Exhibit 4.3


 


INFOSONICS
CORPORATION


2003 STOCK OPTION
PLAN


 


As Adopted As Of September 30,
2003


 


This 2003 Stock Option
Plan (the “Plan”) is adopted by InfoSonics Corporation (the “Company”)
effective as of September 30, 2003.


 


1.                                       Definitions.


 


Unless otherwise
indicated or required by the particular context, the terms used in this Plan
shall have the following meanings:


 


Board:  The Board Of Directors of the Company.


 


Code:  The Internal Revenue Code of 1986, as
amended.


 


Common Stock:  The $.001 par value common stock of the
Company.


 


Company:  InfoSonics Corporation, a corporation
incorporated under the laws of Maryland, any current or future wholly owned
subsidiaries of the Company, and any successors in interest by merger,
operation of law, assignment or purchase of all or substantially all of the
property, assets or business of the Company.


 


Date Of Grant:  The date on which an Option, as defined
below, is granted under the Plan.


 


Fair Market Value:  The Fair Market Value of the Option Shares
(defined below).  The Fair Market Value
as of any date shall be as reasonably determined by the Option Committee
(defined below); provided, however, that if there is a public market for the
Common Stock, the Fair Market Value of the Option Shares as of any date shall
not be less than the last reported sale price for the Common Stock on that date
(or on the preceding stock market business day if such date is a Saturday,
Sunday, or a holiday), on the New York Stock Exchange (“NYSE”), as reported in
The Wall Street Journal, or if not reported in The Wall Street Journal, as
reported in The Denver Post, Denver, Colorado or, if no last sale price for the
NYSE is available, then the last reported sale price on either another stock
exchange or on a national or local over-the-counter market, as reported by The
Wall Street Journal, or if not available there, in The Denver Post; provided
further, that if no such published last sale price is available and a published
bid price is available from one of those sources, then the Fair Market Value of
the shares shall not be less than such last reported bid price for the Common
Stock by the National Quotation Bureau, and if no such published bid price is
available, the Fair Market Value of such shares shall not be less than the
average of the bid prices quoted as of the close of business on that date by
any two independent persons or entities making a market for the Common Stock,
such persons or entities to be selected by the Option Committee.


 


Incentive Options:  “Incentive stock options” as that term is
defined in Code Section 422 or the successor to that Section.


 


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Key Employee:  A person designated by the Option Committee
who is employed by the Company and whose continued employment is considered to
be in the best interests of the Company provided; however, that Key Employees
shall not include those members of the Board who are not employees of the
Company.


 


Key Individual:  A person, other than an employee of the
Company, who is committed to the interests of the Company; provided, however,
that Key Individuals shall not include those members of the Board who are not
employees of the Company.


 


Non-Discretionary
Options:  Options
granted to Non-Employee Directors according to the formula set forth in Section 8
of this Plan.


 


Non-Employee
Director:  A director
of the Company who (a) is not currently an officer of the Company or a
parent or subsidiary of the Company, or otherwise currently employed by the
Company or a parent or subsidiary of the Company, (b) does not receive
compensation, either directly or indirectly, from the Company or a parent or
subsidiary of the Company, for services rendered as a consultant or in any
capacity other than as a director, except for an amount that does not exceed
the dollar amount for which disclosure would be required pursuant to Regulation
S-K, Item 404(a), under the Securities Act of 1933, as amended, (c) does
not possess an interest in any other transaction for which disclosure by the
Company would be required pursuant to Regulation S-K, Item 404(a), and (d) is
not engaged in a business relationship for which disclosure by the Company
would be required pursuant to Regulation S-K, Item 404(a).


 


Non-Qualified
Options:  Options that
are not intended to qualify, or otherwise do not qualify, as “incentive stock
options” under Code Section 422 or the successor to that Section.  To the extent that Options that are
designated by the Option Committee as Incentive Options do not qualify as “incentive
stock options” under Code Section 422 or the successor to that Section,
those Options shall be treated as Non-Qualified Options.


 


Option:  The rights to purchase Common Stock granted
pursuant to the terms and conditions of an Option Agreement (defined below).


 


Option Agreement:  The written agreement (including any
amendments or supplements thereto) between the Company and either a Key
Employee or a Key Individual or a Non-Employee Director designating the terms
and conditions of an Option.


 


Option Committee:  The Plan shall be administered by an Option
Committee (“Option Committee”) composed of the Board or by a committee,
selected by the Board, consisting of two or more Directors, each of whom is a
Non-Employee Director.


 


Option Shares:  The shares of Common Stock underlying an
Option granted pursuant to this Plan.


 


Optionee:  A Key Employee, Key Individual or
Non-Employee Director who has been granted an Option.


 


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2.                                       Purpose
And Scope.


 


(a)                                  The
purpose of the Plan is to advance the interests of the Company and its
stockholders by affording Key Employees, Key Individuals, and Non-Employee
Directors upon whose initiative and efforts, in the aggregate, the Company is
largely dependent for the successful conduct of its business, an opportunity
for investment in the Company and the incentive advantages inherent in stock
ownership in the Company.


 


(b)                                 This
Plan authorizes the Option Committee to grant Incentive Options to Key
Employees and to grant Non-Qualified Options to Key Employees and Key
Individuals, selected by the Option Committee while considering criteria such
as employment position or other relationship with the Company, duties and
responsibilities, ability, productivity, length of service or association,
morale, interest in the Company, recommendations by supervisors, the interests
of the Company, and other matters.  This
Plan also provides that Non-Discretionary Options shall be granted to
Non-Employee Directors pursuant to the formula set forth in Section 8 of
this Plan.


 


3.                                       Administration
Of The Plan.


 


(a)                                  Except
with respect to the grant of Non-Discretionary Options, which shall be granted
in the manner set forth in Section 8 of this Plan, the Plan shall be
administered by the Option Committee. 
The Option Committee shall have the authority granted to it under this Section and
under each other section of the Plan.


 


(b)                                 In
accordance with and subject to the provisions of the Plan, the Option Committee
shall select the Optionees and shall determine (i) the number of shares of
Common Stock to be subject to each Incentive Option and Non-Qualified Option, (ii) the
time at which each Incentive Option and Non-Qualified Option is to be granted, (iii) whether
an Incentive Option and Non-Qualified Option shall be granted in exchange for
the cancellation and termination of a previously granted option or options
under the Plan or otherwise, (iv) the purchase price for the Incentive
Option and Non-Qualified Option Shares, provided that the purchase price shall
be a fixed, and cannot be a fluctuating, price, (v) the option period,
including provisions for the termination of the Option prior to the expiration
of the exercise period upon the occurrence of certain events, (vi) the
manner in which an Incentive Option and Non-Qualified Option becomes
exercisable, including whether portions of the Incentive Option and
Non-Qualified Option become exercisable at different times, and (vii) such
other terms and conditions as the Option Committee may deem necessary or
desirable.  The Option Committee shall
determine the form of Option Agreement to evidence each Option.


 


(c)                                  The
Option Committee from time to time may adopt such rules and regulations
for carrying out the purposes of the Plan as it may deem proper and in the best
interests of the Company.  The Option
Committee shall keep minutes of its meetings and those minutes shall be
distributed to every member of the Board.


 


(d)                                 The
Board from time to time may make such changes in and additions to the Plan as
it may deem proper and in the best interests of the Company provided, however,
that no such change or addition shall impair any Option previously granted
under the Plan, and that the approval by written consent of a majority of the
holders of the Company’s securities entitled to vote, or by the affirmative
votes of the holders of a majority of the Company’s securities entitled to vote
at a meeting


 


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duly held in accordance
with the applicable laws of the State of Maryland, shall be required for any
amendment which would do any of the following:


 


(i)                                     materially modify
the eligibility requirements for receiving Options under the Plan;


 


(ii)                                  materially increase
the benefits accruing to Key Employees, Key Individuals, or Non-Employee
Directors under the Plan; or


 


(iii)                               materially increase the
number of shares of Common Stock that may be issued under the Plan.


 


(e)                                  Each
determination, interpretation or other action made or taken by the Option
Committee, unless otherwise determined by the Board, shall be final, conclusive
and binding on all persons, including without limitation, the Company, the
stockholders, directors, officers and employees of the Company, and the
Optionees and their respective successors in interest.  No member of the Option Committee shall be
personally liable for any action, determination, or interpretation made in good
faith with respect to the Plan, and all members of the Option Committee shall
be, in addition to rights they may have as directors of the Company, fully
protected by the Company with respect to any such action, determination or
interpretation.  If the Board makes a
determination contrary to the Option Committee’s determination, interpretation
or other action, then the Board’s determination shall be final and conclusive
in the same manner.


 


4.                                       The
Common Stock.


 


The Board is authorized
to appropriate, issue and sell for the purposes of the Plan, and the Option
Committee is authorized to grant Options with respect to a total number not in
excess of 1,400,000 shares of Common Stock, either treasury or authorized and
unissued, or the number and kind of shares of stock or other securities which
in accordance with Section 10 shall be substituted for the 1,400,000
shares or into which such 1,400,000 shares shall be adjusted.  All or any unsold shares subject to an Option
that for any reason expires or otherwise terminates before it has been
exercised, again may be made subject to Options under the Plan.


 


5.                                       Eligibility.


 


Incentive Options may be
granted only to Key Employees.  Non-Qualified Options may be granted both to
Key Employees and to Key Individuals. 
Key Employees and Key Individuals may hold more than one Option under
the Plan and may hold Options under the Plan as well as options granted
pursuant to other plans or otherwise. 
Non-Discretionary Options may be granted only to Non-Employee Directors.


 


6.                                       Option
Price.


 


The Option Committee
shall determine the purchase price for the Option Shares; provided, however,
that with respect to Option Shares underlying Incentive Options (a) the
purchase price shall not be less than 100 percent of the Fair Market Value of
the Option Shares on the Date Of Grant and (b) the purchase price shall be
a fixed, and cannot be a fluctuating, price. 
The Option Price for Option Shares underlying Non-Discretionary Options
shall be the Fair Market Value of the Common Stock on the Date Of Grant.


 


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7.                                       Duration
And Exercise Of Options.


 


(a)                                  Except
as provided in Section 8 with respect to Non-Discretionary Options and
except as provided in Section 18, the option period shall commence on the
Date Of Grant and shall continue for the period designated by the Option
Committee up to a maximum of ten years from the Date Of Grant.


 


(b)                                 During
the lifetime of the Optionee, the Option shall be exercisable only by the
Optionee; provided that, subject to the following sentence and paragraph (d) of
this Section 7, in the event of the legal disability of an Optionee, the
guardian or personal representative of the Optionee may exercise the
Option.  If the Option is an Incentive
Option it may be exercised by the guardian or personal representative of the
Optionee only if the guardian or personal representative obtains a ruling from
the Internal Revenue Service or an opinion of counsel to the effect that
neither the grant nor the exercise of such power is violative of Code Section 422(b)(5) or
the successor to that provision.  Any
opinion of counsel must be both from counsel acceptable to the Option Committee
and in a form acceptable to the Option Committee.


 


(c)                                  If
the Optionee’s employment or affiliation with the Company is terminated for any
reason including the Optionee’s death, any Option then held, to the extent that
the Option was exercisable according to its terms on the date of termination,
may be exercised only to the extent determined by the Option Committee at the
time of grant of the Option, but in no case more than three months after
termination.  Any options remaining
unexercised shall expire at the later of termination or the end of the extended
exercise period, if any.


 


(d)                                 Each
Option shall be exercised in whole or in part by delivering to the office of
the Treasurer of the Company written notice of the number of shares with
respect to which the Option is to be exercised and by paying in full the
purchase price for the Option Shares purchased as set forth in Section 9
herein; provided, that an Option may not be exercised in part unless the
purchase price for the Option Shares purchased is at least $1,000.


 


(e)                                  No
Option Shares may be sold, transferred or otherwise disposed of within six
months of the Date Of Grant by any person who is subject to the reporting
requirements of Section 16(a) of the Exchange Act on the Date Of
Grant.


 


8.                                       Non-Discretionary
Options.


 


(a)                                  Grant
Of Non-Discretionary Options: Amount And Timing.  An initial grant of Non-Discretionary Options
to purchase 15,000 shares of Common Stock shall be granted under the Plan to
each Non-Employee Director at the later to occur of (i) the first business
day after the meeting of stockholders at which this Plan is approved by the
Company’s stockholders and (ii) the date he or she becomes a Non-Employee
Director of the Company (other than pursuant to an election by the Company’s
stockholders at an annual meeting of stockholders of the Company).  The Chair of the Audit Committee of the Board
of Directors shall receive additional options to purchase 5,000 shares of
Common Stock at the time of election as Chair of that Committee.  In addition, on the first business day after
the date on which all of a Non-Employee Director’s option or options granted to
the Chair of the Audit Committee have become exercisable pursuant to Section 8(c) below,
Non-Discretionary Options to purchase an additional 15,000 shares, or 5,000
additional shares in the case of the Chair of the Audit Committee, shall be
granted to the Optionee provided that, at that time, he


 


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or she is a Non-Employee
Director.  All Non-Discretionary Options
shall be exercisable only as set forth in Section 8(c) below and
shall be subject to the other terms and conditions set forth in this Plan or
otherwise established by the Company.


 


(b)                                 Option
Exercise Price.  The exercise price
for the Non-Discretionary Options shall be the Fair Market Value of the Common
Stock on the Date Of Grant.


 


(c)                                  Exercise.  One-third of the Non-Discretionary Options
granted to Non-Employee Directors pursuant to this Section 8 shall become
exercisable on December 31 of the first three years following the Date of
Grant.


 


(d)                                 Term.  The Non-Discretionary Options shall expire
five years after the Date Of Grant. 
Notwithstanding the foregoing, Non-Discretionary Options shall expire,
if not exercised, 90 days after the Optionee ceases to be a director of the
Company.


 


9.                                       Payment
For Option Shares.


 


(a)                                  If
the purchase price of the Option Shares purchased by any Optionee at one time
is at least $1,000, the Option Committee, in its sole discretion, upon request
by the Optionee, may permit all or part of the purchase price for the Option
Shares to be paid by delivery to the Company for cancellation shares of the
Common Stock previously owned by the Optionee (“Previously Owned Shares”) with
a Fair Market Value as of the date of the payment equal to the portion of the
purchase price for the Option Shares that the Optionee does not pay in
cash.  Notwithstanding the above, an
Optionee shall be permitted to exercise his Option by delivering Previously
Owned Shares only if he has held, and provides appropriate evidence of such,
the Previously Owned Shares for more than six months prior to the date of
exercise.  This period (the “Holding
Period”) may be extended by the Option Committee acting in its sole discretion
as is necessary, in the opinion of the Option Committee, so that, under
generally accepted accounting principles, no compensation shall be considered
to have been or to be paid to the Optionee as a result of the exercise of the
Option in this manner.  At the time the
Option is exercised, the Optionee shall provide an affidavit, and such other
evidence and documents as the Option Committee shall request, to establish the
Optionee’s Holding Period.  As indicated
above, an Optionee may deliver shares of Common Stock as part of the purchase
price only if the Option Committee, in its sole discretion agrees, on a
case-by-case basis, to permit this form of payment.


 


(b)                                 If
payment for the exercise of an Option is made other than by the delivery to the
Company for cancellation of shares of the Common Stock, the purchase price
shall be paid in cash, certified funds, or Optionee’s check.  Payment shall be considered made when the
Treasurer of the Company receives delivery of the payment at the Company’s
address, provided that a payment made by check is honored when first presented
to the Optionee’s bank.


 


10.                                 Change
In Stock, Adjustments, Etc.


 


In the event that each of
the outstanding shares of Common Stock (other than shares held by dissenting
stockholders which are not changed or exchanged) should be changed into, or
exchanged for, a different number or kind of shares of stock or other
securities of the Company, or if further changes or exchanges of any stock or
other securities into which the Common Stock shall have been changed, or for
which it shall have been exchanged, shall be made (whether by reason of merger,


 


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consolidation,
reorganization, recapitalization, stock dividends, reclassification, split-up,
combination of shares or otherwise), then there shall be substituted for each
share of Common Stock that is subject to the Plan but not subject to an
outstanding Option hereunder, the number and kind of shares of stock or other
securities into which each outstanding share of Common Stock (other than shares
held by dissenting stockholders which are not changed or exchanged) shall be so
changed or for which each outstanding share of Common Stock (other than shares
held by dissenting stockholders) shall be so 
changed or for which each such share shall be exchanged.  Any securities so substituted shall be
subject to similar successive adjustments.


 


In the event of any such
changes or exchanges, (i) the Option Committee shall determine whether, in
order to prevent dilution or enlargement of rights, an adjustment should be
made in the number, or kind, or option price of the shares or other securities
that are then subject to an Option or Options granted pursuant to the Plan, (ii) the
Option Committee shall make any such adjustment, and (iii) such adjustments
shall be made and shall be effective and binding for all purposes of the Plan.


 


11.                                 Relationship
To Employment Or Position.


 


Nothing contained in the
Plan, or in any Option or Option Share granted pursuant to the Plan, (i) shall
confer upon any Optionee any right with respect to continuance of his
employment by, or position or affiliation with, or relationship to, the
Company, or (ii) shall interfere in any way with the right of the Company
at any time to terminate the Optionee’s employment by, position or affiliation
with, or relationship to, the Company.


 


12.                                 Non-transferability
Of Option.


 


No Option granted under
the Plan shall be transferable by the Optionee, either voluntarily or
involuntarily, except (i) with respect to all Options, by will or the laws
of descent and distribution, or (ii) with respect to Non-Qualified
Options, pursuant to a qualified domestic relations order as defined in the
Code, the Employee Retirement Income Security Act, or rules promulgated
thereunder.  Except as provided in the
preceding sentence, any attempt to transfer the Option shall void the Option.


 


13.                                 Rights
As A Stockholder.


 


No person shall have any
rights as a stockholder with respect to any share covered by an Option until
that person shall become the holder of record of such share and, except as
provided in Section 10, no adjustments shall be made for dividends or
other distributions or other rights as to which there is an earlier record
date.


 


14.                                 Securities
Laws Requirements.


 


No Option Shares shall be
issued unless and until, in the opinion of the Company, any applicable
registration requirements of the Securities Act of 1933, as amended, any
applicable listing requirements of any securities exchange on which stock of
the same class is then listed, and any other requirement of law or of any
regulatory bodies having jurisdiction over such issuance and delivery, have
been fully complied with.  Each Option
Agreement and each Option Share certificate and each Grant Share certificate
may be imprinted with legends reflecting federal and state securities laws


 


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restrictions and
conditions, and the Company may comply therewith and issue “stop transfer”
instructions to its transfer agent and registrar in good faith without liability.


 


15.                                 Disposition
Of Shares.


 


To the extent reasonably
requested by the Company, each Optionee, as a condition of exercise, shall
represent, warrant and agree, in a form of written certificate approved by the
Company, as follows:  (a) that all
Option Shares are being acquired solely for his own account and not on behalf
of any other person or entity; (b) that no Option Shares will be sold or
otherwise distributed in violation of the Securities Act of 1933, as amended,
or any other applicable federal or state securities laws; (c) that he or
she will report all sales of Option Shares to the Company in writing on a form
prescribed by the Company; and (d) that if he or she is subject to
reporting requirements under Section 16(a) of the Exchange Act, (i) he
or she will not violate Section 16(b) of the Exchange Act, (ii) he
or she will furnish the Company with a copy of each Form 4 and Form 5
filed by him or her, and (iii) he or she will timely file all reports
required under the federal securities laws.


 


16.                                 Effective
Date Of Plan; Termination Date Of Plan.


 


Subject to the approval
of the Plan on or before September 30, 2004 by the affirmative vote of the
holders of a majority of the shares of Common Stock entitled to vote and
represented at a meeting duly held in accordance with the applicable laws of
the State of Maryland, the Plan shall be deemed effective as of September 30,
2003.  The Plan shall terminate at
midnight on the date that is ten years from that date, except as to Options
previously granted and outstanding under the Plan at that time.  No Options shall be granted after the date on
which the Plan terminates.  The Plan may
be abandoned or terminated at any earlier time by the Board, except with
respect to any Options then outstanding under the Plan.


 


17.                                 Limitation
On Amount Of Option.


 


The aggregate Fair Market
Value of the Option Shares underlying all Incentive Options that have been
granted to a particular Optionee and that become exercisable for the first time
during the same calendar year shall not exceed $100,000, provided that this
amount shall be increased or decreased, from time to time, as Code Section 422
or the successor to that Section, is amended so that this amount at all times
shall equal the amount of the limitation set forth in the Code.  For purposes of the preceding sentence, Fair
Market Value of the Shares underlying any particular Option shall be determined
as of the date that Option is granted.


 


18.                                 Ten
Percent Stockholder Rule.


 


No Incentive Option may
be granted to a Key Employee who, at the time the Incentive Option is granted,
owns stock possessing more than 10 percent of the total combined voting power
of all classes of stock of the Company or of any “parent corporation” or “subsidiary
corporation”, as those terms are defined in Section 424, or its successor
provision, of the Code, unless at the time the Incentive Option is granted the
purchase price for the Option Shares is at least 110 percent of the Fair Market
Value of the Option Shares on the Date Of Grant and the Incentive Option by its
terms is not exercisable after the expiration of five years from the Date Of
Grant.  For purposes of the preceding
sentence, stock ownership shall be determined as provided in Section 424,
or its successor provision, of the Code.


 


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19.                                 Withholding
Taxes.


 


The Option Agreement
shall provide that the Company may take such steps as it may deem necessary or
appropriate for the withholding of any taxes which the Company is required by
any law or regulation or any governmental authority, whether federal, state or
local, domestic or foreign, to withhold in connection with any Option
including, but not limited to, the withholding of all or any portion of any
payment or the withholding of issuance of Option Shares to be issued upon the
exercise of any Option.


 


20.                                 Effect
Of Changes In Control And Certain Reorganizations.


 


(a)                                  In
event of a Change In Control of the Company (as defined below), then all
Options granted pursuant to the Plan shall become exercisable immediately at
the time of such Change In Control, except that this acceleration would not
occur with respect to any Incentive Options for which the acceleration would
result in a violation of Section 17 of this Plan, and, in addition, the Option
Committee, in its sole discretion, shall have the right, but not the
obligation, to do any or all of the following:


 


(i)                                     provide for an
Optionee to surrender an Option (or portion thereof) and to receive in exchange
a cash payment, for each Option share underlying the surrendered Option, equal
to the excess of the aggregate Fair Market Value of the Option Share on the
date of surrender over the exercise price for the Option Share.  To the extent any Option is surrendered
pursuant to this Subparagraph 20(a) (ii), it shall be deemed to have been
exercised for purposes of Section 4 hereof; and


 


(ii)                                  make
any other adjustments, or take any other action, as the Option Committee, in
its discretion, shall deem appropriate provided that any such adjustments or
actions would not result in an Optionee receiving less value than pursuant to
any or all of Subparagraphs 20(a)(i) or 20(a) (ii) above.


 


For purposes of this Section 20,
a “Change In Control” of the Company shall mean a change in control of a nature
that would be required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A promulgated under the Exchange Act regardless of whether the
Company is then subject to such reporting requirement.


 


(b)                                 In
the event that the Company enters into, or the Board shall propose that the
Company enter into, a Reorganization Event (as defined below), then all Options
granted pursuant to the Plan shall become exercisable immediately at the time
of such Reorganization Event, except that this acceleration would not occur
with respect to any Incentive Options for which the advance would result in a
violation of Section 17 of this Plan, and, in addition, the Option
Committee, in its sole discretion, may make any or all of the following
adjustments:


 


(i)                                     by written notice
to each Optionee provide that such Optionee’s Options shall be terminated or
cancelled, unless exercised within 30


 


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days (or such longer
period as the Option Committee shall determine) after the date of such notice;


 


(ii)                                  provide for
termination or cancellation of an Option in exchange for payment to the
Optionee of an amount in cash or securities equal to the excess, if any, over
the exercise price of that Option of the Fair Market Value of the Option Shares
subject to the Option at the time of such termination or cancellation; and


 


(iii)                               make
any other adjustments, or take any other action, as the Option Committee, in
its discretion, shall deem appropriate, provided that any such adjustments or actions
shall not result in the Optionee receiving less value than is possible pursuant
to any or all of Subparagraphs 20(b)(i) and 20(b)(ii) above.  Any action taken by the Option Committee may
be made conditional upon the consummation of the applicable Reorganization
Event.


 


For purposes of this Section 20,
a “Reorganization Event” shall be deemed to occur if (A) the Company is
merged or consolidated with another corporation, (B) one person becomes
the beneficial owner of all of the issued and outstanding equity securities of
the Company (for purposes of this Section 20(b), the terms “person” and “beneficial
owner” shall have the meanings assigned to them in Section 13(d) of
the Exchange Act and the rules and regulations promulgated thereunder), (C) a
division or subsidiary of the Company is acquired by another corporation,
person or entity, (D) all or substantially all the assets of the Company
are acquired by another corporation, or (E) the Company is reorganized,
dissolved or liquidated.


 


21.                                 Other
Provisions.


 


The following provisions
are also in effect under the Plan:


 


(a)                                  The
use of a masculine gender in the Plan shall also include within its meaning the
feminine, and the singular may include the plural, and the plural may include
the singular, unless the context clearly indicates to the contrary.


 


(b)                                 Any
expenses of administering the Plan shall be borne by the Company.


 


(c)                                  This
Plan shall be construed to be in addition to any and all other compensation
plans or programs.  Neither the adoption
of the Plan by the Board nor the submission of the Plan to the stockholders of
the Company for approval shall be construed as creating any limitations on the
power or authority of the Board to adopt such other additional incentive or
other compensation arrangements as the Board may deem necessary or desirable.


 


(d)                                 The
validity, construction, interpretation, administration and effect of the Plan
and of its rules and regulations, and the rights of any and all persons
having or claiming to have an interest therein or thereunder shall be governed
by and determined exclusively and solely in accordance with the laws of the
State of Maryland.


 


* * * * *


 


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