Unassociated Document


    Exhibit
4.5

    


    NEOSTEM,
INC.

    


    2009
NON-U.S. BASED EQUITY COMPENSATION PLAN

    


    1.           Purposes of the
Plan.  The purposes of this NeoStem, Inc. 2009 Non-U.S. Based
Equity Compensation Plan (the “Plan”) are to provide
additional incentives to Service Providers providing services outside of the
United States, and to promote the success of the Company and its Subsidiaries
abroad. Warrants, Stock Awards, Unrestricted Shares and Stock Appreciation
Rights may be granted under the Plan.

    


    2.           Definitions.  As
used herein, the following definitions shall apply:

    


    “Administrator” means
a Committee which has been delegated the responsibility of administering the
Plan in accordance with Section 4 of the Plan or, if there is no such Committee,
the Board.

    


    “Applicable Laws”
means the requirements relating to the administration of equity compensation
plans under the applicable laws, rules and regulations of: (i) any foreign
country or jurisdiction where Awards are, or will be, granted under the Plan;
(ii) the United States; and (iii) any stock exchange or quotation system on
which the Common Stock is listed or quoted.

    


    “Award” means a
Warrant, a Stock Award, a Stock Appreciation Right and/or the grant of
Unrestricted Shares.

    


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

    


    “Cause”, with respect
to any Service Provider, means (unless otherwise determined by the
Administrator): (i) if the Service Provider is party to a written agreement with
the Company or one of its Subsidiaries, which agreement includes a definition of
“Cause” or words having similar import, the meaning set forth in the Service
Provider’s written agreement; or (ii) if the Service Provider is not a party to
a written agreement with the Company or one of its Subsidiaries (A) the
commission of a crime under the Applicable Laws of the jurisdiction in which the
Service Provider is providing services; (B) fraud on or misappropriation of any
funds or property of the Company; (C) personal dishonesty, willful misconduct or
breach of fiduciary duty which involves personal profit; (D) willful misconduct
in connection with the Service Provider’s duties; (E) chronic use of alcohol,
drugs or other similar substances which affects the Service Provider’s work
performance; or (F) material breach of any provision of any employment,
non-disclosure, non-competition, non-solicitation or other similar agreement
executed by the Service Provider for the benefit of the Company, all as
reasonably determined by the Committee, which determination will be
conclusive.

    


    “Code” means the
Internal Revenue Code of the United States and its interpretive
regulations.

    


    “Committee” means a
committee of Directors appointed by the Board in accordance with Section 4 of
the Plan.

    


    “Common Stock” means
the common stock, par value $0.001 per share, of the Company.

    


    “Company” means
NeoStem, Inc., a Delaware corporation.

     

    
      
         

      

      
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    “Consultant” means a
natural person providing bona fide services to the Company or one of its
Subsidiaries, or a natural person providing such services through a wholly-owned
corporate alter-ego; provided, that, such services are not in connection with
the offer or sale of securities in a capital-raising transaction, and do not
directly or indirectly promote or maintain a market for the Company’s
stock.

     

    “Disability” means (i)
if the Service Provider is party to a written agreement with the Company or one
of its Subsidiaries, which agreement includes a definition of “Disability” or
words having similar import, the meaning set forth in the Service Provider’s
written agreement; and (ii) if the Service Provider is not a party to a written
agreement, the Service Provider’s inability to perform the essential functions
of his or her position for a period of 90 consecutive days or, 180 days within
any one year period as a result of an injury or illness.

    


    “Employee” means any
employee of the Company or of a Subsidiary (including, without limitation, an
employee who is also serving as an officer or director of the Company or of a
Subsidiary).

    


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

    


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

     

    (i)           if
the Common Stock is listed on any established stock exchange or a national
market system, including without limitation the NYSE Amex, Nasdaq National
Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, or any
successor to any of them, the Fair Market Value of a Share of Common Stock shall
be the closing sales price of a Share of Common Stock as quoted on such exchange
or system for such date (or the most recent trading day preceding such date if
there were no trades on such date), as reported in The Wall Street
Journal or such other source as the Committee deems reliable, including
without limitation, Yahoo! Finance;

    


    (ii)          if
the Common Stock is regularly quoted by a recognized securities dealer but is
not listed in the manner contemplated by clause (i) above, the Fair Market Value
of a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock for such date (or the most recent trading day
preceding such date if there were no trades on such date), as reported in The Wall Street
Journal or such other source as the Committee deems reliable, including
without limitation Yahoo! Finance; or

    


    (iii)         if
neither clause (i) above nor clause (ii) above applies, the Fair Market Value
shall be determined in good faith by the Administrator based on the reasonable
application of a reasonable valuation method.

    


    “Grant Agreement”
means an agreement between the Company and a Participant evidencing the terms
and conditions of an Award. Each Grant Agreement shall be subject to the terms
and conditions of the Plan.

    


    “Notice of Grant”
means a written or electronic notice evidencing certain terms and conditions of
an Award. The Notice of Grant applicable to Warrant or Stock Appreciation Rights
shall be part of the Grant Agreement.

    


    “Parent” means a
“parent corporation” of the Company (or, for purposes of Section 16(b) of the
Plan, a successor to the Company), whether now or hereafter existing, as defined
in Section 424(e) of the Code.

     

    “Participant” shall
mean any Service Provider who is granted an Award under the Plan.

     

    
      
         

      

      
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    “Person” shall be
construed broadly and shall include, without limitation, an individual, a
partnership, a limited liability company, a corporation, an association, a joint
stock company, a trust, a joint venture, an unincorporated organization and a
governmental entity or any department, agency or political subdivision
thereof.

    


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

    


    “Section 16(b)” means
Section 16(b) of the Exchange Act.

    


    “Service Provider”
means an Employee or Consultant providing services outside the United States to
the Company or to one of its Subsidiaries.

    


    “Share” means a share
of the Common Stock, as adjusted in accordance with Section 16 of the
Plan.

    


    “Stock Appreciation
Right” means a right awarded pursuant to Section 14 of the
Plan.

    


    “Stock Award” means an
Award of Shares pursuant to Section 11 of the Plan or an award of Restricted
Stock Units pursuant to Section 12 of the Plan.

    


    “Stock Award
Agreement” means an agreement, approved by the Administrator, providing
the terms and conditions of a Stock Award.

    


    “Stock Award Shares”
means Shares subject to a Stock Award.

    


    “Stock Awardee” means
the holder of an outstanding Stock Award granted under the Plan.

    


    “Subsidiary” means any
corporation or other entity of which the Company owns securities or interests
having a majority, directly or indirectly, of the ordinary voting power in
electing the board of directors, managers, general partners or similar governing
Persons thereof.

    


    “Unrestricted Shares”
means a grant of Shares made on an unrestricted basis pursuant to Section 13 of
the Plan.

    


    “Warrant” means a
stock warrant granted pursuant to the Plan.

    


    “Warranted Stock”
means the Common Stock subject to a Warrant.

    


    “Warrantee” means the
holder of an outstanding Warrant granted under the Plan.

    


    3.           Stock Subject to the
Plan.  Subject to the provisions of Section 16(a) of the Plan,
the maximum aggregate number of Shares that may be issued under the Plan is
4,700,000 Shares.  The Shares may be authorized but unissued, or
reacquired, shares of Common Stock. If a Warrant or Stock Appreciation Right
expires or becomes unexercisable without having been exercised in full or is
canceled or terminated, or if any Shares of Restricted Stock or Shares
underlying a Stock Award are forfeited or reacquired by the Company, the Shares
that were subject thereto shall be added back to the Shares available for
issuance under the Plan. The Company, during the term of this Plan, will at all
times reserve and keep available such number of Shares as shall be sufficient to
satisfy the requirements of the Plan.

     

    
      
         

      

      
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    4.           Administration of the
Plan.

    


    (a)           Appointment.  The
Plan shall be administered by a Committee to be appointed by the Board, which
Committee shall consist of not less than two members of the Board. The Board
shall have the power to add or remove members of the Committee, from time to
time, and to fill vacancies thereon arising; by resignation, death, removal, or
otherwise. Meetings shall be held at such times and places as shall be
determined by the Committee. A majority of the members of the Committee shall
constitute a quorum for the transaction of business, and the vote of a majority
of those members present at any meeting shall decide any question brought before
that meeting.

    


    (b)           Powers of the
Administrator.  The Administrator shall have the authority, in
its discretion:

    


    (i)           to
determine the Fair Market Value of Shares;

    


    (ii)          to
select the Service Providers to whom Awards may be granted
hereunder;

    


    (iii)         to
determine the number of shares of Common Stock to be covered by each Award
granted hereunder;

    


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

    


    (v)          to
determine the terms and conditions, not inconsistent with the terms of the Plan
or of any Award granted hereunder. Such terms and conditions include, but are
not limited to, the exercise price, the time or times when Warrants and Stock
Appreciation Rights may be exercised (which may be based on performance
criteria), any vesting, acceleration or waiver of forfeiture provisions, and any
restriction or limitation regarding any Awards relating thereto, based in each
case on such factors as the Administrator, in its sole discretion, shall
determine;

    


    (vi)         to
construe and interpret the terms of the Plan, Awards granted pursuant to the
Plan and agreements entered into pursuant to the Plan;

    


    (vii)        to
prescribe, amend and rescind rules and regulations relating to the Plan,
including rules and regulations relating to sub-plans established for the
purpose of qualifying for preferred tax treatment under foreign tax
laws;

    


    (viii)       to
modify or amend each Award (subject to Section 19(c) of the Plan), including the
discretionary authority to extend, subject to the terms of the Plan, the
post-termination exercisability period of Warrant or Stock Appreciation Rights
longer than is otherwise provided for in a Grant Agreement and to accelerate the
time at which any outstanding Warrant or Stock Appreciation Right may be
exercised;

    


    (ix)      
   to allow grantees to satisfy withholding tax obligations by
having the Company withhold from the Shares to be issued upon exercise of a
Warrant or Stock Appreciation Right, upon vesting of a Stock Award, or upon the
grant of Unrestricted Shares that number of Shares having a Fair Market Value
equal to the amount required to be withheld, provided that withholding is
calculated at the minimum statutory withholding level. The Fair Market Value of
the Shares to be withheld shall be determined on the date that the amount of tax
to be withheld is to be determined. All determinations to have Shares withheld
for this purpose shall be made by the Administrator in its
discretion;

     

    
      
         

      

      
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    (x)    
      to reduce or increase the exercise price of
any Award issued and outstanding under the Plan or all of the Awards issued and
outstanding under the Plan;

    


    (xi)          to
authorize any person to execute on behalf of the Company any agreement entered
into pursuant to the Plan and any instrument required to effect the grant of an
Award previously granted by the Administrator;

    


    (xii)         to
modify or amend the Plan to comply with the laws of any foreign territory in
which a Participant is providing services; and

    


    (xiii)        to
make all other determinations deemed necessary or advisable for administering
the Plan.

    


    (c)           Effect of Administrator’s
Decision.  The Administrator’s decisions, determinations and
interpretations shall be final and binding on all holders of Awards and
Restricted Stock. None of the Board, the Committee or the Administrator, nor any
member or delegate thereof, shall be liable for any act, omission,
interpretation, construction or determination made in good faith in connection
with the Plan, and each of the foregoing shall be entitled in all cases to
indemnification and reimbursement by the Company in respect of any claim, loss,
damage or expense (including without limitation reasonable attorneys’ fees)
arising or resulting therefrom to the fullest extent permitted by law and/or
under any directors’ and officers’ liability insurance coverage which may be in
effect from time to time.

    


    (d)           Delegation of Grant
Authority.  Notwithstanding any other provision in the Plan,
the Board may authorize the Company’s Chief Executive Officer or another
executive officer of the Company or a committee of such officers (“Authorized Officers”)
to grant Warrants under the Plan; provided, however, that in no
event shall the Authorized Officers be permitted to grant Warrants to (i) any
Director, (ii) any person who is identified by the Company as an executive
officer of the Company or who is subject to the restrictions imposed under
Section 16 of the Exchange Act, (iii) any person who is not an Employee of the
Company, a Subsidiary, or (iv) such other person or persons as may be designated
from time to time by the Board. If such authority is provided by the Board, the
Board shall establish and adopt written guidelines setting forth the maximum
number of shares for which the Authorized Officers may grant Warrants to any
individual during a specified period of time and such other terms and conditions
as the Board deems appropriate for such grants. Such guidelines may be amended
by the Board prospectively at any time. Subject to the foregoing, the Authorized
Officers shall have the same authority as the Administrator under this Section 4
with respect to the grant of Warrants under the Plan.

    


    5.           Eligibility.  Awards
may only be granted to Service Providers providing services outside of the
United States on the date of the grant of the Award. Notwithstanding anything
contained herein to the contrary, an Award may be granted to a person who is not
then a Service Provider; provided, however, that the grant of such Award shall
be conditioned upon such person becoming a Service Provider at or prior to the
time of the execution of the agreement evidencing such Award.

    


    6.           Limitations.  Neither
the Plan nor any Award nor any agreement entered into pursuant to the Plan shall
confer upon a Participant any right with respect to continuing the Participant’s
relationship as a Service Provider with the Company or any of its Subsidiaries,
nor shall they interfere in any way with the Participant’s right or the right of
the Company or the Subsidiary to terminate such relationship at any time, with
or without cause.

     

    
      
         

      

      
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    7.           Term of the
Plan.  Subject to Section 22 of the Plan, the Plan shall become
effective upon its adoption by the Board. It shall continue in effect for a term
of ten (10) years unless terminated earlier under Section 19 of the
Plan.

    


    8.           Term of
Warrants.  Unless otherwise provided in the applicable Grant
Agreement, the term of each Warrant granted to anyone who is an Employee of the
Company, a Subsidiary shall be ten (10) years from the date of grant and the
term of each Warrant granted to any Consultant shall be five (5) years from the
date of grant.

    


    9.           Warrant Exercise Price;
Exercisability.

    


    (a)           Exercise
Price.  The per share exercise price for the Shares to be
issued pursuant to exercise of a Warrant shall be determined by the
Administrator, provided that the exercise price shall be equal to or greater
than the Fair Market Value of the Common Stock on the date that the Award is
granted. The exercise price shall be stated in U.S. dollars.

    


    (b)           Exercise Period and
Conditions.  At the time that a Warrant is granted, the
Administrator shall fix the period within which the Warrant may be exercised and
shall determine any conditions that must be satisfied before the Warrant may be
exercised.

    


    (c)           Reload
Warrants.  The Administrator may grant Warrants with a reload
feature. A reload feature shall only apply when the Warrant price is paid by
delivery of Common Stock (as set forth in Section 10(f)) or by having the
Company reduce the number of shares otherwise issuable to a Warrantee (as
provided for in Section 10(f)) (a “Net Exercise”). The
Grant Agreement for the Warrants containing the reload feature shall provide
that the Warrant holder shall receive, contemporaneously with the payment of the
exercise price in shares of Common Stock or in the event of a Net Exercise, a
reload warrant (the “Reload Warrant”) to
purchase that number of shares of Common Stock equal to the sum of (i) the
number of shares of Common Stock used to exercise the Warrant (or not issued in
the case of a Net Exercise), and (ii) the number of shares of Common Stock used
to satisfy any tax withholding requirement incident to the exercise of such
Warrant. The terms of the Plan applicable to the Warrant shall be equally
applicable to the Reload Warrant with the following exceptions: (i) the exercise
price per share of Common Stock deliverable upon the exercise of the Reload
Warrant shall be the Fair Market Value of a share of Common Stock on the date of
grant of the Reload Warrant; and (ii) the term of the Reload Warrant shall be
equal to the remaining term of the Warrant (including a Reload Warrant) which
gave rise to the Reload Warrant. The Reload Warrant shall be evidenced by an
appropriate amendment to the Grant Agreement for the Warrant which gave rise to
the Reload Warrant. In the event the exercise price of a Warrant containing a
reload feature is paid by cash or check and not in shares of Common Stock, the
reload feature shall have no application with respect to such
exercise.

    


    10.           Exercise of Warrants;
Consideration.

    


    (a)           Procedure for Exercise; Rights as a
Shareholder.  Any Warrant granted hereunder shall be
exercisable according to the terms of the Plan and at such times and under such
conditions as determined by the Administrator and set forth in the Grant
Agreement. Unless the Administrator provides otherwise, vesting of Warrants
granted hereunder shall be tolled during any unpaid leave of absence. A Warrant
may not be exercised for a fraction of a Share. A Warrant shall be deemed
exercised when the Company receives: (i) written or electronic notice of
exercise (in accordance with the Grant Agreement) from the person entitled to
exercise the Warrant, and (ii) full payment for the Shares with respect to which
the Warrant is exercised. Full payment may consist of any consideration and
method of payment authorized by the Administrator and permitted by the Grant
Agreement and Section 10(f) of the Plan. Shares issued upon exercise of a
Warrant shall be issued in the name of the Warrantee. Until the Shares are
issued (as evidenced by the appropriate entry on the books of the Company or of
a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect to the
Warranted Stock, notwithstanding the exercise of the Warrant. The Company shall
issue (or cause to be issued) such Shares promptly after the Warrant is
exercised. No adjustment will be made for a dividend or other right for which
the record date is prior to the date the Shares are issued, except as provided
in Section 16 of the Plan. Exercising a Warrant in any manner shall decrease the
number of Shares thereafter available, both for purposes of the Plan and for
sale under the Warrant, by the number of Shares as to which the Warrant is
exercised.

     

    
      
         

      

      
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    (b)           Termination of Relationship as a
Service Provider.  Unless otherwise specified in the Grant
Agreement or provided by the Administrator, if a Warrantee ceases to be a
Service Provider, other than as a result of (x) the Warrantee’s death or
Disability, (y) the termination of such Warrantee’s services with Cause, or (z)
the Warrantee’s voluntary termination of service, the Warrantee may exercise his
or her Warrant for up to ninety (90) days following the date on which the
Warrantee ceases to be a Service Provider to the extent that the Warrant is
vested on the date of termination (but in no event later than the expiration of
the term of such Warrant as set forth in the Grant Agreement). If, on the date
that the Warrantee ceases to be a Service Provider, the Warrantee is not vested
as to his or her entire Warrant, the Shares covered by the unvested
portion  of the Warrant shall revert to the Plan. If, after the date
that the Warrantee ceases to be a Service Provider the Warrantee does not
exercise his or her Warrant in full within the time set forth herein or the
Grant Agreement, as applicable, the unexercised portion of the Warrant shall
terminate, and the Shares covered by such unexercised portion of the Warrant
shall revert to the Plan. A Warrantee who changes his or her status as a Service
Provider (e.g., from being an Employee to being a Consultant) or who transfers
his or her services among the Company or any of its Subsidiaries shall not be
deemed to have ceased being a Service Provider for purposes of this Section
10(b).

    


    (c)           Disability of a
Warrantee.  Unless otherwise specified in the Grant Agreement,
if a Warrantee ceases to be a Service Provider as a result of the Warrantee’s
Disability, the Warrantee may exercise his or her Warrant, to the extent the
Warrant is vested on the date that the Warrantee ceases to be a Service
Provider, up until the one-year anniversary of the date on which the Warrantee
ceases to be a Service Provider (but in no event later than the expiration of
the term of such Warrant as set forth in the Grant Agreement). If, on the date
that the Warrantee ceases to be a Service Provider, the Warrantee is not vested
as to his or her entire Warrant, the Shares covered by the unvested portion of
the Warrant shall revert to the Plan. If, after the Warrantee ceases to be a
Service Provider, the Warrantee does not exercise his or her Warrant in full
within the time set forth herein or the Grant Agreement, as applicable, the
unexercised portion of the Warrant shall terminate, and the Shares covered by
such unexercised portion of the Warrant shall revert to the Plan.

    


    (d)           Death of a
Warrantee.  Unless otherwise specified in the Grant Agreement,
if a Warrantee dies while a Service Provider, the Warrant may be exercised, to
the extent that the Warrant is vested on the date of death, by the Warrantee’s
estate or by a person who acquires the right to exercise the Warrant by bequest
or inheritance up until the one-year anniversary of the Warrantee’s death (but
in no event later than the expiration of the term of such Warrant as set forth
in the Notice of Grant). If, at the time of death, the Warrantee is not vested
as to his or her entire Warrant, the Shares covered by the unvested portion of
the Warrant shall revert to the Plan. If the Warrant is not so exercised in full
within the time set forth herein or the Grant Agreement, as applicable, the
unexercised portion of the Warrant shall terminate, and the Shares covered by
the unexercised portion of such Warrant shall revert to the Plan.

    


    (e)           Termination for Cause or Voluntary
Termination.  If the Company or a Subsidiary to which a Service
Provider provides services terminates the Service Provider’s Services for Cause,
or if a Service Provider voluntarily terminates his or her relationship with the
Company or the Subsidiary, unless otherwise provided in such Service Provider’s
Grant Agreement or by the Administrator, the Service Provider shall have no
right to exercise any of such Service Provider’s Warrants at any time on or
after the effective date of such termination.

     

    
      
         

      

      
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    (f)           Form of
Consideration.  The Administrator shall determine the
acceptable form of consideration for exercising a Warrant, including the method
of payment. Such consideration may consist entirely of:

    


    (i)           cash
denominated in U.S. Dollars;

    


    (ii)         
wire transfer denominated in U.S. Dollars;

    


    (iii)         check
denominated in U.S. Dollars;

    


    (iv)    
    other Shares which (A) in the case of Shares acquired
upon exercise of a Warrant at a time when the Company is subject to Section
16(b) of the Exchange Act, have been owned by the Warrantee for more than six
months on the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Warrant shall be exercised;

    


    (v)         
consideration received by the Company under a cashless exercise program
implemented by the Company in connection with the Plan;

    


    (vi)         a
reduction in the number of Shares otherwise issuable by a number of Shares
having a Fair Market Value equal to the exercise price of the Warrant being
exercised;

    


    (vii)        any
combination of the foregoing methods of payment; or

    


    (viii)       such
other consideration and method of payment for the issuance of Shares to the
extent permitted by Applicable Laws.

    


    11.           Stock Awards.  The
Administrator may, in its sole discretion, grant (or sell at par value or such
higher purchase price as it determines) Shares to any Service Provider subject
to such terms and conditions as the Administrator sets forth in a Stock Award
Agreement evidencing such grant. Stock Awards may be granted or sold in respect
of past services or other valid consideration or in lieu of any cash
compensation otherwise payable to such individual. The grant of Stock Awards
under this Section 11 shall be subject to the following provisions:

    


    (a)           At
the time a Stock Award under this Section 11 is made, the Administrator shall
establish a vesting period (the “Restricted Period”)
applicable to the Stock Award Shares subject to such Stock Award. The
Administrator may, in its sole discretion, at the time a grant is made,
prescribe restrictions in addition to the expiration of the Restricted Period,
including the satisfaction of corporate or individual performance objectives.
None of the Stock Award Shares may be sold, transferred, assigned, pledged or
otherwise encumbered or disposed of during the Restricted Period applicable to
such Stock Award Shares or prior to the satisfaction of any other restrictions
prescribed by the Administrator with respect to such Stock Award
Shares.

    


    (b)           The
Company shall issue, in the name of each Service Provider to whom Stock Award
Shares have been granted, stock certificates representing the total number of
Stock Award Shares granted to such person, as soon as reasonably practicable
after the grant. The Company, at the direction of the Administrator, shall hold
such certificates, properly endorsed for transfer, for the Stock Awardee’s
benefit until such time as the Stock Award Shares are forfeited to the Company,
or the restrictions lapse.

     

    
      
         

      

      
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    (c)           Unless
otherwise provided by the Administrator, holders of Stock Award Shares shall
have the right to vote such Shares and have the right to receive any cash
dividends with respect to such Shares. All distributions, if any, received by a
Stock Awardee with respect to Stock Award Shares as a result of any stock split,
stock distribution, combination of shares, or other similar transaction shall be
subject to the restrictions of this Section 11.

    


    (d)           Any
Stock Award Shares granted to a Service Provider pursuant to the Plan shall be
forfeited if the Service Provider voluntarily terminates his or her services
with the Company or the Subsidiary to which the Service Provider provided his or
her services, or if the Company or Subsidiary terminates the Service Provider’s
services for Cause, in each case prior to the expiration or termination of the
applicable Restricted Period and the satisfaction of any other conditions
applicable to such Stock Award Shares. Upon such forfeiture, the Stock Award
Shares that are forfeited shall be retained in the treasury of the Company and
be available for subsequent awards under the Plan. If the Stock Awardee’s
services terminate for any other reason prior to the expiration or termination
of the applicable Restricted Period and the satisfaction of any other conditions
applicable to such Stock Award Shares, the Stock Award Shares held by such
person shall be forfeited, unless the Administrator, in its sole discretion,
shall determine otherwise.

    


    (e)           Upon
the expiration or termination of the Restricted Period and the satisfaction of
any other conditions prescribed by the Committee, the restrictions applicable to
the Stock Award Shares shall lapse and, at the Stock Awardee’s request, a stock
certificate for the number of Stock Award Shares with respect to which the
restrictions have lapsed shall be delivered, free of all such restrictions, to
the Stock Awardee or his beneficiary or estate, as the case may be.

    


    (f)           Prior
to the delivery of any shares of Common Stock in connection with a Stock Award
under this Section 11, the Company shall be entitled to require as a condition
of delivery that the Stock Awardee shall pay or make adequate provision
acceptable to the Company for the satisfaction of the statutory minimum
prescribed amount of tax and other withholding obligations of the Company under
Applicable Law, including, if permitted by the Administrator, by having the
Company withhold from the number of shares of Common Stock otherwise deliverable
in connection with a Stock Award, a number of shares of Common Stock having a
Fair Market Value equal to an amount sufficient to satisfy such tax withholding
obligations.

    


    12.           Restricted Stock
Units.  The Committee may, in its sole discretion, grant
Restricted Stock Units to a Service Provider subject to such terms and
conditions as the Committee sets forth in a Stock Award Agreement evidencing
such grant.

    


    (a)           “Restricted
Stock Units” are Awards denominated in units evidencing the right to receive
Shares of Common Stock, which may vest over such period of time and/or upon
satisfaction of such performance criteria or objectives as is determined by the
Committee at the time of grant and set forth in the applicable Stock Award
Agreement, without payment of any amounts by the Stock Awardee thereof (except
to the extent required by law). Prior to delivery of shares of Common Stock with
respect to an award of Restricted Stock Units, the Stock Awardee shall have no
rights as a stockholder of the Company.

    


    (b)           Upon
satisfaction and/or achievement of the applicable vesting requirements relating
to an award of Restricted Stock Units, the Stock Awardee shall be entitled to
receive a number of shares of Common Stock that are equal to the number of
Restricted Stock Units that became vested. To the extent, if any, set forth in
the applicable Stock Award Agreement, cash dividend equivalents may be paid
during, or may be accumulated and paid at the end of, the applicable vesting
period, as determined by the Committee.

     

    
      
         

      

      
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    (c)           Unless
otherwise provided by the Stock Award Agreement, any Restricted Stock Units
granted to a Service Provider pursuant to the Plan shall be forfeited if the
Stock Awardee’s service with the Company or its Subsidiaries terminates for any
reason prior to the expiration or termination of the applicable vesting period
and/or the achievement of such other vesting conditions applicable to the
award.

    


    (d)           Prior
to the delivery of any shares of Common Stock in connection with an award of
Restricted Stock Units, the Company shall be entitled to require as a condition
of delivery that the Stock Awardee shall pay or make adequate provision
acceptable to the Company for the satisfaction of the statutory minimum
prescribed amount of tax and other withholding obligations of the Company under
Applicable Law, including, if permitted by the Administrator, by having the
Company withhold from the number of shares of Common Stock otherwise deliverable
in connection with an award of Restricted Stock Units, a number of shares of
Common Stock having a Fair Market Value equal to an amount sufficient to satisfy
such tax withholding obligations.

    


    13.           Unrestricted
Shares.  The Administrator may grant Unrestricted Shares in
accordance with the following provisions:

    


    (a)           The
Administrator may cause the Company to grant Unrestricted Shares to Service
Providers at such time or times, in such amounts and for such reasons as the
Administrator, in its sole discretion, shall determine. No payment shall be
required for Unrestricted Shares.

    


    (b)           The
Company shall issue, in the name of each Service Provider to whom Unrestricted
Shares have been granted, stock certificates representing the total number of
Unrestricted Shares granted to such individual, and shall deliver such
certificates to such Service Provider as soon as reasonably practicable after
the date of grant or on such later date as the Administrator shall determine at
the time of grant.

    


    (c)           Prior
to the delivery of any Unrestricted Shares, the Company shall be entitled to
require as a condition of delivery that the Stock Awardee shall pay or make
adequate provision acceptable to the Company for the satisfaction of the
statutory minimum prescribed amount of tax and other withholding obligations of
the Company under Applicable Law, including, if permitted by the Administrator,
by having the Company withhold from the number of Unrestricted Shares otherwise
deliverable, a number of shares of Common Stock having a Fair Market Value equal
to an amount sufficient to satisfy such tax withholding
obligations.

    


    14.           Stock Appreciation
Rights.  A Stock Appreciation Right may be granted by the
Committee either alone, in addition to, or in tandem with other Awards granted
under the Plan. Each Stock Appreciation Right granted under the Plan shall be
subject to the following terms and conditions:

    


    (a)           Each
Stock Appreciation Right shall relate to such number of Shares as shall be
determined by the Committee.

    


    (b)           The
Award Date (i.e., the
date of grant) of a Stock Appreciation Right shall be the date specified by the
Committee, provided that that date shall not be before the date on which the
Stock Appreciation Right is actually granted. The Award Date of a Stock
Appreciation Right shall not be prior to the date on which the recipient
commences providing services as a Service Provider. The term of each Stock
Appreciation Right shall be determined by the Committee, but shall not exceed
ten years from the date of grant. Each Stock Appreciation Right shall become
exercisable at such time or times and in such amount or amounts during its term
as shall be determined by the Committee. Unless otherwise specified by the
Committee, once a Stock Appreciation Right becomes exercisable, whether in full
or in part, it shall remain so exercisable until its expiration, forfeiture,
termination or cancellation.

     

    
      
         

      

      
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    (c)           A
Stock Appreciation Right may be exercised, in whole or in part, by giving
written notice to the Committee. As soon as practicable after receipt of the
written notice, the Company shall deliver to the person exercising the Stock
Appreciation Right stock certificates for the Shares to which that person is
entitled under Section 14(d) hereof.

    


    (d)           A
Stock Appreciation Right shall be exercisable for Shares only. The number of
Shares issuable upon the exercise of the Stock Appreciation Right shall be
determined by dividing:

    


    (i)           the
number of Shares for which the Stock Appreciation Right is exercised multiplied
by the amount of the appreciation per Share (for this purpose, the “appreciation
per Share” shall be the amount by which the Fair Market Value of a Share on the
exercise date exceeds (x) in the case of a Stock Appreciation Right granted in
tandem with a Warrant, the exercise price or (y) in the case of a Stock
Appreciation Right granted alone without reference to a Warrant, the Fair Market
Value of a Share on the Award Date of the Stock Appreciation Right);
by

    


    (ii)          the
Fair Market Value of a Share on the exercise date.

    


    15.           Non-Transferability.  Unless
determined otherwise by the Administrator, a Warrant or Stock Appreciation Right
may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in
any manner other than by will or by the laws of descent or distribution and may
be exercised, during the lifetime of the Warrantee, only by the Warrantee. If
the Administrator makes a Warrant or Stock Appreciation Right transferable, such
Warrant or Stock Appreciation Right shall contain such additional terms and
conditions as the Administrator deems appropriate. Notwithstanding the
foregoing, the Administrator, in its sole discretion, may provide in the Grant
Agreement regarding a given Warrant that the Warrantee may transfer, without
consideration for the transfer, his or her Warrants to members of his or her
immediate family, to trusts for the benefit of such family members, or to
partnerships in which such family members are the only partners, provided that
the transferee agrees in writing with the Company to be bound by all of the
terms and conditions of this Plan and the applicable Warrant. During the period
when Shares of Restricted Stock and Stock Award Shares are restricted (by virtue
of vesting schedules or otherwise), such Shares may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution.

    


    16.           Adjustments Upon Changes in
Capitalization, Dissolution, Merger or Asset Sale.

    


    (a)           Changes in
Capitalization.  Subject to any required action by the
shareholders of the Company, the number of Shares of Common Stock covered by
each outstanding Award and the number of Shares of Common Stock which have been
authorized for issuance under the Plan but as to which no Awards have yet been
granted or which have been returned to the Plan upon cancellation or expiration
of an Award, as well as the price per share of Common Stock covered by each such
outstanding Award, shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Common Stock, or any other increase or decrease in the number of issued
shares of Common Stock effected without receipt of consideration by the Company;
provided, however, that conversion of any convertible securities of the Company
shall not be deemed to have been “effected without receipt of consideration.”
Such adjustment shall be made by the Administrator, whose determination in that
respect shall be final, binding and conclusive. Except as expressly provided
herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price
of Shares of Common Stock subject to an Award hereunder. Except as expressly
provided herein, the issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, for cash or property,
or for labor or services either upon direct sale or upon the exercise of rights
or warrants to subscribe therefore, or upon conversion of shares or obligations
of the Company convertible into sub-shares or other securities, shall not
affect, and no adjustment by reason thereof shall be made with respect to, the
number or price of Shares of Common Stock then subject to outstanding Warrants
and Stock Appreciation Rights.

     

    
      
         

      

      
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    (b)           Corporate
Transactions.  If the Company merges or consolidates with
another corporation, whether or not the Company is the surviving corporation, or
if the Company is liquidated or sells or otherwise disposes of substantially all
its assets, or if any “person” (as that term is used in Section 13(d) and
14(d)(2) of the Exchange Act) is or becomes the beneficial owner, directly or
indirectly, of securities of the Company representing greater than 50% of the
combined voting power of the Company’s then outstanding securities (each such
event a “Corporate
Transaction Event”) then (i) after the effective date of such Corporate
Transaction Event, each holder of an outstanding Warrant or Stock Appreciation
Right shall be entitled, upon exercise of such Warrant or Stock Appreciation
Right to receive, in lieu of Shares of Common Stock, the number and class or
classes of shares of such stock or other securities or property to which such
holder would have been entitled if, immediately prior to such Corporate
Transaction Event, such holder had been the holder of record of a number of
Shares of Common Stock equal to the number of shares as to which such Warrant
and Stock Appreciation Right may be exercised; and (ii) the Board may waive any
limitations set forth in or imposed pursuant hereto so that all Warrants and
Stock Appreciation Rights from and after a date prior to the effective date of
such Corporate Transaction Event, as specified by the Board, shall be
exercisable in full. Notwithstanding anything contained herein to the contrary,
the proposed transaction between the Company and China Biopharmaceutical
Holdings, Inc. shall not constitute a Corporate Transaction Event.

    


    In the
event of a Corporate Transaction Event, then each outstanding Stock Award shall
be assumed or an equivalent agreement or award substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation. In the event
that the Committee determines that the successor corporation or a Parent or a
Subsidiary of the successor corporation has refused to assume or substitute an
equivalent agreement or award for each outstanding Stock Award, all vesting
periods and conditions under Stock Awards shall be deemed to have been
satisfied. The Board may also, in its discretion, cause all vesting periods and
conditions under Stock Awards to be deemed to have been satisfied.

    


    17.           Substitute
Warrants.  In the event that the Company, directly or
indirectly, acquires another entity, the Board may authorize the issuance of
Warrants (“Substitute
Warrants”) to the individuals performing services for the acquired entity
(if such services are performed outside of the United States) in substitution of
Warrants previously granted to those individuals in connection with their
performance of services for such entity upon such terms and conditions as the
Board shall determine. Shares of capital stock underlying Substitute Warrants
shall not constitute Shares issued pursuant to the Plan for any
purpose.

    


    18.           Date of Grant.  The
date of grant of an Award shall be, for all purposes, the date on which the
Administrator makes the determination granting such Warrant, Stock Appreciation
Right, Stock Award or Unrestricted Share, or such other later date as is
determined by the Administrator. Notice of the determination shall be provided
to each grantee within a reasonable time after the date of such
grant.

    


    19.           Amendment and Termination of the
Plan.

    


    (a)           Amendment and
Termination.  The Board may at any time amend, alter, suspend
or terminate the Plan.

     

    
      
         

      

      
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    (b)           Shareholder
Approval.  The Company shall obtain shareholder approval of any
Plan amendment to the extent necessary to comply with Applicable
Laws.

    


    (c)           Effect of Amendment or
Termination.  No amendment, alteration, suspension or
termination of the Plan shall impair the rights of any grantee, unless mutually
agreed otherwise between the grantee and the Administrator, which agreement must
be in writing and signed by the grantee and the Company. Termination of the Plan
shall not affect the Administrator’s ability to exercise the powers granted to
it hereunder with respect to Awards granted under the Plan prior to the date of
such termination.

    


    20.           Conditions Upon Issuance of
Shares.

    


    (a)           Legal
Compliance.  Shares shall not be issued in connection with the
grant of any Stock Award or Unrestricted Share or the exercise of any Warrant or
Stock Appreciation Right unless such grant or the exercise of such Warrant or
Stock Appreciation Right and the issuance and delivery of such Shares shall
comply with Applicable Laws and shall be further subject to the approval of
counsel for the Company with respect to such compliance.

    


    (b)           Investment
Representations.  As a condition to the grant of any Stock
Award or Unrestricted Share or the exercise of any Warrant or Stock Appreciation
Right, the Company may require the person receiving such Award or exercising
such Warrant or Stock Appreciation Right to represent and warrant at the time of
any such exercise or grant that the Shares are being purchased only for
investment and without any present intention to sell or distribute such Shares
if, in the opinion of counsel for the Company, such a representation is
required.

    


    (c)           Additional
Conditions.  The Administrator shall have the authority to
condition the grant of any Award in such other manner that the Administrator
determines to be appropriate, provided that such condition is not inconsistent
with the terms of the Plan.

    


    (d)           Trading Policy
Restrictions.  Warrant and or Stock Appreciation Right
exercises and other Awards under the Plan shall be subject to the terms and
conditions of any insider trading policy established by the Company or the
Administrator.

    


    21.           Inability to Obtain
Authority.  The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the
Company’s counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, shall relieve the Company of any liability in respect of the failure
to issue or sell such Shares as to which such requisite authority shall not have
been obtained.

    


    22.           Shareholder
Approval.  The Plan shall be subject to approval by the
shareholders of the Company within twelve (12) months after the date the Plan is
adopted. Such shareholder approval shall be obtained in the manner and to the
degree required under Applicable Laws. Notwithstanding any provision in the Plan
to the contrary, any exercise of a Warrant or Stock Appreciation Right granted
before the Company has obtained shareholder approval of the Plan in accordance
with this Section 22 shall be conditioned upon obtaining such shareholder
approval of the Plan in accordance with this Section 22.

    


    23.           Withholding; Notice of
Sale.  The Company shall be entitled to withhold from any
amounts payable to a Service Provider any amounts which the Company determines,
in its discretion, are required to be withheld under any Applicable Law as a
result of any action taken by a holder of an Award.

     

    
      
         

      

      
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    24.           Governing Law.  This
Plan shall be governed by the laws of the State of Delaware, without regard to
conflict of law principles.

    


    Adopted
by action of the Board of Directors

    on
the twelfth day of July, 2009.

    


    
      
         

      

      
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