of an Option, or (b) independent of an Option. A
Stock Appreciation Right shall be subject to such terms and conditions not
inconsistent with the Plan as the Administrator shall impose and shall be
evidenced by an Award Agreement.

 

9.2           Coupled Stock Appreciation Rights.

 

(a)          A Coupled Stock Appreciation Right (“CSAR”) shall be related to a
particular Option and shall be exercisable only when and to the extent the
related Option is exercisable.

 

(b)          A CSAR may be granted to the Holder for no more than the number of
shares subject to the simultaneously granted Option to which it is coupled.

 

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(c)          A CSAR shall entitle the Holder (or other person entitled to
exercise the Option pursuant to the Plan) to surrender to the Company
unexercised a portion of the Option to which the CSAR relates (to the extent
then exercisable pursuant to its terms) and to receive from the Company in
exchange therefor an amount determined by multiplying (i) the difference
obtained by subtracting the exercise price per share of the CSAR from (ii) the
Fair Market Value of a share of Common Stock on the date of exercise of the CSAR
by the number of shares of Common Stock with respect to which the CSAR shall
have been exercised, subject to any limitations the Administrator may impose.

 

9.3           Independent Stock Appreciation Rights.

 

(a)          An Independent Stock Appreciation Right (“ISAR”) shall be unrelated
to any Option and shall have a term set by the Administrator in its discretion;
provided, however, that the term shall not be more than ten (10) years from the
date the ISAR is granted. An ISAR shall be exercisable in such installments as
the Administrator may determine. An ISAR shall cover such number of shares of
Common Stock as the Administrator may determine; provided, however, that unless
the Administrator otherwise provides in the terms of the Award Agreement or
otherwise, no ISAR granted to a person subject to Section 16 of the Exchange Act
shall be exercisable until at least six months have elapsed following the date
on which the ISAR was granted. The exercise price per share of Common Stock
subject to each ISAR shall be set by the Administrator; provided, that such
exercise price per share shall not be less than 100% of the Fair Market Value of
a share of Common Stock on the date the ISAR is granted. An ISAR is exercisable
only while the Holder is an Employee, Non-Employee Director or Consultant;
provided, that the Administrator may provide that ISARs may be exercised
following a Termination of Employment, Termination in Directorship or
Termination of Directorship, as applicable, or following a Change in Control, or
because of the Holder’s retirement, death or disability or termination without
cause.

 

(b)          An ISAR shall entitle the Holder (or other person entitled to
exercise the ISAR pursuant to the Plan) to exercise all or a specified portion
of the ISAR (to the extent then exercisable pursuant to its terms) and to
receive from the Company an amount determined by multiplying (i) the difference
obtained by subtracting the exercise price per share of the ISAR from the Fair
Market Value of a share of Common Stock on the date of exercise of the ISAR by
(ii) the number of shares of Common Stock with respect to which the ISAR shall
have been exercised, subject to any limitations the Administrator may impose.

 

9.4           Payment and Limitations on Exercise.

 

(a)          Payment of the amounts determined under Section 9.2(c) and 9.3(b)
above shall be in cash, shares of Common Stock (based on its Fair Market Value
as of the date the Stock Appreciation Right is exercised), or a combination of
both, as determined by the Administrator. The Company shall not be required to
issue or deliver any certificate or certificates for shares of stock issuable
upon the exercise of any Stock Appreciation Right prior to fulfillment of the
conditions set forth in Section 6.3 above.

 

(b)          Holders of Stock Appreciation Rights may be required to comply with
any timing or other restrictions with respect to the settlement or exercise of a
Stock Appreciation Right, including a window-period limitation, as may be
imposed in the discretion of the Administrator.

 

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Article X.
AWARD OF PERFORMANCE SHARES AND PERFORMANCE SHARE UNITS

 

10.1         Eligibility. Subject to the Award Limit, Performance Shares and
Performance Share Units may be awarded to any Employee, Non-Employee Director or
Consultant who the Administrator determines should receive such an Award.

 

10.2         Awards of Performance Shares and Performance Share Units. Any
Employee, Non-Employee Director or Consultant selected by the Administrator may
be granted one or more Performance Shares or Performance Share Units. The amount
of such Awards may be linked to any one or more of the Performance Criteria or
other specific performance criteria determined appropriate by the Administrator,
in each case on a specified date or dates or over a period or periods determined
by the Administrator. In making such determinations, the Administrator shall
consider (among such other factors as it deems relevant in light of the specific
type of award) the contributions, responsibilities and other compensation of the
particular Employee, Non-Employee Director or Consultant.

 

Article XI.
ADMINISTRATION

 

11.1         Duties and Powers of Administrator. It shall be the duty of the
Committee or the Board to conduct the general administration of the Plan in
accordance with its provisions. The Committee or the Board shall have the power
to interpret the Plan and the Award Agreements, and to adopt such rules for the
administration, interpretation and application of the Plan as are consistent
therewith, to interpret, amend or revoke any such rules, to delegate authority
in accordance with Section 11.3 and to amend any Award Agreement provided that
the rights or obligations of the Holder of the Award that is the subject of any
such Award Agreement are not affected adversely. Any such grant or award under
the Plan need not be the same with respect to each Holder. Any such
interpretations and rules with respect to Incentive Stock Options shall be
consistent with the provisions of Section 422 of the Code.

 

11.2         Good Faith Actions. All actions taken and all interpretations and
determinations made by the Committee or the Board in good faith shall be final
and binding upon all Holders, the Company and all other interested persons. No
members of the Committee or Board shall be personally liable for any action,
determination or interpretation made in good faith with respect to the Plan or
Awards, and all members of the Committee and the Board shall be fully protected
by the Company in respect of any such action, determination or interpretation.

 

11.3         Delegation of Authority to Grant Awards. To the extent permitted by
applicable law, the Committee may, but need not, delegate from time to time some
or all of its authority to grant Awards under the Plan to a committee or
committees consisting of one or more members of the Board and/or one or more
officers of the Company. Any delegation hereunder shall be subject to the
restrictions and limits that the Committee specifies at the time of such
delegation of authority and may be rescinded at any time by the Committee.

 

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Article XII.
MISCELLANEOUS

 

12.1         Transferability of Awards.

 

(a)          Except as otherwise provided in Section 12.1(b)

 

(i)          No Award under the Plan may be sold, pledged, assigned or
transferred in any manner other than by will or the laws of descent and
distribution or, subject to the consent of the Administrator, pursuant to a DRO,
unless and until such Award has been exercised, or the shares underlying such
Award have been issued, and all restrictions applicable to such shares have
lapsed;

 

(ii)         No Award or interest or right therein shall be liable for the
debts, contracts or engagements of the Holder or his successors in interest or
shall be subject to disposition by transfer, alienation, anticipation, pledge,
hypothecation, encumbrance, assignment or any other means whether such
disposition be voluntary or involuntary or by operation of law by judgment,
levy, attachment, garnishment or any other legal or equitable proceedings
(including bankruptcy), and any attempted disposition thereof shall be null and
void and of no effect, except to the extent that such disposition is permitted
by the preceding sentence; and

 

(iii)        During the lifetime of the Holder, only the Holder may exercise an
Option or other Award (or any portion thereof) granted to him under the Plan,
unless it has been disposed of pursuant to a DRO; after the death of the Holder,
any exercisable portion of an Option or other Award may, prior to the time when
such portion becomes unexercisable under the Plan or the applicable Award
Agreement, be exercised by his personal representative or by any person
empowered to do so under the deceased Holder’s will or under the then applicable
laws of descent and distribution.

 

(b)          Notwithstanding Section 12.1(a), the Administrator, in its
discretion, may determine to permit a Holder to transfer a Non-Qualified Stock
Option to any one or more Permitted Transferees (as defined below), subject to
the following terms and conditions: (i) a Non-Qualified Stock Option transferred
to a Permitted Transferee shall not be assignable or transferable by the
Permitted Transferee other than by will or the laws of descent and distribution;
(ii) any Non-Qualified Stock Option which is transferred to a Permitted
Transferee shall continue to be subject to all the terms and conditions of the
Non-Qualified Stock Option as applicable to the original Holder (other than the
ability to further transfer the Non-Qualified Stock Option); (iii) any transfer
of a Non-Qualified Stock Option to a Permitted Transferee shall be without
consideration; and (iv) the Holder and the Permitted Transferee shall execute
any and all documents requested by the Administrator, including, without
limitation documents to (A) confirm the status of the transferee as a Permitted
Transferee, (B) satisfy any requirements for an exemption for the transfer under
applicable federal, state and foreign securities laws and (C) evidence the
transfer. For purposes of this Section 12.1(b), “Permitted Transferee” shall
mean, with respect to a Holder, 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 Holder’s
household (other than a tenant or employee), a trust in which these persons (or
the Holder) control the management of assets, and any other entity in which
these persons (or the Holder) own more than fifty percent of the voting
interests, or any other transferee specifically approved by the Administrator
after taking into account any federal, state, local and foreign tax and
securities laws applicable to transferable Non-Qualified Stock Options.

 

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12.2       Amendment, Suspension or Termination of the Plan. Except as otherwise
provided in this Section 12.2, the Plan may be wholly or partially amended or
otherwise modified, suspended or terminated at any time or from time to time by
the Board. Except as provided in Section 12.9, no amendment, suspension or
termination of the Plan shall, without the consent of the Holder, alter or
impair any rights or obligations under any Award theretofore granted or awarded,
unless the Award itself otherwise expressly so provides.

 

12.3       Changes in Common Stock or Assets of the Company; Acquisition or
Liquidation of the Company and Other Corporate Events.

 

(a)          Subject to Section 12.3(d), in the event of any dividend or other
distribution (whether in the form of cash, Common Stock, other securities or
other property), recapitalization, reclassification, stock split, reverse stock
split, reorganization, merger, consolidation, split-up, spin-off, combination,
repurchase, liquidation, dissolution, or sale, transfer, exchange or other
disposition of all or substantially all of the assets of the Company, or
exchange of Common Stock or other securities of the Company, issuance of
warrants or other rights to purchase Common Stock or other securities of the
Company, or other similar corporate transaction or event that affects the Common
Stock, then the Administrator shall equitably adjust any or all of the following
in order to prevent dilution or enlargement of the benefits or potential
benefits intended to be made available under the Plan or with respect to an
Award:

 

(i)          The number and kind of shares of Common Stock (or other securities
or property) with respect to which Awards may be granted or awarded (including,
without limitation, adjustments of the limitations in Section 2.1 on the maximum
number and kind of shares which may be issued under the Plan and adjustments of
the Award Limit);

 

(ii)         The number and kind of shares of Common Stock (or other securities
or property) subject to outstanding Awards

 

(iii)        The grant or exercise price with respect to any Award.

 

(b)          Subject to Section 12.3(d), in the event of any transaction or
event described in Section 12.3(a) or any unusual or nonrecurring transactions
or events affecting the Company, any affiliate of the Company, or the financial
statements of the Company or any affiliate, or of changes in applicable laws,
regulations or accounting principles, the Administrator, in its discretion, and
on such terms and conditions as it deems appropriate, either by the terms of the
Award or by action taken prior to the occurrence of such transaction or event
and either automatically or upon the Holder’s request, is hereby authorized to
take any one or more of the following actions whenever the Administrator
determines that such action is appropriate in order to prevent dilution or
enlargement of the benefits or potential benefits intended to be made available
under the Plan or with respect to any Award under the Plan, to facilitate such
transactions or events or to give effect to such changes in laws, regulations or
principles:

 

-18-

 

 

(i)          To provide for the purchase of any such Award for an amount of cash
equal to the amount that could have been attained upon the exercise of such
Award or realization of the Holder’s rights had such Award been currently
exercisable or payable or fully vested;

 

(ii)         To provide for the replacement of such Award with other rights or
property selected by the Administrator in its discretion having an aggregate
value not exceeding the amount that could have been attained upon the exercise
of such Award or realization of the Holder’s rights had such Award been
currently exercisable or payable or fully vested;

 

(iii)        To provide that the Award cannot vest, be exercised or become
payable after such event;

 

(iv)        To provide that such Award shall be exercisable as to all shares
covered thereby, notwithstanding anything to the contrary in Section 5.3 or the
provisions of such Award;

 

(v)         To provide that such Award be assumed by the successor or survivor
corporation, or a parent or subsidiary thereof, or shall be substituted for by
similar options, rights or awards covering the stock of the successor or
survivor corporation, or a parent or subsidiary thereof, with appropriate
adjustments as to the number and kind of shares and prices;

 

(vi)        To make adjustments in the number and type of shares of Common Stock
(or other securities or property) subject to outstanding Awards, and/or in the
terms and conditions of (including the grant, exercise or purchase price), and
the criteria included in, outstanding options, rights and awards and options,
rights and awards which may be granted in the future; and

 

(vii)       To provide that, for a specified period of time prior to such event,
the restrictions imposed under an Award Agreement upon some or all shares of
Restricted Stock or Restricted Stock Units may be terminated, and, in the case
of Restricted Stock, some or all shares of such Restricted Stock may cease to be
subject to repurchase under Section 7.5 or forfeiture under Section 7.4 after
such event.

 

(c)          Subject to Section 12.3(d), the Administrator may, in its
discretion, include such further provisions and limitations in any Award,
agreement or certificate, as it may deem equitable and in the best interests of
the Company.

 

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(d)          The existence of the Plan, the Award Agreement and the Awards
granted hereunder shall not affect or restrict in any way the right or power of
the Company or the stockholders of the Company to make or authorize any
adjustment, recapitalization, reorganization or other change in the Company’s
capital structure or its business, any merger or consolidation of the Company,
any issue of stock or of options, warrants or rights to purchase stock or of
bonds, debentures, preferred or prior preference stocks whose rights are
superior to or affect the Common Stock or the rights thereof or which are
convertible into or exchangeable for Common Stock, 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.

 

(e)          No action shall be taken under this Section 12.3 which shall cause
an Award to fail to comply with Section 409A of the Code or the Treasury
Regulations thereunder, to the extent applicable to such Award.

 

(f)          In connection with the occurrence of any Equity Restructuring, and
notwithstanding anything to the contrary in Sections 12.3(a) and 12.3(b):

 

(i)          The number and type of securities subject to each outstanding Award
and the exercise price or grant price thereof, if applicable, shall be equitably
adjusted; and/or

 

(ii)         The Administrator shall make such equitable adjustments, if any, as
the Administrator in its discretion may deem appropriate to reflect such Equity
Restructuring with respect to the aggregate number and kind of shares that may
be issued under the Plan (including, but not limited to, adjustments of the
limitations in Section 2.1 on the maximum number and kind of shares which may be
issued under the Plan and adjustments of the Award Limit). The adjustments
provided under this Section 12.3(f) shall be nondiscretionary and shall be final
and binding on the affected Holder and the Company.

 

For purposes of this Section 12.3(f), “Equity Restructuring” shall mean a
nonreciprocal transaction between the Company and its stockholders, such as a
stock dividend, stock split, spin-off, rights offering or recapitalization
through a large, nonrecurring cash dividend, that affects the number or kind of
shares of Common Stock (or other securities of the Company) or the share price
of Common Stock (or other securities) and causes a change in the per share value
of the Common Stock underlying outstanding Awards.

 

12.4         Tax Withholding. The Company or any Subsidiary shall have the
authority and the right to deduct or withhold, or require a Holder to remit to
the Company, an amount sufficient to satisfy federal, state, local and foreign
taxes (including the Holder’s FICA obligation) required by law to be withheld
with respect to any taxable event concerning a Holder arising as a result of
this Plan. The Administrator may in its discretion and in satisfaction of the
foregoing requirement allow a Holder to elect to have the Company withhold
shares of Common Stock otherwise issuable under an Award (or allow the return of
shares of Common Stock) having a Fair Market Value equal to the sums required to
be withheld. Notwithstanding any other provision of the Plan, the number of
shares of Common Stock which may be withheld with respect to the issuance,
vesting, exercise or payment of any Award (or which may be repurchased from the
Holder of such Award within six months (or such other period as may be
determined by the Administrator) after such shares of Common Stock were acquired
by the Holder from the Company) in order to satisfy the Holder’s federal, state,
local and foreign income and payroll tax liabilities with respect to the
issuance, vesting, exercise or payment of the Award shall be limited to the
number of shares which have a Fair Market Value on the date of withholding or
repurchase equal to the aggregate amount of such liabilities based on the
minimum statutory withholding rates for federal, state, local and foreign income
tax and payroll tax purposes that are applicable to such supplemental taxable
income.

 

-20-

 

 

12.5         Effect of Plan upon Other Compensation Plans. The adoption of the
Plan shall not affect any other compensation or incentive plans in effect for
the Company or any Subsidiary. Nothing in the Plan shall be construed to limit
the right of the Company or any Subsidiary: (a) to establish any other forms of
incentives or compensation for Employees, Non-Employee Directors or Consultants
of the Company or any Subsidiary, or (b) to grant or assume options or other
rights or awards otherwise than under the Plan in connection with any proper
corporate purpose including without limitation, the grant or assumption of
options in connection with the acquisition by purchase, lease, merger,
consolidation or otherwise, of the business, stock or assets of any corporation,
partnership, limited liability company, firm or association.

 

12.6         Compliance with Laws. The Plan, the granting and vesting of Awards
under the Plan and the issuance and delivery of shares of Common Stock and the
payment of money under the Plan or under Awards granted or awarded hereunder are
subject to compliance with all applicable federal, state, local and foreign
laws, rules and regulations (including but not limited to federal, state and
foreign securities law and margin requirements) and to such approvals by any
listing, regulatory or governmental authority as may, in the opinion of counsel
for the Company, be necessary or advisable in connection therewith. Any
securities delivered under the Plan shall be subject to such restrictions, and
the person acquiring such securities shall, if requested by the Company, provide
such assurances and representations to the Company as the Company may deem
necessary or desirable to assure compliance with all applicable legal
requirements. To the extent permitted by applicable law, the Plan and Awards
granted or awarded hereunder shall be deemed amended to the extent necessary to
conform to such laws, rules and regulations.

 

12.7         Titles. Titles are provided herein for convenience only and are not
to serve as a basis for interpretation or construction of the Plan.

 

12.8         Governing Law. The Plan and any agreements hereunder shall be
administered, interpreted and enforced under the internal laws of the State of
Florida without regard to conflicts of law thereof.

 

12.9         Section 409A. To the extent that the Administrator determines that
any Award granted under the Plan is subject to Section 409A of the Code, the
Award Agreement evidencing such Award shall incorporate the terms and conditions
required by Section 409A of the Code. To the extent applicable, the Plan and
Award Agreements shall be interpreted in accordance with Section 409A of the
Code and Department of Treasury regulations and other interpretive guidance
issued thereunder, including without limitation any such regulations or other
guidance that may be issued after the Effective Date. Notwithstanding any
provision of the Plan to the contrary, in the event that following the Effective
Date the Administrator determines that any Award may be subject to Section 409A
of the Code and related Department of Treasury guidance (including such
Department of Treasury guidance as may be issued after the Effective Date), the
Administrator may adopt such amendments to the Plan and the applicable Award
Agreement or adopt other policies and procedures (including amendments, policies
and procedures with retroactive effect), or take any other actions, that the
Administrator determines are necessary or appropriate to (a) exempt the Award
from Section 409A of the Code and/or preserve the intended tax treatment of the
benefits provided with respect to the Award, or (b) comply with the requirements
of Section 409A of the Code and related Department of Treasury guidance.

 

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12.10         Paperless Administration. In the event that the Company
establishes, for itself or using the services of a third party, an automated
system for the documentation, granting or exercise of Awards, such as a system
using an internet website or interactive voice response, then the paperless
documentation, granting or exercise of Awards by a Holder may be permitted
through the use of such an automated system.

 

12.11         No Rights to Awards. No Holder or other person shall have any
claim to be granted any Award pursuant to the Plan, and neither the Company nor
the Administrator is obligated to treat Holders or any other persons uniformly.

 

12.12         Unfunded Status of Awards. The Plan is intended to be an
“unfunded” plan for incentive compensation. With respect to any payments not yet
made to a Holder pursuant to an Award, nothing contained in the Plan or any
program or Award Agreement shall give the Holder any rights that are greater
than those of a general creditor of the Company or any affiliate of the Company.

 

12.13         Relationship to other Benefits. No payment pursuant to the Plan
shall be taken into account in determining any benefits under any pension,
retirement, savings, profit sharing, group insurance, welfare or other benefit
plan of the Company or any affiliate of the Company except to the extent
otherwise expressly provided in writing in such other plan or an agreement
thereunder.

 

12.14         Expenses. The expenses of administering the Plan shall be borne by
the Company and its affiliates.

 

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