**Exhibit 10.1**

 

**SENESCO TECHNOLOGIES, INC.**

 

**2008 INCENTIVECOMPENSATION PLAN**

** **

**ARTICLE ONE**

 

**GENERAL PROVISIONS**

**I.****            ****PURPOSE OF THE PLAN**

 

This 2008 IncentiveCompensation Plan (the “Plan”) is intended to promote the interests of SenescoTechnologies, Inc., a Delaware corporation, by providing eligible personsin the Corporation’s service with the opportunity to participate in one or morecash or equity incentive compensation programs designed to encourage them tocontinue their service relationship with the Corporation.

 

The Plan shall serve as thesuccessor to the Corporation’s 1998 Stock Incentive Plan (the “Predecessor Plan”),and no further awards shall be granted under the Predecessor Plan after thePlan Effective Date. All awards outstanding under the Predecessor Plan on thePlan Effective Date shall continue to be governed solely by the terms of thedocuments evidencing such award, and no provision of the Plan shall be deemedto affect or otherwise modify the rights or obligations of the holders of suchtransferred awards.

 

Capitalized terms shall havethe meanings assigned to such terms in the attached Appendix.

** **

**II.****           ****TYPES OF AWARDS**

 

Awards may be made under thePlan in the form of (i) options, (ii) stock appreciation rights, (iii) stockawards, (iv) restricted stock units, (v) cash awards, (vi) performanceunits, and (vii) dividend equivalent rights.

** **

**III.****         ****ADMINISTRATION OF THE PLAN**

 

A.           The Compensation Committee shall havesole and exclusive authority to administer the Plan with respect to Section 16Insiders. Administration of the Plan with respect to all other persons eligibleto participate in the Plan may, at the Board’s discretion, be vested in theCompensation Committee or a Secondary Board Committee, or the Board may retainthe power to administer those programs with respect to such persons.

 

B.            Members of the Compensation Committee orany Secondary Board Committee shall serve for such period of time as the Boardmay determine and may be removed by the Board at any time. The Board may alsoat any time terminate the functions of any Secondary Board Committee andreassume all powers and authority previously delegated to such committee.

 

----

 

C.            To the extent permitted by and consistentwith applicable law, the Board may delegate to one or more executive officersthe power to grant awards to employees other than Section 16 Insiders.

 

D.           Each Plan Administrator shall, within thescope of its administrative functions under the Plan, have full power andauthority (subject to the provisions of the Plan) to establish such rules andregulations as it may deem appropriate for proper administration of the Planand to make such determinations under, and issue such interpretations of, theprovisions of the Plan and any outstanding Awards thereunder as it may deemnecessary or advisable. Decisions of the Plan Administrator within the scope ofits administrative functions under the Plan shall be final and binding on allparties who have an interest in the Plan under its jurisdiction or any Awardthereunder.

 

E.            Service as a Plan Administrator by themembers of the Compensation Committee or the Secondary Board Committee shallconstitute service as Board members, and the members of each such committeeshall accordingly be entitled to full indemnification and reimbursement as Boardmembers for their service on such committee. No member of the CompensationCommittee or the Secondary Board Committee shall be liable for any act oromission made in good faith with respect to the Plan or any Award thereunder.

** **

**IV.****         ****ELIGIBILITY**

 

A.           The persons eligible to participate inthe Plan are as follows:

 

(i)            Employees,

 

(ii)           non-employee members of the Board or theboard of directors of any Parent or Subsidiary, and

 

(iii)          consultantsand other independent advisors who provide services to the Corporation (or anyParent or Subsidiary).

 

B.            The Plan Administrator shall have fullauthority to determine which eligible persons are to receive Awards under thePlan, the time or times when those Awards are to be made, the number of sharesto be covered by each such Award, the time or times when the Award is to becomeexercisable, the status of an option for federal tax purposes, the maximum termfor which an option or stock appreciation right is to remain outstanding, thevesting and issuance schedules applicable to the shares which are the subjectof the Award, the cash consideration (if any) payable for those shares and theform (cash or shares of Common Stock) in which the Award is to be settled and,with respect to performance–based Awards, the performance objectives for eachsuch Award, the amounts payable at designated levels of attained performance,any applicable service vesting requirements, and the payout schedule for eachsuch Award.

 

2

----

 

**V.****           ****STOCK SUBJECT TO THE PLAN**

 

A.           The stock issuable under the Plan shallbe shares of authorized but unissued or reacquired Common Stock, includingshares repurchased by the Corporation on the open market. The number of sharesof Common Stock initially reserved for issuance over the term of the Plan shallbe limited to five million one hundred and thirty seven thousand and twohundred (5,137,200) shares.  Such reserveshall consist of (i) the number of shares of Common Stock estimated toremain available for issuance, as of the Plan Effective Date, under thePredecessor Plan as last approved by the Corporation’s stockholders (excludingshares subject to outstanding awards under the Predecessor Plan), plus (ii) anadditional increase of four million (4,000,000) shares. To the extent anyoptions or restricted stock units outstanding under the Predecessor Plan on thePlan Effective Date expire or terminate unexercised or without the issuance ofshares thereunder, the number of shares of Common Stock subject to those expiredor terminated options and restricted stock units at the time of expiration ortermination shall be added to the share reserve under this Plan and shallaccordingly be available for issuance hereunder, up to a maximum of anadditional one million (1,000,000) shares.

 

B.            Each person participating in the Planshall be subject the following limitations:

 

(i)            for Awards denominated in shares ofCommon Stock (whether payable in Common Stock, cash or a combination of both),the maximum number of shares of Common Stock for which such Awards may be madeto such person in any calendar year shall not exceed one million (1,000,000)shares of Common Stock in the aggregate, and

 

(ii)           for Awards denominated in dollars(whether payable in cash, Common Stock or a combination of both), the maximumdollar amount for which such Awards may be made in the aggregate to such personshall not exceed one million Dollars ($1,000,000) per calendar year within theapplicable service or performance measurement period.

 

C.            Shares of Common Stock subject tooutstanding Awards made under the Plan (including Awards transferred to thisPlan from the Predecessor Plan) shall be available for subsequent issuanceunder the Plan to the extent those Awards expire or terminate for any reason priorto the issuance of the shares of Common Stock subject to those Awards. Unvestedshares issued under the Plan and subsequently forfeited or repurchased by theCorporation, at a price per share not greater than the original issue pricepaid per share, pursuant to the Corporation’s repurchase rights under the Planshall be added back to the number of shares of Common Stock reserved forissuance under the Plan and shall accordingly be available for subsequentreissuance. Should the exercise price of an option under the Plan be paid withshares of Common Stock, then the authorized reserve of Common Stock under thePlan shall be reduced only by the net number of shares issued under theexercised stock option and not by the gross number of shares for which that optionis exercised. Upon the exercise of any stock appreciation right under the Plan,the share reserve shall be reduced only by the net number of shares actuallyissued by the Corporation upon such exercise and not by the gross number ofshares as to which such right is exercised. If shares of Common Stock otherwiseissuable under the Plan are withheld by the Corporation in satisfaction of thewithholding taxes incurred in connection with the exercise, vesting orsettlement of an Award, then the number of shares of Common Stock available for

 

3

----

 

issuance under the Plan shall be reduced by the netnumber of shares issued after such share withholding.

 

D.            Should any change be made to the CommonStock by reason of any stock split, stock dividend, recapitalization,combination of shares, exchange of shares, spin-off transaction or other changeaffecting the outstanding Common Stock as a class without the Corporation’sreceipt of consideration, or should the value of outstanding shares of CommonStock be substantially reduced as a result of a spin-off transaction or anextraordinary dividend or distribution, or should there occur any merger,consolidation or other reorganization, then equitable adjustments shall be madeby the Plan Administrator to (i) the maximum number and/or class ofsecurities issuable under the Plan, (ii) the maximum number and/or classof securities by which the share reserve under the Plan may increase by reasonof the expiration or termination of options or restricted stock units under thePredecessor Plan, (iii) the maximum number and/or class of securities forwhich any one person may be granted Common Stock-denominated Awards under thePlan per calendar year, (iv) the number and/or class of securities and theexercise or base price per share in effect under each outstanding award underthe Plan and the cash consideration (if any) payable per share, and (v) thenumber and/or class of securities subject to the Corporation’s outstandingrepurchase rights under the Plan and the repurchase price payable per share.The adjustments shall be made in such manner as the Plan Administrator deemsappropriate in order to prevent the dilution or enlargement of benefits underthe Plan and the outstanding Awards thereunder, and such adjustments shall befinal, binding and conclusive. In the event of a Change in Control, however,the adjustments (if any) shall be made solely in accordance with the applicableprovisions of the Plan governing Change in Control transactions.

 

E.             Outstanding Awards granted pursuant tothe Plan shall in no way affect the right of the Corporation to adjust,reclassify, reorganize or otherwise change its capital or business structure orto merge, consolidate, dissolve, liquidate or sell or transfer all or any partof its business or assets.

 

**ARTICLE TWO**

** **

**AWARDS**

** **

**I.****            ****OPTIONS**

 

A.            **Authority**. The Plan Administrator shall have fullpower and authority, exercisable in its sole discretion, to grant IncentiveOptions and Nonstatutory Options evidenced by one or more Award Agreements inthe form approved by the Plan Administrator; provided, however, that each suchagreement shall comply with the terms specified below. Each agreementevidencing an Incentive Option shall, in addition, be subject to the provisionsof Section H below.

 

4

----

 

B.            **Exercise Price**.

 

(i)            The exercise price per share shall befixed by the Plan Administrator; ***provided, however,*** that such exercise priceshall not be less than one hundred percent (100%) of the Fair Market Value pershare of Common Stock on the grant date.

 

(ii)           The exercise price shall becomeimmediately due upon exercise of the option and shall, subject to theprovisions of the documents evidencing the option, be payable in one or more ofthe forms specified below:

 

(1)           cash or check made payable to theCorporation,

 

(2)           shares of Common Stock (whether deliveredin the form of actual stock certificates or through attestation of ownership)held for the requisite period (if any) necessary to avoid any resulting chargeto the Corporation’s earnings for financial reporting purposes and valued atFair Market Value on the Exercise Date, or

 

(3)           to the extent the option is exercised forvested shares of Common Stock, through a special sale and remittance procedurepursuant to which the Participant shall concurrently provide instructions to (a) abrokerage firm (reasonably satisfactory to the Corporation for purposes ofadministering such procedure in compliance with the Corporation’spre-clearance/pre-notification policies) to effect the immediate sale of thepurchased shares and remit to the Corporation, out of the sale proceedsavailable on the settlement date, sufficient funds to cover the aggregateexercise price payable for the purchased shares plus all applicable income andemployment taxes required to be withheld by the Corporation by reason of suchexercise and (b) the Corporation to deliver the certificates for thepurchased shares directly to such brokerage firm on such settlement datein order to complete the sale.

 

Except to the extent suchsale and remittance procedure is utilized, payment of the exercise price forthe purchased shares must be made on the Exercise Date.

 

C.            **Exercise and Term ofOptions****.**Each option shall be exercisable at such time or times, during such period andfor such number of shares as shall be determined by the Plan Administrator andset forth in the Award Agreements evidencing the option. However, no optionshall have a term in excess of ten (10) years measured from the optiongrant date.

 

D.           **Effect of Termination ofService**.

 

(i)            The following provisions shall govern theexercise of any options that are outstanding at the time of the Participant’scessation of Service or death:

 

(1)           Any option outstanding at the time of theParticipant’s cessation of Service for any reason shall remain exercisable forsuch period of time thereafter as shall be determined by the Plan Administratorand set forth in the documents evidencing the option, but no such option shallbe exercisable after the expiration of the option term.

 

5

----

 

(2)           Any option held by the Participant at thetime of the Participant’s death and exercisable in whole or in part at thattime may be subsequently exercised by the personal representative of theParticipant’s estate or by the person or persons to whom the option istransferred pursuant to the Participant’s will or the laws of inheritance or bythe Participant’s designated beneficiary or beneficiaries of that option.

 

(3)           Should the Participant’s Service beterminated for Misconduct or should the Participant otherwise engage inMisconduct while holding one or more outstanding options granted under this Article Two,then all of those options shall terminate immediately and cease to beoutstanding.

 

(4)           During the applicable post-Serviceexercise period, the option may not be exercised for more than the number ofvested shares for which the option is at the time exercisable; ***provided, however,***that one or more options may be structured so that those options continue tovest in whole or part during the applicable post-Service exercise period. Uponthe expiration of the applicable exercise period or (if earlier) upon theexpiration of the option term, the option shall terminate and cease to beoutstanding for any shares for which the option has not been exercised.

 

(ii)           The Plan Administrator shall havecomplete discretion, exercisable either at the time an option is granted or atany time while the option remains outstanding, to:

 

(1)           extend the period of time for which theoption is to remain exercisable following the Participant’s cessation ofService from the limited exercise period otherwise in effect for that option tosuch greater period of time as the Plan Administrator shall deem appropriate,but in no event beyond the expiration of the option term;

 

(2)           include an automatic extension provisionwhereby the specified post-Service exercise period in effect for any optionshall automatically be extended by an additional period of time equal induration to any interval within the specified post-Service exercise periodduring which the exercise of that option or the immediate sale of the sharesacquired under such option could not be effected in compliance with applicablefederal and state securities laws, but in no event shall such an extensionresult in the continuation of such option beyond the expiration date of theterm of that option; and/or

 

(3)           permit the option to be exercised, duringthe applicable post-Service exercise period, not only with respect to thenumber of vested shares of Common Stock for which such option is exercisable atthe time of the Participant’s cessation of Service but also with respect to oneor more additional installments in which the Participant would have vested hadthe Participant continued in Service.

 

E.            **Stockholder Rights****.** The holder of an option shall have nostockholder rights with respect to the shares subject to the option until suchperson shall have exercised the option, paid the exercise price and become aholder of record of the purchased shares.

 

F.            **Repurchase Rights****.** The Plan Administrator shall have thediscretion to grant options which are exercisable for unvested shares of CommonStock. Should the 

 

6

----

 

Participant cease Service while such shares areunvested, the Corporation shall have the right to repurchase any or all ofthose unvested shares at a price per share equal to the ***lower*** of (i) theexercise price paid per share or (ii) the Fair Market Value per share ofCommon Stock at the time of repurchase. The terms upon which such repurchaseright shall be exercisable (including the period and procedure for exercise andthe appropriate vesting schedule for the purchased shares) shall be establishedby the Plan Administrator and set forth in the document evidencing suchrepurchase right.

 

G.            **Transferability ofOptions**. Thetransferability of options granted under the Plan shall be governed by thefollowing provisions:

 

(i)             *Incentive Options*: During the lifetime of the Participant,Incentive Options shall be exercisable only by the Participant and shall not beassignable or transferable other than by will or the laws of inheritancefollowing the Participant’s death.

 

(ii)            *Non-Statutory Options*. Non-Statutory Options shall be subjectto the same limitation on transfer as Incentive Options, except that the PlanAdministrator may structure one or more Non-Statutory Options so that theoption may be assigned in whole or in part during the Participant’s lifetime.The assigned portion may only be exercised by the person or persons who acquirea proprietary interest in the option pursuant to the assignment. The termsapplicable to the assigned portion shall be the same as those in effect for theoption immediately prior to such assignment and shall be set forth in suchdocuments issued to the assignee as the Plan Administrator may deemappropriate.

 

(iii)           *Beneficiary Designation**.* Notwithstanding the foregoing, the Participantmay designate one or more persons as the beneficiary or beneficiaries of his orher outstanding options, and those options shall, in accordance with suchdesignation, automatically be transferred to such beneficiary or beneficiariesupon the Participant’s death while holding those options. Such beneficiary orbeneficiaries shall take the transferred options subject to all the terms andconditions of the applicable agreement evidencing each such transferred option,including (without limitation) the limited time period during which the optionmay be exercised following the Participant’s death.

 

H.           **Incentive Options**. The terms specified below shall beapplicable to all Incentive Options.

 

(i)             *Eligibility*. Incentive Options may only be granted toEmployees.

 

(ii)            *Dollar Limitation*. The aggregate Fair Market Value of theshares of Common Stock (determined as of the respective date or dates of grant)for which one or more options granted to any Employee under the Plan (or anyother option plan of the Corporation or any Parent or Subsidiary) may for thefirst time become exercisable as Incentive Options during any one calendar yearshall not exceed the sum of One Hundred Thousand Dollars ($100,000).

 

To the extent the Employeeholds two (2) or more such options which become exercisable for the firsttime in the same calendar year, then for purposes of the foregoing limitationson the exercisability of those options as Incentive Options, such options 

 

7

----

 

shall be deemed to becomefirst exercisable in that calendar year on the basis of the chronological orderin which they were granted, except to the extent otherwise provided underapplicable law or regulation.

 

(iii)           *10% Stockholder*. If any Employee to whom an IncentiveOption is granted is a 10% Stockholder, then the exercise price per share shallnot be less than one hundred ten percent (110%) of the Fair Market Value pershare of Common Stock on the option grant date, and the option term shall notexceed five (5) years measured from the option grant date.

 

**II.****           ****STOCK APPRECIATION RIGHTS**

 

A.           **Authority**. The Plan Administrator shall have fullpower and authority, exercisable in its sole discretion, to grant stockappreciation rights evidenced by one or more Award Agreements in the formapproved by the Plan Administrator which complies with the terms specifiedbelow.

 

B.            **Types**. Two types of stock appreciation rightsshall be authorized for issuance under this Section II: (i) tandemstock appreciation rights (“Tandem Rights”) and (ii) stand-alone stockappreciation rights (“Stand-alone Rights”).

 

C.            **Tandem Rights**. The following terms and conditionsshall govern the grant and exercise of Tandem Rights.

 

(i)             One or more Participants may be granted a TandemRight, exercisable upon such terms and conditions as the Plan Administrator mayestablish, to elect between the exercise of the underlying option for shares ofCommon Stock or the surrender of that option in exchange for a distributionfrom the Corporation in an amount equal to the excess of (i) the FairMarket Value (on the option surrender date) of the number of shares in whichthe Participant is at the time vested under the surrendered option (orsurrendered portion thereof) over (ii) the aggregate exercise price payablefor such vested shares.

 

(ii)            Any distribution to which the Participant becomesentitled upon the exercise of a Tandem Right may be made in (i) shares ofCommon Stock valued at Fair Market Value on the option surrender date, (ii) cashor (iii) a combination of cash and shares of Common Stock, as specified inthe applicable Award agreement.

 

D.           **Stand-Alone Rights**. The following terms and conditionsshall govern the grant and exercise of Stand-alone Rights:

 

(i)             One or more Participants may be granted a Stand-aloneRight not tied to any underlying option. The Stand-alone Right shall relate toa specified number of shares of Common Stock and shall be exercisable upon suchterms and conditions as the Plan Administrator may establish. In no event,however, may the Stand-alone Right have a maximum term in excess of ten (10) yearsmeasured from the grant date.

 

(ii)            Upon exercise of the Stand-alone Right, the holdershall be entitled to receive a distribution from the Corporation in an amountequal to the excess of (i) the 

 

8

----

 

aggregate Fair Market Value (on the exercise date) ofthe shares of Common Stock underlying the exercised right over (ii) theaggregate base price in effect for those shares.

 

(iii)           The number of shares of Common Stock underlying eachStand-alone Right and the base price in effect for those shares shall bedetermined by the Plan Administrator in its sole discretion at the time theStand-alone Right is granted. In no event, however, may the base price pershare be less than the Fair Market Value per underlying share of Common Stockon the grant date.

 

(iv)           Stand-alone Rights shall be subject to the sametransferability restrictions applicable to Non-Statutory Options and may not betransferred during the holder’s lifetime, except to the extent otherwiseprovided in the applicable Award Agreement. In addition, one or morebeneficiaries may be designated for an outstanding Stand-alone Right inaccordance with substantially the same terms and provisions as set forth in Section I.Fof this Article Two.

 

(v)            The distribution with respect to an exercisedStand-alone Right may be made in (i) shares of Common Stock valued at FairMarket Value on the exercise date, (ii) cash or (iii) a combinationof cash and shares of Common Stock, as specified in the applicable Awardagreement.

 

(vi)           The holder of a Stand-alone Right shall have nostockholder rights with respect to the shares subject to the Stand-alone Rightunless and until such person shall have exercised the Stand-alone Right andbecome a holder of record of the shares of Common Stock issued upon theexercise of such Stand-alone Right.

 

E.            **Post-Service Exercise**. The provisions governing the exerciseof Tandem and Stand-alone Rights following the cessation of the Participant’sService shall be substantially the same as those set forth in Section I.C.of this Article Two for the options granted under the Plan, and the PlanAdministrator’s discretionary authority under Section I.C.(ii) ofthis Article Two shall also extend to any outstanding Tandem orStand-alone Appreciation Rights.

 

**III.****         ****STOCK AWARDS**

 

A.           **Authority**. The Plan Administrator shall have fullpower and authority, exercisable in its sole discretion, to grant stock awardseither as vested or unvested shares of Common Stock, through direct andimmediate issuances.  Each stock awardshall be evidenced by one or more Award Agreements in the form approved by thePlan Administrator; provided, however, that each such agreement shall complywith the terms specified below.

 

B.            **Issue Price/Consideration****.**

 

(i)             Shares of Common Stock may be issued under a stockaward for a price per share fixed by the Plan Administrator at the time of theAward, but in no event shall such issue price be less than one hundred percent(100%) of the Fair Market Value per share of Common Stock on the Award date.

 

9

----

 

(ii)            Shares of Common Stock may be issued under a stockaward for any of the following items of consideration which the PlanAdministrator may deem appropriate in each individual instance:

 

(1)           cash;

 

(2)           past services rendered or to be renderedthe Corporation (or any Parent or Subsidiary); or

 

(3)           any other valid consideration under theState in which the Corporation is at the time incorporated.

 

C.            **Vesting Provisions****.**

 

(i)            Stock awards may, in the discretion of the PlanAdministrator, be fully and immediately vested upon issuance as a bonus forService rendered or may vest in one or more installments over the Participant’speriod of Service and/or upon the attainment of specified performanceobjectives. The elements of the vesting schedule applicable to any stock awardshall be determined by the Plan Administrator and incorporated into the AwardAgreement.

 

(ii)           The Plan Administrator shall also havethe discretionary authority, consistent with Code Section 162(m), tostructure one or more stock awards so that the shares of Common Stock subjectto those Awards shall vest upon the achievement of pre-established performanceobjectives based on one or more Performance Goals and measured over theperformance period specified by the Plan Administrator at the time of the grantof the Award.

 

(iii)          Should the Participant cease to remain inService while holding one or more unvested shares of Common Stock issued undera stock award or should the performance objectives not be attained with respectto one or more such unvested shares of Common Stock, then those shares shall beimmediately surrendered to the Corporation for cancellation, and theParticipant shall have no further stockholder rights with respect to thoseshares. To the extent the surrendered shares were previously issued to theParticipant for consideration paid in cash or cash equivalent, the Corporationshall repay to the Participant the ***lower*** of (i) the cash consideration paidfor the surrendered shares or (ii) the Fair Market Value of those sharesat the time of cancellation.

 

(iv)          The Plan Administrator may in itsdiscretion waive the surrender and cancellation of one or more unvested sharesof Common Stock which would otherwise occur upon the cessation of theParticipant’s Service or the non-attainment of the performance objectivesapplicable to those shares. Any such waiver shall result in the immediatevesting of the Participant’s interest in the shares of Common Stock as to whichthe waiver applies. Such waiver may be effected at any time, whether before orafter the Participant’s cessation of Service or the attainment ornon-attainment of the applicable performance objectives. However, no vestingrequirements tied to the attainment of performance objectives may be waivedwith respect to shares which were intended at the time of issuance to qualifyas performance-based compensation under Code Section 162(m), except in theevent of the Participant’s Involuntary 

 

10

----

 

Termination with respect to Awards made prior to January 1,2009 or as otherwise provided in Section VIII of this Article Two.

 

(v)           Any new, substituted or additionalsecurities or other property (including money paid other than as a regular cashdividend) which the Participant may have the right to receive with respect tothe Participant’s unvested shares of Common Stock by reason of any stockdividend, stock split, recapitalization, combination of shares, exchange ofshares, spin-off transaction, extraordinary dividend or distribution****or other change affecting the outstanding Common Stock as aclass without the Corporation’s receipt of consideration shall be issuedsubject to (i) the same vesting requirements applicable to the Participant’sunvested shares of Common Stock and (ii) such escrow arrangements as thePlan Administrator shall deem appropriate, unless and to the extent the PlanAdministrator determines at the time to vest and distribute such securities orother property. Equitable adjustments to reflect each such transaction shallalso be made by the Plan Administrator to the repurchase price payable pershare by the Corporation for any unvested securities subject to its existingrepurchase rights under the Plan; provided the aggregate repurchase price shallin each instance remain the same.

 

D.           **Stockholder Rights**. The Participant shall have fullstockholder rights with respect to any shares of Common Stock issued to theParticipant under a stock award, whether or not the Participant’s interest inthose shares is vested. Accordingly, the Participant shall have the right tovote such shares and to receive any dividends paid on such shares, subject to anyapplicable vesting requirements.

 

**IV.****         ****RESTRICTED STOCK UNITS**

 

A.           **Authority**. The Plan Administrator shall have thefull power and authority, exercisable in its sole discretion, to grantrestricted stock units which entitle the Participants to receive the sharesunderlying those Awards upon vesting or upon the expiration of a designatedtime period following the vesting of those Awards.  Each award of restricted stock units shall beevidenced by one or more Award Agreements in the form approved by the PlanAdministrator; provided, however, that each such agreement shall comply withthe terms specified below.

 

B.            **Vesting Provisions**.

 

(i)            Restricted stock units may, in thediscretion of the Plan Administrator, vest in one or more installments over theParticipant’s period of Service or upon the attainment of specified performanceobjectives.

 

(ii)           The Plan Administrator shall also havethe discretionary authority, consistent with Code Section 162(m), tostructure one or more restricted stock unit awards so that the shares of CommonStock subject to those Awards shall vest (or vest and become issuable) upon theachievement of pre-established performance objectives based on one or morePerformance Goals and measured over the performance period specified by the PlanAdministrator at the time of the grant of the Award.

 

11

----

 

(iii)           Outstanding restricted stock units shall automaticallyterminate, and no shares of Common Stock shall actually be issued insatisfaction of those Awards, if the performance goals or Service requirementsestablished for those Awards are not attained or satisfied. The PlanAdministrator, however, shall have the discretionary authority to issue vestedshares of Common Stock under one or more outstanding Awards of restricted stockunits as to which the designated performance goals or Service requirements havenot been attained or satisfied. However, no vesting requirements tied to theattainment of performance goals may be waived with respect to Awards which wereintended, at the time those Awards were granted, to qualify asperformance-based compensation under Code Section 162(m), except in theevent of the Participant’s Involuntary Termination with respect to Awards madeprior to January 1, 2009 or as otherwise provided in Section VIII ofthis Article Two.

 

C.            **Stockholder Rights**. The Participant shall not have anystockholder rights with respect to the shares of Common Stock subject to arestricted stock unit award until that award vests and the shares of CommonStock are actually issued thereunder. However, dividend-equivalent units may bepaid or credited, either in cash or in actual or phantom shares of CommonStock, on outstanding restricted stock unit awards, subject to such terms andconditions as the Plan Administrator may deem appropriate.

 

**V.****          ****CASH AWARDS**

 

A.           **Authority**. The Plan Administrator shall have thefull power and authority, exercisable in its sole discretion, to make cashincentive awards which are to vest in one or more installments over theParticipant’s continued Service with the Corporation or upon the attainment ofspecified performance goals. Each such cash award shall be evidenced by one ormore Award Agreements in the form approved by the Plan Administrator; ***provided however,***that each such agreement shall comply with the terms specified below.

 

B.            **Vesting Provisions**.

 

(i)             The elements of the vesting schedule applicable toeach cash award shall be determined by the Plan Administrator and incorporatedinto the Award Agreement.

 

(ii)            The Plan Administrator shall also have thediscretionary authority, consistent with Code Section 162(m), to structureone or more cash awards so that those Awards shall vest upon the achievement ofpre-established corporate performance objectives based upon one or morePerformance Goals and measured over the performance period specified by thePlan Administrator at the time of grant of the Award.

 

(iii)           Outstanding cash awards shall automatically terminate,and no cash payment or other consideration shall be due the holders of thoseAwards, if the performance goals or Service requirements established for the Awardsare not attained or satisfied. The Plan Administrator may, however, in itsdiscretion waive the termination of one or more unvested cash awards whichwould otherwise occur upon the cessation of the Participant’s Service or thenon-attainment of the performance objectives applicable to those Awards. Anysuch waiver shall result in the immediate vesting of the Participant’s interestin the cash award as to which the waiver applies. Such wavier may be effectedat any time, whether before or after the 

 

12

----

 

Participant’s cessation of Service or the attainmentor non-attainment of the applicable performance objectives. However, no vestingrequirements tied to the attainment of performance goals may be waived withrespect to awards which were intended, at the time those awards were granted,to qualify as performance-based compensation under Code Section 162(m),except in the event of the Participant’s Involuntary Termination with respectto Awards made prior to January 1, 2009 or as otherwise provided in Section VIIIof this Article Two.

 

C.            **Payment**. Cash awards which become due andpayable following the attainment of the applicable performance goals orsatisfaction of the applicable Service requirement (or the waiver of such goalsor Service requirement) may be paid in (i) cash, (ii) shares ofCommon Stock valued at Fair Market Value on the payment date or (iii) acombination of cash and shares of Common Stock as the Plan Administrator shalldetermine.

 

**VI.****         ****PERFORMANCE UNIT AWARDS**

 

A.           **Authority**. The Plan Administrator shall have fullpower and authority, exercisable in its sole discretion, to grant performanceunit awards in accordance with the terms of this Section VI. Eachperformance unit award shall be evidenced by one or more Award Agreements inthe form approved by the Plan Administrator; ***provided however,*** that each suchagreement shall comply with the terms specified below.

 

B.            **Bonus Pool**. A performance unit shall represent aparticipating interest in a special bonus pool tied to the attainment ofpre-established performance objectives based on one or more Performance Goals.The amount of the bonus pool may vary with the level at which the applicableperformance objectives are attained, and the value of each Performance Unitwhich becomes due and payable upon the attained level of performance shall bedetermined by dividing the amount of the resulting bonus pool (if any) by thetotal number of Performance Units issued and outstanding at the completion of theapplicable performance period.

 

C.            **Service Requirement**. Performance units may also bestructured to include a Service requirement which the Participant must satisfyfollowing the completion of the performance period in order to vest in theperformance units awarded with respect to that performance period.

 

D.           **Payment**. Performance units which become due andpayable following the attainment of the applicable performance objectives andthe satisfaction of any applicable Service requirement may be paid in (i) cash,(ii) shares of Common Stock valued at Fair Market Value on the paymentdate or (iii) a combination of cash and shares of Common Stock, asdetermined by the Plan Administrator in its sole discretion and set forth inthe Award Agreement.

 

**VII.****        ****DIVIDEND EQUIVALENT RIGHTS**

 

A.           **Authority**. The Plan Administrator shall have thediscretionary authority to grant dividend equivalent rights in accordance withthe terms of this Section VII. Each such Award shall be evidenced by oneor more Award Agreements in the form approved by the Plan 

 

13

----

 

Administrator; provided however, that each suchagreement shall comply with the terms specified below.

 

B.            **Terms**. The dividend equivalent rights may begranted as stand-alone awards or in tandem with other Awards made under thePlan. The term of each dividend equivalent right award shall be established bythe Plan Administrator at the time of grant, but no such Award shall have aterm in excess of ten (10) years.

 

C.            **Entitlement**. Each dividend equivalent right shall represent the right to receive theeconomic equivalent of each dividend or distribution, whether in cash,securities or other property (other than shares of Common Stock), which is madeper issued and outstanding share of Common Stock during the term the dividendequivalent right remains outstanding.  Aspecial account on the books of the Corporation shall be maintained for eachParticipant to whom a dividend equivalent right is granted, and that accountshall be credited per dividend equivalent right with each such dividend ordistribution made per issued and outstanding share of Common Stock during theterm of that dividend equivalent right remains outstanding.

 

D.           **Timing of Payment**. Payment of the amounts credited to such book account may be made to theParticipant either concurrently with the actual dividend or distribution madeper issued and outstanding share of Common Stock or may be deferred for aperiod specified by the Plan Administrator at the time the dividend equivalentright is initially granted or (to the extent permitted by the PlanAdministrator) designated by the Participant pursuant to a timely deferralelection made in accordance with the requirements of Code Section 409A.

 

E.            **Form of Payment**. Payment of the amounts due with respect to dividend equivalent rightsmay be made in (i) cash, (ii) shares of Common Stock or (iii) acombination of cash and shares of Common Stock, as determined by the PlanAdministrator in its sole discretion and set forth in the Award Agreement.  If payment is to be made in the form ofCommon Stock, the number of shares of Common Stock into which the cash dividendor distribution amounts are to be converted for purposes of the Participant’sbook account may be based on the Fair Market Value per share of Common Stock onthe date of conversion, a prior date or an average of the Fair Market Value pershare of Common Stock over a designated period, as determined by the PlanAdministrator in its sole discretion.

 

**VIII.****      ****EFFECT OF CHANGE IN CONTROL**

 

A.           In the event of an actual Change inControl transaction, each option, stock appreciation right and restricted stockunit award outstanding at that time under the Plan but not otherwise fullyvested shall automatically accelerate, immediately prior to the effective dateof that Change in Control, as to all the shares of Common Stock at the timesubject to such Award, unless (i) such Award is to be assumed orsubstituted with an equivalent award by the successor corporation (or parent thereof)or is otherwise to continue in full force and effect pursuant to the terms ofthe Change in Control transaction or (ii) such Award is replaced with acash retention program of the successor corporation that preserves the spreadexisting at the time of the Change 

 

14

----

 

in Control on the shares of Common Stock as to whichthe Award is not otherwise at that time vested and exercisable and provides forthe subsequent vesting and payout of that spread in accordance with the sameexercise/vesting schedule applicable to those shares, or (iii) theacceleration of such Award is subject to other limitations imposed by the PlanAdministrator.

 

B.            All outstanding repurchase rights shallautomatically terminate, and the shares of Common Stock subject to thoseterminated rights shall vest in full, immediately prior to the effective dateof an actual Change in Control transaction, except to the extent (i) thoserepurchase rights are to be assigned to the successor corporation (or parentthereof) or are otherwise to continue in full force and effect pursuant to theterms of the Change in Control transaction or (ii) such acceleratedvesting is precluded by other limitations imposed by the Plan Administrator.

 

C.            Immediately following the consummation ofthe Change in Control, all outstanding options, stock appreciation rights andrestricted stock unit awards shall terminate and cease to be outstanding,except to the extent assumed by the successor corporation (or parent thereof)or otherwise continued in full force and effect pursuant to the terms of theChange in Control transaction.

 

D.           Each Award denominated in shares ofCommon Stock which is assumed in connection with a Change in Control orotherwise continued in effect shall be appropriately adjusted, immediatelyafter such Change in Control, to apply to the number and class of securitiesinto which the shares of Common Stock subject to that Award would have beenconverted in consummation of such Change in Control had those shares actuallybeen outstanding at that time. Appropriate adjustments to reflect such Changein Control shall also be made to (i) the exercise or base price or cashconsideration payable per share in effect under each outstanding Award, providedthe aggregate exercise or base price or cash consideration in effect for suchsecurities shall remain the same, (ii) the maximum number and/or class ofsecurities available for issuance over the remaining term of the Plan, (iii) themaximum number and/or class of securities for which any one person may begranted Common Stock-denominated Awards under the Plan per calendar year and (iv) thenumber and/or class of securities subject to the Corporation’s outstandingrepurchase rights under the Plan and the repurchase price payable per share. Tothe extent the actual holders of the Corporation’s outstanding Common Stockreceive cash consideration for their Common Stock in consummation of the Changein Control, the successor corporation may, in connection with the assumption orcontinuation of the outstanding Awards under the Plan and subject to the PlanAdministrator’s approval, substitute, for the securities underlying thoseassumed Awards, one or more shares of its own common stock with a fair marketvalue equivalent to the cash consideration paid per share of Common Stock insuch Change in Control transaction, provided such common stock is readilytraded on an established U.S. securities exchange or market.

 

E.            The Plan Administrator shall have thediscretionary authority to structure one or more outstanding Awards so thatthose Awards shall, immediately prior to the effective date of an actual Changein Control transaction, vest as to all the shares of Common Stock at the timesubject to those Awards, whether or not those Awards are to be assumed in theChange in Control transaction or otherwise continued in effect. In addition,the Plan Administrator shall 

 

15

----

 

have the discretionary authority to structure one ormore of the Corporation’s repurchase rights so that those rights shallterminate immediately prior to the effective date of an actual Change inControl transaction, and the shares subject to those terminated rights shallthereupon vest in full.

 

F.            The Plan Administrator shall have fullpower and authority to structure one or more outstanding Awards so that thoseAwards shall vest as to all the shares of Common Stock at the time subject tothose Awards in the event the Participant’s Service is subsequently terminatedby reason of an Involuntary Termination within a designated period followingthe effective date of any Change in Control transaction in which those Awardsdo not otherwise vest on an accelerated basis. In addition, the PlanAdministrator may structure one or more of the Corporation’s repurchase rightsso that those rights shall immediately terminate with respect to any sharesheld by the Participant at the time of such Involuntary Termination, and theshares subject to those terminated repurchase rights shall accordingly vest infull at that time.

 

G.            The portion of any Incentive Optionaccelerated in connection with a Change in Control shall remain exercisable asan Incentive Option only to the extent the applicable One Hundred ThousandDollar ($100,000) limitation is not exceeded. To the extent such dollarlimitation is exceeded, the accelerated portion of such option shall beexercisable as a Non-statutory Option under the Federal tax laws.

 

H.           The Plan Administrator shall have thediscretionary authority to structure one or more cash, performance unit anddividend equivalent right awards so that such Awards shall automatically vestin whole or in part immediately prior to the effective date of an actual Changein Control transaction or upon the subsequent termination of the Participant’sService by reason of an Involuntary Termination within a designated periodfollowing the effective date of such Change in Control.

 

I.             The Plan Administrator’s authority underParagraphs E, F and H of this Section VIII shall also extend to any Awardsintended to qualify as performance-based compensation under Code Section 162(m),even though the automatic vesting of those Awards pursuant to Paragraphs E, Fand H of this Section VIII may result in their loss of performance-basedstatus under Code Section 162(m).

 

**ARTICLE THREE**

 

**MISCELLANEOUS**

** **

**I.****            ****DEFERRED COMPENSATION**

 

A.           The Plan Administrator may, in its solediscretion, structure one or more Awards (other than options and stockappreciation rights) so that the Participants may be provided with an electionto defer the compensation associated with those Awards for federal income taxpurposes. Any such deferral opportunity shall comply with all applicablerequirements of Code Section 409A.

 

B.            To the extent the Corporation maintainsone or more separate non-qualified deferred compensation arrangements whichallow the participants the opportunity to 

 

16

----

 

make notional investments of their deferred accountbalances in shares of Common Stock, the Plan Administrator may authorize theshare reserve under the Plan to serve as the source of any shares of CommonStock that become payable under those deferred compensation arrangements. Insuch event, the share reserve under the Plan shall be reduced on ashare-for-one share basis for each share of Common Stock issued under the Planin settlement of the deferred compensation owed under those separatearrangements.

 

**II.****           ****TAX WITHHOLDING**

 

A.           The Corporation’s obligation to delivershares of Common Stock upon the exercise, issuance or vesting of an Award underthe Plan shall be subject to the satisfaction of all applicable income andemployment tax withholding requirements.

 

B.            The Plan Administrator may, in itsdiscretion, provide Participants to whom Awards are made under the Plan withthe right to use shares of Common Stock in satisfaction of all or part of theWithholding Taxes to which such holders may become subject in connection withthe exercise, issuance or vesting of those Awards or the issuance of shares ofCommon Stock thereunder. Such right may be provided to any such holder ineither or both of the following formats:

 

(i)             *Stock Withholding*: The election to have the Corporationwithhold, from the shares of Common Stock otherwise issuable upon the issuance,exercise or vesting of such Award or the issuance of shares of Common Stockthereunder, a portion of those shares with an aggregate Fair Market Value equalto the percentage of the Withholding Taxes (not to exceed one hundred percent(100%)) designated by such individual. The shares of Common Stock so withheldshall not reduce the number of shares of Common Stock authorized for issuanceunder the Plan.

 

(ii)            *Stock Delivery*: The election to deliver to the Corporation, at thetime of the issuance, exercise or vesting of such Award or the issuance ofshares of Common Stock thereunder, one or more shares of Common Stockpreviously acquired by such individual (other than in connection with theexercise, share issuance or share vesting triggering the Withholding Taxes)with an aggregate Fair Market Value equal to the percentage of the WithholdingTaxes (not to exceed one hundred percent (100%)) designated by the individual.The shares of Common Stock so delivered shall neither reduce the number ofshares of Common Stock authorized for issuance under the Plan nor be added tothe number of shares of Common Stock authorized for issuance under the Plan.

 

**III.****         ****SHARE ESCROW/LEGENDS**

 

Unvested shares may, in thePlan Administrator’s discretion, be held in escrow by the Corporation until theParticipant’s interest in such shares vests or may be issued directly to theParticipant with restrictive legends on the certificates evidencing thoseunvested shares.

 

**IV.****         ****EFFECTIVE DATE AND TERM OF THEPLAN**

 

A.            The Plan shall become effective on thePlan Effective Date.

 

17

----

 

B.            The Plan shall terminate upon the ***earliest*** to occur of (i) September 21,2018, (ii) the date on which all shares available for issuance under thePlan shall have been issued as fully vested shares or (iii) thetermination of all outstanding Awards in connection with a Change in Control.Should the Plan terminate on September 21, 2018, then all Awardsoutstanding at that time shall continue to have force and effect in accordancewith the provisions of the documents evidencing those Awards.

 

**V.****          ****AMENDMENT OF THE PLAN**

 

A.            The Board shall have complete andexclusive power and authority to amend or modify the Plan in any or allrespects, subject to stockholder approval to the extent required underapplicable law or regulation or pursuant to the listing standards of the StockExchange on which the Common Stock is at the time primarily traded. However, nosuch amendment or modification shall adversely affect the rights andobligations with respect to Awards at the time outstanding under the Planunless the Participant consents to such amendment or modification.

 

B.            The Compensation Committee shall have thediscretionary authority to adopt and implement from time to time such addendaor subplans to the Plan as it may deem necessary in order to bring the Planinto compliance with applicable laws and regulations of any foreignjurisdictions in which Awards are to be made under the Plan and/or to obtain favorabletax treatment in those foreign jurisdictions for the individuals to whom theAwards are made.

 

C.            Awards may be made under the Plan thatinvolve shares of Common Stock in excess of the number of shares then availablefor issuance under the Plan, provided no shares shall actually be issuedpursuant to those Awards until the number of shares of Common Stock availablefor issuance under the Plan is sufficiently increased by stockholder approvalof an amendment of the Plan authorizing such increase. If such stockholderapproval is not obtained within twelve (12) months after the date thefirst excess Award is made, then all Awards granted on the basis of such excessshares shall terminate and cease to be outstanding.

 

**VI.****         ****USE OF PROCEEDS**

 

Any cash proceeds receivedby the Corporation from the sale of shares of Common Stock under the Plan shallbe used for general corporate purposes.

 

**VII.****        ****REGULATORY APPROVALS**

 

A.            The implementation of the Plan, thegranting of any Award under the Plan and the issuance of any shares of CommonStock in connection with the issuance, exercise or vesting of any Award underthe Plan shall be subject to the Corporation’s procurement of all approvals andpermits required by regulatory authorities having jurisdiction over the Plan,the Awards made under the Plan and the shares of Common Stock issuable pursuantto those Awards.

 

B.            No shares of Common Stock or other assetsshall be issued or delivered under the Plan unless and until there shall havebeen compliance with all applicable requirements 

 

18

----

 

of applicable securities laws, including the filingand effectiveness of the Form S-8 registration statement for the shares ofCommon Stock issuable under the Plan, and all applicable listing requirementsof any Stock Exchange on which Common Stock is then listed for trading.

 

**VIII.****      ****NO EMPLOYMENT/SERVICE RIGHTS**

 

Nothing in the Plan shallconfer upon the Participant any right to continue in Service for any period ofspecific duration or interfere with or otherwise restrict in any way the rightsof the Corporation (or any Parent or Subsidiary employing or retaining suchperson) or of the Participant, which rights are hereby expressly reserved byeach, to terminate such person’s Service at any time for any reason, with orwithout cause.

 

19

----

 

**APPENDIX**

 

The following definitionsshall be in effect under the Plan:

 

A.           **Award** shall mean any of the following awardsauthorized for issuance or grant under the Plan: options, stock appreciationrights, stock awards, restricted stock units, performance units, dividendequivalent rights and cash incentive awards.

 

B.            **Award Agreement** shall mean the written agreement(s) betweenthe Corporation and the Participant evidencing a particular Award made to thatindividual under the Plan, as such agreement(s) may be in effect from timeto time.

 

C.            **Board** shall mean the Corporation’s Board ofDirectors.

 

D.           **Change in Control** shall, with respect to each Award madeunder the Plan, be defined in accordance with the following provisions:

 

(i)            Change in Control shall have the meaning assigned tosuch term in the Award Agreement for the particular Award or in any otheragreement incorporated by reference into the Award Agreement for purposes ofdefining such term.

 

(ii)           In the absence of any other Change in Controldefinition in the Award Agreement (or in any other agreement incorporated byreference into the Award Agreement), Change in Control shall mean a change inownership or control of the Corporation effected through any of the followingtransactions:

 

a.             a merger, consolidation or otherreorganization approved by the Corporation’s stockholders, unlesssecurities representing more than fifty percent (50%) of the total combinedvoting power of the voting securities of the successor corporation areimmediately thereafter beneficially owned, directly or indirectly and insubstantially the same proportion, by the persons who beneficially owned theCorporation’s outstanding voting securities immediately prior to suchtransaction,

 

b.             a sale, transfer or other disposition ofall or substantially all of the Corporation’s assets, or

 

c.             the closing of any transaction or seriesof related transactions pursuant to which any person or any group of personscomprising a “group” within the meaning of Rule 13d-5(b)(1) of the1934 Act (other than the Corporation or a person that, prior to suchtransaction or series of related transactions, directly or indirectly controls,is controlled by or is under common control with, the Corporation) becomesdirectly or indirectly (whether as a result of a single acquisition or byreason of one or more acquisitions within the twelve (12)-month period endingwith the most recent acquisition) the beneficial owner (within the meaning of Rule 13d-3of the 1934 Act) of securities possessing (or convertible into or exercisablefor securities possessing) fifty percent (50%) or more of the total combinedvoting power of the Corporation’s securities (as measured in terms of the powerto vote with respect to 

 

A-1

----

 

theelection of Board members) outstanding immediately after the consummation ofsuch transaction or series of related transactions, whether such transactioninvolves a direct issuance from the Corporation or the acquisition ofoutstanding securities held by one or more of the Corporation’s existingstockholders.

 

d.             a change in the composition of the Boardover a period of twelve (12) consecutive months or less such that a majority ofthe Board members ceases, by reason of one or more contested elections forBoard membership, to be comprised of individuals who either (A) have beenBoard members continuously since the beginning of such period or (B) havebeen elected or nominated for election as Board members during such period byat least a majority of the Board members described in clause (A) who werestill in office at the time the Board approved such election or nomination.

 

E.             **Code** shall mean the Internal Revenue Code of1986, as amended.

 

F.             **Common Stock** shall mean the Corporation’s CommonStock.

 

G.            **Compensation Committee** shall mean the Compensation Committee ofthe Board comprised of two (2) or more non-employee Board members.

 

H.            **Corporation** shall mean Senesco Technologies, Inc.,a Delaware corporation, and any corporate successor to all or substantially allof the assets or voting stock of Senesco Technologies, Inc. which has byappropriate action assumed the Plan.

 

I.              **Employee** shall mean an individual who is in theemploy of the Corporation (or any Parent or Subsidiary, whether now existing orsubsequently established), subject to the control and direction of the employerentity as to both the work to be performed and the manner and method of performance.

 

J.             **Exercise Date** shall mean the date on which theCorporation shall have received written notice of the option exercise.

 

K.            **Fair Market Value** per share of Common Stock on anyrelevant date shall be the closing selling price per share of Common Stock atthe close of regular hours trading (i.e., before after-hours trading begins) ondate on question on the Stock Exchange serving as the primary market for theCommon Stock, as such price is reported by the National Association ofSecurities Dealers (if primarily traded on the Nasdaq Global or Global SelectMarket) or as officially quoted in the composite tape of transactions on anyother Stock Exchange on which the Common Stock is then primarily traded. Ifthere is no closing selling price for the Common Stock on the date in question,then the Fair Market Value shall be the closing selling price on the lastpreceding date for which such quotation exists.

 

A-2

----

 

L.             **Good Reason** shall, with respect to each Award madeunder the Plan, be defined in accordance with the following provisions:

 

(i)            Good Reason shall have the meaningassigned to such term in the Award Agreement for the particular Award or in anyother agreement incorporated by reference into the Award Agreement for purposesof defining such term.

 

(ii)           In the absence of any other Good Reasondefinition in the Award Agreement (or in any other agreement incorporated byreference into the Award Agreement), Good Reason shall mean an individual’svoluntary resignation following (A) a change in his or her position withthe Corporation (or any Parent or Subsidiary) which materially reduces his orher duties, responsibilities or authority, (B) a material diminution inthe duties, responsibilities or authority of the person to whom such individualreports, (C) a material reduction in such individual’s level of basecompensation, with a reduction of more than fifteen percent (15%) to be deemedmaterial for such purpose, or (D) a material relocation of such individual’splace of employment, with a relocation of more than fifty (50) miles to bedeemed material for such purpose, ***provided, however,*** that a resignation forGood Reason may be effected only after (i) the individual provides writtennotice to the Corporation of the event or transaction constituting grounds forsuch resignation within sixty (60) days after the occurrence of that eventor transaction and (ii) the Corporation fails to take the requisiteremedial action with respect to such event or transaction within thirty(30) days after receipt of such notice.

 

M.          **Incentive Option** shall mean an option which satisfies therequirements of Code Section 422.

 

N.           **Involuntary Termination** shall, with respect to each Award madeunder the Plan, be defined in accordance with the following provisions:

 

(i)            Involuntary Termination shall have themeaning assigned to such term in the Award Agreement for the particular Awardor in any other agreement incorporated by reference into the Award Agreementfor purposes of defining such term.

 

(ii)           In the absence of any other InvoluntaryTermination definition in the Award Agreement (or in any other agreementincorporated by reference into the Award Agreement), Involuntary Terminationshall mean such individual’s involuntary dismissal or discharge by theCorporation (or any Parent or Subsidiary) for reasons other than Misconduct, orsuch individual’s voluntary resignation for Good Reason.

 

O.           **Misconduct** shall, with respect to each Award madeunder the Plan, be defined in accordance with the following provisions:

 

(i)            Misconduct shall have the meaningassigned to such term in the Award Agreement for the particular Award or in anyother agreement incorporated by reference into the Award Agreement for purposesof defining such term.

 

A-3

----

 

(ii)           Inthe absence of any other Misconduct definition in the Award Agreement for aparticular Award (or in any other agreement incorporated by reference into theAward Agreement), Misconduct shall mean the commission of any act of fraud,embezzlement or dishonesty by the Participant, any unauthorized use ordisclosure by such person of confidential information or trade secrets of theCorporation (or any Parent or Subsidiary), or any other intentional misconductby such person adversely affecting the business or affairs of the Corporation(or any Parent or Subsidiary) in a material manner. The foregoing definitionshall not in any way preclude or restrict the right of the Corporation (or anyParent or Subsidiary) to discharge or dismiss any Participant or other personin the Service of the Corporation (or any Parent or Subsidiary) for any otheracts or omissions, but such other acts or omissions shall not be deemed, forpurposes of the Plan, to constitute grounds for termination for Misconduct.

 

P.             **1934 Act** shall mean the SecuritiesExchange Act of 1934, as amended.

 

Q.            **Non-Statutory Option** shall mean anoption not intended to satisfy the requirements of Code Section 422.

 

R.            **Parent** shall mean any corporation(other than the Corporation) in an unbroken chain of corporations ending withthe Corporation, provided each corporation in the unbroken chain (other thanthe Corporation) owns, at the time of the determination, stock possessing fiftypercent (50%) or more of the total combined voting power of all classes ofstock in one of the other corporations in such chain.

 

S.             **Participant** shall mean any person whois granted an Award under the Plan.

 

T.            **PerformanceGoals**shall mean any of the following performance criteria uponwhich the vesting of one or more Awards under the Plan may be based: (i) pre-taxor after-tax earnings, profit or net income, (ii) revenue or revenuegrowth, (iii) earnings per share, (iv) return on assets, capital orstockholder equity, (v) total stockholder return, (vi) gross or net profitmargin, (vii) cash flow, (viii) earnings or operating income beforeinterest, taxes, depreciation, amortization and/or charges for stock-basedcompensation, (ix) market share, (x) increases in customer base,(xi) operating income, net operating income or net operating income afterrecorded tax expense; (xii) operating profit, net operating profit or netoperating profit after recorded tax expense, (xiii) operating margin,(xiv) cost reductions or other expense control objectives, (xv) marketprice of the Common Stock, whether measured in absolute terms or inrelationship to earnings or operating income, (xvi) budget objectives andresearch and development milestones, (xvii) working capital,(xviii) mergers, acquisitions or divestitures or (xix) measures ofcustomer satisfaction. Each performance criteria may be based upon theattainment of specified levels of the Corporation’s performance under one ormore of the measures described above relative to the performance of otherentities and may also be based on the performance of any of the Corporation’sbusiness units or divisions or any Parent or Subsidiary. Each applicablePerformance Goal may include a minimum threshold level of performance belowwhich no Award will be earned, levels of performance at which specifiedportions of an Award will be earned and a maximum level of performance at whichan Award 

 

A-4

----

 

will be fully earned. Each applicable Performance Goalmay be structured at the time of the Award to provide for appropriateadjustment for one or more of the following items: (A) assetimpairments or write-downs; (B) litigation judgments or claim settlements;(C) the effect of changes in tax law, accounting principles or other suchlaws or provisions affecting reported results; (D) accruals forreorganization and restructuring programs; (E) any extraordinarynonrecurring items as described in Accounting Principles Board Opinion No. 30and/or in management’s discussion and analysis of financial condition andresults of operations appearing in the Corporation’s annual report toshareholders for the applicable year; (F) the operations of any businessacquired by the Corporation or any Parent or Subsidiary or of any joint venturein which the Corporation or any Parent or Subsidiary participates; (G) thedivestiture of one or more business operations or the assets thereof; or (H) thecosts incurred in connection with such acquisitions or divestitures.

 

U.            **Permanent Disabilityor Permanently Disabled** shall, with respect to each Award madeunder the Plan, be defined in accordance with the following provisions:

 

(i)            PermanentDisability or Permanently Disabled shall have the meaning assigned to such termin the Award Agreement for the particular Award or in any other agreementincorporated by reference into the Award Agreement for purposes of definingsuch term.

 

(ii)           Inthe absence of any other definition of Permanent Disability or PermanentlyDisabled in the Award Agreement for a particular Award (or in any otheragreement incorporated by reference into the Award Agreement), PermanentDisability or Permanently Disabled shall mean the inability of the Participantto engage in any substantial gainful activity by reason of any medicallydeterminable physical or mental impairment expected to result in death or to beof continuous duration of twelve (12) months or more.

 

V.            **Plan** shall mean the Corporation’s 2008Incentive Compensation Plan, as set forth in this document.

 

W.           **Plan Administrator** shall mean theparticular entity or individual, whether the Compensation Committee (orsubcommittee thereof), the Board, the Secondary Board Committee or executiveofficer authorized to administer the Plan with respect to one or more classesof eligible persons, to the extent such entity or individual is carrying outits administrative functions under the Plan with respect to the persons underthe jurisdiction of such entity or individual.

 

X.            **Plan Effective Date** shall mean the dateupon which the Plan shall be approved by the Corporation’s stockholders.

 

Y.            **Predecessor Plan** shall mean theCorporation’s 1998 Stock Incentive Plan in effect immediately prior to the PlanEffective Date hereunder.

 

A-5

----

 

Z.            **Secondary Board Committee** shall mean acommittee of one or more Board members appointed by the Board to administer thePlan with respect to eligible persons other than Section 16 Insiders.

 

AA.        **Section 16 Insider** shall mean anofficer or director of the Corporation subject to the short-swing profitliabilities of Section 16 of the 1934 Act.

 

BB.          **Service**shall, with respect to each Award made under the Plan, be defined in accordancewith the following provisions:

 

(i)            Serviceshall have the meaning assigned to such term in the Award Agreement for theparticular Award or in any other agreement incorporated by reference into theAward Agreement for purposes of defining such term.

 

(ii)           Inthe absence of any other definition of Service in the Award Agreement for aparticular Award (or in any other agreement incorporated by reference into theAward Agreement), Service shall mean the performance of services for theCorporation (or any Parent or Subsidiary, whether now existing or subsequentlyestablished) by a person in the capacity of an Employee, a non-employee memberof the board of directors or a consultant or independent advisor, except to theextent otherwise specifically provided in the documents evidencing the optiongrant or stock issuance. For purposes of this particular definition of Service,a Participant shall be deemed to cease Service immediately upon the occurrenceof the either of the following events: (i) the Participant no longerperforms services in any of the foregoing capacities for the Corporation or anyParent or Subsidiary or (ii) the entity for which the Participant isperforming such services ceases to remain a Parent or Subsidiary of theCorporation, even though the Participant may subsequently continue to performservices for that entity.

 

(iii)          Serviceshall not be deemed to cease during a period of military leave, sick leave orother personal leave approved by the Corporation; ***provided, however,*** that should suchleave of absence exceed three (3) months, then for purposes of determiningthe period within which an Incentive Option may be exercised as such under thefederal tax laws, the Participant’s Service shall be deemed to cease on thefirst day immediately following the expiration of such three (3)-month period,unless Participant is provided with the right to return to Service followingsuch leave either by statute or by written contract. Except to the extentotherwise required by law or expressly authorized by the Plan Administrator orby the Corporation’s written policy on leaves of absence, no Service credit shallbe given for vesting purposes for any period the Participant is on a leave ofabsence.

 

CC.          **Stock Exchange** shall mean the AmericanStock Exchange, the Nasdaq Global or Global Select Market or the New York StockExchange.

 

DD.         **Subsidiary** shall mean any corporation(other than the Corporation) in an unbroken chain of corporations beginningwith the Corporation, provided each corporation (other than the lastcorporation) in the unbroken chain owns, at the time of the determination,stock 

 

A-6

----

 

possessing fifty percent (50%) or more of the totalcombined voting power of all classes of stock in one of the other corporationsin such chain.

 

EE.          **10% Stockholder** shall mean the owner ofstock (as determined under Code Section 424(d)) possessing more than tenpercent (10%) of the total combined voting power of all classes of stock of theCorporation (or any Parent or Subsidiary).

 

FF.          **Withholding Taxes** shall mean theapplicable federal, state and foreign income and employment withholding taxesand other payments to which the holder of an Award under the Plan may becomesubject in connection with the issuance, exercise or vesting of that Award orthe issuance of shares of Common Stock thereunder.

 

A-7

----