Exhibit
10.13

CHEMBIO
DIAGNOSTIC SYSTEMS, INC. 

1999
STOCK OPTION PLAN




As
Adopted As Of November 9, 1999







This 1999
Stock Option (the “Plan”) is adopted by Chembio Diagnostic Systems, Inc. (the
“Company” effective as of November 9, 1999.




1. Definitions.




Unless
otherwise indicated or required by the particular context, the terms used in
this Plan shall have the following meanings:




Board: The
Board Of Directors of the Company.




Change in Control. For
purposes of this Plan, a “Change in Control” shall mean any of the following
events:




(a) An
acquisition (other than directly from the Company) of any voting securities of
the Company (the “Voting Securities”) by any “Person” (as the term person is
used for purposes of Section 13(d) or 14(d) of the Securities Exchange Act of
1934, as amended (the “1934 Act”)) immediately after which such Person has
“Beneficial Ownership” (within the meaning of Rule 13d-3 promulgated under the
1934 Act) of thirty percent or more of the combined voting power of the
Company’s then outstanding Voting Securities; provided,
however, that in
determining whether a Change in Control has occurred, Voting Securities which
are acquired in a “Non-Control Acquisition” (as hereinafter defined) shall not
constitute an acquisition which would cause a Change in Control. A “Non-Control
Acquisition” shall mean an acquisition by (1) an employee benefit plan (or
a trust forming a part thereof) maintained by (x) the Company or
(y) any corporation or other Person of which a majority of its voting power
or its equity securities or equity interest is owned directly or indirectly by
the Company (a “Subsidiary”), (2) the Company or any Subsidiary, or
(3) any Person in connection with a “Non-Control Transaction.”

 

(b) The
individuals who, as of the date hereof, are members of the Board (the “Incumbent
Board”), cease for any reason to constitute at least two-thirds of the Board;
provided,
however, that if
the election, or nomination for election by the Company’s stockholders, of any
new director was approved by a vote of at least two-thirds of the then Incumbent
Board, such new director shall, for purposes of this Plan, be considered as a
member of the Incumbent Board; provided,
further,
however, that no
individual shall be considered a member of the Incumbent Board if such
individual initially assumed office as a result of either an actual or
threatened “Election Contest” (as described in Rule 14a-11 promulgated under the
1934 Act) or other actual or threatened solicitation of proxies or consents by
or on behalf of a Person other than the Board (a “Proxy Contest”) including by
reason of any agreement intended to avoid or settle any Election Contest or
Proxy Contest; or











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(c) Approval
by stockholders of the Company of:




(1) A merger,
consolidation or reorganization involving the Company, unless 




(A) the
stockholders of the Company, immediately before such merger, consolidation or
reorganization, own, directly or indirectly, immediately following such merger,
consolidation or reorganization, at least sixty percent of the combined voting
power of the outstanding Voting Securities of the corporation resulting from
such merger or consolidation or reorganization (the “Surviving Corporation”) in
substantially the same proportion as their ownership of the Voting Securities
immediately before such merger, consolidation or reorganization,
and




(B) the
individuals who were members of the Incumbent Board immediately prior to the
execution of the agreement providing for such merger, consolidation or
reorganization constitute at least two-thirds of the members of the board of
directors of the Surviving Corporation or a corporation beneficially owning,
directly or indirectly, a majority of the Voting Securities of the Surviving
Corporation, and




(C) no Person
(other than the Company, any Subsidiary, any employee benefit plan (or any trust
forming a part thereof) maintained by the Company, the Surviving Corporation or
any Subsidiary, or any Person who, immediately prior to such merger,
consolidation or reorganization had Beneficial Ownership of thirty percent or
more of the then outstanding Voting Securities) owns, directly or indirectly,
thirty percent or more of the combined voting power of the Surviving
Corporation’s then outstanding voting securities, and



(D) a
transaction described in clauses (A) through (C) shall herein be referred to as
a “Non-Control Transaction”;




(2) A
complete liquidation or dissolution of the Company; or 




(3) An
agreement for the sale or other disposition of all or substantially all of the
assets of the Company to any Person (other than a transfer to a
Subsidiary).




Notwithstanding
the foregoing, a Change in Control shall not be deemed to occur solely because
any Person (the “Subject Person”) acquired Beneficial Ownership of more than the
permitted amount of the outstanding Voting Securities as a result of the
acquisition of Voting Securities by the Company which, by reducing the number of
Voting Securities outstanding, increases the proportional number of shares
Beneficially Owned by the Subject Person, provided that if a Change in Control
would occur (but for the operation of this sentence) as a result of the
acquisition of Voting Securities by the Company, and after such share
acquisition by the Company, the Subject Person becomes the Beneficial Owner of
any additional Voting Securities which increases the percentage of the then
outstanding Voting Securities Beneficially Owned by the Subject Person, then a
Change in Control shall occur.










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(d) Notwithstanding
anything contained in this Plan to the contrary, if the Optionee is an employee
of the Company and Optionee’s employment is terminated prior to a Change in
Control and the Optionee reasonably demonstrates that such termination
(i) was at the request of a third party who has indicated an intention or
taken steps reasonably calculated to effect a Change in Control and who
effectuates a Change in Control (a “Third Party”) or (ii) otherwise
occurred in connection with, or in anticipation of, a Change in Control which
actually occurs, then for all purposes of this Plan, the date of a Change in
Control with respect to the Optionee shall mean the date immediately prior to
the date of such termination of the Optionee’s employment.




Code: The
Internal Revenue Code of 1986, as amended.




Common
Stock: The
$.001 par value common stock of the Company.




Company: Chembio
Diagnostic Systems, Inc., a corporation incorporated under the laws of Delaware,
any current or future wholly owned subsidiar-ies of the Company, and any
successors in interest by merger, operation of law, assignment or purchase of
all or substantially all of the property, assets or business of the
Company.




Date
Of Grant: The
date on which an Option, as defined below, is granted under the
Plan.




Fair
Market Value: The
Fair Market Value of the Option Shares (defined below). The Fair Market Value as
of any date shall be as reasonably determined by the Option Committee (defined
below); provided, however, that if there is a public market for the Common
Stock, the Fair Market Value of the Option Shares as of any date shall not be
less than the last reported sale price for the Common Stock on that date (or on
the preceding stock market business day if such date is a Saturday, Sunday, or a
holiday), on the New York Stock Exchange (“NYSE”), as reported in The
Wall Street Journal, or if
not reported in The
Wall Street Journal, as
reported in The
New York Times, New
York, New York or, if no last sale price for the NYSE is available, then the
last reported sale price on either another stock exchange or on a national or
local over-the-counter market, as reported by The
Wall Street Journal, or if
not available there, in The
New York Times;
provided further, that if no such published last sale price is available and a
published bid price is available from one of those sources, then the Fair Market
Value of the shares shall not be less than such last reported bid price for the
Common Stock, and if no such published bid price is available, the Fair Market
Value of such shares shall not be less than the average of the bid prices quoted
as of the close of business on that date by any two independent persons or
entities making a market for the Common Stock, such persons or entities to be
selected by the Option Committee. 










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Incentive
Options:
“Incentive stock options” as that term is defined in Code Section 422 or the
successor to that Section.




Key
Employee: A
person designated by the Option Committee who is employed by the Company and
whose continued employment is considered to be in the best interests of the
Company; provided, however, that Key Employees shall not include those members
of the Board who are not employees of the Company.




Key
Individual: A
person, other than an employee of the Company, who is committed to the interests
of the Company; provided, however, that Key Individuals shall not include those
members of the Board who are not employees of the Company. 




Non-Employee
Director: A
director of the Company who (a) is not currently an officer of the Company or a
parent or subsidiary of the Company, or otherwise currently employed by the
Company or a parent or subsidiary of the Company, (b) does not receive
compensation, either directly or indirectly, from the Company or a parent or
subsidiary of the Company, for services rendered as a consultant or in any
capacity other than as a director, except for an amount that does not exceed the
dollar amount for which disclosure would be required pursuant to Regulation S-K,
Item 404(a), under the Securities Act of 1933, as amended (the “1933 Act”), (c)
does not possess an interest in any other transaction for which disclosure by
the Company would be required pursuant to Regulation S-K, Item 404(a), and (d)
is not engaged in a business relationship for which disclosure by the Company
would be required pursuant to Regulation S-K, Item 404(a).




Non-Qualified
Options: Options
that are not intended to qualify, or otherwise do not qualify, as Incentive
Options. To the extent that Options that are designated by the Option Committee
as Incentive Options do not qualify as “incentive stock options” under Code
Section 422 or the successor to that Section, those Options shall be treated as
Non-Qualified Options.




Option: The
rights to purchase Common Stock granted pursuant to the terms and conditions of
an Option Agreement (defined below).




Option
Agreement: The
written agreement (including any amendments or supplements thereto) between the
Company and either a Key Employee or a Key Individual designating the terms and
conditions of an Option.




Option
Committee: The
Plan shall be administered by an Option Committee (the “Option Committee”)
composed of the Board or by a committee of at least two directors selected by
the Board; provided,
however, that
(a) at all times that the Company is subject to the periodic reporting
requirements of the 1934 Act, if the Option Committee consists of less than the
entire Board, each member shall be a Non-Employee Director and (b) to the extent
necessary for any Option intended to qualify as Performance-Based Compensation
to so qualify, each member of the Option Committee, whether or not it consists
of the entire Board, shall be an Outside Director. For purposes of the proviso
to the preceding sentence (the “Proviso”), if one or more members of the
Committee is not, in the case of clause (a) of the Proviso, a Non-Employee
Director, or, in the case of clause (b) of the Proviso, an Outside Director,
and, in either case, recuses himself or herself or abstains from voting with
respect to a particular action taken by the Option Committee, then the Option
Committee, with respect to that action, shall be deemed to consist only of the
members of the Option Committee who have not recused themselves or abstained
from voting.










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Option
Shares: The
shares of Common Stock underlying an Option granted pursuant to this
Plan.




Optionee: A Key
Employee or Key Individual who has been granted an Option.




Outside
Director:
“Outside Director” shall have the meaning set forth in Section 162 of the Code
or the successor to that Section and any regulations promulgated under that or
the successor to that Section.




Performance-Based
Compensation:
“Performance-Based Compensation” means any Option that is intended to constitute
“performance-based compensation” within the meaning of Section 162(m)(4)(C) of
the Code and the regulations promulgated thereunder.




Permitted
Transferee: A
Permitted Transferee means, with respect to any person, such person’s immediate
family, trusts solely for the benefit of such family members and partnerships in
which such family members and/or trusts are the only partners. For this purpose,
immediate family of a person means the person’s spouse, parents, children,
stepchildren and grandchildren and the spouses of such parents, children,
stepchildren and grandchildren.




2. Purpose
And Scope.




(a) The
purpose of the Plan is to advance the interests of the Company and its
stockholders by affording Key Employees and Key Individuals, upon whose
initiative and efforts, in the aggregate, the Company is largely dependent for
the successful conduct of its business, an opportunity for investment in the
Company and the incentive advantages inherent in stock ownership in the
Company.




(b) This Plan
authorizes the Option Committee to grant Incentive Options to Key Employees and
to grant Non-Qualified Options to Key Employees and Key Individuals, selected by
the Option Committee while considering criteria such as employment position or
other relationship with the Company, duties and responsibilities, ability,
productivi-ty, length of service or association, morale, interest in the
Company, recommen-dations by supervisors, the interests of the Company, and
other matters.










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3. Administration
Of The Plan.




(a) The Plan
shall be administered by the Option Committee. The Option Committee shall have
the authority granted to it under this Section and under each other section of
the Plan.




(b) In
accordance with and subject to the provisions of the Plan, the Option Committee
shall select the Optionees and shall determine (i) the number of shares of
Common Stock to be subject to each Option, (ii) the time at which each Option is
to be granted, (iii) whether an Option shall be granted in exchange for the
cancellation and termination of a previously granted option or options under the
Plan or otherwise, (iv) the purchase price for the Option Shares, provided that
the purchase price shall be a fixed, and cannot be a fluctuating, price, (v) the
option period, including provisions for the termination of the Option prior to
the expiration of the exercise period upon the occurrence of certain events,
(vi) the manner in which the Option becomes exercisable, including whether
portions of the Option become exercisable at different times and including
determining that, at any time, the portion not yet exercisable shall become
exercisable upon the occurrence of certain events, and (vii) such other terms
and conditions as the Option Committee may deem necessary or desirable. The
Option Committee shall determine the form of Option Agreement to evidence each
Option and may amend the terms of any Option (subject to Section 3(d)
below).




(c) The
Option Committee from time to time may adopt such rules and regulations for
carrying out the purposes of the Plan as it may deem proper and in the best
interests of the Company. The Option Committee shall keep minutes of its
meetings and those minutes shall be distributed to every member of the
Board.




(d) The Board
from time to time may make such changes in and additions to the Plan as it may
deem proper and in the best interests of the Company provided, however, that no
such change or addition shall impair any Option previously granted under the
Plan, and that no change that under applicable law requires the approval of
stockholders may be made without such approval.




(e) Each
determination, interpretation or other action made or taken by the Option
Committee, unless otherwise determined by the Board, shall be final, conclusive
and binding on all persons, including without limitation, the Company, the
stockhold-ers, directors, officers and employees of the Company, and the
Optionees and their respective successors in interest. No member of the Option
Committee shall be personally liable for any action, determination, or
interpretation made in good faith with respect to the Plan, and all members of
the Option Committee shall be, in addition to rights they may have as directors
of the Company, fully protected by the Company with respect to any such action,
determi-nation or interpretation. If the Board makes a determination contrary to
the Option Committee’s determination, interpretation or other action, then the
Board’s determination shall be final and conclusive in the same
manner.










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4. The
Common Stock.




The Board
is authorized to appropriate, issue and sell for the purposes of the Plan, and
the Option Committee is autho-rized to grant Options with respect to, a total
number not in excess of 2,500 shares of Common Stock, either treasury or
authorized and unissued, or the number and kind of shares of stock or other
securities which in accordance with Section 9 shall be substituted for the 2,500
shares or into which such 2,500 shares shall be adjusted. All or any unsold
shares subject to an Option, that for any reason expires or otherwise terminates
before it has been exercised, again may be made subject to Options under the
Plan.




5. Eligibility.




Incentive
Options may be granted only to Key Employees. Non-Qualified Options may be
granted both to Key Employees and to Key Individuals. Key Employees and Key
Individuals may hold more than one Option under the Plan and may hold Options
under the Plan as well as options granted pursuant to other plans or
other-wise.




6. Option
Price.




The
Option Committee shall determine the purchase price for the Option Shares;
provided, however, that the purchase price to be paid by Optionees for the
Option Shares shall not be less than 100 percent of the Fair Market Value of the
Option Shares on the Date Of Grant and provided further that the purchase price
shall be a fixed, and cannot be a fluctuating, price. 




7. Duration
And Exercise Of Options.




(a) Except as
provided in Section 17, the option period shall commence on the Date Of Grant
and shall continue for the period designated by the Option Committee up to a
maximum of ten years from the Date Of Grant.




(b) During
the lifetime of the Optionee, the Option shall be exercisable only by the
Optionee; provided that, subject to the following sentence and paragraph (d) of
this Section 7, in the event of the legal disability of an Optionee, the
guardian or personal representative of the Optionee may exercise the Option. If
the Option is an Incentive Option, it may be exercised by the guardian or
personal representative of the Optionee only if the guardian or personal
representative obtains a ruling from the Internal Revenue Service or an opinion
of counsel to the effect that neither the grant nor the exercise of such power
is violative of Code Section 422(b)(5) or the successor to that provision. Any
opinion of counsel must be both from counsel acceptable to the Option Committee
and in a form acceptable to the Option Committee.




(c) If the
Optionee’s employment or affiliation with the Company is terminated for any
reason except the Optionee’s death, any Option then held, to the extent that the
Option was exercisable according to its terms on the date of termination, may be
exercised only to the extent determined by the Option Committee at the time of
grant of the Option or thereafter, but in no case more than three months after
termina-tion. If the Optionee’s employment or affiliation with the Company is
terminated because of the Optionee’s death, any Option then held, to the extent
that the Option was exercisable according to its terms on the date of
termination, may be exercised only to the extent determined by the Option
Committee on the Date of Grant or thereafter, but in no case more than one year
after termination. Any options remaining unexercised shall expire at the later
of termination or the end of the extended exercise period, if any. 










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(d) Each
Option shall be exercised in whole or in part by delivering to the office of the
Treasurer of the Company written notice of the number of shares with respect to
which the Option is to be exercised and by paying in full the purchase price for
the Option Shares purchased as set forth in Section 8 herein; provided, that an
Option may not be exercised in part unless the purchase price for the Option
Shares purchased is at least $1,000.




(e) No Option
may be exercised until the Plan is approved by the stockholders of the Company
as provided in Section 15 below.




8. Payment
For Option Shares.




(a) If the
purchase price of the Option Shares purchased by any Optionee at one time
exceeds $1,000, all or part of the purchase price for the Option Shares may be
paid by delivery to the Company for cancellation shares of the Common Stock
previously owned by the Optionee (“Previously Owned Shares”) with a Fair Market
Value as of the date of the payment equal to the portion of the purchase price
for the Option Shares that the Optionee does not pay in cash. Notwithstanding
the above, an Optionee shall be permitted to exercise his Option by delivering
Previously Owned Shares only if he has held, and provides appropri-ate evidence
of such, the Previously Owned Shares for more than six months prior to the date
of exercise (or such lesser period as the Option Committee may permit). This
period (the “Holding Period”) may be extended by the Option Committee acting in
its sole discretion as is necessary, in the opinion of the Option Commit-tee, so
that, under generally accepted accounting principles, no compensation shall be
considered to have been or to be paid to the Optionee as a result of the
exercise of the Option in this manner. At the time the Option is exercised, the
Optionee shall provide an affidavit, and such other evidence and documents as
the Option Committee shall request, to establish the Optionee’s Holding Period.





(b) If
payment for the exercise of an Option is made other than by the delivery to the
Company for cancellation of shares of the Common Stock, the purchase price shall
be paid in cash, certified funds, or Optionee’s check. Payment shall be
considered made when the Treasurer of the Company receives delivery of the
payment at the Company’s address, provided that a payment made by check is
honored when first presented to the Optionee’s bank.




9. Change
In Stock, Adjustments, Etc.




In the
event that each of the outstanding shares of Common Stock (other than shares
held by dissenting stockholders which are not changed or exchanged) should be
changed into, or exchanged for, a different number or kind of shares of stock or
other securities of the Company, or if further changes or exchanges of any stock
or other securities into which the Common Stock shall have been changed, or for
which it shall have been exchanged, shall be made (whether by reason of merger,
consolidation, reorganiza-tion, recapitalization, stock dividends,
reclassification, split-up, spin-off, combination of shares or otherwise), then
there shall be substituted for each share of Common Stock that is subject to the
Plan but not subject to an outstanding Option hereunder, the number and kind of
shares of stock or other securities into which each outstanding share of Common
Stock (other than shares held by dissenting stockholders which are not changed
or exchanged) shall be so changed or for which each outstanding share of Common
Stock (other than shares held by dissenting stockholders) shall be so changed or
for which each such share shall be exchanged. Any securities so substituted
shall be subject to similar successive adjustments.










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In the
event of any such changes or exchanges, (i) the Option Committee shall determine
whether an adjustment should be made in the number, or kind, or option price of
the shares or other securities that are then subject to an Option or Options
granted pursuant to the Plan, (ii) the Option Committee shall make any such
adjustment, and (iii) such adjustments shall be made and shall be effective and
binding for all purposes of the Plan.




10. Relationship
To Employment Or Position.




Nothing
contained in the Plan, or in any Option or Option Share granted pursuant to the
Plan, (i) shall confer upon any Optionee any right with respect to continuance
of his employment by, or position or affiliation with, or relationship to, the
Company, or (ii) shall interfere in any way with the right of the Company at any
time to terminate the Optionee’s employment by, position or affiliation with, or
relationship to, the Company.




11. Nontransferability
Of Option.




No Option
shall be transferable by the Optionee otherwise than by will or by the laws of
descent and distribution or, in the case of an Option other than an Incentive
Stock Option, pursuant to a domestic relations order (within the meaning of Rule
12a-12 promulgated under the 1934 Act), and Options shall be exercisable during
the lifetime of an Optionee only by the Optionee or his or her guardian or legal
representative. Notwithstanding the foregoing, the Committee may set forth in
the Agreement evidencing an Option (other than an Incentive Stock Option) at the
time of grant or thereafter, that the Option may be transferred to Permitted
Transferees of the Optionee, and for purposes of this Plan, a Permitted
Transferee of an Optionee shall be deemed to be the Optionee. The terms of an
Option shall be final, binding and conclusive upon the beneficiaries, executors,
administrators, heirs and successors of the Optionee.




12. Rights
As A Stockholder.




No person
shall have any rights as a stockholder with respect to any share covered by an
Option until that person shall become the holder of record of such share and,
except as provided in Section 9, no adjustments shall be made for dividends or
other distributions or other rights as to which there is an earlier record
date.










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13. Securities
Laws Requirements.




No Option
Shares shall be issued unless and until, in the opinion of the Company, any
applicable registration requirements of the 1933 Act, any applicable listing
requirements of any securities exchange on which stock of the same class is then
listed, and any other requirement of law or of any regulatory bodies having
jurisdiction over such issuance and delivery, have been fully complied with.
Each Option Agreement and each Option Share certificate may be imprinted with
legends reflect-ing federal and state securities laws restrictions and
conditions, and the Company may comply therewith and issue “stop transfer”
instructions to its transfer agent and registrar in good faith without
liability.




14. Disposition
Of Shares.




To the
extent reasonably requested by the Company, each Optionee, as a condition of
exercise, shall represent, warrant and agree, in a form of written certificate
approved by the Company, as follows: (a) that all Option Shares are being
acquired solely for his own account and not on behalf of any other person or
entity; (b) that no Option Shares will be sold or otherwise distributed in
violation of the 1933 Act or any other applicable federal or state securities
laws; (c) that he will report all sales of Option Shares to the Company in
writing on a form prescribed by the Company; and (d) that if he is subject to
reporting requirements under Section 16(a) of the 1934 Act, (i) he will not
violate Section 16(b) of the 1934 Act, (ii) he will furnish the Company with a
copy of each Form 4 and Form 5 filed by him, and (iii) he will timely file all
reports required under the federal securities laws.




15. Effective
Date Of Plan; Termination Date Of Plan.




Subject
to the approval of the Plan on or before November 9, 2000 by the affirmative
vote of the holders of a majority of the shares of Common Stock entitled to vote
and represented at a meeting duly held in accordance with the applicable laws of
the State of Delaware, the Plan shall be deemed effective as of November 9,
1999. The Plan shall terminate at midnight on the date that is ten years from
that date, except as to Options previously granted and outstanding under the
Plan at that time. No Options shall be granted after the date on which the Plan
terminates. The Plan may be abandoned or terminated at any earlier time by the
Board, except with respect to any Options then outstanding under the
Plan.




16. Limitation
On Amount Of Option.




The
aggregate Fair Market Value of the Option Shares underlying all Incentive
Options that have been granted to a particular Optionee and that become
exercisable for the first time during the same calendar year shall not exceed
$100,000, provided that this amount shall be increased or decreased, from time
to time, as Code Section 422 or the successor to that Section is amended, so
that this amount at all times shall equal the amount of the limitation set forth
in the Code. For purposes of the preceding sentence, Fair Market Value of the
Shares underlying any particular Option shall be determined as of the Date of
Grant of that Option.










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17. Ten
Percent Stockholder Rule.




No
Incentive Option may be granted to a Key Employee who, at the time the Incentive
Option is granted, owns stock possessing more than 10 percent of the total
combined voting power of all classes of stock of the Company or of “parent
corporation” or “subsidiary corporation”, as those terms are defined in Section
424, or its successor provision, of the Code, unless at the time the Incentive
Option is granted the purchase price for the Option Shares is at least 110
percent of the Fair Market Value of the Option Shares on the Date Of Grant and
the Incentive Option by its terms is not exercisable after the expiration of
five years from the Date Of Grant. For purposes of the preceding sentence, stock
ownership shall be determined as provided in Section 424, or its successor
provision, of the Code.




18. Withholding
Taxes.




The
Option Agreement shall provide that the Company may take such steps as it may
deem necessary or appropriate for the withholding of any taxes which the Company
is required by any law or regulation or any governmental authority, whether
federal, state or local, domestic or foreign, to withhold in connection with any
Option including, but not limited to, the withholding of all or any portion of
any payment or the withholding of issuance of Option Shares to be issued upon
the exercise of any Option.




19. Effect
Of Changes In Control.




In event
of a Change In Control of the Company, then all Options granted pursuant to the
Plan shall become exercisable immediately at the time of such Change In Control,
and, in addition, the Option Committee, in its sole discretion, shall have the
right, but not the obligation, to do any or all of the following:




(a) provide
for an Optionee to surrender an Op-tion (or portion thereof) and to receive in
ex-change a cash payment, for each Option Share underlying the surrendered
Option, equal to the excess of the aggregate Fair Market Value of the Option
Share on the date of surrender over the exercise price for the Option Share. To
the extent any Option is surrendered pursu-ant to this Subparagraph 19(a), it
shall be deemed to have been exercised for purposes of Section 4 hereof;
and




(b) make any
other adjustments, or take any other action, as the Option Committee, in its
dis-cretion, shall deem appropriate provided that any such adjustments or
actions would not result in an Optionee receiving less value than pursuant to
Sub-para-graph 19(a) above.




20. Other
Provisions.




The
following provisions are also in effect under the Plan:




(a) The use
of a masculine gender in the Plan shall also include within its meaning the
feminine, and the singular may include the plural, and the plural may include
the singular, unless the context clearly indicates to the contrary.










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(b) Any
expenses of administering the Plan shall be borne by the Company.




(c) This Plan
shall be construed to be in addition to any and all other compensation plans or
programs. Neither the adoption of the Plan by the Board nor the submission of
the Plan to the stockholders of the Company for approval shall be construed as
creating any limitations on the power or authority of the Board to adopt such
other additional incentive or other compensation arrangements as the Board may
deem necessary or desirable.




(d) The
validity, construction, interpretation, administration and effect of the Plan
and of its rules and regulations, and the rights of any and all persons having
or claiming to have an interest therein or thereunder shall be governed by and
determined exclusively and solely in accordance with the laws of the State of
New York, except in those instances where the rules of conflicts of laws would
require application of the laws of the State of Delaware.







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