Exhibit 10.9





Exhibit 10.9




GENESIS FLUID SOLUTIONS HOLDINGS, INC.




2009 EQUITY INCENTIVE PLAN





1. Purpose of the Plan.



This 2009 Equity Incentive Plan (the “Plan”) is intended as an incentive, to retain in
the employ of and as directors, officers, consultants, advisors and employees to Genesis Fluid
Solutions Holdings, Inc., a Delaware corporation (the “Company”), and any Subsidiary of the
Company, within the meaning of Section 424(f) of the United States Internal Revenue Code of 1986,
as amended (the “Code”), persons of training, experience and ability, to attract new
directors, officers, consultants, advisors and employees whose services are considered valuable, to
encourage the sense of proprietorship and to stimulate the active interest of such persons in the
development and financial success of the Company and its Subsidiaries.



It is further intended that certain options granted pursuant to the Plan shall constitute
incentive stock options within the meaning of Section 422 of the Code (the “Incentive
Options”) while certain other options granted pursuant to the Plan shall be nonqualified stock
options (the “Nonqualified Options”). Incentive Options and Nonqualified Options are
hereinafter referred to collectively as “Options.”



The Company intends that the Plan meet the requirements of Rule 16b-3 (“Rule 16b-3”)
promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and
that transactions of the type specified in subparagraphs (c) to (f) inclusive of Rule 16b-3 by
officers and directors of the Company pursuant to the Plan will be exempt from the operation of
Section 16(b) of the Exchange Act. Further, the Plan is intended to satisfy the performance-based
compensation exception to the limitation on the Company’s tax deductions imposed by Section 162(m)
of the Code with respect to those Options for which qualification for such exception is intended.
In all cases, the terms, provisions, conditions and limitations of the Plan shall be construed and
interpreted consistent with the Company’s intent as stated in this Section 1.




2. Administration of the Plan.



The Board of Directors of the Company (the “Board”) shall appoint and maintain as
administrator of the Plan a Committee (the “Committee”) consisting of two or more directors
who are (i) “Independent Directors” (as such term is defined under the rules of the NASDAQ Stock
Market), (ii) “Non-Employee Directors” (as such term is defined in Rule 16b-3) and (iii) “Outside
Directors” (as such term is defined in Section 162(m) of the Code), which shall serve at the
pleasure of the Board. The Committee, subject to Sections 3, 5 and 6 hereof, shall have full power
and authority to designate recipients of Options and restricted stock (“Restricted Stock”)
and to determine the terms and conditions of the respective Option and Restricted Stock agreements
(which need not be identical) and to interpret the provisions and supervise the administration of
the Plan. The Committee shall have the authority, without limitation, to designate which Options
granted under the Plan shall be Incentive Options and which shall be Nonqualified Options. To the
extent any Option does not qualify as an Incentive Option, it shall constitute a separate
Nonqualified Option.



Subject to the provisions of the Plan, the Committee shall interpret the Plan and all Options
and Restricted Stock granted under the Plan, shall make such rules as it deems necessary for the
proper administration of the Plan, shall make all other determinations necessary or advisable for
the administration of the Plan and shall correct any defects or supply any omission or reconcile
any inconsistency in the Plan or in any Options or Restricted Stock granted under the Plan in the
manner and to the extent that the Committee deems desirable to carry into effect the Plan or any
Options or Restricted Stock. The act or determination of a majority of the Committee shall be the
act or determination of the Committee and any decision reduced to writing and signed by all of the
members of the Committee shall be fully effective as if it had been made by a majority of the
Committee at a meeting duly held for such purpose. Subject to the provisions of the Plan, any
action taken or determination made by the Committee pursuant to this and the other Sections of the
Plan shall be conclusive on all parties.


 


 









 





In the event that for any reason the Committee is unable to act or if the Committee at the
time of any grant, award or other acquisition under the Plan does not consist of two or more
Non-Employee Directors, or if there shall be no such Committee, or if the Board otherwise
determines to administer the Plan, then the Plan shall be administered by the Board, and references
herein to the Committee (except in the proviso to this sentence) shall be deemed to be references
to the Board, and any such grant, award or other acquisition may be approved or ratified in any
other manner contemplated by subparagraph (d) of Rule 16b-3; provided, however,
that grants to the Company’s Chief Executive Officer or to any of the Company’s other four most
highly compensated officers that are intended to qualify as performance-based compensation under
Section 162(m) of the Code may only be granted by the Committee.




3. Designation of Optionees and Grantees.



The persons eligible for participation in the Plan as recipients of Options (the
“Optionees”) or Restricted Stock (the “Grantees” and together with Optionees, the
“Participants”) shall include directors, officers and employees of, and consultants and
advisors to, the Company or any Subsidiary; provided that Incentive Options may only be granted to
employees of the Company and any Subsidiary. In selecting Participants, and in determining the
number of shares to be covered by each Option or award of Restricted Stock granted to Participants,
the Committee may consider any factors it deems relevant, including, without limitation, the office
or position held by the Participant or the Participant’s relationship to the Company, the
Participant’s degree of responsibility for and contribution to the growth and success of the
Company or any Subsidiary, the Participant’s length of service, promotions and potential. A
Participant who has been granted an Option or Restricted Stock hereunder may be granted an
additional Option or Options, or Restricted Stock if the Committee shall so determine.




4. Stock Reserved for the Plan.



Subject to adjustment as provided in Section 8 hereof, a total of 4,542,000 shares of the
Company’s common stock, par value $0.001 per share (the “Stock”), shall be subject to the
Plan. The shares of Stock subject to the Plan shall consist of unissued shares, treasury shares or
previously issued shares held by any Subsidiary of the Company, and such number of shares of Stock
shall be and is hereby reserved for such purpose. Any of such shares of Stock that may remain
unissued and that are not subject to outstanding Options at the termination of the Plan shall cease
to be reserved for the purposes of the Plan, but until termination of the Plan the Company shall at
all times reserve a sufficient number of shares of Stock to meet the requirements of the Plan.
Should any Option or award of Restricted Stock expire or be canceled prior to its exercise or
vesting in full or should the number of shares of Stock to be delivered upon the exercise or
vesting in full of an Option or award of Restricted Stock be reduced for any reason, the shares of
Stock theretofore subject to such Option or Restricted Stock may be subject to future Options or
Restricted Stock under the Plan, except where such reissuance is inconsistent with the provisions
of Section 162(m) of the Code where qualification as performance-based compensation under Section
162(m) of the Code is intended.




5. Terms and Conditions of Options.



Options granted under the Plan shall be subject to the following conditions and shall contain
such additional terms and conditions, not inconsistent with the terms of the Plan, as the Committee
shall deem desirable:



(a) Option Price. The purchase price of each share of Stock purchasable under an
Incentive Option shall be determined by the Committee at the time of grant, but shall not be less
than 100% of the Fair Market Value (as defined below) of such share of Stock on the date the Option
is granted; provided, however, that with respect to an Optionee who, at the time
such Incentive Option is granted, owns (within the meaning of Section 424(d) of the Code) more than
10% of the total combined voting power of all classes of stock of the Company or of any Subsidiary,
the purchase price per share of Stock shall be at least 110% of the Fair Market Value per share of
Stock on the date of grant. The purchase price of each share of Stock purchasable under a
Nonqualified Option shall not be less than 100% of the Fair Market Value of such share of Stock on
the date the Option is granted. The exercise price for each Option shall be subject to adjustment
as provided in Section 8 below. “Fair Market Value” means the closing price on the final
trading day immediately prior to the grant date of the Stock on the principal securities exchange
on which shares of Stock are listed (if the shares of Stock are so listed), or on the NASDAQ Stock
Market or OTC Bulletin Board (if the shares of Stock are regularly quoted on the NASDAQ Stock
Market or
OTC Bulletin Board, as the case may be), or, if not so listed, the mean between the closing
bid and asked prices of publicly traded shares of Stock in the over the counter market, or, if such
bid and asked prices shall not be available, as reported by any nationally recognized quotation
service selected by the Company, or as determined by the Committee in a manner consistent with the
provisions of the Code. Anything in this Section 5(a) to the contrary notwithstanding, in no event
shall the purchase price of a share of Stock be less than the minimum price permitted under the
rules and policies of any national securities exchange on which the shares of Stock are listed.


 


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(b) Option Term. The term of each Option shall be fixed by the Committee, but no
Option shall be exercisable more than ten years after the date such Option is granted and in the
case of an Incentive Option granted to an Optionee who, at the time such Incentive Option is
granted, owns (within the meaning of Section 424(d) of the Code) more than 10% of the total
combined voting power of all classes of stock of the Company or of any Subsidiary, no such
Incentive Option shall be exercisable more than five years after the date such Incentive Option is
granted.



(c) Exercisability. Subject to Section 5(j) hereof, Options shall be exercisable at
such time or times and subject to such terms and conditions as shall be determined by the Committee
at the time of grant; provided, however, that in the absence of any Option vesting
periods designated by the Committee at the time of grant, Options shall vest and become exercisable
as to one-third of the total number of shares subject to the Option on each of the first, second
and third anniversaries of the date of grant; and provided further that no Options shall be
exercisable until such time as any vesting limitation required by Section 16 of the Exchange Act,
and related rules, shall be satisfied if such limitation shall be required for continued validity
of the exemption provided under Rule 16b-3(d)(3).



Upon the occurrence of a “Change in Control” (as hereinafter defined), the Committee may
accelerate the vesting and exercisability of outstanding Options, in whole or in part, as
determined by the Committee in its sole discretion. In its sole discretion, the Committee may also
determine that, upon the occurrence of a Change in Control, each outstanding Option shall terminate
within a specified number of days after notice to the Optionee thereunder, and each such Optionee
shall receive, with respect to each share of Company Stock subject to such Option, an amount equal
to the excess of the Fair Market Value of such shares immediately prior to such Change in Control
over the exercise price per share of such Option; such amount shall be payable in cash, in one or
more kinds of property (including the property, if any, payable in the transaction) or a
combination thereof, as the Committee shall determine in its sole discretion.



For purposes of the Plan, unless otherwise defined in an employment agreement between the
Company and the relevant Optionee, a Change in Control shall be deemed to have occurred if:




(i) a tender offer (or series of related offers) shall be made and consummated
for the ownership of 50% or more of the outstanding voting securities of the
Company, unless as a result of such tender offer more than 50% of the outstanding
voting securities of the surviving or resulting corporation shall be owned in the
aggregate by the stockholders of the Company (as of the time immediately prior to
the commencement of such offer), any employee benefit plan of the Company or its
Subsidiaries, and their affiliates;




(ii) the Company shall be merged or consolidated with another corporation,
unless as a result of such merger or consolidation more than 50% of the outstanding
voting securities of the surviving or resulting corporation shall be owned in the
aggregate by the stockholders of the Company (as of the time immediately prior to
such transaction), any employee benefit plan of the Company or its Subsidiaries, and
their affiliates;




(iii) the Company shall sell substantially all of its assets to another
corporation that is not wholly owned by the Company, unless as a result of such sale
more than 50% of such assets shall be owned in the aggregate by the stockholders of
the Company (as of the time immediately prior to such transaction), any employee
benefit plan of the Company or its Subsidiaries and their affiliates; or




(iv) a Person (as defined below) shall acquire 50% or more of the outstanding
voting securities of the Company (whether directly, indirectly, beneficially or of
record), unless as a result of such acquisition more than 50% of the outstanding
voting securities of the surviving or resulting corporation shall be owned in the
aggregate by the stockholders of the Company (as of the time immediately prior to
the first acquisition of such securities by such Person), any employee benefit plan
of the Company or its Subsidiaries, and their affiliates.


 


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Notwithstanding the foregoing, if Change of Control is defined in an employment agreement between
the Company and the relevant Optionee, then, with respect to such Optionee, Change of Control shall
have the meaning ascribed to it in such employment agreement.



For purposes of this Section 5(c), ownership of voting securities shall take into account and
shall include ownership as determined by applying the provisions of Rule 13d-3(d)(I)(i) (as in
effect on the date hereof) under the Exchange Act. In addition, for such purposes, “Person” shall
have the meaning given in Section 3(a)(9) of the Exchange Act, as modified and used in Sections
13(d) and 14(d) thereof; provided, however, that a Person shall not include (A) the
Company or any of its Subsidiaries; (B) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its Subsidiaries; (C) an underwriter temporarily
holding securities pursuant to an offering of such securities; or (D) a corporation owned, directly
or indirectly, by the stockholders of the Company in substantially the same proportion as their
ownership of stock of the Company.



(d) Method of Exercise. Options to the extent then exercisable may be exercised in
whole or in part at any time during the option period, by giving written notice to the Company
specifying the number of shares of Stock to be purchased, accompanied by payment in full of the
purchase price, in cash, or by check or such other instrument as may be acceptable to the
Committee. As determined by the Committee, in its sole discretion, at or after grant, payment in
full or in part may be made at the election of the Optionee (i) in the form of Stock owned by the
Optionee (based on the Fair Market Value of the Stock which is not the subject of any pledge or
security interest, (ii) in the form of shares of Stock withheld by the Company from the shares of
Stock otherwise to be received with such withheld shares of Stock having a Fair Market Value equal
to the exercise price of the Option, or (iii) by a combination of the foregoing, such Fair Market
Value determined by applying the principles set forth in Section 5(a), provided that the combined
value of all cash and cash equivalents and the Fair Market Value of any shares surrendered to the
Company is at least equal to such exercise price and except with respect to (ii) above, such method
of payment will not cause a disqualifying disposition of all or a portion of the Stock received
upon exercise of an Incentive Option. An Optionee shall have the right to dividends and other
rights of a stockholder with respect to shares of Stock purchased upon exercise of an Option at
such time as the Optionee (i) has given written notice of exercise and has paid in full for such
shares, and (ii) has satisfied such conditions that may be imposed by the Company with respect to
the withholding of taxes.



(e) Non-transferability of Options. Options are not transferable and may be exercised
solely by the Optionee during his lifetime or after his death by the person or persons entitled
thereto under his will or the laws of descent and distribution. The Committee, in its sole
discretion, may permit a transfer of a Nonqualified Option to (i) a trust for the benefit of the
Optionee, (ii) a member of the Optionee’s immediate family (or a trust for his or her benefit) or
(iii) pursuant to a domestic relations order. Any attempt to transfer, assign, pledge or otherwise
dispose of, or to subject to execution, attachment or similar process, any Option contrary to the
provisions hereof shall be void and ineffective and shall give no right to the purported
transferee.



(f) Termination by Death. Unless otherwise determined by the Committee, if any
Optionee’s employment with or service to the Company or any Subsidiary terminates by reason of
death, the Option may thereafter be exercised, to the extent then exercisable (or on such
accelerated basis as the Committee shall determine at or after grant), by the legal representative
of the estate or by the legatee of the Optionee under the will of the Optionee, for a period of one
(1) year after the date of such death (or, if later, such time as the Option may be exercised
pursuant to Section 14(d) hereof) or until the expiration of the stated term of such Option as
provided under the Plan, whichever period is shorter.



(g) Termination by Reason of Disability. Unless otherwise determined by the
Committee, if any Optionee’s employment with or service to the Company or any Subsidiary terminates
by reason of Disability (as defined below), then any Option held by such Optionee may thereafter be
exercised, to the extent it was exercisable
at the time of termination due to Disability (or on such accelerated basis as the Committee
shall determine at or after grant), but may not be exercised after ninety (90) days after the date
of such termination of employment or service (or, if later, such time as the Option may be
exercised pursuant to Section 14(d) hereof) or the expiration of the stated term of such Option,
whichever period is shorter; provided, however, that, if the Optionee dies within
such ninety (90) day period, any unexercised Option held by such Optionee shall thereafter be
exercisable to the extent to which it was exercisable at the time of death for a period of one (1)
year after the date of such death (or, if later, such time as the Option may be exercised pursuant
to Section 14(d) hereof) or for the stated term of such Option, whichever period is shorter.
“Disability” shall mean an Optionee’s total and permanent disability; provided, that if Disability
is defined in an employment agreement between the Company and the relevant Optionee, then, with
respect to such Optionee, Disability shall have the meaning ascribed to it in such employment
agreement


 


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(h) Termination by Reason of Retirement. Unless otherwise determined by the
Committee, if any Optionee’s employment with or service to the Company or any Subsidiary terminates
by reason of Normal or Early Retirement (as such terms are defined below), any Option held by such
Optionee may thereafter be exercised to the extent it was exercisable at the time of such
Retirement (or on such accelerated basis as the Committee shall determine at or after grant), but
may not be exercised after ninety (90) days after the date of such termination of employment or
service (or, if later, such time as the Option may be exercised pursuant to Section 14(d) hereof)
or the expiration of the stated term of such Option, whichever date is earlier; provided,
however, that, if the Optionee dies within such ninety (90) day period, any unexercised
Option held by such Optionee shall thereafter be exercisable, to the extent to which it was
exercisable at the time of death, for a period of one (1) year after the date of such death (or, if
later, such time as the Option may be exercised pursuant to Section 14(d) hereof) or for the stated
term of such Option, whichever period is shorter.



For purposes of this paragraph (h), “Normal Retirement” shall mean retirement from
active employment with the Company or any Subsidiary on or after the normal retirement date
specified in the applicable Company or Subsidiary pension plan or if no such pension plan, age 65,
and “Early Retirement” shall mean retirement from active employment with the Company or any
Subsidiary pursuant to the early retirement provisions of the applicable Company or Subsidiary
pension plan or if no such pension plan, age 55.



(i) Other Terminations. Unless otherwise determined by the Committee upon grant, if
any Optionee’s employment with or service to the Company or any Subsidiary is terminated by such
Optionee for any reason other than death, Disability, Normal or Early Retirement or Good Reason (as
defined below), the Option shall thereupon terminate, except that the portion of any Option that
was exercisable on the date of such termination of employment or service may be exercised for the
lesser of ninety (90) days after the date of termination (or, if later, such time as the Option may
be exercised pursuant to Section 14(d) hereof) or the balance of such Option’s term, which ever
period is shorter. The transfer of an Optionee from the employ of or service to the Company to the
employ of or service to a Subsidiary, or vice versa, or from one Subsidiary to another, shall not
be deemed to constitute a termination of employment or service for purposes of the Plan.




(i) In the event that the Optionee’s employment or service with the Company or any
Subsidiary is terminated by the Company or such Subsidiary for “cause” any
unexercised portion of any Option shall immediately terminate in its entirety. For
purposes hereof, unless otherwise defined in an employment agreement between the
Company and the relevant Optionee, “Cause” shall exist upon a good-faith
determination by the Board, following a hearing before the Board at which an
Optionee was represented by counsel and given an opportunity to be heard, that such
Optionee has been accused of fraud, dishonesty or act detrimental to the interests
of the Company or any Subsidiary of Company or that such Optionee has been accused
of or convicted of an act of willful and material embezzlement or fraud against the
Company or of a felony under any state or federal statute; provided,
however, that it is specifically understood that “Cause” shall not include
any act of commission or omission in the good-faith exercise of such Optionee’s
business judgment as a director, officer or employee of the Company, as the case may
be, or upon the advice of counsel to the Company. Notwithstanding the foregoing, if
Cause is defined in an employment agreement between the Company and the relevant
Optionee, then, with respect to such Optionee, Cause shall have the meaning ascribed
to it in such employment agreement.


 


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(ii) In the event that an Optionee is removed as a director, officer or
employee by the Company at any time other than for “Cause” or resigns as a director,
officer or employee for “Good Reason” the Option granted to such Optionee may be
exercised by the Optionee, to the extent the Option was exercisable on the date such
Optionee ceases to be a director, officer or employee. Such Option may be exercised
at any time within one (1) year after the date the Optionee ceases to be a director,
officer or employee (or, if later, such time as the Option may be exercised pursuant
to Section 14(d) hereof), or the date on which the Option otherwise expires by its
terms; which ever period is shorter, at which time the Option shall terminate;
provided, however, if the Optionee dies before the Options terminate
and are no longer exercisable, the terms and provisions of Section 5(f) shall
control. For purposes of this Section 5(i), and unless otherwise defined in an
employment agreement between the Company and the relevant Optionee, Good Reason
shall exist upon the occurrence of the following:




	(A)	 	the assignment to Optionee of any duties
inconsistent with the position in the Company that Optionee held
immediately prior to the assignment;







	(B)	 	a Change of Control resulting in a significant
adverse alteration in the status or conditions of Optionee’s
participation with the Company or other nature of Optionee’s
responsibilities from those in effect prior to such Change of Control,
including any significant alteration in Optionee’s responsibilities
immediately prior to such Change in Control; and







	(C)	 	the failure by the Company to continue to
provide Optionee with benefits substantially similar to those enjoyed
by Optionee prior to such failure.







Notwithstanding the foregoing, if Good Reason is defined in an employment agreement
between the Company and the relevant Optionee, then, with respect to such Optionee,
Good Reason shall have the meaning ascribed to it in such employment agreement.



(j) Limit on Value of Incentive Option. The aggregate Fair Market Value, determined
as of the date the Incentive Option is granted, of Stock for which Incentive Options are
exercisable for the first time by any Optionee during any calendar year under the Plan (and/or any
other stock option plans of the Company or any Subsidiary) shall not exceed $100,000.




6. Terms and Conditions of Restricted Stock.



Restricted Stock may be granted under this Plan aside from, or in association with, any other
award and shall be subject to the following conditions and shall contain such additional terms and
conditions (including provisions relating to the acceleration of vesting of Restricted Stock upon a
Change of Control), not inconsistent with the terms of the Plan, as the Committee shall deem
desirable:



(a) Grantee rights. A Grantee shall have no rights to an award of Restricted Stock
unless and until Grantee accepts the award within the period prescribed by the Committee and, if
the Committee shall deem desirable, makes payment to the Company in cash, or by check or such other
instrument as may be acceptable to the Committee. After acceptance and issuance of a certificate
or certificates, as provided for below, the Grantee shall have the rights of a stockholder with
respect to Restricted Stock subject to the non-transferability and forfeiture restrictions
described in Section 6(d) below.



(b) Issuance of Certificates. The Company shall issue in the Grantee’s name a
certificate or certificates for the shares of Common Stock associated with the award promptly after
the Grantee accepts such award.



(c) Delivery of Certificates. Unless otherwise provided, any certificate or
certificates issued evidencing shares of Restricted Stock shall not be delivered to the Grantee
until such shares are free of any restrictions specified by the Committee at the time of grant.



(d) Forfeitability, Non-transferability of Restricted Stock. Shares of Restricted
Stock are forfeitable until the terms of the Restricted Stock grant have been satisfied. Shares of
Restricted Stock are not transferable until the date on which the Committee has specified such
restrictions have lapsed. Unless otherwise provided by the Committee at or after grant,
distributions in the form of dividends or otherwise of additional shares or property in respect of
shares of Restricted Stock shall be subject to the same restrictions as such shares of Restricted
Stock.


 


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(e) Change of Control. Upon the occurrence of a Change in Control as defined in
Section 5(c), the Committee may accelerate the vesting of outstanding Restricted Stock, in whole or
in part, as determined by the Committee, in its sole discretion.



(f) Termination of Employment. Unless otherwise determined by the Committee at or
after grant, in the event the Grantee ceases to be an employee or otherwise associated with the
Company for any other reason, all shares of Restricted Stock theretofore awarded to him which are
still subject to restrictions shall be forfeited and the Company shall have the right to complete
the blank stock power. The Committee may provide (on or after grant) that restrictions or
forfeiture conditions relating to shares of Restricted Stock will be waived in whole or in part in
the event of termination resulting from specified causes, and the Committee may in other cases
waive in whole or in part restrictions or forfeiture conditions relating to Restricted Stock.




7. Term of Plan.



No Option or award of Restricted Stock shall be granted pursuant to the Plan on or after the
date which is ten years from the effective date of the Plan, but Options and awards of Restricted
Stock theretofore granted may extend beyond that date.




8. Capital Change of the Company.



In the event of any merger, reorganization, consolidation, recapitalization, stock dividend,
or other change in corporate structure affecting the Stock, the Committee shall make an appropriate
and equitable adjustment in the number and kind of shares reserved for issuance under the Plan and
in the number and option price of shares subject to outstanding Options granted under the Plan, to
the end that after such event each Optionee’s proportionate interest shall be maintained (to the
extent possible) as immediately before the occurrence of such event. The Committee shall, to the
extent feasible, make such other adjustments as may be required under the tax laws so that any
Incentive Options previously granted shall not be deemed modified within the meaning of Section
424(h) of the Code. Appropriate adjustments shall also be made in the case of outstanding
Restricted Stock granted under the Plan.



The adjustments described above will be made only to the extent consistent with continued
qualification of the Option under Section 422 of the Code (in the case of an Incentive Option) and
Section 409A of the Code.




9. Purchase for Investment/Conditions.



Unless the Options and shares covered by the Plan have been registered under the Securities
Act of 1933, as amended (the “Securities Act”), or the Company has determined that such
registration is unnecessary, each person exercising or receiving Options or Restricted Stock under
the Plan may be required by the Company to give a representation in writing that he is acquiring
the securities for his own account for investment and not with a view to, or for sale in connection
with, the distribution of any part thereof. The Committee may impose any additional or further
restrictions on awards of Options or Restricted Stock as shall be determined by the Committee at
the time of award.




10. Taxes.



(a) The Company may make such provisions as it may deem appropriate, consistent with
applicable law, in connection with any Options or Restricted Stock granted under the Plan with
respect to the withholding of any taxes (including income or employment taxes) or any other tax
matters.



(b) If any Grantee, in connection with the acquisition of Restricted Stock, makes the election
permitted under Section 83(b) of the Code (that is, an election to include in gross income in the
year of transfer the amounts specified in Section 83(b)), such Grantee shall notify the Company of
the election with the Internal Revenue Service pursuant to regulations issued under the authority
of Code Section 83(b).


 


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(c) If any Grantee shall make any disposition of shares of Stock issued pursuant to the
exercise of an Incentive Option under the circumstances described in Section 421(b) of the Code
(relating to certain disqualifying dispositions), such Grantee shall notify the Company of such
disposition within ten (10) days hereof.




11. Effective Date of Plan.



The Plan shall be effective on
October ___, 2009; provided, however, that if, and only if,
certain options are intended to qualify as Incentive Stock Options, the Plan must subsequently be
approved by majority vote of the Company’s stockholders no later than
October ___, 2010, and
further, that in the event certain Option grants hereunder are intended to qualify as
performance-based compensation within the meaning of Section 162(m) of the Code, the requirements
as to stockholder approval set forth in Section 162(m) of the Code are satisfied.




12. Amendment and Termination.



The Board may amend, suspend, or terminate the Plan, except that no amendment shall be made
that would impair the rights of any Participant under any Option or Restricted Stock theretofore
granted without the Participant’s consent, and except that no amendment shall be made which,
without the approval of the stockholders of the Company would:



(a) materially increase the number of shares that may be issued under the Plan, except as is
provided in Section 8;




(b) materially increase the benefits accruing to the Participants under the Plan;




(c) materially modify the requirements as to eligibility for participation in the Plan;



(d) decrease the exercise price of an Incentive Option to less than 100% of the Fair Market
Value per share of Stock on the date of grant thereof or the exercise price of a Nonqualified
Option to less than 100% of the Fair Market Value per share of Stock on the date of grant thereof;
or




(e) extend the term of any Option beyond that provided for in Section 5(b).



(f) except as otherwise provided in Sections 5(d) and 8 hereof, reduce the exercise price of
outstanding Options or effect repricing through cancellations and re-grants of new Options.



Subject to the forgoing, the Committee may amend the terms of any Option theretofore granted,
prospectively or retrospectively, but no such amendment shall impair the rights of any Optionee
without the Optionee’s consent.



It is the intention of the Board that the Plan comply strictly with the provisions of Section
409A of the Code and Treasury Regulations and other Internal Revenue Service guidance promulgated
thereunder (the “Section 409A Rules”) and the Committee shall exercise its discretion in
granting awards hereunder (and the terms of such awards), accordingly. The Plan and any grant of
an award hereunder may be amended from time to time (without, in the case of an award, the consent of the Participant) as may be necessary or
appropriate to comply with the Section 409A Rules.




13. Government Regulations.



The Plan, and the grant and exercise of Options or Restricted Stock hereunder, and the
obligation of the Company to sell and deliver shares under such Options and Restricted Stock shall
be subject to all applicable laws, rules and regulations, and to such approvals by any governmental
agencies, national securities exchanges and interdealer quotation systems as may be required.


 


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14. General Provisions.



(a) Certificates. All certificates for shares of Stock delivered under the Plan shall
be subject to such stop transfer orders and other restrictions as the Committee may deem advisable
under the rules, regulations and other requirements of the Securities and Exchange Commission, or
other securities commission having jurisdiction, any applicable Federal or state securities law,
any stock exchange or interdealer quotation system upon which the Stock is then listed or traded
and the Committee may cause a legend or legends to be placed on any such certificates to make
appropriate reference to such restrictions.



(b) Employment Matters. Neither the adoption of the Plan nor any grant or award under
the Plan shall confer upon any Participant who is an employee of the Company or any Subsidiary any
right to continued employment or, in the case of a Participant who is a director, continued service
as a director, with the Company or a Subsidiary, as the case may be, nor shall it interfere in any
way with the right of the Company or any Subsidiary to terminate the employment of any of its
employees, the service of any of its directors or the retention of any of its consultants or
advisors at any time.



(c) Limitation of Liability. No member of the Committee, or any officer or employee
of the Company acting on behalf of the Committee, shall be personally liable for any action,
determination or interpretation taken or made in good faith with respect to the Plan, and all
members of the Committee and each and any officer or employee of the Company acting on their behalf
shall, to the extent permitted by law, be fully indemnified and protected by the Company in respect
of any such action, determination or interpretation.



(d) Registration of Stock. Notwithstanding any other provision in the Plan, no Option
may be exercised unless and until the Stock to be issued upon the exercise thereof has been
registered under the Securities Act and applicable state securities laws, or are, in the opinion of
counsel to the Company, exempt from such registration in the United States. The Company shall not
be under any obligation to register under applicable federal or state securities laws any Stock to
be issued upon the exercise of an Option granted hereunder in order to permit the exercise of an
Option and the issuance and sale of the Stock subject to such Option, although the Company may in
its sole discretion register such Stock at such time as the Company shall determine. If the
Company chooses to comply with such an exemption from registration, the Stock issued under the Plan
may, at the direction of the Committee, bear an appropriate restrictive legend restricting the
transfer or pledge of the Stock represented thereby, and the Committee may also give appropriate
stop transfer instructions with respect to such Stock to the Company’s transfer agent.




15. Non-Uniform Determinations.



The Committee’s determinations under the Plan, including, without limitation, (i) the
determination of the Participants to receive awards, (ii) the form, amount and timing of such
awards, (iii) the terms and provisions of such awards and (ii) the agreements evidencing the same,
need not be uniform and may be made by it selectively among Participants who receive, or who are
eligible to receive, awards under the Plan, whether or not such Participants are similarly
situated.




16. Governing Law.



The validity, construction, and effect of the Plan and any rules and regulations relating to
the Plan shall be determined in accordance with the internal laws of the State of Delaware, without
giving effect to principles of conflicts of laws, and applicable federal law.




 


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