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4.       Stock Available for Awards          (a)          Number of Shares; Share Counting.                         (1)          Authorized Number of Shares. Subject to adjustment under Section 10, Awards maybe made under the Plan for up to 5,400,000 shares of common stock, $0.01 par value per share, ofthe Company (the “***Common Stock***”), any or all of which Awards may be in the form of Incentive StockOptions (as defined in Section 5(b)). Shares issued under the Plan may consist in whole or in partof authorized but unissued shares or treasury shares. The Company shall not make any new Awardsunder any prior equity plans after the date the Plan is approved by the Company’s stockholders (the“***Effective Date***”).                         (2)          Fungible Share Pool. Subject to adjustment under Section 10, any Award that isnot a Full-Value Award shall be counted against the share limit specified in Section 4(a)(1) as oneshare for each share of Common Stock subject to such Award and any Award that is a Full-Value Awardshall be counted against the share limit specified in Sections 4(a)(1) as 1.6 shares for each oneshare of Common Stock subject to such Full-Value Award. “Full-Value Award” means any RestrictedStock Award or other Stock-Based Award, including Performance Awards (as defined below) designed tobe settled in stock, with a per share price or per unit purchase price lower than 100% of FairMarket Value (as defined below) on the date of grant. To the extent a share that was subject to anAward that counted as one share is returned to the Plan pursuant to Section 4(a)(3), the sharereserve will be credited with one share. To the extent that a share that was subject to an Awardthat counts as 1.6 shares is returned to the Plan pursuant to Section 4(a)(3), the share reservewill be credited with 1.6 shares.                         (3)          Share Counting. For purposes of counting the number of shares available for thegrant of Awards under the Plan:                                        (A)          all shares of Common Stock covered by SARs shall be counted against the number of sharesavailable for the grant of Awards under the Plan; however, if the Company makes a tandem award ofan Option and a SAR for the same number of shares of Common Stock and provides that only one may beexercised, the Common Stock counted against the limit shall be the number that could be issuedunder either but not both, and the expiration of one in connection with the other’s exercise willnot restore shares to the Plan.                                        (B)          if any Award granted under this or any predecessor plan of the Company (i) expires or isterminated, surrendered or canceled without having been fully exercised or is forfeited in whole orin part (including as the result of shares of Common Stock subject to such Award being repurchasedby the Company at the original issuance price pursuant to a contractual repurchase right) or (ii)results in any Common Stock not being issued (including as a result of an SAR that was settleableeither in cash or in stock actually being settled in cash), the unused Common Stock covered by suchAward shall again be available for the grant of Awards using the fungible share principles setforth in Section 4(a)(2); *provided, however*, in the case of Incentive Stock Options, the foregoingshall be subject to any limitations under the Code; and *provided further*, in the case of theexercise of an SAR, the number of shares counted against the shares available under the Plan shallbe the full number of shares subject to the SAR multiplied by the percentage of the SAR actuallyexercised, regardless of the number of shares actually used to settle such SAR upon exercise;                                        (C)          shares of Common Stock delivered by actual delivery, attestation, or net exercise) to theCompany by a Participant to (i) purchase shares of Common Stock upon the exercise of an Award or(ii) satisfy tax withholding obligations (including shares retained from the Award creating the taxobligation) shall not be added back to the number of shares available for the future grant ofAwards;                                        (D)          shares of Common Stock repurchased by the Company on the open market using the proceedsfrom the exercise of an Award shall not increase the number of shares available for future grant ofAwards; and                                        (E)          any Awards granted under any stockholder approved plan between October 1, 2009 and theEffective Date will be counted against the shares available in Section 4(a)(1) using the fungibleshare principles set out in Section 4(a)(2).          (b)          Section 162(m) Per-Participant Limit. Subject to adjustment under Section 10, themaximum number of shares of Common Stock with respect to which Awards may be granted to anyParticipant under the Plan shall be 1,400,000 per calendar year. For purposes of the foregoinglimit, the combination of an Option in tandem
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with an SAR shall be treated as a single Award. Theper Participant limit described in this Section 4(b) shall be construed and applied consistentlywith Section 162(m) of the Code or any successor provision thereto, and the regulations thereunder(“***Section 162(m)***”).          (c)          Substitute Awards. In connection with a merger or consolidation of an entity withthe Company or the acquisition by the Company of property or stock of an entity, the Board maygrant Awards in substitution for any options or other stock or stock-based awards granted by suchentity or an affiliate thereof. Substitute Awards may be granted on such terms as the Board deemsappropriate in the circumstances, notwithstanding any limitations on Awards contained in the Plan.Substitute Awards shall not count against the overall share limit set forth in Section 4(a)(1) orthe limit in Section 4(b), except as may be required by reason of Section 422 and relatedprovisions of the Code.5.       Stock Options          (a)          General. The Board may grant options to purchase Common Stock (each, an “***Option***”)and determine the number of shares of Common Stock to be covered by each Option, the exercise priceof each Option and the conditions and limitations applicable to the exercise of each Option,including conditions relating to applicable federal or state securities laws, as it considersnecessary or advisable.          (b)          Incentive Stock Options. An Option that the Board intends to be an “incentivestock option” as defined in Section 422 of the Code (an “***Incentive Stock Option***”) shall only begranted to employees of Biodel Inc., any of Biodel Inc.’s present or future parent or subsidiarycorporations as defined in Sections 424(e) or (f) of the Code, and any other entities the employeesof which are eligible to receive Incentive Stock Options under the Code, and shall be subject toand shall be construed consistently with the requirements of Section 422 of the Code. An Optionthat is not intended to be an Incentive Stock Option shall be designated a “***Nonstatutory StockOption***.” The Company shall have no liability to a Participant, or any other party, if an Option(or any part thereof) that is intended to be an Incentive Stock Option is not an Incentive StockOption or if the Company converts an Incentive Stock Option to a Nonstatutory Stock Option.          (c)          Exercise Price. The Board shall establish the exercise price of each Option andspecify the exercise price in the applicable Option agreement. The exercise price shall be not lessthan 100% of the fair market value (“***Fair Market Value***”) on the date the Option is granted (whichshall be the closing sales price for such stock (or the closing bid, if no sales were reported) asquoted on the Nasdaq Global Market, the Nasdaq Capital Market or the Nasdaq Global Select Market(or the exchange or market with the greatest volume of trading in the Common Stock), as reported inThe Wall Street Journal or such other source as the Board deems reliable, on the date of grant oras of such other date as satisfies applicable tax requirements); *provided*that if the Boardapproves the grant of an Option with an exercise price to be determined on a future date, theexercise price shall be not less than 100% of the Fair Market Value on such future date. If theCommon Stock is not publicly traded, the Board will determine the Fair Market Value for purposes ofthe Plan using any measure of value it determines to be appropriate (including, as it considersappropriate, relying on appraisals) in a manner consistent with the valuation principles under CodeSection 409A, except as the Board may expressly determine otherwise. For any date that is not atrading day, the Fair Market Value of a share of Common Stock for such date will be determined byusing the closing sale price or average of the bid and asked prices, as appropriate, for theimmediately preceding trading day. The Board can substitute a particular time of day or othermeasure of “closing sale price” or “bid and asked prices” if appropriate because of exchange ormarket procedures or can, in its sole discretion, use weighted averages either on a daily basis orsuch longer period as complies with Code Section 409A.          (d)          Duration of Options. Each Option shall be exercisable at such times and subjectto such terms and conditions as the Board may specify in the applicable option agreement; *provided,however*, that no Option will be granted with a term in excess of seven years.          (e)          Exercise of Options. Options may be exercised by delivery to the Company of anotice of exercise in a form (which may be in electronic form) approved by the Company, togetherwith payment in full (in the manner specified in Section 5(g)) of the exercise price for the numberof shares for which the Option is exercised. Shares of Common Stock subject to the Option will bedelivered by the Company as soon as practicable following exercise.          (f)          Payment Upon Exercise. Common Stock purchased upon the exercise of an Optiongranted under the Plan shall be paid for as follows:
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                         (1)          in cash or by check, payable to the order of the Company;                         (2)          except as may otherwise be provided in the applicable Option agreement or approved by theBoard, in its sole discretion, by (i) delivery of an irrevocable and unconditional undertaking by acreditworthy broker to deliver promptly to the Company sufficient funds to pay the exercise priceand any required tax withholding or (ii) delivery by the Participant to the Company of a copy ofirrevocable and unconditional instructions to a creditworthy broker to deliver promptly to theCompany cash or a check sufficient to pay the exercise price and any required tax withholding;                         (3)          to the extent provided for in the applicable Option agreement or approved by the Board, inits sole discretion, by delivery (either by actual delivery or attestation) of shares of CommonStock owned by the Participant valued at their Fair Market Value, provided (i) such method ofpayment is then permitted under applicable law, (ii) such Common Stock, if acquired directly fromthe Company, was owned by the Participant for such minimum period of time, if any, as may beestablished by the Board in its discretion and (iii) such Common Stock is not subject to anyrepurchase, forfeiture, unfulfilled vesting or other similar requirements;                         (4) to the extent provided for in the applicable Nonstatutory Stock Option agreement orapproved by the Board in its sole discretion, by delivery of a notice of “net exercise” to theCompany, as a result of which the Participant would receive the number of shares of Common Stockunderlying the portion of the Option being exercised reduced by the number of shares of CommonStock equal to the aggregate exercise price of the portion of the Option being exercised divided bythe Fair Market Value on the date of exercise;                         (5)          to the extent permitted by applicable law and provided for in the applicable Optionagreement or approved by the Board, in its sole discretion, by payment of such other lawfulconsideration as the Board may determine; or                         (6)          by any combination of the above permitted forms of payment.          (g)          No Reload Options. No Option granted under the Plan shall contain any provisionentitling the Participant to the automatic grant of additional Options in connection with anyexercise of the original Option.          (h)          No Dividend Equivalents. No Option shall provide for the payment or accrual ofdividend equivalents.          (i)          Limitation on Repricing. Unless such action is approved by the Company’sstockholders, the Company may not (except as provided for under Section 10): (1) amend anyoutstanding Option granted under the Plan to provide an exercise price per share that is lower thanthe then-current exercise price per share of such outstanding Option, (2) cancel any outstandingoption (whether or not granted under the Plan) and grant in substitution therefor new Awards underthe Plan (other than Awards granted pursuant to Section 4(c)) covering the same or a differentnumber of shares of Common Stock and having an exercise price per share lower than the then-currentexercise price per share of the cancelled option, (3) cancel for cash any Options that then haveexercise prices per share below the Fair Market Value, other than under Section 10, or (4) take anyother action that that constitutes a “repricing” within the meaning of the rules of the NASDAQStock Market (“***NASDAQ***”).6.       Stock Appreciation Rights          (a)          General. The Board may grant Awards consisting of stock appreciation rights(“***SARs***”) entitling the holder, upon exercise, to receive an amount of Common Stock determined byreference to appreciation, from and after the date of grant, in the Fair Market Value of a share ofCommon Stock over the measurement price established pursuant to Section 6(b). The date as of whichsuch appreciation is determined shall be the exercise date.          (b)          Measurement Price. The Board shall establish the measurement price of each SARand specify it in the applicable SAR agreement. The measurement price shall not be less than 100%of the Fair Market Value on the date the SAR is granted; *provided*that if the Board approves thegrant of a SAR effective as of a future date, the measurement price shall be not less than 100% ofthe Fair Market Value on such future date.
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          (c)          Duration of SARs. Each SAR shall be exercisable at such times and subject to suchterms and conditions as the Board may specify in the applicable SAR agreement; *provided, however*,that no SAR will be granted with a term in excess of seven years.          (d)          Exercise of SARs. SARs may be exercised by delivery to the Company of a notice ofexercise in a form (which may be in electronic form) approved by the Company, together with anyother documents required by the Board.          (e)          Dividend Equivalents. No SAR shall provide for the payment or accrual of dividendequivalents.          (f)          Limitation on Repricing. Unless such action is approved by the Company’sstockholders, the Company may not (except as provided for under Section 10): (1) amend anyoutstanding SAR granted under the Plan to provide a measurement price per share that is lower thanthe then-current measurement price per share of such outstanding SAR, (2) cancel any outstandingSAR (whether or not granted under the Plan) and grant in substitution therefor new Awards under thePlan (other than Awards granted pursuant to Section 4(c)) covering thesame or a different number of shares of Common Stock and having an exercise or measurementprice per share lower than the then-current measurement price per share of the cancelled SAR,(3) cancel for cash any SARs that then have measurement prices per share below the Fair MarketValue, other than under Section 10, or (4) take any other action that that constitutes a“repricing” within the meaning of the rules of NASDAQ.7.       Restricted Stock; Restricted Stock Units          (a)          General. The Board may grant Awards entitling recipients to acquire shares ofCommon Stock (“***Restricted Stock***”), subject to the right of the Company to repurchase all or part ofsuch shares at their issue price or other stated or formula price (or to require forfeiture of suchshares if issued at no cost) from the recipient in the event that conditions specified by the Boardin the applicable Award are not satisfied prior to the end of the applicable restriction period orperiods established by the Board for such Award. The Board may also grant Awards entitling therecipient to receive shares of Common Stock or cash to be delivered at the time such Award vests(“***Restricted Stock Units***”) (Restricted Stock and Restricted Stock Units are each referred toherein as a “***Restricted Stock Award***”).          (b)          Terms and Conditions for All Restricted Stock Awards.                         (1)          The Board shall determine the terms and conditions of a Restricted Stock Award, includingthe conditions for vesting and repurchase (or forfeiture) and the issue price, if any.                         (2)          Notwithstanding any other provision of the Plan (other than Section 9, if applicable), theBoard may, either at the time a Restricted Stock Award is made or at any time thereafter, waive itsright to repurchase shares of Common Stock (or waive the forfeiture thereof) or remove or modifythe restrictions applicable to the Restricted Stock Award, in whole or in part.          (c)          Additional Provisions Relating to Restricted Stock.                         (1)          Dividends. Restricted Stock will accrue ordinary cash dividends, unless the Boarddetermines otherwise and applicable law permits such nonaccrual. Participants holding shares ofRestricted Stock will only be entitled to such cash dividends if specifically provided in theRestricted Stock agreement, will only receive the dividends if and when the Restricted Stock vests,and will then receive dividends only prospectively unless the Board or the Restricted Stockagreement provides for the payment of prior dividends upon or after vesting. Any dividend paymentwill be made no later than the latest of the end of the calendar year in which the dividends arepaid to stockholders of that class of stock, the 15th day of the third month following the date thedividends are paid to stockholders of that class of stock, or the 15th day of the third monthfollowing the date on which the Restricted Stock to which the dividends pertain vests. Unlessotherwise provided in the Restricted Stock agreement, if any dividends or distributions are paid inshares, or consist of a dividend or distribution to holders of Common Stock other than an ordinarycash dividend, the shares, cash or other property will be subject to the same restrictions ontransferability and forfeitability as the shares of Restricted Stock with respect to which theywere paid.                         (2)          Stock Certificates. The Company may require that any stock certificates issued inrespect of shares of Restricted Stock, as well as dividends or distributions paid on suchRestricted Stock, shall be deposited
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in escrow by the Participant, together with a stock powerendorsed in blank, with the Company (or its designee). At the expiration of the applicablerestriction periods, the Company (or such designee) shall deliver the certificates no longersubject to such restrictions to the Participant or if the Participant has died, to his or herDesignated Beneficiary. “***Designated Beneficiary***” means (i) the beneficiary designated, in a mannerdetermined by the Board, by a Participant to receive amounts due or exercise rights of theParticipant in the event of the Participant’s death or (ii) in the absence of an effectivedesignation by a Participant, the Participant’s estate.          (d)          Additional Provisions Relating to Restricted Stock Units.                         (1)          Settlement. Upon the vesting of and/or lapsing of any other restrictions (i.e.,settlement) with respect to each Restricted Stock Unit, the Participant shall be entitled toreceive from the Company one share of Common Stock, unless the Board provides in the applicableAward agreement that the Restricted Stock Unit will be settled in cash (either automatically or atthe Board’s discretion on payment). The Board may, in its discretion, provide that settlement ofRestricted Stock Units shall be deferred, on a mandatory basis or at the election of theParticipant in a manner that complies with Section 409A of the Code.                         (2)          Voting Rights. A Participant shall have no voting rights with respect to anyRestricted Stock Units.                         (3)          Dividend Equivalents. To the extent provided by the Board, in its solediscretion, a grant of Restricted Stock Units may provide Participants with the right to receive anamount equal to any dividends or other distributions declared and paid on an equal number ofoutstanding shares of Common Stock (“***Dividend Equivalents***”). Dividend Equivalents may be settledin cash and/or shares of Common Stock and will be subject to the same restrictions on transfer andforfeitability as the Restricted Stock Units with respect to which paid, as determined by the Boardin its sole discretion, subject in each case to such terms and conditions as the Board shallestablish, in each case to be set forth in the applicable Award agreement. Any Dividend Equivalentpayments will be made no later than the latest of the end of the calendar year in which thedividends are paid to stockholders of the class of stock underlying the Restricted Stock Units, the15th day of the third month following the date the dividends are paid to stockholders of that classof stock, or the 15th day of the third month following the date on which the Restricted Stock Unitto which the dividends pertain vests, absent a further deferral that complies with Section 409A ofthe Code.8.       Other Stock-Based and Cash-Based Awards          (a)          General. Other Awards of shares of Common Stock, and other Awards that are valuedin whole or in part by reference to, or are otherwise based on, shares of Common Stock or otherproperty, may be granted hereunder to Participants (“***Other Stock-Based-Awards***”), including withoutlimitation Awards entitling recipients to receive shares of Common Stock to be delivered in thefuture. Such Other Stock-Based Awards shall also be available as a form of payment in thesettlement of other Awards granted under the Plan or as payment in lieu of compensation to which aParticipant is otherwise entitled. Other Stock-Based Awards may be paid in shares of Common Stockor cash, as the Board shall determine. The Company may also grant Performance Awards or otherAwards denominated in cash rather than shares of Common Stock (“***Cash-Based Awards***”).          (b)          Terms and Conditions.                         (1)          Subject to the provisions of the Plan, the Board shall determine the terms and conditionsof each Other Stock-Based Award or Cash-Based Award, including any purchase price applicablethereto.                         (2)          Notwithstanding any other provision of the Plan (other than Section 9, if applicable), theBoard may, either at the time an Other Stock-Based Award is made or at any time thereafter, waiveits right to repurchase shares of Common Stock (or waive the forfeiture thereof) or remove ormodify the restrictions applicable to the Other Stock-Based Award, in whole or in part.9.       Performance Awards.          (a)          Grants. Restricted Stock Awards and Other Stock-Based Awards under the Plan maybe made subject to the achievement of performance goals pursuant to this Section 9 (“***PerformanceAwards***”). Performance Awards can also provide for cash payments of up to $1,000,000 per calendaryear per individual.
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          (b)          Committee. Grants of Performance Awards to any Covered Employee (as definedbelow) intended to qualify as “performance-based compensation” under Section 162(m)(“***Performance-Based Compensation***”) shall be made only by a Committee (or a subcommittee of aCommittee) comprised solely of two or more directors eligible to serve on a committee making Awardsqualifying as “performance-based compensation” under Section 162(m). In the case of such Awardsgranted to Covered Employees, references to the Board or to a Committee shall be treated asreferring to such Committee (or subcommittee). “***Covered Employee***” shall mean any person who is, orwhom the Committee, in its discretion, determines may be, a “covered employee” under Section162(m)(3) of the Code.          (c)          Performance Measures. For any Award that is intended to qualify asPerformance-Based Compensation, the Committee shall specify that the degree of granting, vestingand/or payout shall be subject to the achievement of one or more objective performance measuresestablished by the Committee, which shall be based on the relative or absolute attainment ofspecified levels of one or any combination of the following: reductions in net loss, approval ofproduct candidates by regulatory authorities, increase in cost savings, earnings before or afterdiscontinued operations, interest, taxes, depreciation and/or amortization, operating profit beforeor after discontinued operations and/or taxes, sales, sales growth, earnings growth, cash flow orcash position, gross margins, stock price, market share, return on sales, assets, equity orinvestment, improvement of financial ratings, achievement of balance sheet or income statementobjectives or total stockholder return. Such goals may reflect absolute entity or business unitperformance or a relative comparison to the performance of a peer group of entities or otherexternal measure of the selected performance criteria and may be absolute in their terms ormeasured against or in relationship to other companies comparably, similarly or otherwise situated.The Committee may specify that such performance measures shall be adjusted to exclude any one ormore of (i) extraordinary items, (ii) gains or losses on the dispositions of discontinuedoperations, (iii) the cumulative effects of changes in accountingprinciples, (iv) the writedown of any asset, and (v) charges for restructuring andrationalization programs. Such performance measures: (i) may vary by Participant and may bedifferent for different Awards; (ii) may be particular to a Participant or the department, branch,line of business, subsidiary or other unit in which the Participant works and may cover such periodas may be specified by the Committee; and (iii) shall be set by the Committee within the timeperiod prescribed by, and shall otherwise comply with the requirements of, Section 162(m). Awardsthat are not intended to qualify as Performance-Based Compensation may be based on these or suchother performance measures as the Board may determine.          (d)          Adjustments. Notwithstanding any provision of the Plan, with respect to anyPerformance Award that is intended to qualify as Performance-Based Compensation, the Committee mayadjust downwards, but not upwards, the cash or number of shares payable pursuant to such Award, andthe Committee may not waive the achievement of the applicable performance measures except in thecase of the death or disability of the Participant or a change in control of the Company.          (e)          Other. The Committee shall have the power to impose such other restrictions onPerformance Awards as it may deem necessary or appropriate to ensure that such Awards satisfy allrequirements for Performance-Based Compensation.10.     Adjustments for Changes in Common Stock and Certain Other Events          (a)          Changes in Capitalization. In the event of any stock split, reverse stock split,stock dividend, recapitalization, combination of shares, reclassification of shares, spin-off orother similar change in capitalization or event, or any dividend or distribution to holders ofCommon Stock other than an ordinary cash dividend, (i) the number and class of securities availableunder the Plan, (ii) the share counting rules and sublimit set forth in Sections 4(a) and 4(b),(iii) the share and per-share provisions and the measurement price of each outstanding SAR, (iv)the number of shares subject to and the repurchase price per share subject to each outstandingRestricted Stock Award and (v) the share and per-share-related provisions and the purchase price,if any, of each outstanding Other Stock-Based Award, shall be equitably adjusted by the Company (orsubstitute Awards may be made, if applicable) in the manner determined by the Board. Withoutlimiting the generality of the foregoing, in the event the Company effects a split of the CommonStock by means of a stock dividend and the exercise price of and the number of shares subject to anoutstanding Option are adjusted as of the date of the distribution of the dividend (rather than asof the record date for such dividend), then an optionee who exercises an Option between the recorddate and the distribution date for such stock dividend shall be entitled to receive, on thedistribution date, the stock dividend with respect to the shares of Common Stock acquired upon suchOption exercise, notwithstanding the fact that such shares were not outstanding as of the close ofbusiness on the record date for such stock dividend.
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          (b)          Reorganization Events.                         (1)          Definition. A “***Reorganization Event***” shall mean: (a) any merger or consolidationof the Company with or into another entity as a result of which all of the Common Stock of theCompany is converted into or exchanged for the right to receive cash, securities or other propertyor is cancelled, (b) any transfer or disposition of all of the Common Stock of the Company forcash, securities or other property pursuant to a share exchange or other transaction or (c) anyliquidation or dissolution of the Company.                         (2)          Consequences of a Reorganization Event on Awards Other than Restricted Stock. Inconnection with a Reorganization Event, the Board may take any one or more of the following actionsas to all or any (or any portion of) outstanding Awards other than Restricted Stock on such termsas the Board determines: (i) provide that Awards shall be assumed, or substantially equivalentAwards shall be substituted, by the acquiring or succeeding corporation (or an affiliate thereof),(ii) upon written notice to a Participant, provide that all of the Participant’s unexercised Awardswill terminate immediately prior to the consummation of such Reorganization Event unless exercisedby the Participant within a specified period following the date of such notice and that allunexercisable Awards shall become exercisable for such purpose, (iii) provide that outstandingAwards shall become exercisable, realizable, or deliverable, or restrictions applicable to an Awardshall lapse, in whole or in part prior to or upon such Reorganization Event, (iv) in the event of aReorganization Event under the terms of which holders of Common Stock will receive uponconsummation thereof a cash payment for each share surrendered in the Reorganization Event (the“***Acquisition Price***”), make or provide for a cash payment to Participants with respect to each Awardheld by a Participant equal to (A) the number of shares of Common Stock subject to the vestedportion of the Award (after giving effect to any acceleration of vesting that occurs upon orimmediately prior to such Reorganization Event) multiplied by (B) the excess, if any, of (I) theAcquisition Price over (II) the exercise, measurement or purchase price of such Award and anyapplicable tax withholdings, in exchange for the termination of such Award, (v) provide that, inconnection with a liquidation or dissolution of the Company, Awards shall convert into the right toreceive liquidation proceeds (if applicable, net of the exercise, measurement or purchase pricethereof and any applicable tax withholdings) and (vi) any combination of the foregoing. In takingany of theactions permitted under this Section 10(b), the Board shall not be obligated by the Plan totreat all Awards, all Awards held by a Participant, or all Awards of the same type, identically.                         For purposes of clause (i) above, an Award (other than Restricted Stock) shall be consideredassumed if, following consummation of the Reorganization Event, such Award confers the right topurchase or receive, for each share of Common Stock subject to the Award immediately prior to theconsummation of the Reorganization Event, the consideration (whether cash, securities or otherproperty) received as a result of the Reorganization Event by holders of Common Stock for eachshare of Common Stock held immediately prior to the consummation of the Reorganization Event (andif holders were offered a choice of consideration, the type of consideration chosen by the holdersof a majority of the outstanding shares of Common Stock) less any applicable exercise ormeasurement price; *provided, however*, that if the consideration received as a result of theReorganization Event is not solely common stock of the acquiring or succeeding corporation (or anaffiliate thereof), the Company may, with the consent of the acquiring or succeeding corporation,provide for the consideration to be received upon the exercise of Awards or settlement ofRestricted Stock Units to consist solely of such number of shares of common stock of the acquiringor succeeding corporation (or an affiliate thereof) that the Board determined to be equivalent invalue (as of the date of such determination or another date specified by the Board) to the pershare consideration received by holders of outstanding shares of Common Stock as a result of theReorganization Event.                         (3)          Consequences of a Reorganization Event on Restricted Stock. Upon the occurrenceof a Reorganization Event other than a liquidation or dissolution of the Company, the repurchaseand other rights of the Company with respect to outstanding Restricted Stock shall inure to thebenefit of the Company’s successor and shall, unless the Board determines otherwise, apply to thecash, securities or other property which the Common Stock was converted into or exchanged forpursuant to such Reorganization Event in the same manner and to the same extent as they applied tosuch Restricted Stock; *provided*, *however*, that the Board may provide for termination or deemedsatisfaction of such repurchase or other rights under the instrument evidencing any RestrictedStock or any other agreement between a Participant and the Company, either initially or byamendment. Upon the occurrence of a Reorganization Event involving the liquidation or dissolutionof the Company, except to the extent specifically provided to the contrary in the instrumentevidencing any Restricted Stock or any other agreement between a Participant and the Company, allrestrictions and conditions on all Restricted Stock then outstanding shall automatically be deemedterminated or satisfied.
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          (c)          Change in Control Events.                         (1)          Definition. A “***Change in Control Event***” shall mean:                                        (A)          the acquisition by an individual, entity or group (within the meaning of Section 13(d)(3)or 14(d)(2) of the Exchange Act) (a “***Person***”) of beneficial ownership of any capital stock of theCompany if, after such acquisition, such Person beneficially owns (within the meaning of Rule 13d-3under the Exchange Act) 50% or more of either (x) the then-outstanding shares of common stock ofthe Company (the “***Outstanding Company Common Stock***”) or (y) the combined voting power of thethen-outstanding securities of the Company entitled to vote generally in the election of directors(the “***Outstanding Company Voting Securities***”); *provided, however*, that for purposes of thissubsection (A), the following acquisitions shall not constitute a Change in Control Event: (1) anyacquisition directly from the Company (excluding an acquisition pursuant to the exercise,conversion or exchange of any security exercisable for, convertible into or exchangeable for commonstock or voting securities of the Company, unless the Person exercising, converting or exchangingsuch security acquired such security directly from the Company or an underwriter or agent of theCompany), (2) any acquisition by any employee benefit plan (or related trust) sponsored ormaintained by the Company or any corporation controlled by the Company, or (3) any acquisition byany corporation pursuant to a Business Combination (as defined below) that complies with clauses(x) and (y) of subsection (C) of this definition; or                                        (B)          a change in the composition of the Board that results in the Continuing Directors (asdefined below) no longer constituting a majority of the Board (or, if applicable, the Board ofDirectors of a successor corporation to the Company), where the term “***Continuing Director***” means atany date a member of the Board (x) who was a member of the Board on the date of the initialadoption of the Plan by the Board or (y) who was nominated or elected subsequent to such date by atleast a majority of the directors who were Continuing Directors at the time of such nomination orelection or whose election to the Board was recommended or endorsed by at least a majority of thedirectors who were Continuing Directors at the time of such nomination or election; *provided,however*, that there shall be excluded from this clause (y) any individual whose initial assumptionof office occurred as a result of an actual or threatened election contest with respect to theelection or removal of directors or other actual or threatened solicitation of proxies or consents,by or on behalf of a person other than the Board; or                                        (C)          the consummation of a merger, consolidation, reorganization, recapitalization or shareexchange involving the Company or a sale or other disposition of all or substantially all of theassets of the Company (a “***Business Combination***”), unless, immediately following such BusinessCombination, each of the following two conditions is satisfied: (x) all or substantially all of theindividuals and entities who were the beneficial owners of the Outstanding Company Common Stock andOutstanding Company Voting Securities immediately prior to such Business Combination beneficiallyown, directly or indirectly, more than 50% of the then-outstanding shares of common stock and thecombined voting power of the then-outstanding securities entitled to vote generally in the electionof directors, respectively, of the resulting or acquiring corporation in such Business Combination(which shall include, without limitation, a corporation which as a result of such transaction ownsthe Company or substantially all of the Company’s assets either directly or through one or moresubsidiaries) (such resulting or acquiring corporation is referred to herein as the “***AcquiringCorporation***”) in substantially the same proportions as their ownership of the Outstanding CompanyCommon Stock and Outstanding Company Voting Securities, respectively, immediately prior to suchBusiness Combination and (y) no Person (excluding any employee benefit plan (or related trust)maintained or sponsored by the Company or by the Acquiring Corporation) beneficially owns, directlyor indirectly, 50% or more of the then-outstanding shares of common stock of the AcquiringCorporation, or of the combined voting power of the then-outstanding securities of such corporationentitled to vote generally in the election of directors (except to the extent that such ownershipexisted prior to the Business Combination); or                                        (D)          the liquidation or dissolution of the Company.                         (2)          Effect on Options. Notwithstanding the provisions of Section 10(b), effectiveimmediately prior to a Change in Control Event, except to the extent specifically provided to thecontrary in the instrument evidencing any Option or any other agreement between a Participant andthe Company, all Options then outstanding shall automatically become immediately exercisable infull.                         (3)          Effect on Restricted Stock Awards. Notwithstanding the provisions of Section10(b), effective immediately prior to a Change in Control Event, except to the extent specificallyprovided to the contrary in the instrument evidencing any Restricted Stock Award or any otheragreement between a Participant and the
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Company, all restrictions and conditions on all RestrictedStock Awards then-outstanding shall automatically be deemed terminated or satisfied.                         (4)          Effect on SARs and Other Stock-Based Awards. The Board may specify in an Award atthe time of the grant the effect of a Change in Control Event on any SAR and Other Stock-BasedAward.          (d)          Effect of Section 409A on Award Acceleration. Unless the Board provides otherwisein the Award Agreement, if an Award is subject to, rather than exempt from, Code Section 409A, aReorganization Event or Change in Control may vest the Award but shall only accelerate payment tothe Participant if the Reorganization Event or Change in Control also comports with the descriptionof “Change in Control Events” in Treasury Regulation section 1.409A-3(i)(5), or in subsequent IRSguidance describing what constitutes a change in control event for purposes of Code Section 409A.11.     General Provisions Applicable to Awards          (a)          Transferability of Awards. Awards shall not be sold, assigned, transferred,pledged or otherwise encumbered by the person to whom they are granted, either voluntarily or byoperation of law, except by will or the laws of descent and distribution or, other than in the caseof an Incentive Stock Option, pursuant to a qualified domestic relations order, and, during thelife of the Participant, shall be exercisable only by the Participant; *provided, however*, that theBoard may permit or provide in an Award for the gratuitous transfer of the Award by the Participantto or for the benefit of any immediate family member, family trust or other entity established forthe benefit of the Participant and/or an immediate family member thereof if the Company would beeligible to use a Form S-8 under the Securities Act for the registration of the sale of the CommonStock subject to such Award to such proposed transferee; *provided further*, that the Company shallnot be required to recognize any such permitted transfer until such time as such permittedtransferee shall, as a condition to such transfer, deliver to the Company a written instrument inform and substance satisfactory to the Company confirming that such transferee shall be bound byall of the terms and conditions of the Award. References to a Participant, to the extent relevantin the context, shall include references to authorized transferees. For the avoidance of doubt,nothing contained in this Section 11(a) shall be deemed to restrict a transfer to the Company.          (b)          Documentation. Each Award shall be evidenced in such form (written, electronic orotherwise) as the Board shall determine. Each Award may contain terms and conditions in additionto those set forth in the Plan.          (c)          Board Discretion. Except as otherwise provided by the Plan, each Award may bemade alone or in addition or in relation to any other Award. The terms of each Award need not beidentical, and the Board need not treat Participants uniformly.          (d)          Termination of Status. The Board shall determine the effect on an Award of thedisability, death, termination or other cessation of employment, authorized leave of absence orother change in the employment or other status of a Participant and the extent to which, and theperiod during which, the Participant, or the Participant’s legal representative, conservator,guardian or Designated Beneficiary, may exercise rights under the Award.          (e)          Withholding. The Participant must satisfy all applicable federal, state, andlocal or other income and employment tax withholding obligations before the Company will deliverstock certificates or otherwise recognize ownership of Common Stock under an Award. The Companymay decide to satisfy the withholding obligations through additional withholding on salary orwages. If the Company elects not to or cannot withhold from other compensation, the Participantmust pay the Company the full amount, if any, required for withholding or have a broker tender tothe Company cash equal to the withholding obligations. Payment of withholding obligations is duebefore the Company will issue any shares on exercise, vesting or release from forfeiture of anAward or, if the Company so requires, at the same time as payment of the exercise or purchaseprice, unless the Company determines otherwise. If provided for in an Award or approved by theBoard in its sole discretion, a Participant may satisfy such tax obligations in whole or in part bydelivery (either by actual delivery or attestation) of shares of Common Stock, including sharesretained from the Award creating the tax obligation, valued at their Fair Market Value; *provided,however*, except as otherwise provided by the Board, that the total tax withholding where stock isbeing used to satisfy such tax obligations cannot exceed the Company’s minimum statutorywithholding obligations (based on minimum statutory withholding rates for federal and state taxpurposes, including payroll taxes, that are applicable to such supplemental taxable income).Shares used to satisfy tax withholding requirements cannot be subject to any repurchase,forfeiture, unfulfilled vesting or other similar requirements.
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          (f)          Amendment of Award. Except as otherwise provided in Sections 5(i) and 6(f) withrespect to repricings, Section 9 with respect to Performance Awards, or Section 12(d) with respectto actions requiring stockholder approval, the Board may amend, modify or terminate any outstandingAward, including but not limited to, substituting therefore another Award of the same or adifferent type, changing the date of exercise or realization, and converting an Incentive StockOption to a Nonstatutory Stock Option. The Participant’s consent to such action shall be requiredunless (i) the Board determines that the action, taking into account any related action, does notmaterially and adversely affect the Participant’s rights under the Plan or (ii) the change ispermitted under Section 10.          (g)          Conditions on Delivery of Stock. The Company will not be obligated to deliver anyshares of Common Stock pursuant to the Plan or to remove restrictions from shares previously issuedor delivered under the Plan until (i) all conditions of the Award have been met or removed to thesatisfaction of the Company, (ii) in the opinion of the Company’s counsel, all other legal mattersin connection with the issuance and delivery of such shares have been satisfied, including anyapplicable securities laws and regulations and any applicable stock exchange or stock market rulesand regulations, and (iii) the Participant has executed and delivered to the Company suchrepresentations or agreements as the Company may consider appropriate to satisfy the requirementsof any applicable laws, rules or regulations.          (h)          Acceleration. The Board may at any time provide that any Award shall becomeimmediately exercisable in whole or in part, free of some or all restrictions or conditions, orotherwise realizable in whole or in part, as the case may be.12.     Miscellaneous          (a)          No Right To Employment or Other Status. No person shall have any claim or rightto be granted an Award by virtue of the adoption of the Plan, and the grant of an Award shall notbe construed as giving a Participant the right to continued employment or any other relationshipwith the Company. The Company expressly reserves the right at any time to dismiss or otherwiseterminate its relationship with a Participant free from any liability or claim under the Plan,except as expressly provided in the applicable Award.          (b)          No Rights As Stockholder. Subject to the provisions of the applicable Award, noParticipant or Designated Beneficiary shall have any rights as a stockholder with respect to anyshares of Common Stock to be distributed with respect to an Award until becoming the record holderof such shares.          (c)          Term of Plan. No Awards shall be granted under the Plan after the expiration of10 years from the Effective Date, but Awards previously granted may extend beyond that date.          (d)          Amendment of Plan. The Board may amend, suspend or terminate the Plan or anyportion thereof at any time provided that (i) to the extent required by Section 162(m), no Awardgranted to a Participant that is intended to comply with Section 162(m) after the date of suchamendment shall become exercisable, realizable or vested, as applicable to such Award, unless anduntil the Company’s stockholders approve such amendment in the manner required by Section 162(m);(ii) no amendment that would require stockholder approval under the rules of NASDAQ may be madeeffective unless and until the Company’s stockholders approve such amendment; and (iii) if NASDAQamends its corporate governance rules so that such rules no longer require stockholder approval ofmaterial amendments to equity compensation plans, then, from and after the effective date of suchamendment to the NASDAQ rules, no amendment to the Plan (A) materially increasing the number ofshares authorized under the Plan (other than pursuant to Section 4(c) or 10), (B) expanding thetypes of Awards that may be granted under the Plan, or (C) materially expanding the class ofparticipants eligible to participate in the Plan shall be effective unless and until the Company’sstockholders approve such amendment. In addition, if at any time the approval of the Company’sstockholders is required as to any other modification or amendment under Section 422 of the Code orany successor provision with respect to Incentive Stock Options, the Board may not effect suchmodification or amendment without such approval. Unless otherwise specified in the amendment, anyamendment to the Plan adopted in accordance with this Section 12(d) shall apply to, and be bindingon the holders of, all Awards outstanding under the Plan at the time the amendment is adopted,provided the Board determines that such amendment, taking into account any related action, does notmaterially and adversely affect the rights of Participants under the Plan.          (e)          Authorization of Sub-Plans for Grants to non-U.S. Employees. The Board may fromtime to time establish one or more sub-plans under the Plan for purposes of satisfying applicablesecurities, tax or other laws of
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various jurisdictions. The Board shall establish such sub-plansby adopting supplements to the Plan containing (i) such limitations on the Board’s discretion underthe Plan as the Board deems necessary or desirable or (ii) such additional terms and conditions nototherwise inconsistent with the Plan as the Board shall deem necessary or desirable. Allsupplements adopted by the Board shall be deemed to be part of the Plan, but each supplement shallapply only to Participants within the affected jurisdiction and the Company shall not be requiredto provide copies of any supplement to Participants in any jurisdiction which is not the subject ofsuch supplement.          (f)          Compliance with Section 409A of the Code. Except as provided in individual Awardagreements initially or by amendment, if and to the extent any portion of any payment, compensationor other benefit provided to a Participant in connection with his or her employment termination isdetermined to constitute “nonqualified deferred compensation” within the meaning of Section 409A ofthe Code and the Participant is a specified employee as defined in Section 409A(a)(2)(B)(i) of theCode, as determined by the Company in accordance with its procedures, by which determination theParticipant (through accepting the Award) agrees that he or she is bound, such portion of thepayment, compensation or other benefit shall not be paid before the day that is six months plus oneday after the date of “separation from service” (as determined under Section 409A of the Code) (the“***New Payment Date***”), except as Section 409A of the Code may then permit. The aggregate of anypayments that otherwise would have been paid to the Participant during the period between the dateof separation from service and the New Payment Date shall be paid to the Participant in a lump sumon such New Payment Date, and any remaining payments will be paid on their original schedule. TheCompany makes no representations or warranty and shall have no liability to the Participant or anyother person if any provisions of or payments, compensation or other benefits under the Plan aredetermined to constitute nonqualified deferred compensation subject to Section 409A of the Code butdo not to satisfy the conditions of that section.          (g)          Limitations on Liability. Notwithstanding any other provisions of the Plan, noindividual acting as a director, officer, employee or agent of the Company will be liable to anyParticipant, former Participant, spouse, beneficiary, or any other person for any claim, loss,liability, or expense incurred in connection with the Plan, nor will such individual be personallyliable with respect to the Plan because of any contract or other instrument he or she executes inhis or her capacity as a director, officer, employee or agent of the Company. The Company willindemnify and hold harmless each director, officer, employee or agent of the Company to whom anyduty or power relating to the administration or interpretation of the Plan has been or will bedelegated, against any cost or expense (including attorneys’ fees) or liability (including any sumpaid in settlement of a claim with the Board’s approval) arising out of any act or omission to actconcerning the Plan unless arising out of such person’s own fraud or bad faith.          (h)          Governing Law. The provisions of the Plan and all Awards made hereunder shall begoverned by and interpreted in accordance with the laws of the State of Delaware, excludingchoice-of-law principles of the law of such state that would require the application of the laws ofa jurisdiction other than the State of Delaware.
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