Exhibit 4.4


    
      

    

     

    

       

      Exhibit
        4.4

       

       

      VITALSTREAM
        HOLDINGS, INC.

      2001
        STOCK INCENTIVE PLAN

      (Third
        Amended and Restated)

       

       

                  1.
                    Purpose.  The
        purpose of this 2001 Incentive Stock Plan (Third Amended and Restated) (the
        "Plan";
        when
        distinguished from earlier versions of the Plan, the "Third
        Amendment")
        is to
        enable VitalStream Holdings, Inc. (the "Company")
        to
        attract and retain the services of (i) selected employees, officers and
        directors of the Company or any parent or subsidiary of the Company and
        (ii) selected nonemployee agents, consultants, advisers and independent
        contractors of the Company or any parent or subsidiary of the Company. For
        purposes of this Plan, a person is considered to be employed by or in the
        service of the Company if the person is employed by or in the service of
        any
        entity (an "Employer")
        that
        is the Company or any parent or subsidiary of the Company.

       

                  2.
                    Shares
        Subject to the Plan.  Subject
        to adjustment as provided below and in Section 10, the shares to be offered
        under the Plan shall consist of Common Stock of the Company, and the total
        number of shares of Common Stock that may be issued under the Plan shall
        be
        21,500,000 shares; provided, however, the total number of securities issuable
        upon exercise of all outstanding awards and the total number of shares subject
        to any other bonus or similar plan or agreement of the Company shall not
        exceed
        a number of securities which is equal to 30 percent of the then outstanding
        securities of the Company, with convertible preferred or convertible senior
        common shares of stock counted on an as if converted basis, unless a percentage
        higher than 30 percent is approved by at least two-thirds of the outstanding
        securities entitled to vote. If an option or Performance-based Award (as
        defined
        below) granted under the Plan expires, terminates or is canceled, the unissued
        shares subject to that option or Performance-based Award shall again be
        available under the Plan. If shares awarded as a bonus pursuant to Section
        7 or
        sold pursuant to Section 8 under the Plan are forfeited to or repurchased
        by the
        Company, the number of shares forfeited or repurchased shall again be available
        under the Plan.

       

       

       

       

       

       

       

       

       

       

      


       

       

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


       

      


       

       

                  3.
                    Effective
        Date and Duration of Plan.

       

                              3.1            Effective
        Date.  The
        initial 2001 Stock Incentive Plan became effective as of January 28, 2002
        (the
        "Initial
        Effective Date");
        the
        2001 Stock Incentive Plan (Amended and Restated) became effective on March
        15,
        2002; the 2001 Stock Incentive Plan (Second Amended and Restated) became
        effective on February 28, 2005; the 2001 Stock Incentive Plan (Increased
        Second
        Amended and Restated) became effective on May 26, 2005), and this Third
        Amendment became effective on January 30, 2006 (the "Third
        Amendment Effective Date").
        Any
        awards may be granted and shares may be issued with respect to such awards
        at
        any time after the Initial Effective Date and before termination of the Plan
        (and any awards with respect to shares of common stock added to the Plan
        as a
        result of an amendment may be granted after the effective date of such
        amendment). Notwithstanding the foregoing, (a) no payments shall be made
        under a
        Performance-based Award granted after the Third Amendment Effective Date
        unless
        and until the Third Amendment is approved by the shareholders of the Company,
        and (b) any option granted after the Third Amended Effective Date that is
        designated an Incentive Stock Option (as defined in Section 5 below)
        granted under the Plan shall be deemed to be a Non-Statutory Stock Option
        if it
        is exercised prior to the approval of the Third Amendment by the shareholders
        of
        the Company or if shareholder approval is not obtained within one year of
        the
        Third Amendment Effective Date, , and (c) unless a waiver of California Code
        of
        Regulations Rule 260.140.41(i) is obtained from the Securities Regulation
        Division of the State of California, all options granted under the Plan after
        the Third Amendment Effective Date (or otherwise in reliance upon the Third
        Amendment) and prior to the approval of the Third Amendment by the shareholders
        of the Company shall automatically terminate if the Third Amendment is not
        approved by the shareholders of the Company within one year of the Third
        Amendment Effective Date, and if any such options are exercised prior to
        such
        date, , the exercise shall be subject to an obligation on the part of the
        option
        holder to rescind the exercise if the Third Amendment is not approved by
        the
        shareholders of the Company within one year of the Third Amendment Effective
        Date. All agreements reflecting the grant of Performance-based Awards or
        options
        shall contain provisions reflecting the limitations set forth in this paragraph
        to the extent applicable.

       

                              3.2            Duration.  The
        Plan shall continue in effect until the earliest to occur of (a) January
        28,
        2012, (b) the date all shares available for issuance under the Plan have
        been
        issued and all restrictions on the shares have lapsed, and (c) the date set
        by
        the Board of Directors. The Board of Directors may suspend or terminate the
        Plan
        at any time except with respect to options, Performance-based Awards and
        shares
        subject to restrictions then outstanding under the Plan. Termination shall
        not
        affect any outstanding options, Performance-based Awards, any right of the
        Company to repurchase shares or the forfeitability of shares issued under
        the
        Plan.

       

                  4.
                    Administration.

       

                              4.1            Board
        of Directors.  The
        Plan shall be administered by the Board of Directors of the Company, which
        shall
        determine and designate the individuals to whom awards shall be made, the
        amount
        of the awards and the other terms and conditions of the awards. Subject to
        the
        provisions of the Plan, the Board of Directors may adopt and amend rules
        and
        regulations relating to administration of the Plan, advance the lapse of
        any
        waiting period, accelerate any exercise date, waive or modify any restriction
        applicable to shares (except those restrictions imposed by law) and make
        all
        other determinations in the judgment of the Board of Directors necessary
        or
        desirable for the administration of the Plan. The interpretation and
        construction of the provisions of the Plan and related agreements by the
        Board
        of Directors shall be final and conclusive. The Board of Directors may correct
        any defect or supply any omission or reconcile any inconsistency in the Plan
        or
        in any related agreement in the manner and to the extent it deems expedient
        to
        carry the Plan into effect, and the Board of Directors shall be the sole
        and
        final judge of such expediency.

       

       

       

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


       

      


       

       

                              4.2            Committee.  The
        Board of Directors may delegate to any committee of the Board of Directors
        (the "Committee")
        any or
        all authority for administration of the Plan. If authority is delegated to
        the
        Committee, all references to the Board of Directors in the Plan shall mean
        and
        relate to the Committee, except (i) as otherwise provided by the Board of
        Directors and (ii) only the Board of Directors may amend or terminate the
        Plan as provided in Sections 3, 10 and 11.

       

                  5.
                    Types
        of Awards; Eligibility; Limitations.  The
        Board of Directors may, from time to time, take the following actions,
        separately or in combination, under the Plan: (i) grant options that are
        Incentive Stock Options as defined in Section 422 of the Internal Revenue
        Code
        of 1986, as amended (the "Code")
        ("Incentive
        Stock Options");
        (ii) grant options that are not Incentive Stock Options ("Non-Statutory
        Stock Options");
        (iii) award stock bonuses as provided in Section 7; (iv) issue shares
        subject to restrictions as provided in Section 8; and (v) award
        Performance-based Awards as provided in Section 9. Awards may be made to
        employees, including employees who are officers or directors, and to other
        individuals described in Section 1 selected by the Board of Directors; provided,
        however, only employees of the Company or any parent or subsidiary of the
        Company (as defined in Sections 424(e) and 424(f) of the Code) are eligible
        to
        receive Incentive Stock Options under the Plan. The Board of Directors shall
        select the individuals to whom awards shall be made and shall specify the
        action
        taken with respect to each individual to whom an award is made. At the
        discretion of the Board of Directors, an individual may be given an election
        to
        surrender an award in exchange for the grant of a new award.

       

                  6.
                    Option
        Grants.

       

                              6.1            General
        Rules Relating to Options.

       

                                          6.1-1            Terms
        of Grant.  The
        Board of Directors may grant options under the Plan. Subject to the provisions
        of subsections (a), (b) and (c) of this Section 6.1-1, from which the Board
        of
        Directors is not authorized to deviate with respect to options granted after
        the
        Amended Effective Date, with respect to each option grant, the Board of
        Directors shall determine the number of shares subject to the option, the
        exercise price, the period of the option, the time or times at which the
        option
        may be exercised and whether the option is an Incentive Stock Option or a
        Non-Statutory Stock Option. At the time of the grant of an option or at any
        time
        thereafter, the Board of Directors may provide that an optionee who exercised
        an
        option with Common Stock of the Company shall automatically receive a new
        option
        to purchase additional shares equal to the number of shares surrendered and
        may
        specify the terms and conditions of such new options. 

       

      Notwithstanding
        the foregoing, the following limitations shall apply to all options granted
        after March 15, 2002: 

       

                                                      6.1-1(a)
                    Limitations
        on Grants to 10 Percent Shareholders.  An
        option may be granted to a person possessing more than 10 percent of the
        total combined voting power of all classes of stock of the Company or any
        parent
        or subsidiary (as defined in subsections 424(e) and 424(f) of the Code)
        only if the exercise price is at least 110 percent of the fair market value
        of the Common Stock subject to the option on the date it is granted and the
        option by its terms is not exercisable after the expiration of five years
        from
        the date it is granted. Unless otherwise specified, for purposes of any award
        granted under the Plan, the fair market value of the Common Stock shall be
        the
        closing price of the Common Stock last reported before the time the award
        is
        granted (or the time as of which the determination must be made), if the
        stock
        is publicly traded, or another value of the Common Stock as specified by
        the
        Board of Directors.

       

                                                      6.1-1(b)
                    Duration
        of Options.  Subject
        to Sections 6.1-2, 6.1-4 and 6.1-1(a), options shall continue in effect for
        the period fixed by the Board of Directors, which period shall be no more
        than
        10 years from the date the option is granted.

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


       

                                                      6.1-1(c)
                    Exercise
        Price.  The
        exercise price of an option shall not be less than 85% of the fair market
        value
        of the Common Stock covered by the option at the date the option is granted.
        

       

                                                      6.1-1(d)
                    Nontransferability.  Each
        option granted after the Amended Effective Date by its terms (i) shall be
        nonassignable and nontransferable by the optionee, either voluntarily or
        by
        operation of law, except by will, by the laws of descent and distribution
        of the
        state or country of the optionee's domicile at the time of death, by instrument
        to an intervivos or testamentary trust in which the options are to be passed
        to
        beneficiaries upon the death of the trustor (settlor) or by gift to "immediate
        family" as that term is defined in 17 CFR 240.16a-1(e). 

       

                                          6.1-2            Exercise
        of Options.  Except
        as provided in Section 6.1-4 or as determined by the Board of Directors, no
        option granted under the Plan may be exercised unless at the time of exercise
        the optionee is employed by or in the service of an Employer and shall have
        been
        so employed or provided such service continuously since the date the option
        was
        granted. Except as provided in Sections 6.1-4 and 10 and in this paragraph,
        options granted under the Plan may be exercised from time to time over the
        period stated in each option in amounts and at times prescribed by the Board
        of
        Directors; provided, however the vesting schedule for any options granted
        to a
        person who is not an officer, director or consultant of the Company, its
        parent
        or one of its subsidiaries shall provide that no fewer than 20% of the options
        subject to such option become exercisable each year following the grant (so
        that
        the option vests in full no later than 5 years after the grant date). Options
        may not be exercised for fractional shares. Unless otherwise determined by
        the
        Board of Directors, if an optionee does not exercise an option in any one
        year
        for the full number of shares to which the optionee is entitled in that year,
        the optionee's rights shall be cumulative and the optionee may purchase those
        shares in any subsequent year during the term of the option.

       

                                          6.1-3            
        [intentionally left blank]

       

                                          6.1-4            Termination
        of Employment or Service.

       

                                                      6.1-4(a)
                    General
        Rule.  Unless
        the Board of Directors determines to extend the period of exercise for an
        option
        (either at or following the grant date), if an optionee's employment or service
        with the Employer terminates for any reason other than because of total
        disability or death as provided in Sections 6.1-4(b) and (c), his or her
        option may be exercised at any time before the expiration date of the option
        or
        the expiration of 90 days after the date of termination, whichever is the
        shorter period, but only if and to the extent the optionee was entitled to
        exercise the option at the date of termination.

       

                                                      6.1-4(b)
                    Termination
        Because of Total Disability.  
        Unless the Board of Directors determines to extend the period of exercise
        for an
        option (either at or following the grant date) if an optionee's employment
        or
        service with the Employer terminates because of total disability, his or
        her
        option may be exercised at any time before the expiration date of the option
        or
        before the date 12 months after the date of termination, whichever is the
        shorter period, but only if and to the extent the optionee was entitled to
        exercise the option at the date of termination. The term "total disability"
        means a medically determinable mental or physical impairment that is expected
        to
        result in death or has lasted or is expected to last for a continuous period
        of
        12 months or more and that, in the opinion of the Company and two
        independent physicians, causes the optionee to be unable to perform his or
        her
        duties as an employee, director, officer or consultant of the Employer and
        unable to be engaged in any substantial gainful activity. Total disability
        shall
        be deemed to have occurred on the first day after the two independent physicians
        have furnished their written opinion of total disability to the Company and
        the
        Company has reached an opinion of total disability.


      
        
           

        

        
           

          
            

          

        

        
           

        

      


       

       

                                                      6.1-4(c)
                    Termination
        Because of Death.  Unless
        the Board of Directors determines to extend the period of exercise for an
        option, (either at or following the grant date), if an optionee dies while
        employed by or providing service to an Employer, his or her option may be
        exercised at any time before the expiration date of the option or before
        the
        date 12 months after the date of death, whichever is the shorter period,
        but only if and to the extent the optionee was entitled to exercise the option
        at the date of death and only by the person or persons to whom the optionee's
        rights under the option shall pass by the optionee's will or by the laws
        of
        descent and distribution of the state or country of domicile at the time
        of
        death.

       

                                                      6.1-4(d)
                    Amendment
        of Exercise Period Applicable to Termination.  The
        Board of Directors may at any time extend the 30-day and 12-month exercise
        periods any length of time not longer than the original expiration date of
        the
        option. The Board of Directors may at any time increase the portion of an
        option
        that is exercisable, subject to terms and conditions determined by the Board
        of
        Directors.

       

                                                      6.1-4(e)
                    Failure
        to Exercise Option.  To
        the extent that the option of any deceased optionee or any optionee whose
        employment or service terminates is not exercised within the applicable period,
        all further rights to purchase shares pursuant to the option shall cease
        and
        terminate.

       

                                                      6.1-4(f)
                    Leave
        of Absence.  Absence
        on leave approved by the Employer or on account of illness or disability
        shall
        not be deemed a termination or interruption of employment or service. Unless
        otherwise determined by the Board of Directors, vesting of options shall
        continue during a medical, family or military leave of absence, whether paid
        or
        unpaid, and vesting of options shall be suspended during any other unpaid
        leave
        of absence.

       

                                          6.1-5            Purchase
        of Shares.

       

                                                      6.1-5(a)
                    Notice
        of Exercise.  Unless
        the Board of Directors determines otherwise, shares may be acquired pursuant
        to
        an option granted under the Plan only upon the Company's receipt of written
        notice from the optionee of the optionee's binding commitment to purchase
        shares, specifying the number of shares the optionee desires to purchase
        under
        the option and the date on which the optionee agrees to complete the
        transaction, and, if required to comply with the Securities Act of 1933 and/or
        governing state securities laws, containing a representation that it is the
        optionee's intention to acquire the shares for investment and not with a
        view to
        distribution.

       

                                                      6.1-5(b)
                    Payment.  Unless
        the Board of Directors determines otherwise (either at or following the grant
        date), on or before the date specified for completion of the purchase of
        shares
        pursuant to an option exercise, the optionee must pay the Company the full
        purchase price of those shares in cash or by check or, with the consent of
        the
        Board of Directors, in whole or in part, in Common Stock of the Company valued
        at fair market value, restricted stock or other contingent awards denominated
        in
        either stock or cash, promissory notes and other forms of consideration.
        Unless
        otherwise determined by the Board of Directors (either at or following the
        grant
        date), any Common Stock provided in payment of the purchase price must have
        been
        previously acquired and held by the optionee for at least six months. The
        fair
        market value of Common Stock provided in payment of the purchase price shall
        be
        the closing price of the Common Stock last reported before the time payment
        in
        Common Stock is made or, if earlier, committed to be made, if the Common
        Stock
        is publicly traded, or another value of the Common Stock as specified by
        the
        Board of Directors. No shares shall be issued until full payment for the
        shares
        has been made, including all amounts owed for tax withholding. With the consent
        of the Board of Directors, an optionee may request the Company to apply
        automatically the shares to be received upon the exercise of a portion of
        a
        stock option (even though stock certificates have not yet been issued) to
        satisfy the purchase price for additional portions of the option.

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


       

       

                                                      6.1-5(c)
                    Tax
        Withholding.  Each
        optionee who has exercised an option shall, immediately upon notification
        of the
        amount due, if any, pay to the Company in cash or by check amounts necessary
        to
        satisfy any applicable federal, state and local tax withholding requirements.
        If
        additional withholding is or becomes required (as a result of exercise of
        an
        option or as a result of disposition of shares acquired pursuant to exercise
        of
        an option) beyond any amount deposited before delivery of the certificates,
        the
        optionee shall pay such amount, in cash or by check, to the Company on demand.
        If the optionee fails to pay the amount demanded, the Company or the Employer
        may withhold that amount from other amounts payable to the optionee, including
        salary, subject to applicable law. With the consent of the Board of Directors,
        an optionee may satisfy this obligation, in whole or in part, by instructing
        the
        Company to withhold from the shares to be issued upon exercise or by delivering
        to the Company other shares of Common Stock; provided, however, that the
        number
        of shares so withheld or delivered shall not exceed the minimum amount necessary
        to satisfy the required withholding obligation.

       

                                                      6.1-5(d)
                    Reduction
        of Reserved Shares.  Upon
        the exercise of an option, the number of shares reserved for issuance under
        the
        Plan shall be reduced by the number of shares issued upon exercise of the
        option
        (less the number of any shares surrendered in payment for the exercise price
        or
        withheld to satisfy withholding requirements).

       

                                          6.1-6            Limitations
        on Grants to Non-Exempt Employees.  Unless
        otherwise determined by the Board of Directors (either at or following the
        grant
        date), if an employee of the Company or any parent or subsidiary of the Company
        is a non-exempt employee subject to the overtime compensation provisions
        of
        Section 7 of the Fair Labor Standards Act (the "FLSA"), any option granted
        to that employee shall be subject to the following restrictions: (i) the
        exercise price shall be at least 85 percent of the fair market value of the
        Common Stock subject to the option on the date it is granted; and (ii) the
        option shall not be exercisable until at least six months after the date
        it is
        granted; provided, however, that this six-month restriction on exercisability
        will cease to apply if the employee dies, becomes disabled or retires, there
        is
        a change in ownership of the Company, or in other circumstances permitted
        by
        regulation, all as prescribed in Section 7(e)(8)(B) of the
        FLSA.

       

                              6.2            Incentive
        Stock Options.  Incentive
        Stock Options shall be subject to the following additional terms and
        conditions:

       

                                          6.2-1            Limitation
        on Amount of Grants.  If
        the aggregate fair market value of stock (determined as of the date the option
        is granted) for which Incentive Stock Options granted under this Plan (and
        any
        other stock incentive plan of the Company or its parent or subsidiary
        corporations, as defined in subsections 424(e) and 424(f) of the Code) are
        exercisable for the first time by an employee during any calendar year exceeds
        $100,000, the portion of the option or options not exceeding $100,000, to
        the
        extent of whole shares, will be treated as an Incentive Stock Option and
        the
        remaining portion of the option or options will be treated as a Non-Statutory
        Stock Option. The preceding sentence will be applied by taking options into
        account in the order in which they were granted. If, under the $100,000
        limitation, a portion of an option is treated as an Incentive Stock Option
        and
        the remaining portion of the option is treated as a Non-Statutory Stock Option,
        unless the optionee designates otherwise at the time of exercise, the optionee's
        exercise of all or a portion of the option will be treated as the exercise
        of
        the Incentive Stock Option portion of the option to the full extent permitted
        under the $100,000 limitation. If an optionee exercises an option that is
        treated as in part an Incentive Stock Option and in part a Non-Statutory
        Stock
        Option, the Company will designate the portion of the stock acquired pursuant
        to
        the exercise of the Incentive Stock Option portion as Incentive Stock Option
        stock by issuing a separate certificate for that portion of the stock and
        identifying the certificate as Incentive Stock Option stock in its stock
        records. 

       

                                          6.2-2            Exercise
        price.  The
        exercise price shall not be less than 100 percent of the fair market value
        of the Common Stock covered by the Incentive Stock Option at the date the
        option
        is granted.

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


      


       

       

       

       

                                          6.2-3            Early
        Dispositions.  If
        within two years after an Incentive Stock Option is granted or within
        12 months after an Incentive Stock Option is exercised, the optionee sells
        or otherwise disposes of Common Stock acquired on exercise of the Option,
        the
        optionee shall within 30 days of the sale or disposition notify the Company
        in writing of (i) the date of the sale or disposition, (ii) the amount realized
        on the sale or disposition and (iii) the nature of the disposition (e.g.,
        sale,
        gift, etc.).

       

                                          6.2-4.
                    Nontransferability.  Each
        Incentive Stock Option shall be nonassignable and nontransferable by the
        optionee, either voluntarily or by operation of law, except by will or by
        the
        laws of descent and distribution of the state or country of the optionee's
        domicile at the time of death, and during the optionee's lifetime, shall
        be
        exercisable only by the optionee.

       

                  7.
                    Stock
        Bonuses.  Subject
        to any restrictions imposed by applicable law, the Board of Directors may
        award
        shares under the Plan as stock bonuses. Shares awarded as a bonus shall be
        subject to the terms, conditions and restrictions determined by the Board
        of
        Directors. The restrictions may, subject to any limitations imposed by
        applicable law (including California Code of Regulations Rule 260.140.41)
        include restrictions concerning transferability and forfeiture of the shares
        awarded, together with any other restrictions determined by the Board of
        Directors. The Board of Directors may require the recipient to sign an agreement
        as a condition of the award, but may not require the recipient to pay any
        monetary consideration other than amounts necessary to satisfy tax withholding
        requirements. The agreement may contain any terms, conditions, restrictions,
        representations and warranties required by the Board of Directors. The
        certificates representing the shares awarded shall bear any legends required
        by
        the Board of Directors. The Company may require any recipient of a stock
        bonus
        to pay to the Company in cash or by check upon demand amounts necessary to
        satisfy any applicable federal, state or local tax withholding requirements.
        If
        the recipient fails to pay the amount demanded, the Company or the Employer
        may
        withhold that amount from other amounts payable to the recipient, including
        salary, subject to applicable law. With the consent of the Board of Directors,
        a
        recipient may satisfy this obligation, in whole or in part, by instructing
        the
        Company to withhold from any shares to be issued or by delivering to the
        Company
        other shares of Common Stock; provided, however, that the number of shares
        so
        withheld or delivered shall not exceed the minimum amount necessary to satisfy
        the required withholding obligation. Upon the issuance of a stock bonus,
        the
        number of shares reserved for issuance under the Plan shall be reduced by
        the
        number of shares issued, less the number of shares withheld or delivered
        to
        satisfy withholding obligations.

       

                  8.
                    Restricted
        Stock.

       

                              8.1            General
        Rules.  Subject
        to any restrictions imposed by applicable law and the Plan, the Board of
        Directors may issue shares under the Plan for any consideration (including
        promissory notes and services) determined by the Board of Directors. Shares
        issued under the Plan shall be subject to the terms, conditions and restrictions
        of the Plan and any other terms, conditions and restrictions determined by
        the
        Board of Directors. The restrictions may include, subject to any limitations
        imposed by applicable law (including California Code of Regulations Rule
        260.140.41), without limitation, restrictions concerning transferability,
        repurchase by the Company and forfeiture of the shares issued.

       

       

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


      


       

       

       

       

                              8.2            Pricing
        Limitations.  The
        purchase price for any shares issued under this Section 8 shall be at least
        85%
        of the fair market value of the Common Stock on the date the purchase agreement
        is signed. The purchase price for any shares issued under this Section 8
        to any
        person possessing more than 10 percent of the total combined voting power
        of all classes of stock of the Company or any parent or subsidiary shall
        be at
        least 100% of the fair market value of the Common Stock on the date the purchase
        agreement is signed. 

       

                              8.2            Purchase
        Agreement and Legends.  All
        Common Stock issued pursuant to this Section 8 shall be subject to a purchase
        agreement, which shall be executed by the Company and the prospective purchaser
        of the shares before the delivery of certificates representing the shares
        to the
        purchaser. The purchase agreement may contain any terms, conditions,
        restrictions, representations and warranties required by the Board of Directors.
        The certificates representing the shares shall bear any legends required
        by the
        Board of Directors.

       

                              8.3            Transferability.  The
        rights of any purchaser of shares under this Section 8 shall be nonassignable
        and nontransferable, either voluntarily or by operation of law, except by
        will,
        by the laws of descent and distribution of the state or country of such person's
        at the time of death. 

       

                              8.4            Tax
        Withholding.  The
        Company may require any purchaser of restricted stock to pay to the Company
        in
        cash or by check upon demand amounts necessary to satisfy any applicable
        federal, state or local tax withholding requirements. If the purchaser fails
        to
        pay the amount demanded, the Company or the Employer may withhold that amount
        from other amounts payable to the purchaser, including salary, subject to
        applicable law. With the consent of the Board of Directors, a purchaser may
        satisfy this obligation, in whole or in part, by instructing the Company
        to
        withhold from any shares to be issued or by delivering to the Company other
        shares of Common Stock; provided, however, that the number of shares so withheld
        or delivered shall not exceed the minimum amount necessary to satisfy the
        required withholding obligation. Upon the issuance of restricted stock, the
        number of shares reserved for issuance under the Plan shall be reduced by
        the
        number of shares issued, less the number of shares withheld or delivered
        to
        satisfy withholding obligations.

       

                  9.
                    Performance-based
        Awards.  To
        the extent counsel for the Company determines that the applicable grants
        qualify, the Board of Directors may grant awards intended to qualify as
        qualified performance-based compensation under Section 162(m) of the Code
        and
        the regulations thereunder ("Performance-based
        Awards").
        Performance-based Awards shall be denominated at the time of grant either
        in
        Common Stock ("Stock
        Performance Awards")
        or in
        dollar amounts ("Dollar
        Performance Awards").
        Payment under a Stock Performance Award or a Dollar Performance Award shall
        be
        made, at the discretion of the Board of Directors, in Common Stock
        ("Performance
        Shares"),
        or in
        cash or in any combination thereof. Performance-based Awards shall be subject
        to
        the following terms and conditions:

       

                              9.1            Award
        Period.  The
        Board of Directors shall determine the period of time for which a
        Performance-based Award is made (the "Award
        Period").

       

       

       

       

       

       

       

       

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


      


       

       

       

       

                              9.2            Performance
        Goals and Payment.  The
        Board of Directors shall establish in writing objectives ("Performance
        Goals")
        that
        must be met by the Company or any subsidiary, division or other unit of the
        Company ("Business
        Unit")
        during
        the Award Period as a condition to payment being made under the
        Performance-based Award. The Performance Goals for each award shall be one
        or
        more targeted levels of performance with respect to one or more of the following
        objective measures with respect to the Company or any Business Unit: earnings,
        earnings per share, stock price increase, total shareholder return (stock
        price
        increase plus dividends), return on equity, return on assets, return on capital,
        economic value added, revenues, operating income, inventories, inventory
        turns,
        cash flows or any of the foregoing before the effect of acquisitions,
        divestitures, accounting changes, and restructuring and special charges
        (determined according to criteria established by the Board of Directors).
        The
        Board of Directors shall also establish the number of Performance Shares
        or the
        amount of cash payment to be made under a Performance-based Award if the
        Performance Goals are met or exceeded, including the fixing of a maximum
        payment
        (subject to Section 9.4). The Board of Directors may establish other
        restrictions to payment under a Performance-based Award, such as a continued
        employment requirement, in addition to satisfaction of the Performance Goals.
        Some or all of the Performance Shares may be issued at the time of the award
        as
        restricted shares subject to forfeiture in whole or in part if Performance
        Goals
        or, if applicable, other restrictions are not satisfied.

       

                              9.3            Computation
        of Payment.  During
        or after an Award Period, the performance of the Company or Business Unit,
        as
        applicable, during the period shall be measured against the Performance Goals.
        If the Performance Goals are not met, no payment shall be made under a
        Performance-based Award. If the Performance Goals are met or exceeded, the
        Board
        of Directors shall certify that fact in writing and certify the number of
        Performance Shares earned or the amount of cash payment to be made under
        the
        terms of the Performance-based Award. 

       

                              9.4            Maximum
        Awards.  No
        participant may receive in any fiscal year Stock Performance Awards under
        which
        the aggregate amount payable under the awards exceeds the equivalent of 500,000
        shares of Common Stock or Dollar Performance awards under which the aggregate
        amount payable under the awards exceeds $500,000.

       

                              9.5            Tax
        Withholding.  With
        respect to Dollar Performance Awards, the Company or the Employer may withhold
        any amounts necessary to satisfy any applicable federal, state or local tax
        withholding requirements from the Dollar Performance Award. Each participant
        who
        has received Performance Shares shall, upon notification of the amount due,
        pay
        to the Company in cash or by check amounts necessary to satisfy any applicable
        federal, state and local tax withholding requirements. If the participant
        fails
        to pay the amount demanded, the Company or the Employer may withhold that
        amount
        from other amounts payable to the participant, including salary, subject
        to
        applicable law. With the consent of the Board of Directors, a participant
        may
        satisfy this obligation with respect to Performance Shares, in whole or in
        part,
        by instructing the Company to withhold from any shares to be issued or by
        delivering to the Company other shares of Common Stock; provided, however,
        that
        the number of shares so delivered or withheld shall not exceed the minimum
        amount necessary to satisfy the required withholding obligation.

       

                              9.6            Effect
        on Shares Available.  The
        payment of a Performance-based Award in cash shall not reduce the number
        of
        shares of Common Stock reserved for issuance under the Plan. The number of
        shares of Common Stock reserved for issuance under the Plan shall be reduced
        by
        the number of shares issued upon payment of an award, less the number of
        shares
        delivered or withheld to satisfy withholding obligations.

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


      


       

       

       

       

                  10.
                    Changes
        in Capital Structure.

       

                              10.1            Stock
        Splits, Stock Dividends.  If
        the outstanding Common Stock of the Company is hereafter increased or decreased
        or changed into or exchanged for a different number or kind of shares or
        other
        securities of the Company by reason of any stock split, combination of shares,
        dividend payable in shares, distribution, reverse stock split, recapitalization
        or reclassification, appropriate adjustment shall be made by the Board of
        Directors in the number and kind of shares available for grants under the
        Plan
        and in all other share amounts set forth in the Plan. In addition, the Board
        of
        Directors shall make appropriate adjustment in the number and kind of shares
        as
        to which outstanding options or other awards, or portions thereof then
        unexercised, shall relate, so that the holder's proportionate interest before
        and after the occurrence of the event is maintained. Notwithstanding the
        foregoing, the Board of Directors shall have no obligation to effect any
        adjustment that would or might result in the issuance of fractional shares,
        and
        any fractional shares resulting from any adjustment may be disregarded or
        provided for in any manner determined by the Board of Directors. Any such
        adjustments made by the Board of Directors shall be conclusive.

       

                              10.2            Mergers,
        Reorganizations, Etc.  For
        purposes of this Section, a "Transaction" shall mean (a) a transaction (or
        a
        related series of transactions not in the ordinary course of business) in
        which
        a majority of the assets or business of the Company is transferred, by merger,
        lease, sale, consolidation, plan of exchange, split-up, split-off, spin-off,
        reorganization, liquidation or other transfer, to a person or entity that
        is not
        a parent of the Company, a wholly-owned subsidiary of the Company or an other
        entity in which the shareholders of the Company immediately prior to such
        transaction (or the first of a series of related transaction) receive in
        the
        transaction on a pro rata basis and own immediately after the transaction
        (or
        the last of a series of related transactions) a majority of the issued and
        outstanding shares of capital stock, or (b) a transfer by one or more
        shareholders, in one transfer or several related transfers (such as in response
        to a tender offer or in a collectively negotiated sale), of 50% or more of
        the
        Common Stock outstanding on the date of such transfer (or the first of such
        related transfers) to persons, other than wholly-owned subsidiaries or family
        trusts, who were not shareholders of the Company prior to the first such
        transfer. 

       

      In
        the
        event of a Transaction, the Board of Directors shall, in its sole discretion
        and
        to the extent possible under the structure of the Transaction, select one
        of the
        following alternatives for treating outstanding options and other awards
        under
        the Plan prior to the consummation of the Transaction:

       

                                          10.2-1
        Outstanding options and other awards shall remain in effect in accordance
        with
        their terms.

       

                                          10.2-2
        Outstanding options and other awards shall be converted into options to purchase
        stock or awards with respect to stock in one or more of the corporations,
        including the Company, that are the surviving or acquiring corporations in
        the
        Transaction. The amount, type of securities subject thereto and exercise
        price
        of the converted options or other awards shall be determined by the Board
        of
        Directors of the Company, taking into account the relative values of the
        companies involved in the Transaction and the exchange rate, if any, used
        in
        determining shares of the surviving corporation(s) to be held by holders
        of
        shares of the Company following the Transaction. Unless otherwise determined
        by
        the Board of Directors, the converted options or other awards shall be vested
        only to the extent that the vesting requirements relating to options or other
        awards granted hereunder have been satisfied. The Board of Directors may,
        in its
        sole discretion, accelerate the exercisability of options so that they are
        exercisable in full prior to being converted into options to purchase stock
        of
        the surviving or acquiring corporations in the Transaction.

       

       

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


       

                                          10.2-3
        With respect to options, the Board of Directors shall provide a period of
        at
        least 10 days before the completion of the Transaction during which outstanding
        options may be exercised, to the extent then exercisable, and upon the
        expiration of that period, all unexercised options shall immediately terminate.
        The Board of Directors may, in its sole discretion, accelerate the
        exercisability of options so that they are exercisable in full during that
        period.

       

                                          10.2-4
        With respect to awards other than options, the Board of Directors may, in
        its
        sole discretion and subject to applicable law, terminate or waive the
        application of all forfeiture provisions, performance thresholds and similar
        restrictions at any time prior to the consummation of the
        Transaction.

       

                              10.3            Dissolution
        of the Company.  In
        the event of the dissolution of the Company, options and other awards shall
        be
        treated in accordance with Section 10.2-3.

       

                              10.4            Rights
        Issued by Another Corporation.  The
        Board of Directors may also grant options and stock bonuses and
        Performance-based Awards and issue restricted stock under the Plan with terms,
        conditions and provisions that vary from those specified in the Plan, provided
        that any such awards are granted in substitution for, or in connection with
        the
        assumption of, existing options, stock bonuses, Performance-based Awards
        and
        restricted stock granted, awarded or issued by another corporation and assumed
        or otherwise agreed to be provided for by the Company pursuant to or by reason
        of a Transaction. 

       

                  11.
                    Amendment
        of the Plan.  The
        Board of Directors may at any time modify or amend the Plan in any respect
        (except that the Board of Directors may not make any amendment that would
        cause
        the Plan to cease to comply with governing law). Except as provided in Section
        10, however, no change in an award already granted shall be made without
        the
        written consent of the holder of the award if the change would adversely
        affect
        the holder.

       

                  12.
                    Approvals.  The
        Company's obligations under the Plan are subject to the approval of state
        and
        federal authorities or agencies with jurisdiction in the matter. The Company
        will use its best efforts to take steps required by state or federal law
        or
        applicable regulations, including rules and regulations of the Securities
        and
        Exchange Commission and any stock exchange on which the Company's shares
        may
        then be listed, in connection with the grants under the Plan. The foregoing
        notwithstanding, the Company shall not be obligated to issue or deliver Common
        Stock under the Plan if such issuance or delivery would violate state or
        federal
        securities laws. Unless the Company determines, with advice of counsel that
        such
        legend is not necessary, certificates representing all shares of Common Stock
        issued in connection with the Plan will contain a legend indicating that
        such
        shares of Common Stock are "restricted securities," as defined under Rule
        144
        promulgated under the Securities Act of 1933, as amended, and that such shares
        may not be transferred unless such transfer is registered under the Securities
        Act and governing state securities laws or exempt from the registration
        requirements of the same.

       

                  13.
                    Employment
        and Service Rights.  Nothing
        in the Plan or any award pursuant to the Plan shall (i) confer upon any employee
        any right to be continued in the employment of an Employer or interfere in
        any
        way with the Employer's right to terminate the employee's employment at will
        at
        any time, for any reason, with or without cause, or to decrease the employee's
        compensation or benefits, or (ii) confer upon any person engaged by an
        Employer any right to be retained or employed by the Employer or to the
        continuation, extension, renewal or modification of any compensation, contract
        or arrangement with or by the Employer.

       

       

       

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


      


       

       

       

       

                  14.
                    Rights
        as a Shareholder.  The
        recipient of any award under the Plan shall have no rights as a shareholder
        with
        respect to any shares of Common Stock until the date the recipient becomes
        the
        holder of record of those shares. Except as otherwise expressly provided
        in the
        Plan, no adjustment shall be made for dividends or other rights for which
        the
        record date occurs before the date the recipient becomes the holder of
        record.

       

                  15.
                    Right
        to Receive Financial Statements.  A
        holder of any award granted under the Plan shall be entitled to receive
        financial statements of the Company at least annually until the expiration
        or
        full exercise of such award. 

       

       

       

       

       

       

       

       

       


      
        
           

        

        
           

          
            

          

        

        
           

        

      


      


       

                  The
        undersigned, who is the duly elected Chief Operating Officer of the Company,
        hereby certifies that the Third Amendment was approved by the Board of Directors
        of the Company and became effective January 30, 2006. The Board of Directors
        has
        directed the Company to submit the Third Amendment to the shareholders for
        approval within one year of the Third Amendment Effective Date. 

       

       

       

       

      
        	
                 

              	
                 

                VITALSTREAM
                  HOLDINGS, INC.

                 

              
	
                 

              	
                 

              	
                 

              
	
                 

              	
                 

              	
                 

              
	
                 

              	
                By:

              	
                /s/
                  Philip N.
                  Kaplan                                                           
                  

              
	
                 

              	
                 

              	
                Philip
                  N. Kaplan

              
	
                 

              	
                 

              	
                President
                  & Chief Operating Officer