EXHIBIT 10.1

 

    **MOSCOW CABLECOM CORP.**

**2003 STOCK OPTION PLAN**

**As Amended and Restated December 15, 2004**

**ARTICLE I****.**

Establishment of Plan; Definitions

            1.1            Purpose. The purpose of the Moscow CableCom Corp. 2003 Stock Option Plan is toprovide an incentive to key employees, directors and consultants to MoscowCableCom Corp. (the "Corporation") who are in a position to contributematerially to the long‐term success of the Corporation, to increase theirinterest in the Corporation's welfare, and to aid in attracting and retainingemployees, directors and consultants of outstanding ability.

            1.2.            Definitions. Unless the context clearly indicates otherwise, the following termsshall have the meanings set forth below:

            (a)            "Board" shall mean the Board of Directors of theCorporation.

            (b)            "Code" shall mean the Internal Revenue Code of1986, as it may be amended from time to time.

            (c)            "Committee" shall mean the Compensation Committeeof the Board or such other committee which may be designated by the Board toadminister the Plan.  The Committeeshall be composed of two or more Non-Employee Directors, as defined in Rule16b-3 under the the 1934 Act, as such Rule 16b-3 may be amended from time totime, as appointed from time to time by the Board.

(d)            "Common Stock" shall mean sharesof the Corporation's Common Stock, par value $0.01 per share, or if theoutstanding shares of Common Stock are hereafter changed into or exchanged fordifferent shares or securities of the Corporation, such other shares orsecurities.

            (e)            "Consultants" shall mean individuals who provideservices to the Corporation who are not Employees or Directors.

            (f)            "Directors" shall mean those members of the Boardof Directors of the Corporation who are not Employees.

(g)         "Disability" shall mean the inability, due toillness, accident, injury, physical or mental incapacity or other disability,of any Participant to carry out effectively his or her duties and obligationsto the Corporation or any of its Subsidiaries or to participate effectively andactively in the management of the Corporation or any of its Subsidiaries for aperiod of at least 180 consecutive days, as determined in the reasonablejudgment of the Committee or the Board.

            (h)            "Employee" shall mean any common law employee,including officers, of the Corporation as determined under the Code and theTreasury Regulations thereunder.

            (i)            "Fair Market Value" shall mean the closing priceof the Stock as quoted by NASDAQ for the date on which the option is granted,or if there are no sales on such date, on the next preceding day on which therewere sales, or if the Stock is not traded on NASDAQ, the fair market value ofthe Stock as determined by the Committee on the basis of a review of the factsand circumstances at the time.

            (j)            "Grantee" shall mean an Employee, Director orConsultant granted a Stock Option under this Plan.

            (k)            "Incentive Stock Option" shall mean an optiongranted pursuant to the Incentive Stock Option provisions as set forth inArticle II of this Plan.

            (l)            "Non-Qualified Stock Option" shall mean an optiongranted pursuant to the Non-Qualified Stock Option provisions as set forth inArticle III of this Plan.

            (m)            "1934 Act" shall mean the Securities Exchange Act of1934, as amended.

            (n)            "Person" means an individual,a partnership, a corporation, a limited liability company, an association, ajoint stock company, a trust, a joint venture, an unincorporated organizationand a governmental entity or any department, agency or political subdivisionthereof.

            (o)            "Plan" shall mean the Moscow Cable Com Corp. 2003 StockOption Plan as set forth herein and as amended from time to time.

            (p)            "Stock" shall mean authorized but unissued sharesof the Common Stock of the Corporation or reacquired shares of theCorporation's Common Stock.

            (q)            "Stock Option" shall mean an option grantedpursuant to the Plan to purchase shares of Stock.

            (r)                "Subsidiary" shall mean any subsidiary corporation ofthe Corporation as defined in Section 424 of the Code.

            (s)            "Ten Percent Shareholder" shall mean an Employeewho at the time a Stock Option is granted owns stock possessing more than tenpercent (10%) of the total combined voting power of all stock of theCorporation or of its parent or subsidiary corporation.

            1.3.            Shares of Stock Subject to the Plan.  Subject to the provisions of Section 4.2 ofthe Plan, the Stock which may be issued or transferred pursuant to StockOptions granted under the Plan and the Stock which is subject to outstandingbut unexercised Stock Options under the Plan shall not exceed 1,700,000 sharesin the aggregate.  If a Stock Optionshall expire and terminate for any reason, in whole or in part, without beingexercised, the number of shares of Stock which are no longer subject to StockOptions may again become available for the grant of Stock Options.  There shall be no terms and conditions in anIncentive Stock Option which provide that the exercise of an Incentive StockOption reduces the number of shares of Stock for which an outstandingNon-Qualified Stock Option may be exercised; and there shall be no terms andconditions in a Non-Qualified Stock Option which provide that the exercise of aNon-Qualified Stock Option reduces the number of shares of Stock for which anoutstanding Incentive Stock Option may be exercised.

            1.4.            Administration of the Plan.  The Plan shall be administered by theCommittee.  Subject to the expressprovisions of the Plan, the Committee shall have authority to interpret thePlan, to prescribe, amend, and rescind rules and regulations relating to it, todetermine the terms and provisions of Stock Option agreements, and to make allother determinations necessary or advisable for the administration of thePlan.  Any controversy or claim arisingout of or related to this Plan shall be determined unilaterally by and at thesole discretion of the Committee.

            1.5.            Amendment or Termination.  The Board may, at any time, alter, amend,suspend, discontinue, or terminate this Plan; provided, however, that suchaction shall not adversely affect the right of Grantees with respect to StockOptions previously granted and no amendment, without the approval of thestockholders of the Corporation, shall increase the maximum number of shareswhich may be awarded under the Plan in the aggregate, materially increase thebenefits accruing to Grantees under the Plan, change the class of Employeeseligible to receive options under the Plan, or materially modify theeligibility requirements for participation in the Plan.

            1.6.            Effective Date and Duration of the Plan.  This Plan shall become effective onSeptember 2, 2003 and is amended and restated effective December 15, 2004.  This Plan shall terminate at the close ofbusiness on September 1, 2013, and no Stock Option may be issued or grantedunder the Plan thereafter, but such termination shall not affect any StockOption theretofore issued or granted.

**ARTICLE****II**

Incentive Stock Option Provisions

            2.1.            Granting of Incentive Stock Options.

            (a)            Only key Employees of the Corporation shall be eligibleto receive Incentive Stock Options under the Plan.  Directors and Consultants of the Corporation who are not alsoEmployees shall not be eligible to receive Incentive Stock Options.

            (b)            The purchase price of each share of Stock subject to anIncentive Stock Option shall not be less than 100% of the Fair Market Value ofa share of the Stock on the date the Incentive Stock Option is granted;provided, however, that the purchase price of each share of Stock subject to anIncentive Stock Option granted to a Ten Percent Shareholder shall not be lessthan 110% of the Fair Market Value of a share of the Stock on the date theIncentive Stock Option is granted.

            (c)            No Incentive Stock Option shall be exercisable more thanten years from the date the Incentive Stock Option was granted; provided,however, that an Incentive Stock Option granted to a Ten Percent Shareholdershall not be exercisable more than five years from the date the Incentive StockOption was granted.

            (d)            The Committee shall determine and designate from time totime those Employees who are to be granted Incentive Stock Options and specifythe number of shares of Stock subject to each Incentive Stock Option.

            (e)            The Committee, in its sole discretion, shall determinewhether any particular Incentive Stock Option shall become exercisable in oneor more installments, specify the installment dates, and, within thelimitations herein provided, determine the total period during which theIncentive Stock Option is exercisable. Further, the Committee may make such other provisions as may appeargenerally acceptable or desirable to the Committee or necessary to qualify itsgrants under the provisions of Section 422 of the Code.

            (f)            The Committee may grant at any time new Incentive StockOptions to an Employee who has previously received Incentive Stock Options orother options, whether such prior Incentive Stock Options or other options arestill outstanding, have previously been exercised in whole or in part, or arecanceled in connection with the issuance of new Incentive Stock Options.  The purchase price of the new IncentiveStock Options may be established by the Committee without regard to theexisting Incentive Stock Options or other options.

            (g)            Notwithstanding any other provisions hereof, theaggregate Fair Market Value (determined at the time the option is granted) ofthe Stock with respect to which Incentive Stock Options are exercisable for thefirst time by the Employee during any calendar year (under all such plans ofthe Grantee's employer corporation and any subsidiary corporations) shall notexceed $100,000.

            2.2.            Exercise of Incentive Stock Options.  The option price of an Incentive StockOption shall be payable on exercise of the option (i) in cash or by check,bank draft or postal or express money order, (ii) by the surrender ofStock then owned by the Grantee, or (iii) partially in accordance withclause (i) and partially in accordance with clause (ii) of this Section2.2.  Shares of Stock so surrendered inaccordance with clause (ii) or (iii) shall be valued at the Fair Market Valuethereof on the date of exercise, surrender of such Stock to be evidenced bydelivery of the certificate(s) representing such shares in such manner, andendorsed in such form, or accompanied by stock powers endorsed in such form, asthe Committee may determine.

            2.3.            Termination of Employment.

            (a)            If a Grantee's employment with the Corporation isterminated other than by Disability or death, the terms of any then outstandingIncentive Stock Option held by the Grantee shall extend for a period ending onthe earlier of the date on which such Incentive Stock Option would otherwiseexpire or three months after such termination of employment, and such IncentiveStock Option shall be exercisable to the extent it was exercisable as of suchlast date of employment.

            (b)            If a Grantee's employment with the Corporation isterminated by reason of Disability, the term of any then outstanding IncentiveStock Option held by the Grantee shall extend for a period ending on theearlier of the date on which such Incentive Stock Option would otherwise expireor twelve months after such termination of employment, and such Incentive StockOption shall be exercisable to the extent it was exercisable as of such lastdate of employment.

            (c)            If a Grantee's employment with the Corporation isterminated by reason of death, the representative of his or her estate orbeneficiaries thereof to whom the Stock Option has been transferred shall havethe right during the period ending on the earlier of the date on which suchStock Option would otherwise expire or twelve months after such date of death,to exercise any then outstanding Incentive Stock Options in whole or inpart.  If a Grantee dies without havingfully exercised any then outstanding Incentive Stock Options, the representativeof his or her estate or beneficiaries thereof to whom the Stock Option has beentransferred shall have the right to exercise such Stock Options in whole or inpart.

**ARTICLE III**

**Non-Qualified Stock Option Provisions**

            3.1.            Granting of Stock Options.

            (a)            Employees, Directors and Consultants shall be eligible toreceive Non-Qualified Stock Options under the Plan.

            (b)            The Committee shall determine and designate from time totime those Employees, Directors and Consultants who are to be grantedNon-Qualified Stock Options and the amount subject to each Non-Qualified StockOption.

            (c)            The Committee may grant at any time new Non-QualifiedStock Options to an Employee, Director or Consultant who has previouslyreceived Non-Qualified Stock Options or other stock options, whether such priorNon-Qualified Stock Options or other stock options are still outstanding, havepreviously been exercised in whole or in part, or are canceled in connectionwith the issuance of new Non-Qualified Stock Options.

            (d)            The Committee shall determine the purchase price of eachshare of Stock subject to a Non-Qualified Stock Option.  Such price shall not be less than 50% of theFair Market Value of such Stock on the date the Non-Qualified Stock Option isgranted.

            (e)            The Committee, in its sole discretion, shall determinewhether any particular Non-Qualified Stock Option shall become exercisable inone or more installments, specify the installment dates, and, within thelimitations herein provided, determine the total period during which theNon-Qualified Stock Option is exercisable. Further, the Committee may make such other provisions as may appeargenerally acceptable or desirable to the Committee.

            (f)            No Non-Qualified Stock Option shall be exercisable morethan ten years from the date such option is granted.

            3.2.            Exercise of Stock Options.   The option price of a Non-Qualified StockOption shall be payable on exercise of the Stock Option (i) in cash or bycheck, bank draft or postal or express money order, (ii) by the surrenderof Stock then owned by the Grantee, or (iii) partially in accordance withclause (i) and partially in accordance with clause (ii) of this Section3.2.  Shares of Stock so surrendered inaccordance with clause (ii) or (iii) shall be valued at the Fair Market Valuethereof on the date of exercise, surrender of such to be evidenced by deliveryof the certificate(s) representing such shares in such manner, and endorsed insuch form, or accompanied by stock powers endorsed in such form, as theCommittee may determine.

            3.3.            Termination of Relationship.

            (a)            Unless otherwise determined by the Committee, if aGrantee's employment with the Corporation is terminated, a Director Granteeceases to be a Director, or a Consultant Grantee ceases to be a Consultant,other than by reason of Disability or death, the terms of any then outstandingNon-Qualified Stock Option held by the Grantee shall extend for a period endingon the earlier of the date established by the Committee at the time of grant orthree months after the Grantee's last date of employment or cessation of beinga Director or Consultant, and such Non-Qualified Stock Option shall beexercisable to the extent it was exercisable as of the date of termination ofemployment or cessation of being a Director or Consultant.

            (b)            Unless otherwise determined by the Committee, if aGrantee's employment is terminated by reason of Disability, a Director Granteeceases to be a Director by reason of Disability or a Consultant Grantee ceasesto be a Consultant by reason of Disability, the term of any then outstandingNon-Qualified Stock Option held by the Grantee shall extend for a period endingon the earlier of the date on which such Non-Qualified Stock Option wouldotherwise expire or twelve months after the Grantee's last date of employmentor cessation of being a Director or Consultant, and such Stock Option shall beexercisable to the extent it was exercisable as of such last date of employmentor cessation of being a Director or Consultant.

            (c)            Unless otherwise determined by the Committee, if aGrantee's employment is terminated by reason of death, a Director Granteeceases to be a Director by reason of death or a Consultant Grantee ceases to bea Consultant by reason of death, the representative of his or her estate orbeneficiaries thereof to whom the Non-Qualified Stock Option has beentransferred shall have the right during the period ending on the earlier of thedate on which such Non-Qualified Stock Option would otherwise expire or twelvemonths following his or her death to exercise any then outstandingNon-Qualified Stock Options in whole or in part.  If a Grantee dies without having fully exercised any thenoutstanding Non-Qualified Stock Options, the representative of his or her estateor beneficiaries thereof to whom the Non-Qualified Stock Option has beentransferred shall have the right to exercise such Non-Qualified Stock Optionsin whole or in part.

**ARTICLE IV**

 **General Provisions**

            4.1.            Substitution of Options.  In the event of a corporate merger or consolidation, or theacquisition by the Corporation of property or stock of an acquired corporationor any reorganization or other transaction qualifying under Section 424 of theCode, the Committee may, in accordance with the provisions of that Section,substitute Stock Options under this Plan for stock options under the plan ofthe acquired corporation provided (i) the excess of the aggregate fair marketvalue of the shares of Stock subject to the Stock Option immediately after thesubstitution over the aggregate option price of such Stock is not more than thesimilar excess immediately before such substitution and (ii) the new StockOption does not give the Grantee additional benefits, including any extensionof the exercise period.

            4.2.            Adjustment Provisions.

            (a)            In the event that a dividend shall be declared upon the Stockpayable in shares of the Corporation's Common Stock, the number of shares ofStock then subject to any Stock Option outstanding under the Plan and thenumber of shares reserved for the grant of Stock Options pursuant to the Planshall be adjusted by adding to each such number the number of shares whichwould be distributable in respect thereof if such shares had been outstandingon the date fixed for determining the shareholders of the Corporation entitledto receive such share dividend.

            (b)            If the shares of Stock outstanding are changed into orexchanged for a different number or class or other securities of theCorporation or of another corporation, whether through split‐up, merger,consolidation, reorganization, reclassification or recapitalization, then thereshall be substituted for each share of Stock subject to any such Stock Optionand for each share of Stock reserved for the grant of Stock Options pursuant tothe Plan the number and kind of shares or other securities into which eachoutstanding share of Stock shall have been so changed or for which each shareof Stock shall have been exchanged.

            (c)            In the event there shall be any change, other than as specifiedabove in this Section 4.2, in the number or kind of outstanding shares of Stockor of any shares or other securities into which such shares shall have beenchanged or for which they shall have been exchanged, then if the Board shall,in its sole discretion, determine that such change equitably requires anadjustment in the number or kind of shares theretofore reserved for the grantof Stock Options pursuant to the Plan and of the shares then subject to StockOptions, such adjustment shall be made by the Board and shall be effective andbinding for all purposes of the Plan and of each Stock Option outstandingthereunder.

            (d)            In the case of any such substitution or adjustment asprovided for in this Section 4.2, the option price set forth in eachoutstanding Stock Option for each share covered thereby prior to suchsubstitution or adjustment will be the option price for all shares or othersecurities which shall have been substituted for such share or to which suchshare shall have been adjusted pursuant to this Section 4.2, and the price pershare shall be adjusted accordingly.

            (e)            No adjustment or substitution provided for in thisSection 4.2 shall require the Corporation to sell a fractional share, and thetotal substitution or adjustment with respect to each outstanding Stock Optionshall be limited accordingly.

            (f)            Upon any adjustment made pursuant to this Section 4.2,the Corporation will, upon request, deliver to the Grantee a certificatesetting forth the option price thereafter in effect and the number and kind ofshares or other securities thereafter purchasable on the exercise of such StockOption.

            4.3.            General.

            (a)            Each Stock Option shall be evidenced by a writteninstrument containing such terms and conditions, not inconsistent with thisPlan, as the Committee shall approve.

            (b)            The granting of a Stock Option in any year shall not givethe Grantee any right to similar grants in future years or any right to beretained in the employ of the Corporation, and all Employees shall remainsubject to discharge to the same extent as if the Plan were not in effect.

            (c)            No Employee, Director or Consultant and no beneficiary orother person claiming under or through him or her, shall have any right, titleor interest by reason of any Stock Option to any particular assets of theCorporation, or any shares of Stock allocated or reserved for the purposes ofthe Plan or subject to any Stock Option except as set forth herein.  The Corporation shall not be required toestablish any fund or make any other segregation of assets to assure thepayment of any Stock Option.

            (d)            No right under the Plan shall be subject to anticipation,sale, assignment, pledge, encumbrance, or charge except by will or the laws ofdescent and distribution, and a Stock Option shall be exercisable during theGrantee's lifetime only by the Grantee or his or her conservator.

            (e)            Notwithstanding any other provision of this Plan oragreements made pursuant thereto, the Corporation's obligation to issue ordeliver any certificate or certificates for shares of Stock under a StockOption, and the transferability of Stock acquired by exercise of a StockOption, shall be subject to all of the following conditions:

                        (1)            Any registration or other qualification of such sharesunder any state or federal law or regulation, or the maintaining in effect ofany such registration or other qualification which the Committee or Boardshall, in its absolute discretion upon the advice of counsel, deem necessary oradvisable; and

                        (2)            The obtaining of any other consent, approval, or permitfrom any state or federal governmental agency which the Committee or Boardshall, in its absolute discretion upon the advice of counsel, determine to benecessary or advisable.

            (f)            All payments to Grantees or to their legalrepresentatives shall be subject to any applicable tax, community property, orother statutes or regulations of the United States or of any state havingjurisdiction thereof.  The Grantee maybe required to pay to the Corporation the amount of any withholding taxes whichthe Corporation is required to withhold with respect to a Stock Option or itsexercise.  In the event that suchpayment is not made when due, the Corporation shall have the right to deduct,to the extent permitted by law, from any payment of any kind otherwise due tosuch person all or part of the amount required to be withheld.

            (g)            In the case of a grant of a Stock Option to any Employeeof a Subsidiary of the Corporation, the Corporation may, if the Committee sodirects, issue or transfer the shares, if any, covered by the Stock Option tothe Subsidiary, for such lawful consideration as the Committee may specify,upon the condition or understanding that the Subsidiary will transfer theshares to the Employee in accordance with the terms of the Stock Optionspecified by the Committee pursuant to the provisions of the Plan.           

            (h)            A Grantee entitled to Stock as a result of the exerciseof a Stock Option shall not be deemed for any purpose to be, or have rights as,a shareholder of the Corporation by virtue of such exercise, except to theextent a stock certificate is issued therefor and then only from the date suchcertificate is issued.  No adjustmentsshall be made for dividends or distributions or other rights for which therecord date is prior to the date such stock certificate is issued.  The Corporation shall issue any stockcertificates required to be issued in connection with the exercise of a StockOption with reasonable promptness after such exercise.

            (i)            The grant or exercise of Stock Options granted under thePlan shall be subject to, and shall in all respects comply with, applicable lawrelating to such grant or exercise, or to the number of shares of Stock whichmay be beneficially owned or held by any Grantee.