EXHIBIT 10.2C

NPS PHARMACEUTICALS, INC.

1994 EQUITY INCENTIVE PLAN
(reflects all amendments by the Board of Directors through December 2002)

1 PURPOSES.

1.1 The purpose of the 1994 Equity Incentive Plan (the “Plan”) is to provide a
means by which employees of and consultants to the Company, and its Affiliates,
may be given an opportunity to benefit from increases in value of the stock of
the Company through the granting of (a) Incentive Stock Options, (b)
Nonstatutory Stock Options, (c) stock bonuses, (d) rights to purchase restricted
stock, and (e) stock appreciation rights, all as defined below.

1.2 The Company, by means of the Plan, seeks to retain the services of persons
who are now Employees or Directors of or Consultants to the Company, to secure
and retain the services of new Employees, Directors and Consultants, and to
provide incentives for such persons to exert maximum efforts for the success of
the Company.

1.3 The Company intends that the Stock Awards issued under the Plan shall, in
the discretion of the Board or any Committee to which responsibility for
administration of the Plan has been delegated pursuant to subsection 3.3, be
either (a) Options granted pursuant to paragraph 6 hereof, including Incentive
Stock Options and Nonstatutory Stock Options, (b) stock bonuses or rights to
purchase restricted stock granted pursuant to paragraph 7 hereof, or (c) stock
appreciation rights granted pursuant to paragraph 8 hereof. All Options shall be
separately designated Incentive Stock Options or Nonstatutory Stock Options at
the time of grant, and in such form as issued pursuant to section 6, and a
separate certificate or certificates will be issued for shares purchased on
exercise of each type of Option.

2  DEFINITIONS.

2.1 “Affiliate” means any parent corporation or subsidiary corporation, whether
now or hereafter existing, as those terms are defined in Sections 424(e) and (f)
respectively, of the Code.

2.2 “Board” means the Board of Directors of the Company.

2.3 “Code” means the Internal Revenue Code of 1986, as amended.

2.4 “Committee” means a Committee appointed by the Board in accordance with
subsection 3.3 of the Plan.

2.5 “Company” means NPS Pharmaceuticals, Inc., a Delaware corporation.

2.6 “Concurrent Stock Appreciation Right” or “Concurrent Right” means a right
granted pursuant to subsection 8.2.2 of the Plan.

2.7 “Consultant” means any person, including an advisor, engaged by the Company
or an Affiliate to render consulting services and who is compensated for such
services, provided that the term “Consultant” shall not include Directors who
are paid only a director’s fee by the Company or who are not compensated by the
Company for their services as Directors.

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2.8  “Continuous Status as an Employee, Director or Consultant” means the
employment or relationship as an Employee, Director or Consultant is not
interrupted or terminated by the Company or any Affiliate. The Board, in its
sole discretion, may determine whether Continuous Status as an Employee,
Director or Consultant shall be considered interrupted in the case of: (a) any
leave of absence approved by the Board, including sick leave, military leave, or
any other personal leave; provided, however, that for purposes of Incentive
Stock Options and Stock Appreciation Rights appurtenant thereto, any such leave
may not exceed ninety (90) days, unless reemployment upon the expiration of such
leave is guaranteed by contract (including certain Company policies) or statute;
or (b) transfers between locations of the Company or between the Company,
Affiliates or its successor.

2.9  “Day of Determination” means the date of the occurrence of an event that
requires the determination of the Fair Market Value of an award made hereunder.

2.10 “Director” means a member of the Board.

2.11 “Disability” means total and permanent disability as defined in
Section 22(e)(3) of the Code.

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

2.13 “Exchange Act” means the Securities Exchange Act of 1934, as amended.

2.14 “Fair Market Value” means, as of any date, the value of the common stock of
the Company as determined as follows:

2.14.1 If the common stock is listed on any established stock exchange or a
national market system, including without limitation the National Market System
of the National Association of Securities Dealers, Inc. Automated Quotation
(“NASDAQ”) System, the Fair Market Value of a share of common stock shall be the
closing price for such stock on the Day of Determination as quoted on such
system as reported in the Wall Street Journal or such other source as the Board
deems reliable. In the event the Day of Determination falls on a date that the
NASDAQ system is closed, then the Fair Market Value shall be the closing sales
price for such stock on the last market trading day prior to the Day of
Determination as quoted on such system as reported in the Wall Street Journal or
such other source as the Board deems reliable.

2.14.2   If the common stock is quoted on the NASDAQ System (but not on the
National Market System thereof) or is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a share of common stock shall be the mean between the bid and asked prices for
the common stock on the last market trading day prior to the day of
determination, as reported in the Wall Street Journal or such other source as
the Board deems reliable;

2.14.3  In the absence of an established market for the common stock, the Fair
Market Value shall be determined in good faith by the Board.

2.15  “Incentive Stock Option” means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

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2.16 “Independent Stock Appreciation Right” or “Independent Right” means a right
granted under subsection 8.2.3 of the Plan.

2.17 “Non-employee Director” means a Director: (a) who is not, at the time of
approval of an award under the Plan, an Officer or Employee of the Company or an
Affiliate of the Company; and (b) who is otherwise considered to be a
“Non-employee Director” in accordance with Rule 16b-3(b)(3), or any other
applicable rules, regulations or interpretations of the Securities and Exchange
Commission.

2.18 “Nonstatutory Stock Option” means an Option not intended to qualify as an
Incentive Stock Option or an Incentive Stock Option which, subsequent to its
date of grant, no longer qualifies as an Incentive Stock Option under Section
422 of the Code.

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

2.20 “Option” means a stock option granted pursuant to the Plan.

2.21 “Option Agreement” means a written agreement between the Company and an
Optionee evidencing the terms and conditions of an individual Option grant. The
Option Agreement is subject to the terms and conditions of the Plan.

2.22 “Optionee” means an Employee, Director or Consultant who holds an
outstanding Option.

2.23 “Plan” means this 1994 Equity Incentive Plan.

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

2.25 “Stock Appreciation Right” means any of the various types of rights which
may be granted under Section 8 of the Plan.

2.26 “Stock Award” means any right granted under the Plan, including any Option,
any stock bonus, any right to purchase restricted stock, and any Stock
Appreciation Right.

2.27 “Stock Award Agreement” means a written agreement including an Option
Agreement between the Company and a holder of a Stock Award evidencing the terms
and conditions of an individual Stock Award grant. The Stock Award Agreement is
subject to the terms and conditions of the Plan.

2.28 “Tandem Stock Appreciation Right” or “Tandem Right” means a right granted
under subsection 8.2.1 of the Plan.

3 ADMINISTRATION.

3.1 The Plan shall be administered by the Board unless and until the Board
delegates administration to a Committee, as provided in subsection 3.3.

3.2 The Board shall have the power, subject to, and within the limitations of,
the express provisions of the Plan:

3.2.1 To determine from time to time which of the persons eligible under the
Plan shall be granted Stock Awards; when and how Stock Awards shall be granted;
whether a Stock Award

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will be an Incentive Stock Option, a Nonstatutory Stock Option, a stock bonus, a
right to purchase restricted stock, a stock appreciation right, or a combination
of the foregoing; the provisions of each Stock Award granted (which need not be
identical), including the time or times when a person shall be permitted to
receive stock pursuant to a Stock Award; whether a person shall be permitted to
receive stock upon exercise of an Independent Stock Appreciation Right; and the
number of shares with respect to which Stock Awards shall be granted to each
such person.

3.2.2 To construe and interpret the Plan and Stock Awards granted under it, and
to establish, amend and revoke rules and regulations for its administration. The
Board, in the exercise of this power, may correct any defect, omission or
inconsistency in the Plan or in any Stock Award Agreement, in a manner and to
the extent it shall deem necessary or expedient to make the Plan fully
effective.

3.2.3 To amend the Plan as provided in Section 14.

3.2.4 Generally, to exercise such powers and to perform such acts as the Board
deems necessary or expedient to promote the best interests of the Company.

3.3 The Board may delegate administration of the Plan to a committee composed of
not fewer than two (2) members (the “Committee”), all of the members of which
Committee shall be Non-employee Directors, if required and as defined by the
provisions of subsection 3.4. If administration is delegated to a Committee, the
Committee shall have, in connection with the administration of the Plan, the
powers theretofore possessed by the Board (and references in this Plan to the
Board shall thereafter be to the Committee), subject, however, to such
resolutions, not inconsistent with the provisions of the Plan, as may be adopted
from time to time by the Board. The Board may abolish the Committee at any time
and revest in the Board the administration of the Plan. Notwithstanding anything
in this Section 3 to the contrary, the Board or the Committee may delegate to a
committee of one or more members of the Board the authority to grant options to
eligible persons who are not then subject to Section 16 of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”).

3.4 Any requirement that an administrator of the Plan be a Non-employee Director
shall not apply if the Board or the Committee expressly declares that such
requirement shall not apply. Any Non-employee Director shall otherwise comply
with the requirements of Rule 16b-3.

4 SHARES SUBJECT TO THE PLAN.

4.1 Subject to the provisions of Section 13 relating to adjustments upon changes
in stock, the stock that may be issued pursuant to Stock Awards shall not exceed
in the aggregate one million seven hundred two thousand five hundred three
(1,702,503) shares of the Company's common stock. If any Stock Award shall for
any reason expire or otherwise terminate without having been exercised in full,
the stock not purchased under such Stock Award shall again become available for
the Plan. Shares subject to Stock Appreciation Rights exercised in accordance
with Section 8 of the Plan shall not be available for subsequent issuance under
the Plan.

4.2 The stock subject to the Plan may be unissued shares or reacquired shares,
bought on the market or otherwise.

5 ELIGIBILITY.

5.1 Incentive Stock Options and Stock Appreciation Rights appurtenant thereto
may be granted only to Employees. Stock Awards other than Incentive Stock
Options and Stock Appreciation Rights appurtenant thereto may be granted only to
Employees, Directors or Consultants.

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5.2 No Officer or Director shall be eligible for the benefits of the Plan unless
at the time discretion is exercised in the selection of an Officer or Director
as a person to whom Stock Awards may be granted, or in the determination of the
number of shares which may be covered by Stock Awards granted to the Officer or
Director, the Plan otherwise complies with the requirements of Rule 16b-3. This
subsection 5.2 shall not apply if the Board or Committee expressly declares that
it shall not apply.

5.3 No person shall be eligible for the grant of an Incentive Stock Option if,
at the time of grant, such person owns (or is deemed to own pursuant to Section
424(d) of the Code) stock possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or of any of its
Affiliates unless the exercise price of such Incentive Stock Option is at least
one hundred ten percent (110%) of the Fair Market Value of such stock at the
date of grant and the Incentive Stock Option is not exercisable after the
expiration of five (5) years from the date of grant.

6 OPTION PROVISIONS.

Each Option shall be in such form and shall contain such terms and conditions as
the Board shall deem appropriate. The provisions of separate Options need not be
identical, but each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:

6.1 Term. No Option shall be exercisable after the expiration of ten (10) years
from the date it was granted.

6.2 Price. The exercise price of each Incentive Stock Option shall be not less
than one hundred percent (100%) of the Fair Market Value of the stock subject to
the Option on the date the Option is granted. The exercise price of each
Nonstatutory Stock Option shall be the price established by the Board or a
Committee established by the Board in accordance with subsection 3.3.

6.3 Consideration. The purchase price of stock acquired pursuant to an Option
shall be paid, to the extent permitted by applicable statutes and regulations,
either (a) in cash at the time the option is exercised, or (b) by delivery of
already-owned shares of common stock of the Company, held by the Optionee for at
least six (6) months, or a combination of cash and already-owned shares of
common stock of the Company, or (c) according to a deferred payment or other
arrangement (which may include, without limiting the generality of the
foregoing, the use of other common stock of the Company) with the person to whom
the Option is granted or to whom the Option is transferred pursuant to
subsection 6.4, or (d) as required in the discretion of the Board or the
Committee, either at the time of the grant or exercise of the Option, or (e) a
combination of (a), (b), (c), and/or (d) above.

In the case of any deferred payment arrangement, interest shall be payable at
least annually and shall be charged at the minimum rate of interest necessary to
avoid the treatment as interest, under any applicable provisions of the Code, of
any amounts other than amounts stated to be interest under the deferred payment
arrangement.

6.4 Transferability.

6.4.1 Incentive Stock Options. In order for an Option to qualify for treatment
as an Incentive Stock Option, it may not be transferable except by will or by
the laws of descent and distribution. In the event an Optionee transfers such
Option, such transfer shall constitute a disqualifying event and the Option
shall no longer qualify as an Incentive Stock Option but shall be considered a
Nonstatutory Stock Option under the terms of this Plan.

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6.4.2 Nonstatutory Stock Option. The Board or Committee may, in its discretion,
authorize all or a portion of the Nonstatutory Stock Options to be granted to an
Optionee to be on terms that permit transfer by such Optionee to (a) the spouse,
children or grandchildren of the Optionee (“Immediate Family Members”), (b) a
trust or trusts for the exclusive benefit of such Immediate Family Members, or
(c) a partnership in which such Immediate Family Members are the only partners,
provided that (i) there may be no consideration for any such transfer, (ii) the
stock option agreement pursuant to which such Options are granted must expressly
provide for transferability in a manner consistent with this Section, (iii)
subsequent transfers of transferred options shall be prohibited except those
occurring by will or the laws of descent and distribution, and (iv) the Options
shall continue to be subject to all the terms and conditions that applied prior
to transfer in the same manner and to the same extent as non-transferred
options, including Sections 6.5 Vesting; 6.6 Securities Law Compliance; 6.7
Termination of Employment; 6.8 Disability of Optionee; and 6.9 Death of
Optionee. The Options shall be exercisable by the transferee only to the extent,
and for the periods specified in such sections. The Company expressly disclaims
any obligation to provide notice to a transferee of the termination of the
Option.

Unless transfer by an Optionee is specifically provided for in the Option
Agreement, a Nonstatutory Stock Option shall not be transferable except by will
or by the laws of descent and distribution or pursuant to a qualified domestic
relations order as defined by the Code or Title I of the Employee Retirement
Income Security Act, or the rules thereunder (a “QDRO”), and shall be
exercisable during the lifetime of the person to whom the Nonstatutory Stock
Option is granted only by such person or any transferee pursuant to a QDRO.

6.5 Vesting. The total number of shares of stock subject to an Option may, but
need not, be allotted in periodic installments (which may, but need not, be
equal). The Option Agreement may provide that from time to time during each of
such installment periods, the Option may become exercisable (“vest”) with
respect to some or all of the shares allotted to that period, and may be
exercised with respect to some or all of the shares allotted to such period
and/or any prior period as to which the Option became vested but was not fully
exercised. The Option may be subject to such other terms and conditions on the
time or times when it may be exercised (which may be based on performance
criteria) as the Board may deem appropriate. The provisions of this subsection
6.5 are subject to any Option provisions governing the minimum number of shares
as to which an Option may be exercised.

6.6 Securities Law Compliance. The Company may require any Optionee, or any
person to whom an Option is transferred under subsection 6.4, as a condition of
exercising any such Option, (a) to give written assurances satisfactory to the
Company as to the Optionee's knowledge and experience in financial and business
matters and/or to employ a purchaser representative reasonably satisfactory to
the Company who is knowledgeable and experienced in financial and business
matters, and that he or she is capable of evaluating, alone or together with the
purchaser representative, the merits and risks of exercising the Option; and
(b) to give written assurances satisfactory to the Company stating that such
person is acquiring the stock subject to the Option for such person's own
account and not with any present intention of selling or otherwise distributing
the stock. These requirements, and any assurances given pursuant to such
requirements, shall be inoperative if (i) the issuance of the shares upon the
exercise of the Option has been registered under a then currently effective
registration statement under the Securities Act of 1933, as amended (the
“Securities Act”), or (ii) as to any particular requirement, a determination is
made by counsel for the Company that such requirement need not be met in the
circumstances under the then applicable securities laws.

6.7 Termination of Employment or Relationship as an Employee, Director or
Consultant. In the event an Optionee’s Continuous Status as an Employee,
Director or Consultant terminates (other than upon the Optionee’s death or
Disability), the Optionee may exercise his or her Option, but only within such

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period of time as is determined by the Board, and only to the extent that the
Optionee was entitled to exercise it at the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option
Agreement). In the case of an Incentive Stock Option, the Board shall determine
such period of time (in no event to exceed three (3) months from the date of
termination) when the Option is granted. If, at the date of termination, the
Optionee is not entitled to exercise his or her entire Option, the shares
covered by the unexercisable portion of the Option shall revert to the Plan. If,
after termination, the Optionee does not exercise his or her Option within the
time specified in the Option Agreement, the Option shall terminate, and the
shares covered by such Option shall revert to the Plan.

6.8 Retirement of Optionee. Notwithstanding any contrary Plan provision, in the
event an Optionee’s employment as an Employee, Director, or Consultant
terminates due to Optionee’s Retirement, the Optionee shall vest in that number
of shares subject to the Option that would have vested had the Optionee remained
an Employee, Director or Consultant for an additional two (2) years from the
date of Retirement. In addition, the Option shall remain exercisable until the
expiration of its term. For purposes of this paragraph, Retirement shall mean
the termination of service with the Company or an Affiliate of an Optionee on or
after the date on which the Optionee’s number of completed years of service with
the Company or Affiliate and age equal or exceed seventy (70) (including
termination due to death or Disability after such time).

6.9 Disability of Optionee. In the event an Optionee’s Continuous Status as an
Employee, Director or Consultant terminates as a result of the Optionee’s
Disability, the Optionee may exercise his or her Option, but only within twelve
(12) months from the date of such termination (or such shorter period specified
in the Option Agreement), and only to the extent that the Optionee was entitled
to exercise it at the date of such termination (but in no event later than the
expiration of the term of such Option as set forth in the Option Agreement). If,
at the date of termination, the Optionee is not entitled to exercise his or her
entire Option, the shares covered by the unexercisable portion of the Option
shall revert to the Plan. If, after termination, the Optionee does not exercise
his or her Option within the time specified herein, the Option shall terminate,
and the shares covered by such Option shall revert to the Plan.

6.10 Death of Optionee. In the event of the death of an Optionee, the Option may
be exercised, at any time within eighteen (18) months following the date of
death (or such shorter period specified in the Option Agreement) (but in no
event later than the expiration of the term of such Option as set forth in the
Option Agreement), by the Optionee’s estate or by a person who acquired the
right to exercise the Option by bequest or inheritance, but only to the extent
the Optionee was entitled to exercise the Option at the date of death. If, at
the time of death, the Optionee was not entitled to exercise his or her entire
Option, the shares covered by the unexercisable portion of the Option shall
revert to the Plan. If, after death, the Optionee's estate or a person who
acquired the right to exercise the Option by bequest or inheritance does not
exercise the Option within the time specified herein, the Option shall
terminate, and the shares covered by such Option shall revert to the Plan.

6.11 Early Exercise. The Option may, but need not, include a provision whereby
the Optionee may elect at any time while an Employee, Director or Consultant to
exercise the Option as to any part or all of the shares subject to the Option
prior to the full vesting of the Option. Any nonvested shares so purchased may
be subject to a repurchase right in favor of the Company or to any other
restriction the Board determines to be appropriate.

6.12 Withholding. To the extent provided by the terms of an Option Agreement,
the Optionee may satisfy any federal, state or local tax withholding obligation
relating to the exercise of such Option by any of the following means or by a
combination of such means: (a) tendering a cash payment; (b) authorizing the
Company to withhold shares from the shares of the common stock otherwise
issuable to the participant as a result of the exercise of the Option; or (c)
delivering to the Company owned and unencumbered shares of the common stock of
the Company.

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6.13 Re-Load Options. Without in any way limiting the authority of the Board or
Committee to make or not to make grants of Options hereunder, the Board or
Committee shall have the authority (but not an obligation) to include as part of
any Option Agreement a provision entitling the Optionee to a further Option (a
“Re-Load Option”) in the event the Optionee exercises the Option evidenced by
the Option agreement, in whole or in part, by surrendering other shares of
Common Stock in accordance with this Plan and the terms and conditions of the
Option Agreement. Any such Re-Load Option (i) shall be for a number of shares
equal to the number of shares surrendered as part or all of the exercise price
of such Option; (ii) shall have an expiration date which is the same as the
expiration date of the Option the exercise of which gave rise to such Re-Load
Option; and (iii) shall have an exercise price which is equal to one hundred
percent (100%) of the Fair Market Value of the Common Stock subject to the
Re-Load Option on the date of exercise of the original Option or, in the case of
a Re-Load Option which is an Incentive Stock Option and which is granted to a
10% stockholder (as described in subparagraph 5.3), shall have an exercise price
which is equal to one hundred ten percent (110%) of the Fair Market Value of the
stock subject to the Re-Load Option on the date of exercise of the original
Option.

Any such Re-Load Option may be an Incentive Stock Option or a Non-qualified
Stock Option, as the Board or Committee may designate at the time of the grant
of the original Option, provided, however, that the designation of any Re-Load
Option as an Incentive Stock Option shall be subject to the one hundred thousand
dollars ($100,000) annual limitation on exercisability of Incentive Stock
Options described in subparagraph 12.4 of the Plan and in Section 422(d) of the
Code. There shall be no Re-Load Options on a Re-Load Option. Any such Re-Load
Option shall be subject to the availability of sufficient shares under
subparagraph 4.1 and shall be subject to such other terms and conditions as the
Board or Committee may determine.

7 TERMS OF STOCK BONUSES AND PURCHASES OF RESTRICTED STOCK.

Each stock bonus or restricted stock purchase agreement shall be in such form
and shall contain such terms and conditions as the Board or the Committee shall
deem appropriate. The terms and conditions of stock bonus or restricted stock
purchase agreements may change from time to time, and the terms and conditions
of separate agreements need not be identical, but each stock bonus or restricted
stock purchase agreement shall include (through incorporation of provisions
hereof by reference in the agreement or otherwise) the substance of each of the
following provisions as appropriate:

7.1 Purchase Price. The purchase price under each stock purchase agreement shall
be such amount as the Board or Committee shall determine and designate in such
agreement. Notwithstanding the foregoing, the Board or the Committee may
determine that eligible participants in the Plan may be awarded stock pursuant
to a stock bonus agreement in consideration for past services actually rendered
to the Company or for its benefit.

7.2 Transferability. No rights under a stock bonus or restricted stock purchase
agreement shall be assignable by any participant under the Plan, either
voluntarily or by operation of law, except where such assignment is required by
law or expressly authorized by the terms of the applicable stock bonus or
restricted stock purchase agreement.

7.3 Consideration. The purchase price of stock acquired pursuant to a stock
purchase agreement shall be paid either: (a) in cash at the time of purchase;
(b) at the discretion of the Board or the Committee, according to a deferred
payment or other arrangement with the person to whom the stock is sold; or (c)
in any other form of legal consideration that may be acceptable to the Board or
the Committee in their discretion. Notwithstanding the foregoing, the Board or
the Committee to which administration of the Plan has been delegated may award
stock pursuant to a stock bonus agreement in consideration for past services
actually rendered to the Company or for its benefit.

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7.4 Vesting. Shares of stock sold or awarded under the Plan may, but need not,
be subject to a repurchase option in favor of the Company in accordance with a
vesting schedule to be determined by the Board or the Committee.

7.5 Termination of Employment or Relationship as an Employee, Director or
Consultant. In the event a Participant’s Continuous Status as an Employee,
Director or Consultant terminates, the Company may repurchase or otherwise
reacquire any or all of the shares of stock held by that person which have not
vested as of the date of termination under the terms of the stock bonus or
restricted stock purchase agreement between the Company and such person.

8 STOCK APPRECIATION RIGHTS.

8.1 The Board or Committee shall have full power and authority, exercisable in
its sole discretion, to grant Stock Appreciation Rights to Employees or
Directors of or Consultants to, the Company or its Affiliates under the Plan.
Each such right shall entitle the holder to a distribution based on the
appreciation in the fair market value per share of a designated amount of stock.

8.2 Three types of Stock Appreciation Rights shall be authorized for issuance
under the Plan:

8.2.1 Tandem Stock Appreciation Rights. Tandem Rights will be granted
appurtenant to an Option and will require the holder to elect between the
exercise of the underlying Option for shares of stock and the surrender, in
whole or in part, of such Option for an appreciation distribution equal to the
excess of (a) the Fair Market Value (on the date of Option surrender) of vested
shares of stock purchasable under the surrendered Option over (b) the aggregate
exercise price payable for such shares.

8.2.2 Concurrent Stock Appreciation Rights. Concurrent Rights will be granted
appurtenant to an Option and may apply to all or any portion of the shares of
stock subject to the underlying Option and will be exercised automatically at
the same time the Option is exercised for those shares. The appreciation
distribution to which the holder of such concurrent right shall be entitled upon
exercise of the underlying Option shall be in an amount equal to the excess of
(a) the aggregate fair market value (at date of exercise) of the vested shares
purchased under the underlying Option with such concurrent rights over (b) the
aggregate exercise price paid for those shares.

8.2.3 Independent Stock Appreciation Rights. Independent Rights may be granted
independently of any Option and will entitle the holder upon exercise to an
appreciation distribution equal in amount to the excess of (a) the aggregate
fair market value (at the date of exercise) of a number of shares of stock equal
to the number of vested share equivalents exercised at such time (as described
in subsection 8.3.3 over (b) the aggregate fair market value of such number of
shares of stock at the date of grant.

8.3 The terms and conditions applicable to each Tandem Right, Concurrent Right
and Independent Right shall be as follows:

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    8.3.1 Tandem Rights.

8.3.1.1 Tandem Rights may be tied to either Incentive Stock Options or
Nonstatutory Stock Options. Each such right shall, except as specifically set
forth below, be subject to the same terms and conditions applicable to the
particular Option to which it pertains. If Tandem Rights are granted appurtenant
to an Incentive Stock Option, they shall satisfy any applicable Treasury
Regulations so as not to disqualify such Option as an Incentive Stock Option
under the Code.

8.3.1.2 The appreciation distribution payable on the exercised Tandem Right
shall be in cash in an amount equal to the excess of (a) the fair market value
(on the date of the Option surrender) of the number of shares of stock covered
by that portion of the surrendered Option in which the optionee is vested over
(b) the aggregate exercise price payable for such vested shares.

    8.3.2 Concurrent Rights.

8.3.2.1 Concurrent Rights may be tied to any or all of the shares of stock
subject to any Incentive Stock Option or Nonstatutory Stock Option grant made
under the Plan. A Concurrent Right shall, except as specifically set forth
below, be subject to the same terms and conditions applicable to the particular
Option grant to which it pertains.

8.3.2.2 A Concurrent Right shall be automatically exercised at the same time the
underlying Option is exercised with respect to the particular shares of stock to
which the Concurrent Right pertains.

8.3.2.3 The appreciation distribution payable on an exercised Concurrent Right
shall be in cash in an amount equal to such portion as shall be determined by
the Board or the Committee at the time of the grant of the excess of (a) the
aggregate fair market value (on the Exercise Date) of the vested shares of stock
purchased under the underlying Option which have Concurrent Rights appurtenant
to them over (b) the aggregate exercise price paid for such shares.

    8.3.3 Independent Rights.

8.3.3.1 Independent Rights shall, except as specifically set forth below, be
subject to the same terms and conditions applicable to Nonstatutory Stock
Options as set forth in Section 6. They shall be denominated in share
equivalents.

8.3.3.2 The appreciation distribution payable on the exercised Independent Right
shall be in an amount equal to the excess of (a) the aggregate fair market value
(on the date of the exercise of the Independent Right) of a number of shares of
Company stock equal to the number of share equivalents in which the holder is
vested under such Independent right, and with respect to which the holder is
exercising the Independent Right on such date, over (b) the aggregate fair
market value (on the date of the grant of the Independent Right) of such number
of shares of Company stock.

8.3.3.3 The appreciation distribution payable on the exercised Independent Right
may be paid, in the discretion of the Board or the Committee, in cash, in shares
of stock or in a combination of cash and stock. Any shares of stock so
distributed shall be valued at fair market value on the date the Independent
Right is exercised.

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8.3.4 Terms Applicable to Tandem Rights, Concurrent Rights and
Independent Rights.

8.3.4.1 To exercise any outstanding Tandem, Concurrent or Independent Right, the
holder must provide written notice of exercise to the Company in compliance with
the provisions of the instrument evidencing such right.

8.3.4.2 If a Tandem, Concurrent, or Independent Right is granted to an
individual who is at the time subject to Section 16(b) of the Exchange Act (a
“Section 16(b) Insider”), then the instrument of grant shall incorporate all the
terms and conditions at the time necessary to assure that the subsequent
exercise of such right shall qualify for the safe-harbor exemption from
short-swing profit liability provided by Rule 16b-3 promulgated under the
Exchange Act (or any successor rule or regulation).

8.3.4.3 No limitation shall exist on the aggregate amount of cash payments the
Company may make under the Plan in connection with the exercise of Tandem,
Concurrent or Independent Rights.

9 CANCELLATION AND RE-GRANT OF OPTIONS.

The Board or the Committee shall have the authority to effect, at any time and
from time to time, with the consent of the affected holders of Options and/or
Stock Appreciation Rights, (a) the repricing of any outstanding Options and/or
any Stock Appreciation Rights under the Plan and/or (b) the cancellation of any
outstanding Options and/or any Stock Appreciation Rights under the Plan and the
grant in substitution therefor of new Options and/or Stock Appreciation Rights
under the Plan covering the same or different numbers of shares of stock, but
having an exercise price per share not less than one hundred percent (100%) of
the Fair Market Value in the case of an Incentive Stock Option or, in the case
of a 10% stockholder (as described in subparagraph 5.3), not less than one
hundred ten percent (110%) of the Fair Market Value per share of stock on the
new grant date.

10 COVENANTS OF THE COMPANY.

10.1 During the terms of the Stock Awards, the Company shall keep available at
all times the number of shares of stock required to satisfy such Stock Awards up
to the number of shares of stock authorized under the Plan.

10.2 The Company shall seek to obtain from each regulatory commission or agency
having jurisdiction over the Plan such authority as may be required to issue and
sell shares of stock under the Stock Awards; provided, however, that this
undertaking shall not require the Company to register under the Securities Act
either the Plan, any Stock Award or any stock issued or issuable pursuant to any
such Stock Award. If, after reasonable efforts, the Company is unable to obtain
from any such regulatory commission or agency the authority which counsel for
the Company deems necessary for the lawful issuance and sale of stock under the
Plan, the Company shall be relieved from any liability for failure to issue and
sell stock under such Stock Awards unless and until such authority is obtained.

11 USE OF PROCEEDS FROM STOCK.

Proceeds from the sale of stock pursuant to Stock Awards shall constitute
general funds of the Company.

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12 MISCELLANEOUS.

12.1 The Board or the Committee shall have the power to accelerate the time at
which a Stock Award may first be exercised or the time during which a Stock
Award or any part thereof will vest, notwithstanding the provisions in the Stock
Award stating the time at which it may first be exercised or the time during
which it will vest.

12.2 Neither an Optionee nor any person to whom an Option is transferred under
subsection 6.4 shall be deemed to be the holder of, or to have any of the rights
of a holder with respect to, any shares subject to such Option unless and until
such person has satisfied all requirements for exercise of the Option pursuant
to its terms.

12.3 Nothing in the Plan or any instrument executed or Stock Award granted
pursuant thereto shall confer upon any Employee, Director, Consultant, Optionee,
or other holder of Stock Awards any right to continue in the employ of the
Company or any Affiliate (or to continue acting as a Director or Consultant) or
shall affect the right of the Company or any Affiliate to terminate the
employment or relationship as a Director or Consultant of any Employee,
Director, Consultant or Optionee with or without cause.

12.4 To the extent that the aggregate Fair Market Value (determined at the time
of grant) of stock with respect to which Incentive Stock Options granted after
1986 are exercisable for the first time by any Optionee during any calendar year
under all plans of the Company and its Affiliates exceeds one hundred thousand
dollars ($100,000), the Options or portions thereof which exceed such limit
(according to the order in which they were granted) shall be treated as
Nonstatutory Stock Options.

13 ADJUSTMENTS UPON CHANGES IN STOCK.

13.1 If any change is made in the stock subject to the Plan, or subject to any
Stock Award (through merger, consolidation, reorganization, recapitalization,
stock dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or otherwise), the Plan and outstanding Stock Awards will be
appropriately adjusted in the class(es) and maximum number of shares subject to
the Plan and the class(es) and number of shares and price per share of stock
subject to outstanding Stock Awards.

13.2 In the event of: (a) a merger or consolidation in which the Company is not
the surviving corporation; (b) a reverse merger in which the Company is the
surviving corporation but the shares of the Company’s common stock outstanding
immediately preceding the merger are converted by virtue of the merger into
other property, whether in the form of securities, cash, or otherwise; (c) a
strategic corporate event, such as a merger or acquisition, where the Company is
technically the surviving entity, but where other elements of a change of
control are present, i.e. change in management team or board composition; (d) a
transaction which the Board determines in its sole discretion to constitute a
change in control of the Company; or (e) any other capital reorganization in
which more than 50% of the shares of the Company entitled to vote are exchanged,
then, the time during which such Stock Awards become vested or may be exercised
shall be accelerated and such Stock Awards shall continue to be exercisable
until the later of (i) twenty-four (24) months from the effective date of such
event, or (ii) the time specified in the Option Agreement during which the
Option is exercisable following an Optionee’s termination of service; provided,
however, that in no event shall the Option be exercisable after the expiration
of its term.

14 AMENDMENT OF THE PLAN.

14.1 The Board at any time, and from time to time, may amend the Plan. However,
except as provided in Section 13 relating to adjustments upon changes in stock,
no amendment shall be effective

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unless approved by the stockholders of the Company within twelve (12) months
before or after the adoption of the amendment, where the amendment will:

14.1.1 Increase the number of shares reserved for Stock Awards under the Plan;

14.1.2  Modify the requirements as to eligibility for participation in the Plan
to the extent such modification requires stockholder approval in order for the
Plan to satisfy the requirements of Sections 162(m) and 422 of the Code; or

14.1.3 Modify the Plan in any other way if such modification requires
stockholder approval in order for the Plan to satisfy the requirements of
Section 422 of the Code or to comply with the requirements of Rule 16b-3.

14.2 It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide under the provisions
of the Code and the regulations promulgated thereunder relating to Incentive
Stock Options and/or to bring the Plan and/or Incentive Stock Options granted
under it into compliance therewith.

14.3 Rights and obligations under any Stock Award granted before amendment of
the Plan shall not be altered or impaired by any amendment of the Plan unless
(a) the Company requests the consent of the person to whom the Stock Award was
granted and (b) such person consents in writing.

15 TERMINATION OR SUSPENSION OF THE PLAN.

15.1 The Board may suspend or terminate the Plan at any time. Unless sooner
terminated, the Plan shall terminate on midnight, January 6, 2004. No Stock
Awards may be granted under the Plan while the Plan is suspended or after it is
terminated.

15.2 Rights and obligations under any Stock Award granted while the Plan is in
effect shall not be altered or impaired by suspension or termination of the
Plan, except with the consent of the person to whom the Stock Award was granted.

16 EFFECTIVE DATE OF PLAN.

The Plan shall become effective as determined by the Board, but no Stock Awards
granted under the Plan shall be exercisable unless and until the Plan has been
approved by the stockholders of the Company.

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