Exhibit 10.1
BIOCRYST PHARMACEUTICALS, INC.
STOCK INCENTIVE PLAN
(AS AMENDED AND RESTATED FEBRUARY 17, 2011)
ARTICLE ONE
GENERAL PROVISIONS
     I. PURPOSES OF THE PLAN
          A. This Stock Incentive Plan (the “Plan”), formerly the “BioCryst
Pharmaceuticals, Inc. 1991 Stock Option Plan,” is intended to promote the
interests of BioCryst Pharmaceuticals, Inc., a Delaware corporation (the
“Company”), by providing a method whereby (i) key employees (including officers
and directors) of the Company (or its parent or subsidiary corporations) who are
responsible for the management, growth and financial success of the Company (or
any parent or subsidiary corporations), (ii) non-employee members of the board
of directors of the Company (the “Board”) (or of any parent or subsidiary
corporations) and (iii) consultants and other independent contractors who
provide valuable services to the Company (or any parent or subsidiary
corporations) may be offered the opportunity to acquire a proprietary interest,
or otherwise increase their proprietary interest, in the Company as an incentive
for them to remain in the service of the Company (or any parent or subsidiary
corporations).
          B. For purposes of the Plan, the following provisions shall be
applicable in determining the parent and subsidiary corporations of the Company:
               (i) Any corporation (other than the Company) in an unbroken chain
of corporations ending with the Company shall be considered to be a parent
corporation of the Company, provided each such corporation in the unbroken chain
(other than the Company) owns, at the time of the determination, 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.
               (ii) Each corporation (other than the Company) in an unbroken
chain of corporations beginning with the Company shall be considered to be a
subsidiary of the Company, provided each such corporation (other than the last
corporation) in the unbroken chain owns, at the time of the determination, 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.
          C. The Plan, as hereby amended and restated, was approved and adopted
by the Board on February 17, 2011 in order to increase by 1,600,000 the number
of shares of the Company’s common stock, par value $0.01 per share (the “Common
Stock”), that may be issued pursuant to the Plan. The Board’s adoption of the
share increase was approved by the Company’s stockholders at the Company’s 2011
Annual Stockholders Meeting held on May 12, 2011.
     II. STRUCTURE OF THE PLAN
          A. The Plan shall be divided into three separate equity programs:

 

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          (i) the Discretionary Option Grant Program specified in Article Two,
pursuant to which eligible persons may, at the discretion of the Plan
Administrator, be granted options to purchase shares of Common Stock,
          (ii) the Stock Issuance Program specified in Article Three, pursuant
to which eligible persons may, at the discretion of the Plan Administrator, be
issued shares of Common Stock directly, either through immediate purchase of
such shares or as compensation for services rendered to the Company (or any
parent or subsidiary), and
          (iii) the Automatic Option Grant Program specified in Article Four,
pursuant to which non-employee members of the Board will automatically receive
option grants to purchase shares of Common Stock.
          B. Unless the context clearly indicates otherwise, the provisions of
Articles One and Five of the Plan shall apply to all equity programs under the
Plan and shall accordingly govern the interests of all individuals under the
Plan.
     III. ADMINISTRATION OF THE PLAN
          A. A committee of two (2) or more non-employee Board members appointed
by the Board (the “Primary Committee”) shall have sole and exclusive authority
to administer the Discretionary Option Grant and Stock Issuance Programs with
respect to Section 16 Insiders. For purposes of this Section, a Section 16
Insider shall mean an officer or director of the Company subject to the
short-swing profit liabilities of Section 16 of the Securities Exchange Act of
1934 (the “1934 Act”).
          B. Administration of the Discretionary Option Grant and Stock Issuance
Programs with respect to all other persons eligible to participate in the
programs may, at the Board’s discretion, be vested in the Primary Committee,
another committee of one (1) or more Board members appointed by the Board (the
“Secondary Committee”), or the Board may retain the power to administer those
programs with respect to all such persons.
          C. Members of the Primary Committee and any Secondary Committee shall
serve for such period of time as the Board may determine and shall be subject to
removal by the Board at any time.
          D. Each Plan Administrator (whether the Primary Committee, the Board
or the Secondary Committee) shall, within the scope of its administrative
functions under the Plan, have full power and authority (subject to the express
provisions of the Plan) to establish such rules and regulations as it may deem
appropriate for the proper administration of the Discretionary Option Grant and
Stock Issuance Programs and to make such determinations under, and issue
interpretations of, the provisions of such programs and any outstanding options
or stock issuances thereunder as it may deem necessary or advisable. Decisions
of the Plan Administrator within the scope of its administrative authority under
the Plan shall be final and binding on all parties.
          E. Service on the Primary Committee or the Secondary Committee shall
constitute service as a Board member, and members of each such committee shall
accordingly be

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entitled to full indemnification and reimbursement as Board members for their
service on such committee. No member of the Primary Committee or Secondary
Committee shall be liable for any act of omission made in good faith with
respect to the Plan or any option grants or stock issuances under the Plan.
          F. Administration of the Automatic Option Grant Program shall be
self-executing in accordance with the express terms and conditions of
Article Four, and no Plan Administrator shall exercise any discretionary
functions under that program.
     IV. ELIGIBILITY
          A. The persons eligible to participate in the Discretionary Option
Grant and Stock Issuance Programs shall be limited to the following:
               (i) officers and other key employees of the Company (or its
parent or subsidiary corporations) who render services which contribute to the
management, growth and financial success of the Company (or its parent or
subsidiary corporations);
               (ii) individuals who are consultants or independent advisors and
who provide valuable services to the Company (or its parent or subsidiary
corporations); and
               (iii) non-employee members of the Board (or of the board of
directors of parent or subsidiary corporations).
          B. Only Board members who are not employees of the Company (or any
parent or subsidiary) shall be eligible to receive automatic option grants
pursuant to the Automatic Option Grant Program specified in Article Four.
          C. The Plan Administrator shall, within the scope of its
administrative jurisdiction under the Plan, have full power and authority to
determine (i) whether to grant options in accordance with the Discretionary
Option Grant Program or to effect stock issuances in accordance with the Stock
Issuance Program, (ii) which eligible persons are to receive option grants under
the Discretionary Option Grant Program, the time or times when such option
grants are to be made, the number of shares to be covered by each such grant,
the status of the granted option as either an incentive stock option (“Incentive
Option”) which satisfies the requirements of Section 422 of the Internal Revenue
Code of 1986, as amended (the “Code”) or a non-statutory option not intended to
meet such requirements, the time or times when each such option is to become
exercisable, the vesting schedule (if any) applicable to the option shares and
the maximum term for which such option is to remain outstanding, and (iii) which
eligible persons are to receive stock issuances under the Stock Issuance
Program, the time or times when such issuances are to be made, the number of
shares to be issued to each participant, the vesting schedule (if any)
applicable to the shares and the consideration for such shares.
     V. STOCK SUBJECT TO THE PLAN
          A. Shares of the Company’s Common Stock shall be available for
issuance under the Plan and shall be drawn from either the Company’s authorized
but unissued shares of Common Stock or from reacquired shares of Common Stock,
including shares repurchased by

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the Company on the open market. The maximum number of shares of Common Stock
which may be issued over the term of the Plan, as amended and restated, shall
not exceed 12,460,000 shares, subject to adjustment from time to time in
accordance with the provisions of this Section V. The total number of shares
available under the Plan as of March 24, 2011 is 10,333,704. This amount
includes: 8,733,704 shares reserved for awards already issued; 522,842 shares of
Common Stock available for future issuance under the Plan; and the increase of
1,600,000 shares of Common Stock authorized by the Board and approved by the
Company’s stockholders at the 2011 Annual Stockholders Meeting.
          B. In no event shall the number of shares of Common Stock for which
any one individual participating in the Plan may receive options, separately
exercisable stock appreciation rights and direct stock issuances exceed
1,500,000 shares of Common Stock in the aggregate. For purposes of such
limitation, however, no stock options granted prior to the date the Common Stock
was first registered under Section 12 of the 1934 Act (the “Section 12(g)
Registration Date”) shall be taken into account.
          C. Should an outstanding option under this Plan expire or terminate
for any reason prior to exercise in full, the shares subject to the portion of
the option not so exercised shall be available for subsequent option grant or
direct stock issuances under the Plan. Unvested shares issued under the Plan and
subsequently repurchased by the Company, at the original issue price paid per
share, pursuant to the Company’s repurchase rights under the Plan, or shares
underlying terminated share right awards, shall be added back to the number of
shares of Common Stock reserved for issuance under the Plan and shall
accordingly be available for reissuance through one or more subsequent option
grants or direct stock issuances under the Plan. However, should the exercise
price of an outstanding option under the Plan be paid with shares of Common
Stock or should shares of Common Stock otherwise issuable under the Plan be
withheld by the Company in satisfaction of the withholding taxes incurred in
connection with the exercise of an outstanding option or the vesting of a direct
stock issuance under the Plan, then the number of shares of Common Stock
available for issuance under the Plan shall be reduced by the gross number of
shares for which the option is exercised or which vest under the direct stock
issuance, and not by the net number of shares of Common Stock actually issued to
the holder of such option or stock issuance. Shares of Common Stock subject to
any option surrendered for an appreciation distribution under Section IV of
Article Two or Section IV of Article Four shall not be available for subsequent
issuance under the Plan.
          D. In the event any change is made to the Common Stock issuable under
the Plan by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without receipt of consideration, then
appropriate adjustments shall be made to (i) the maximum number and/or class of
securities issuable under the Plan, (ii) the maximum number and/or class of
securities for which any one individual participating in the Plan may be granted
stock options, separately exercisable stock appreciation rights, and direct
stock issuances under the Plan from and after the Section 12(g) Registration
Date, (iii) the number and/or class of securities and price per share in effect
under each outstanding option under the Plan, (iv) the number and/or class of
securities in effect under each outstanding direct stock issuance under the
Plan, and (v) the number and/or class of securities for which automatic option
grants are subsequently to be made per non-employee Board member under the
Automatic Option Grant Program. The purpose of

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such adjustments shall be to preclude the enlargement or dilution of rights and
benefits under the Plan.
          E. The fair market value per share of Common Stock on any relevant
date under the Plan shall be determined in accordance with the following
provisions:
               (i) If the Common Stock is not at the time listed or admitted to
trading on any national securities exchange but is traded in the
over-the-counter market, the fair market value shall be the mean between the
highest bid and lowest asked prices (or, if such information is available, the
closing selling price) per share of Common Stock on the date in question in the
over-the-counter market, as such prices are reported by the National Association
of Securities Dealers through the Nasdaq National Market, the Nasdaq Global
Select Market or any successor system. If there are no reported bid and asked
prices (or closing selling price) for the Common Stock on the date in question,
then the mean between the highest bid price and lowest asked price (or the
closing selling price) on the last preceding date for which such quotations
exist shall be determinative of fair market value.
               (ii) If the Common Stock is at the time listed or admitted to
trading on any national securities exchange, then the fair market value shall be
the closing selling price per share of Common Stock on the date in question on
the securities exchange determined by the Plan Administrator to be the primary
market for the Common Stock, as such price is officially quoted in the composite
tape of transactions on such exchange. If there is no reported sale of Common
Stock on the exchange on the date in question, then the fair market value shall
be the closing selling price on the exchange on the last preceding date for
which such quotation exists.
               (iii) If the Common Stock is at the time neither listed nor
admitted to trading on any securities exchange nor traded in the
over-the-counter market, then the fair market value shall be determined by the
Plan Administrator after taking into account such factors as the Plan
Administrator shall deem appropriate.

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ARTICLE TWO
DISCRETIONARY OPTION GRANT PROGRAM
     I. TERMS AND CONDITIONS OF OPTIONS
          Options granted pursuant to this Article Two shall be authorized by
action of the Plan Administrator and may, at the Plan Administrator’s
discretion, be either Incentive Options or non-statutory options. Individuals
who are not Employees may only be granted non-statutory options under this
Article Two. Each option granted shall be evidenced by one or more instruments
in the form approved by the Plan Administrator. Each such instrument shall,
however, comply with the terms and conditions specified below, and each
instrument evidencing an Incentive Option shall, in addition, be subject to the
applicable provisions of Section II of this Article Two.
          A. Option Price.
               1. The option price per share shall be fixed by the Plan
Administrator. In no event, however, shall the option price per share be less
than one hundred percent (100%) of the fair market value per share of Common
Stock on the date of the option grant.
               2. The option price shall become immediately due upon exercise of
the option and shall, subject to the provisions of Section IV of this
Article Two and the instrument evidencing the grant, be payable as follows:
                    (i) full payment in cash or check drawn to the Company’s
order;
                    (ii) full payment in shares of Common Stock held by the
optionee for the requisite period necessary to avoid a charge to the Company’s
earnings for financial reporting purposes and valued at fair market value on the
Exercise Date (as such term is defined below);
                    (iii) full payment through a combination of shares of Common
Stock held by the optionee for the requisite period necessary to avoid a charge
to the Company’s earnings for financial reporting purposes and valued at fair
market value on the Exercise Date and cash or cash equivalent; or
                    (iv) full payment through a broker-dealer sale and
remittance procedure pursuant to which the optionee (I) shall provide
irrevocable written instructions to a designated brokerage firm to effect the
immediate sale of the purchased shares and remit to the Company, out of the sale
proceeds available on the settlement date, sufficient funds to cover the
aggregate option price payable for the purchased shares plus all applicable
Federal and State income and employment taxes required to be withheld by the
Company in connection with such purchase and (II) shall provide written
directives to the Company to deliver the certificates for the purchased shares
directly to such brokerage firm in order to complete the sale transaction.

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     For purposes of this subparagraph 2, the Exercise Date shall be the date on
which written notice of the option exercise is delivered to the Company. Except
to the extent the sale and remittance procedure is utilized in connection with
the exercise of the option, payment of the option price for the purchased shares
must accompany such notice.
          B. Term and Exercise of Options.
               Each option granted under this Article Two shall be exercisable
at such time or times, during such period, and for such number of shares as
shall be determined by the Plan Administrator and set forth in the instrument
evidencing the option grant. No such option, however, shall have a maximum term
in excess of ten (10) years from the grant date. During the lifetime of the
optionee, the option, together with any stock appreciation rights pertaining to
such option, shall be exercisable only by the optionee and shall not be
assignable or transferable by the optionee except for a transfer of the option
by will or by the laws of descent and distribution following the optionee’s
death. However, the Plan Administrator shall have the discretion to provide that
a non-statutory option may, in connection with the optionee’s estate plan, be
assigned in whole or in part during the optionee’s lifetime either as (i) as a
gift to one or more members of optionee’s immediate family, to a trust in which
optionee and/or one or more such family members hold more than fifty percent
(50%) of the beneficial interest or an entity in which more than fifty percent
(50%) of the voting interests are owned by optionee and/or one or more such
family members, or (ii) pursuant to a domestic relations order. The assigned
portion shall be exercisable only by the person or persons who acquire a
proprietary interest in the option pursuant to such assignment. The terms
applicable to the assigned portion shall be the same as those in effect for this
option immediately prior to such assignment and shall be set forth in such
documents issued to the assignee as the Plan Administrator may deem appropriate.
          C. Termination of Service.
               1. Except to the extent otherwise provided pursuant to Section V
of this Article Two, the following provisions shall govern the exercise period
applicable to any options held by the optionee at the time of cessation of
Service or death.
               (i) Should the optionee cease to remain in Service for any reason
other than death or permanent disability, then the period for which each
outstanding option held by such optionee is to remain exercisable shall be
limited to the three (3)-month period following the date of such cessation of
Service. However, should optionee die during the three (3)-month period
following his or her cessation of Service, the personal representative of the
optionee’s estate or the person or persons to whom the option is transferred
pursuant to the optionee’s will or in accordance with the laws of descent and
distribution shall have a twelve (12)-month period following the date of the
optionee’s death during which to exercise such option.
               (ii) In the event such Service terminates by reason of permanent
disability (as defined in Section 22(e)(3) of the Internal Revenue Code), then
the period for which each outstanding option held by the optionee is to remain
exercisable shall be limited to the twelve (12)-month period following the date
of such cessation of Service.

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               (iii) Should the optionee, after completing five (5) full years
of Service, die while in Service, then the exercisability of each of his or her
outstanding options shall automatically accelerate so that each such option
shall become fully exercisable with respect to the total number of shares of
Common Stock at the time subject to such option and may be exercised for all or
any portion of such shares. The personal representative of the optionee’s estate
or the person or persons to whom the option is transferred pursuant to the
optionee’s will or in accordance with the laws of descent and distribution shall
have a twelve (12)-month period following the date of the optionee’s death
during which to exercise such option.
               (iv) In the event such Service terminates by reason of death
prior to the optionee obtaining five (5) full years of Service, then the period
for which each outstanding vested option held by the optionee at the time of
death shall be exercisable by the optionee’s estate or the person or persons to
whom the option is transferred pursuant to the optionee’s will shall be limited
to the twelve (12)-month period following the date of the optionee’s death.
               (v) Under no circumstances, however, shall any such option be
exercisable after the specified expiration date of the option term.
               (vi) Each such option shall, during such limited exercise period,
be exercisable for any or all of the shares for which the option is exercisable
on the date of the optionee’s cessation of Service. Upon the expiration of such
limited exercise period or (if earlier) upon the expiration of the option term,
the option shall terminate and cease to be exercisable. However, each
outstanding option shall immediately terminate and cease to remain outstanding,
at the time of the optionee’s cessation of Service, with respect to any shares
for which the option is not otherwise at that time exercisable or in which the
optionee is not otherwise vested.
               (vii) Should (i) the optionee’s Service be terminated for
misconduct (including, but not limited to, any act of dishonesty, willful
misconduct, fraud or embezzlement) or (ii) the optionee make any unauthorized
use or disclosure of confidential information or trade secrets of the Company or
its parent or subsidiary corporations, then in any such event all outstanding
options held by the optionee under this Article Two shall terminate immediately
and cease to be exercisable.
               2. The Plan Administrator shall have complete discretion,
exercisable either at the time the option is granted or at any time while the
option remains outstanding, to permit one or more options held by the optionee
under this Article Two to be exercised, during the limited period of
exercisability provided under subparagraph 1 above, not only with respect to the
number of shares for which each such option is exercisable at the time of the
optionee’s cessation of Service but also with respect to one or more subsequent
installments of purchasable shares for which the option would otherwise have
become exercisable had such cessation of Service not occurred.
               3. For purposes of the foregoing provisions of this Section I.C
(and for all other purposes under the Plan):

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               (i) The optionee shall be deemed to remain in the Service of the
Company for so long as such individual renders services on a periodic basis to
the Company (or any parent or subsidiary corporation) in the capacity of an
Employee, a non-employee member of the board of directors or an independent
consultant or advisor, unless the agreement evidencing the applicable option
grant specifically states otherwise.
               (ii) The optionee shall be considered to be an Employee for so
long as such individual remains in the employ of the Company or one or more of
its parent or subsidiary corporations, subject to the control and direction of
the employer entity not only as to the work to be performed but also as to the
manner and method of performance.
          D. Stockholder Rights.
               An optionee shall have no stockholder rights with respect to any
shares covered by the option until such individual shall have exercised the
option and paid the option price for the purchased shares.
          E. Repurchase Rights.
               The shares of Common Stock acquired upon the exercise of options
granted under this Article Two may be subject to repurchase by the Company in
accordance with the following provisions:
               1. The Plan Administrator shall have the discretion to grant
options which are exercisable for unvested shares of Common Stock under this
Article Two. Should the optionee cease Service while holding such unvested
shares, the Company shall have the right to repurchase any or all those unvested
shares at the option price paid per share. The terms and conditions upon which
such repurchase right shall be exercisable (including the period and procedure
for exercise and the appropriate vesting schedule for the purchased shares)
shall be established by the Plan Administrator and set forth in the instrument
evidencing such repurchase right.
               2. All of the Company’s outstanding repurchase rights shall
automatically terminate, and all shares subject to such terminated rights shall
immediately vest in full, upon the occurrence of any Corporate Transaction under
Section III of this Article Two, except to the extent: (i) any such repurchase
right is expressly assigned to the successor corporation (or parent thereof) in
connection with the Corporate Transaction or (ii) such termination is precluded
by other limitations imposed by the Plan Administrator at the time the
repurchase right is issued.
               3. The Plan Administrator shall have the discretionary authority,
exercisable either before or after the optionee’s cessation of Service, to
cancel the Company’s outstanding repurchase rights with respect to one or more
shares purchased or purchasable by the optionee under this Discretionary Option
Grant Program and thereby accelerate the vesting of such shares in whole or in
part at any time.

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     II. INCENTIVE OPTIONS
          The terms and conditions specified below shall be applicable to all
Incentive Options granted under this Article Two. Incentive Options may only be
granted to individuals who are Employees of the Company. Options which are
specifically designated as “non-statutory” options when issued under the Plan
shall not be subject to such terms and conditions.
          A. Dollar Limitation. The aggregate fair market value (determined as
of the respective date or dates of grant) of the Common Stock for which one or
more options granted to any Employee under this Plan (or any other option plan
of the Company or its parent or subsidiary corporations) may for the first time
become exercisable as incentive stock options under the Federal tax laws during
any one calendar year shall not exceed the sum of One Hundred Thousand Dollars
($100,000). To the extent the Employee holds two or more such options which
become exercisable for the first time in the same calendar year, the foregoing
limitation on the exercisability of such options as incentive stock options
under the Federal tax laws shall be applied on the basis of the order in which
such options are granted. Should the number of shares of Common Stock for which
any Incentive Option first becomes exercisable in any calendar year exceed the
applicable One Hundred Thousand Dollar ($100,000) limitation, then that option
may nevertheless be exercised in such calendar year for the excess number of
shares as a non-statutory option under the Federal tax laws.
          B. 10% Stockholder. If any individual to whom an Incentive Option is
granted is the owner of stock (as determined under Section 424(d) of the
Internal Revenue Code) possessing 10% or more of the total combined voting power
of all classes of stock of the Company or any one of its parent or subsidiary
corporations, then the option price per share shall not be less than one hundred
and ten percent (110%) of the fair market value per share of Common Stock on the
grant date, and the option term shall not exceed five (5) years, measured from
the grant date.
          C. Termination of Employment. Any portion of an Incentive Option that
remains outstanding (by reason of the optionee remaining in the Service of the
Company, pursuant to the Plan Administrator’s exercise of discretion under
Section V of this Article Two, or otherwise) more than 3 months following the
date an optionee ceases to be an Employee of the Company shall thereafter be
exercisable as a non-statutory option under federal tax laws.
          Except as modified by the preceding provisions of this Section II, the
provisions of Articles One, Two and Five of the Plan shall apply to all
Incentive Options granted hereunder.
     III. CORPORATE TRANSACTIONS/CHANGES IN CONTROL
          A. In the event of any of the following stockholder-approved
transactions (a “Corporate Transaction”):
               (1) a merger or consolidation in which the Company is not the
surviving entity, except for a transaction the principal purpose of which is to
change the State of the Company’s incorporation,

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               (2) the sale, transfer or other disposition of all or
substantially all of the assets of the Company in liquidation or dissolution of
the Company, or
               (3) any reverse merger in which the Company is the surviving
entity but in which securities possessing more than fifty percent (50%) of the
total combined voting power of the Company’s outstanding securities are
transferred to a person or persons different from the persons holding those
securities immediately prior to such merger,
then the exercisability of each option outstanding under this Article Two shall
automatically accelerate so that each such option shall, immediately prior to
the specified effective date for the Corporate Transaction, become fully
exercisable with respect to the total number of shares of Common Stock at the
time subject to such option and may be exercised for all or any portion of such
shares. However, an outstanding option under this Article Two shall not so
accelerate if and to the extent the acceleration of such option is subject to
other limitations imposed by the Plan Administrator at the time of grant, unless
the Plan Administrator, in its discretion, later determines to waive such
limitations.
          B. Immediately after the consummation of the Corporate Transaction,
all outstanding options under this Article Two shall terminate and cease to be
outstanding, except to the extent assumed by the successor corporation or its
parent company. The Plan Administrator shall have complete discretion to
provide, on such terms and conditions as it sees fit, for a cash payment to be
made to any optionee on account of any option terminated in accordance with this
paragraph, in an amount equal to the excess (if any) of (A) the fair market
value of the shares subject to the option as of the date of the Corporate
Transaction, over (B) the aggregate exercise price of the option.
          C. Each outstanding option under this Article Two which is assumed in
connection with the Corporate Transaction or is otherwise to continue in effect
shall be appropriately adjusted, immediately after such Corporate Transaction,
to apply and pertain to the number and class of securities which would have been
issued to the option holder, in consummation of such Corporate Transaction, had
such person exercised the option immediately prior to such Corporate
Transaction. Appropriate adjustments shall also be made to the option price
payable per share, provided the aggregate option price payable for such
securities shall remain the same. In addition, the class and number of
securities available for issuance under the Plan following the consummation of
the Corporate Transaction shall be appropriately adjusted.
          D. The grant of options under this Article Two shall in no way affect
the right of the Company to adjust, reclassify, reorganize or otherwise change
its capital or business structure or to merge, consolidate, dissolve, liquidate
or sell or transfer all or any part of its business or assets.
          E. The exercisability of each outstanding option under this
Article Two shall automatically accelerate, and the Company’s outstanding
repurchase rights under this Article Two shall immediately terminate upon the
occurrence of a Change in Control.
          F. For purposes of this Section III (and for all other purposes under
the Plan), a Change in Control shall be deemed to occur in the event:

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          (1) any person or related group of persons (other than the Company or
a person that directly or indirectly controls, is controlled by, or is under
common control with, the Company) directly or indirectly acquires beneficial
ownership (within the meaning of Rule 13d-3 of the 1934 Act) of securities
possessing more than fifty percent (50%) of the total combined voting power of
the Company’s outstanding securities pursuant to a tender or exchange offer made
directly to the Company’s stockholders; or
          (2) there is a change in the composition of the Board over a period of
twenty-four (24) consecutive months or less such that a majority of the Board
members (rounded up to the next whole number) ceases, by reason of one or more
contested elections for Board membership, to be comprised of individuals who
either (A) have been Board members continuously since the beginning of such
period or (B) have been elected or nominated for election as Board members
during such period by at least two-thirds of the Board members described in
clause (A) who were still in office at the time such election or nomination was
approved by the Board.
          G. All options accelerated in connection with the Change in Control
shall remain fully exercisable until the expiration or sooner termination of the
option term.
          H. The portion of any Incentive Option accelerated under this
Section III in connection with a Corporate Transaction or Change in Control
shall remain exercisable as an incentive stock option under the Federal tax laws
only to the extent the dollar limitation of Section II of this Article Two is
not exceeded. To the extent such dollar limitation is exceeded, the accelerated
portion of such option shall be exercisable as a non-statutory option under the
Federal tax laws.
     IV. STOCK APPRECIATION RIGHTS
          A. Provided and only if the Plan Administrator determines in its
discretion to implement the stock appreciation right provisions of this
Section IV, one or more optionees may be granted the right, exercisable upon
such terms and conditions as the Plan Administrator may establish, to surrender
all or part of an unexercised option granted under this Article Two in exchange
for a distribution from the Company in an amount equal to the excess of (i) the
fair market value (on the option surrender date) of the number of shares in
which the optionee is at the time vested under the surrendered option (or
surrendered portion thereof) over (ii) the aggregate option price payable for
such vested shares. The distribution may be made in shares of Common Stock
valued at fair market value on the option surrender date, in cash, or partly in
shares and partly in cash, as the Plan Administrator shall determine in its sole
discretion.
          B. The shares of Common Stock subject to any option surrendered for an
appreciation distribution pursuant to this Section IV shall not be available for
subsequent option grant under the Plan.
     V. EXTENSION OF EXERCISE PERIOD
          The Plan Administrator shall have full power and authority,
exercisable either at the time the option is granted or at any time while the
option remains outstanding, to extend the

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period of time for which any option granted under this Article Two is to remain
exercisable following the optionee’s cessation of Service or death from the
limited period in effect under Section I.C.1 of Article Two to such greater
period of time as the Plan Administrator shall deem appropriate; provided,
however, that in no event shall such option be exercisable after the specified
expiration date of the option term.
ARTICLE THREE
STOCK ISSUANCE PROGRAM
     I. STOCK ISSUANCE TERMS
Shares of Common Stock may be issued under the Stock Issuance Program through
direct and immediate issuances without any intervening option grants. Each such
stock issuance shall be evidenced by a Stock Issuance Agreement which complies
with the terms specified below. Shares of Common Stock may also be issued under
the Stock Issuance Program pursuant to share right awards which entitle the
recipients to receive shares upon the attainment of designated Service and/or
performance goals.
          A. Purchase Price.
               1. The purchase price per share shall be fixed by the Plan
Administrator, but shall not be less than one hundred percent (100%) of the fair
market value per share of Common Stock on the issuance date.
               2. Shares of Common Stock may be issued under the Stock Issuance
Program for any of the following items of consideration which the Plan
Administrator may deem appropriate in each individual instance:

  (i)   cash or check made payable to the Company, or     (ii)   services
rendered to the Company (or any parent or subsidiary).

          B. Vesting Provisions.
               1. The Plan Administrator may issue shares of Common Stock under
the Stock Issuance Program which are fully and immediately vested upon issuance
or which are to vest in one or more installments over the participant’s period
of Service or upon attainment of specified performance objectives.
Alternatively, the Plan Administrator may issue share right awards under the
Stock Issuance Program which shall entitle the recipient to receive a specified
number of shares of Common Stock upon the attainment of one or more Service
and/or performance goals established by the Plan Administrator. Upon the
attainment of such Service and/or performance goals, fully-vested shares of
Common Stock shall be issued in satisfaction of those share right awards.
               2. Any new, substituted or additional securities or other
property (including money paid other than as a regular cash dividend) issued by
reason of

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any stock dividend, stock split, recapitalization, combination of shares,
exchange of shares or other change affecting the outstanding Common Stock as a
class without the Company’s receipt of consideration, shall be issued or set
aside with respect to the shares of unvested Common Stock granted to a
participant or subject to a participant’s share right award, subject to (i) the
same vesting requirements applicable to the participant’s unvested shares of
Common Stock or share rights award, and (ii) such escrow arrangements as the
Plan Administrator shall deem appropriate.
               3. The participant shall have full stockholder rights with
respect to any shares of Common Stock issued to the participant under the Stock
Issuance Program, whether or not the participant’s interest in those shares is
vested. Accordingly, the participant shall have the right to vote such shares
and to receive any regular cash dividends paid on such shares.
               4. The participant shall not have any stockholders rights with
respect to any shares of Common Stock subject to a share right award. However,
the Plan Administrator may provide for a participant to receive one or more
dividend equivalents with respect to such shares, entitling the participant to
all regular cash dividends payable on the shares of Common Stock underlying the
share right award, which amounts shall be (i) subject to the same vesting
requirements applicable to the shares of Common Stock underlying the share
rights award, and (ii) payable upon issuance of the shares to which such
dividend equivalents relate.
               5. Should the participant cease to remain in Service while
holding one or more unvested shares of Common Stock issued under the Stock
Issuance Program or should the performance objectives not be attained with
respect to one or more such unvested shares of Common Stock, then those shares
shall be immediately surrendered to the Company for cancellation, and the
participant shall have no further stockholder rights with respect to those
shares. To the extent the surrendered shares were previously issued to the
participant for consideration paid in cash, the Company shall repay to the
participant the cash consideration paid for the surrendered shares.
               6. The Plan Administrator may in its discretion waive the
surrender and cancellation of one or more unvested shares of Common Stock which
would otherwise occur upon the cessation of the Participant’s Service or the
non-attainment of the performance objectives applicable to those shares. Such
waiver shall result in the immediate vesting of the participant’s interest in
the shares of Common Stock as to which the waiver applies. Such waiver may be
effected at any time, whether before or after the participant’s cessation of
Service or the attainment or non-attainment of the applicable performance
objectives.
               7. Outstanding share right awards under the Stock Issuance
Program shall automatically terminate, and no shares of Common Stock shall
actually be issued in satisfaction of those awards, if the Service and/or
performance goals established for such awards are not attained. The Plan
Administrator, however, shall have the discretionary authority to issue shares
of Common Stock in satisfaction of one or more outstanding share right awards as
to which the designated Service and/or performance

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goals are not attained. Such authority may be exercised at any time, whether
before or after the participant’s cessation of Service or the attainment or
non-attainment of the applicable performance objectives.
     II. CORPORATE TRANSACTION/CHANGE IN CONTROL
          A. All of the Company’s outstanding repurchase rights under the Stock
Issuance Program shall terminate automatically, and all the shares of Common
Stock subject to those terminated rights shall immediately vest in full, in the
event of any Corporate Transaction, except to the extent (i) those repurchase
rights are to be assigned to the successor corporation (or parent thereof) in
connection with the such Corporate Transaction, or (ii) such accelerated vesting
is precluded by other limitations imposed in the Stock Issuance Agreement,
unless the Plan Administrator determines to waive such limitations.
          B. Each repurchase right which is assigned in connection with (or is
otherwise to continue in effect after) a Corporate Transaction shall be
appropriately adjusted such that it shall apply and pertain to the number and
class of securities issued to the participant in consummation of the Corporate
Transaction with respect to the shares granted to participant under this
Article Three.
          C. All of the Company’s outstanding repurchase rights under the Stock
Issuance Program shall automatically terminate, and all shares of Common Stock
subject to those terminated rights shall immediately vest, in the event of any
Change in Control.
          D. All shares of Common Stock underlying outstanding share right
awards issued under the Stock Issuance Program shall vest, and all of the shares
of Common Stock subject to such share right awards shall be issued to
participants, immediately prior to the consummation of any Corporate Transaction
or Change in Control.
     III. SHARE ESCROW / LEGENDS
          Unvested shares may, in the Plan Administrator’s discretion, be held
in escrow by the Company until the participant’s interest in such shares vests
or may be issued directly to the participant with restrictive legends on the
certificates evidencing those unvested shares.

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ARTICLE FOUR
AUTOMATIC OPTION GRANT PROGRAM
     I. ELIGIBILITY.
          The individuals eligible to receive automatic option grants pursuant
to the provisions of this Article Four shall be (i) those individuals who, after
the effective date of this amendment and restatement, first become non-employee
Board members, whether through appointment by the Board, election by the
Company’s stockholders, or by continuing to serve as a Board member after
ceasing to be employed by the Company, and (ii) those individuals already
serving as non-employee Board members on the effective date of this amendment
and restatement. As used herein, a “non-employee” Board member is any Board
member who is not employed by the Company on the date in question.
     II. TERMS AND CONDITIONS OF AUTOMATIC OPTION GRANTS
          A. Grants. Option grants shall be made under this Article Four as
follows:
               1. Each individual who first becomes a non-employee Board member
on or after the effective date of this amendment and restatement shall
automatically be granted at such time a non-statutory stock option under the
terms and conditions of this Article Four, to purchase a number shares of Common
Stock equal to the product of (i) 25,000, and (ii) a fraction, the numerator of
which is the number of months (rounded to the nearest whole number) remaining
between the date such Board member first became a non-employee Board member and
the Company’s next scheduled Annual Stockholders Meeting, and the denominator of
which is 12.
               2. Immediately following each Annual Stockholders Meeting of the
Company, each individual who is then serving as a non-employee Board member
(except for those individuals first elected to serve as non-employee Board
members at such meeting), shall automatically be granted a non-statutory stock
option under this Article Four to acquire 15,000 shares of Common Stock.
          B. Exercise Price. The exercise price per share of each automatic
option grant made under this Article Four shall be equal to one hundred percent
(100%) of the fair market value per share of Common Stock on the automatic grant
date.
          C. Payment. The exercise price shall be payable in one of the
alternative forms specified below:
               (1) payment in cash or check made payable to the Company’s order;
or
               (2) full payment in shares of Common Stock held for the requisite
period necessary to avoid a charge to the Company’s reported earnings and valued
at fair market value on the Exercise Date (as such term is defined below); or

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               (3) full payment in a combination of shares of Common Stock held
for the requisite period necessary to avoid a charge to the Company’s reported
earnings and valued at fair market value on the Exercise Date and cash or check
payable to the Company’s order; or
               (4) full payment through a sale and remittance procedure pursuant
to which the non-employee Board member (I) shall provide irrevocable written
instructions to a designated brokerage firm to effect the immediate sale of the
purchased shares and remit to the Company, out of the sale proceeds available on
the settlement date, sufficient funds to cover the aggregate exercise price
payable for the purchased shares and shall (II) concurrently provide written
directives to the Company to deliver the certificates for the purchased shares
directly to such brokerage firm in order to complete the sale transaction.
     For purposes of this subparagraph C, the Exercise Date shall be the date on
which written notice of the option exercise is delivered to the Company. Except
to the extent the sale and remittance procedure specified above is utilized for
the exercise of the option, payment of the option price for the purchased shares
must accompany the exercise notice.
          D. Option Term. Each automatic grant under this Article Four shall
have a term of ten (10) years measured from the automatic grant date.
          E. Exercisability.
               1. Each initial automatic grant made pursuant to Section II.A.1
of this Article Four shall vest and become exercisable over the period extending
from the date of grant to the scheduled date of the next Annual Stockholders
Meeting following the grant. A pro rata portion of such automatic grant shall
vest on the last day of each calendar month following the date of grant, with
the final portion vesting on the scheduled date of such Annual Stockholders
Meeting.
               2. Each 15,000 share automatic grant made pursuant to
Section II.A.2 of this Article Four shall vest and become exercisable for 1/12th
of the option shares upon the optionee’s completion of each month of Board
service over the twelve (12)-month period measured from the automatic grant
date.
          F. Non-Transferability. During the lifetime of the optionee, each
automatic option grant, together with the limited stock appreciation right
pertaining to such option, shall be exercisable only by the optionee, except to
the extent such option or the limited stock appreciation right is assigned or
transferred (i) by will or by the laws of descent and distribution following the
optionee’s death, or (ii) during optionee’s lifetime either (A) as a gift in
connection with the optionee’s estate plan to one or more members of optionee’s
immediate family, to a trust in which optionee and/or one or more such family
members hold more than fifty percent (50%) of the beneficial interest or to an
entity in which more than fifty percent (50%) of the voting interests are owned
by optionee and/or one or more such family members, or (B) pursuant to a
domestic relations order. The portion of any option assigned or transferred
during optionee’s lifetime shall be exercisable only by the person or persons
who acquire a proprietary interest in the option pursuant to such assignment.
The terms applicable to the assigned portion shall be the same as those in
effect for this option immediately prior to such assignment and shall

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be set forth in such documents issued to the assignee as the Plan Administrator
may deem appropriate.
          G. Cessation of Board Service.
               1. Should the optionee cease to serve as a Board member for any
reason while holding one or more automatic option grants under this
Article Four, then such optionee shall have the remainder of the ten (10) year
term of each such option in which to exercise each such option for any or all of
the shares of Common Stock for which the option is exercisable at the time of
such cessation of Board service. Each such option shall immediately terminate
and cease to be outstanding, at the time of such cessation of Board service,
with respect to any shares for which the option is not otherwise at that time
exercisable. Upon the expiration of the ten (10)-year option term, the automatic
grant shall terminate and cease to be outstanding in its entirety. Upon the
death of the optionee, whether before or after cessation of Board service, any
option held by optionee at the time of optionee’s death may be exercised, for
any or all of the shares of Common Stock for which the option was exercisable at
the time of cessation of Board service by the optionee and which have not been
theretofore exercised by the optionee, by the personal representative of the
optionee’s estate or by the person or persons to whom the option is transferred
pursuant to the optionee’s will or in accordance with the laws of descent and
distribution. Any such exercise must occur during the reminder of the ten
(10) year term of such option.
               H. Stockholder Rights. The holder of an automatic option grant
under this Article Four shall have none of the rights of a stockholder with
respect to any shares subject to such option until such individual shall have
exercised the option and paid the exercise price for the purchased shares.
     III. CORPORATE TRANSACTIONS/CHANGES IN CONTROL
          A. In the event of a Corporate Transaction, the exercisability of each
option outstanding under this Article Four shall automatically accelerate so
that each such option shall, immediately prior to the specified effective date
for the Corporate Transaction, become fully exercisable with respect to the
total number of shares of Common Stock at the time subject to such option and
may be exercised for all or any portion of such shares.
          B. Immediately after the consummation of the Corporate Transaction,
all outstanding options under this Article Four shall terminate and cease to be
outstanding, except to the extent assumed by the successor corporation or its
parent company. If so provided by the terms of the Corporate Transaction, the
optionee shall receive a cash payment on account of any option terminated in
accordance with this paragraph, in an amount equal to the excess (if any) of
(A) the fair market value of the shares subject to the option as valued pursuant
to the Corporate Transaction over (B) the aggregate exercise price of the
option.
          C. Each outstanding option under this Article Four which is assumed in
connection with the Corporate Transaction or is otherwise to continue in effect
shall be appropriately adjusted, immediately after such Corporate Transaction,
to apply and pertain to the

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number and class of securities which would have been issued to the option
holder, in consummation of such Corporate Transaction, had such person exercised
the option immediately prior to such Corporate Transaction. Appropriate
adjustments shall also be made to the option price payable per share, provided
the aggregate option price payable for such securities shall remain the same.
          D. In connection with any Change in Control, the exercisability of
each option grant outstanding at the time under this Article Four shall
automatically accelerate so that each such option shall, immediately prior to
the specified effective date for the Change in Control, become fully exercisable
with respect to the total number of shares of Common Stock at the time subject
to such option and may be exercised for all or any portion of such shares.
          E. The automatic grant of options under this Article Four shall in no
way affect the right of the Company to adjust, reclassify, reorganize or
otherwise change its capital or business structure or to merge, consolidate,
dissolve, liquidate or sell or transfer all or any part of its business or
assets.
     IV. STOCK APPRECIATION RIGHTS
          A. With respect to options granted under the Automatic Option Grant
Program prior to March 7, 2006:
               1. Upon the occurrence of a Hostile Take-Over, the optionee shall
have a thirty (30)-day period in which to surrender to the Company each option
held by him or her under this Article Four. The optionee shall in return be
entitled to a cash distribution from the Company in an amount equal to the
excess of (i) the Take-Over Price of the shares of Common Stock at the time
subject to each surrendered option (whether or not the option is then
exercisable for those shares) over (ii) the aggregate exercise price payable for
such shares. The cash distribution shall be made within five (5) days following
the date the option is surrendered to the Company, and neither the approval of
the Plan Administrator nor the consent of the Board shall be required in
connection with the option surrender and cash distribution. Any unsurrendered
portion of the option shall continue to remain outstanding and become
exercisable in accordance with the terms of the instrument evidencing such
grant. This limited stock appreciation right shall in all events terminate upon
the expiration or sooner termination of the option term and may not be assigned
or transferred by the optionee.
               2. For purposes of Article Four, the following definitions shall
be in effect:
                    (i) A Hostile Take-Over shall be deemed to occur in the
event any person or related group of persons (other than the Company or a person
that directly or indirectly controls, is controlled by, or is under common
control with, the Company) directly or indirectly acquires beneficial ownership
(within the meaning of Rule 13d-3 of the 1934 Act, as amended) of securities
possessing more than fifty percent (50%) of the total combined voting power of
the Company’s outstanding securities pursuant to a tender or exchange offer made

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directly to the Company’s stockholders which the Board does not recommend such
stockholders to accept.
                    (ii) The Take-Over Price per share shall be deemed to be
equal to the fair market value per share on the option surrender date.
          B. With respect to each option granted under the Automatic Option
Grant Program on and after March 7, 2006, each optionee shall have the right to
surrender all or part of the option (to the extent not then exercised) in
exchange for a distribution from the Company in an amount equal to the excess of
(i) the fair market value (on the option surrender date) of the number of shares
in which the optionee is at the time vested under the surrendered option (or
surrendered portion thereof) over (ii) the aggregate option price payable for
such vested shares. The distribution shall be made in shares of Common Stock
valued at fair market value on the option surrender date.
          C. The shares of Common Stock subject to any option surrendered for an
appreciation distribution pursuant to this Section IV shall not be available for
subsequent option grant under the Plan.
ARTICLE FIVE
MISCELLANEOUS
     I. AMENDMENT OF THE PLAN
          The Board shall have complete and exclusive power and authority to
amend or modify the Plan in any or all respects whatsoever. However, no such
amendment or modification shall, without the consent of the holders, adversely
affect rights and obligations with respect to options at the time outstanding
under the Plan. In addition, certain amendments may require stockholder approval
pursuant to applicable laws or regulations.
     II. TAX WITHHOLDING
          A. The Company’s obligation to deliver shares or cash upon the
exercise of stock options or stock appreciation rights or upon the grant or
vesting of direct stock issuances under the Plan shall be subject to the
satisfaction of all applicable Federal, State and local income and employment
tax withholding requirements.
          B. The Plan Administrator may, in its discretion and upon such terms
and conditions as it may deem appropriate, provide any or all holders of
outstanding options or stock issuances under the Plan (other than the automatic
option grants under Article Four) with the election to have the Company
withhold, from the shares of Common Stock otherwise issuable upon the exercise
or vesting of such awards, a whole number of such shares with an aggregate fair
market value equal to the minimum amount necessary to satisfy the Federal, State
and local income and employment tax withholdings (the “Taxes”) incurred in
connection with the

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acquisition or vesting of such shares. In lieu of such direct withholding, one
or more participants may also be granted the right to deliver whole shares of
Common Stock to the Company in satisfaction of such Taxes. Any withheld or
delivered shares shall be valued at their fair market value on the applicable
determination date for such Taxes.
     III. EFFECTIVE DATE AND TERM OF PLAN
          A. The Plan, as amended and restated, shall be effective on the date
specified in the Board of Directors resolution adopting the Plan. Except as
provided below, each option issued and outstanding under the Plan immediately
prior to such effective date shall continue to be governed solely by the terms
and conditions of the agreement evidencing such grant, and nothing in this
restatement of the Plan shall be deemed to affect or otherwise modify the rights
or obligations of the holders of such options with respect to their acquisition
of shares of Common Stock thereunder. The Plan Administrator shall, however,
have full power and authority, under such circumstances as the Plan
Administrator may deem appropriate (but in accordance with Section I of this
Article Five), to extend one or more features of this amendment and restatement
to any options outstanding on the effective date.
          B. Unless sooner terminated in accordance with the other provisions of
this Plan, the Plan shall terminate upon the earlier of (i) March 6, 2016 or
(ii) the date on which all shares available for issuance under the Plan shall
have been issued or cancelled pursuant to the exercise, surrender or cash-out of
the options granted hereunder. If the date of termination is determined under
clause (i) above, then any options or stock issuances outstanding on such date
shall continue to have force and effect in accordance with the provisions of the
agreements evidencing those awards.
          C. Options may be granted with respect to a number of shares of Common
Stock in excess of the number of shares at the time available for issuance under
the Plan, provided each granted option is not to become exercisable, in whole or
in part, at any time prior to stockholder approval of an amendment authorizing a
sufficient increase in the number of shares issuable under the Plan.
     IV. USE OF PROCEEDS
          Any cash proceeds received by the Company from the sale of shares
pursuant to options or stock issuances granted under the Plan shall be used for
general corporate purposes.
     V. REGULATORY APPROVALS
          A. The implementation of the Plan, the granting of any option
hereunder, and the issuance of stock (i) upon the exercise or surrender of any
option or (ii) under the Stock Issuance Program shall be subject to the
procurement by the Company of all approvals and permits required by regulatory
authorities having jurisdiction over the Plan, the options granted under it and
the stock issued pursuant to it.
          B. No shares of Common Stock or other assets shall be issued or
delivered under the Plan unless and until there shall have been compliance with
all applicable requirements of Federal and state securities laws, including (to
the extent required) the filing and effectiveness

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of the Form S-8 registration statement for the shares of Common Stock issuable
under the Plan, and all applicable listing requirements of any stock exchange
(or the Nasdaq National Market, the Nasdaq Global Select Market or any successor
system, if applicable) on which Common Stock is then trading.
     VI. NO EMPLOYMENT/SERVICE RIGHTS
          Neither the action of the Company in establishing or restating the
Plan, nor any action taken by the Plan Administrator hereunder, nor any
provision of the Plan shall be construed so as to grant any individual the right
to remain in the employ or service of the Company (or any parent or subsidiary
corporation) for any period of specific duration, and the Company (or any parent
or subsidiary corporation retaining the services of such individual) may
terminate such individual’s employment or service at any time and for any
reason, with or without cause.
     VII. MISCELLANEOUS PROVISIONS
          A. Except to the extent otherwise expressly provided in the Plan, the
right to acquire Common Stock or other assets under the Plan may not be
assigned, encumbered or otherwise transferred by any participant.
          B. The provisions of the Plan relating to the exercise of options and
the issuance and/or vesting of shares shall be governed by the laws of the State
of Alabama without resort to that state’s conflict-of-laws provisions, as such
laws are applied to contracts entered into and performed in such State.

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