2016 10-K Exhibit 10.1





EXHIBIT 10.1


AMENDED AND RESTATED PERNIX THERAPEUTICS HOLDINGS, INC.

2009 STOCK INCENTIVE PLAN

(Amended and Restated as of October 14, 2016)





1.   Purpose .
  The purpose of the Amended and Restated Pernix Therapeutics Holdings, Inc. 2009 Stock Incentive Plan (the "Plan") is to increase
stockholder value and to advance the interests of Pernix Therapeutics Holdings, Inc. ("Pernix") and its subsidiaries (collectively with Pernix, the
"Company") by furnishing stock-based economic incentives (the "Incentives") designed to attract, retain, reward and motivate key employees, officers
and directors of the Company and consultants and advisors to the Company and to strengthen the mutuality of interests between service providers and Pernix's stockholders.  Incentives
consist of opportunities to purchase or receive shares of Common Stock, $0.01 par value per share, of Pernix (the "Common Stock") or cash valued in relation to common
stock, on terms determined under the Plan.  As used in the Plan, the term "subsidiary" means any corporation, limited liability company or other entity, of which Pernix owns (directly
or indirectly) within the meaning of section 424(f) of the Internal Revenue Code of 1986, as amended (the "Code"), 50% or more of the total combined voting power of all
classes of stock, membership interests, or other equity interests issued thereby.


2.   Administration.



2.1   Composition.  The Plan shall generally be administered by the Compensation Committee or a sub-committee thereof (the
"Committee") of the Board of Directors of Pernix (the "Board").  The Committee shall consist of not fewer than two members of the Board, each of
whom shall (a) qualify as a "non-employee director" under Rule 16b-3 under the Securities Exchange Act of 1934 (the "1934 Act") or any successor rule and (b)
qualify as an "outside director" under Section 162(m) of the Code ("Section 162(m)").


2.2   Authority.  The Committee shall have plenary authority to award Incentives under the Plan and to enter into agreements with or provide notices to
participants as to the terms of the Incentives (the "Incentive Agreements").  The Committee shall have the general authority to interpret the Plan, to establish any rules or
regulations relating to the Plan that it determines to be appropriate, and to make any other determination that it believes necessary or advisable for the proper administration of the Plan.
Committee decisions in matters relating to the Plan shall be final and conclusive on the Company and participants.  The Committee may delegate its authority hereunder to the extent provided
in Section 3 hereof.


3.   Eligible Participants
.  Key employees, officers and directors of the Company and persons providing services as consultants or advisors to the Company shall become eligible to
receive Incentives under the Plan when designated by the Committee.  With respect to participants not subject to Section 16 of the 1934 Act or Section 162(m) of the Code, the Committee may
delegate to appropriate officers of the Company its authority to designate participants, to determine the size and type of Incentives to be received by those participants and to set and modify the
terms of such Incentives; provided, however, that the resolution so authorizing any such officer shall specify the total number of Incentives such officer may so award and such actions shall be
treated for all purposes as if taken by the Committee, and provided further that the per share exercise price of any options granted by an officer, rather than


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by the Committee, shall be equal to
the Fair Market Value (as defined in Section 12.11) of a share of Common Stock on the later of the date of grant or the date the participant's employment with or service to the Company commences.


4.   Types of Incentives
.  Incentives may be granted under the Plan to eligible participants in the forms of (a) incentive stock options; (b) non-qualified stock options; (c) restricted stock,
(d) restricted stock units ("RSUs"); (e) stock appreciation rights ("SARs") and (f) Other Stock-Based Awards (as defined in Section 10).


5.   Shares Subject to the Plan.1



5.1   Number of Shares.  Subject to adjustment as provided in Section 12.5, the maximum number of shares of Common Stock that may be delivered to
participants and their permitted transferees under the Plan shall be 775,000 shares.


5.2   Share Counting.  To the extent any shares of Common Stock covered by a stock option or SAR are not delivered to a participant or permitted transferee
because the Incentive is forfeited or canceled, or shares of Common Stock are not delivered because an Incentive is paid or settled in cash, such shares shall not be deemed to have been
delivered for purposes of determining the maximum number of shares of Common Stock available for delivery under this Plan.  In the event that shares of Common Stock are issued as an
Incentive and thereafter are forfeited or reacquired by the Company pursuant to rights reserved upon issuance thereof, such forfeited and reacquired Shares may again be issued under the
Plan.  With respect to SARs, if the SAR is payable in shares of Common Stock, all shares to which the SARs relate are counted against the Plan limits, rather than the net number of shares
delivered upon exercise of the SAR.


5.3   Limitations on Awards.  Subject to adjustment as provided in Section 12.5, the following additional limitations are imposed under the Plan:




	The maximum number of shares of Common Stock that may be issued upon exercise of stock options intended to qualify as incentive stock options under Section
422 of the Code shall be 500,000 shares.


	The maximum number of shares of Common Stock that may be covered by Incentives granted under the Plan to any one individual during any one fiscal-year
period shall be 150,000.


	The aggregate maximum number of shares of Common Stock that may be granted as restricted stock, restricted stock units, and Other Stock-Based Awards shall
be 300,000.



___________________


1 All share numbers in Section 5 of the Plan have been adjusted to reflect the 1-for-10 reverse stock split of the Common Stock effected as of the close of business on October 13, 2016.



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	Restricted stock, restricted stock units and Other Stock-Based Awards with respect to an aggregate of 100,000 shares of Common Stock may be granted to
officers, employees, consultants, or advisors without compliance with the minimum vesting periods or exceptions provided in Sections 7.2, 8.2 and 10.2.


	The maximum value of an Other Stock-based Award that is valued in dollars (whether paid in Common Stock) scheduled to paid out to any one participant in any
fiscal year shall be $5,000,000.

5.4   Type of Common Stock.  Common Stock issued under the Plan may be authorized and unissued shares or issued shares held as treasury
shares.


6.   Stock Options
.  A stock option is a right to purchase shares of Common Stock from Pernix.  Stock options granted under the Plan may be incentive stock options (as such
term is defined in Section 422 of the Code) or non-qualified stock options.  Any option that is designated as a non-qualified stock option shall not be treated as an incentive stock option.  Each
stock option granted by the Committee under this Plan shall be subject to the following terms and conditions:



6.1   Price.  The exercise price per share shall be determined by the Committee, subject to adjustment under Section 12.5; provided that in no event shall the
exercise price be less than the Fair Market Value (as defined in Section 12.11) of a share of Common Stock on the date of grant, except in the case of a stock option granted in assumption of
or substitution for an outstanding award of a company acquired by the Company or with which the Company combines.

6.2   Number.  The number of shares of Common Stock subject to the option shall be determined by the Committee, subject to Section 5 and subject to
adjustment as provided in Section 12.5.


6.3   Duration and Time for Exercise.  The term of each stock option shall be determined by the Committee, but shall not exceed a maximum term of ten years.
Each stock option shall become exercisable at such time or times during its term as shall be determined by the Committee.  Notwithstanding the foregoing, the Committee may accelerate the
exercisability of any stock option at any time, in addition to the automatic acceleration of stock options under Section 12.10.

6.4   Repurchase.  Upon approval of the Committee, the Company may repurchase a previously granted stock option from a participant by mutual agreement
before such option has been exercised by payment to the participant of the amount per share by which:  (a) the Fair Market Value (as defined in Section 12.11) of the Common Stock subject to
the option on the business day immediately preceding the date of purchase exceeds (b) the exercise price, or by payment of such other mutually agreed upon amount; provided, however, that
no such repurchase shall be permitted if prohibited by Section 6.6.


6.5   Manner of Exercise.  A stock option may be exercised, in whole or in part, by giving written notice to the Company, specifying the number of shares of
Common Stock to be purchased.  The exercise notice shall be accompanied by the full purchase price for such shares.  The option price shall be payable in United States dollars and may be
paid (a) in cash; (b) by check; (c) by delivery of or attestation of ownership of shares of Common Stock,


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which shares shall be valued for this purpose at the Fair Market Value on the business
day immediately preceding the date such option is exercised; (d) by delivery of irrevocable written instructions to a broker approved by the Company (with a copy to the Company) to
immediately sell a portion of the shares, issuable under the option and to deliver promptly to the Company the amount of sale proceeds (or loan proceeds if the broker lends funds to the
participant for delivery to the Company) to pay the exercise price; or (e) if approved by the Committee, through a net exercise procedure whereby the optionee surrenders the option in
exchange for that number of shares of Common Stock with an aggregate Fair Market Value equal to the difference between the aggregate exercise price of the options being surrendered and
the aggregate Fair Market Value of the shares of Common Stock subject to the option, (f) in such other manner as may be authorized from time to time by the Committee.

6.6   Repricing.  Except for adjustments pursuant to Section 12.5 or actions permitted to be taken by the Committee under Section 12.10(c) in the event of a
Change of Control, unless approved by the stockholders of the Company, (a) the exercise or base price for any outstanding option or SAR granted under this Plan may not be decreased after
the date of grant and (b) an outstanding option or SAR that has been granted under this Plan may not, as of any date that such option or SAR has a per share exercise price that is greater than
the then current Fair Market Value of a share of Common Stock, be surrendered to the Company as consideration for the grant of a new option or SAR with a lower exercise price, shares of
restricted stock, restricted stock units, an Other Stock-Based Award, a cash payment or Common Stock.

6.7   Incentive Stock Options.  Notwithstanding anything in the Plan to the contrary, the following additional provisions shall apply to the grant of stock options
that are intended to qualify as incentive stock options (as such term is defined in Section 422 of the Code):





	Any incentive stock option agreement authorized under the Plan shall contain such other provisions as the Committee shall deem advisable, but shall in all events
be consistent with and contain or be deemed to contain all provisions required in order to qualify the options as incentive stock options.


	All incentive stock options must be granted within ten years from the date on which this Plan is adopted by the Board of Directors.


	No incentive stock options shall be granted to any non-employee or to any employee who, at the time such option is granted, would own (within the meaning of
Section 422 of the Code) stock possessing more than 10% of the total combined voting power of all classes of stock of the employer corporation or of its parent or subsidiary
corporation.


	The aggregate Fair Market Value (determined with respect to each incentive stock option as of the time such incentive stock option is granted) of the Common
Stock with respect to which incentive stock options are exercisable for the first time by a participant during any calendar year (under the Plan or any other plan of Pernix or any of its
subsidiaries) shall not exceed $100,000.  To the extent that such limitation is exceeded, the excess options shall be treated as non-qualified stock options for federal income tax
purposes.


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7.   Restricted Stock.



7.1   Grant of Restricted Stock.  The Committee may award shares of restricted stock to such eligible participants as the Committee determines pursuant to the
terms of Section 3.  An award of restricted stock shall be subject to such restrictions on transfer and forfeitability provisions and such other terms and conditions, including the attainment of
specified performance goals, as the Committee may determine, subject to the provisions of the Plan.  To the extent restricted stock is intended to qualify as "performance-based
compensation" under Section 162(m), it must be granted subject to the attainment of performance goals as described in Section 11 below and meet the additional requirements imposed by Section 162(m).


7.2   The Restricted Period.  At the time an award of restricted stock is made, the Committee shall establish a period of time during which the transfer of the
shares of restricted stock shall be restricted and after which the shares of restricted stock shall be vested (the "Restricted Period").  The Restricted Period shall be a
minimum of three years with incremental vesting of portions of the award over the three-year period permitted, with the following exceptions:





	If the vesting of the shares of restricted stock is based upon the attainment of performance goals as described in Section 11, a minimum Restricted Period of one
year is allowed.


	No minimum Restricted Period applies to grants to non-employee directors, to grants issued in payment of cash amounts earned under the Company's annual
incentive plan, or to grants under Section 5.3(c) hereof.


	Each award of restricted stock may have a different Restricted Period.  The expiration of the Restricted Period shall also occur: (1) as provided under Section 12.3
in the event of termination of employment under the circumstances provided in the Incentive Agreement, and (2) as described in Section 12.10 in the event of a Change of Control of the
Company.

7.3   Escrow.  The participant receiving restricted stock shall enter into an Incentive Agreement with the Company setting forth the conditions of the grant.  Any
certificates representing shares of restricted stock shall be registered in the name of the participant and deposited with the Company, together with a stock power endorsed in blank by the
participant.  Each such certificate shall bear a legend in substantially the following form:


7.4   The transferability of this certificate and the shares of Common Stock represented by it are subject to the terms and conditions (including conditions of forfeiture)
contained in the Plan and an agreement entered into between the registered owner and the Company thereunder.  Copies of the Plan and the agreement are on file at the principal office of the
Company.




	Alternatively, in the discretion of the Company, ownership of the shares of restricted stock and the appropriate restrictions shall be reflected in the records of the
Company's transfer agent and no physical certificates shall be issued prior to vesting.

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7.5   Dividends on Restricted Stock.  Any and all cash and stock dividends paid with respect to the shares of restricted stock shall be subject to any restrictions
on transfer, forfeitability provisions or reinvestment requirements as the Committee may, in its discretion, prescribe in the Incentive Agreement.

7.6   Forfeiture.  In the event of the forfeiture of any shares of restricted stock under the terms provided in the Incentive Agreement (including any additional
shares of restricted stock that may result from the reinvestment of cash and stock dividends, if so provided in the Incentive Agreement), such forfeited shares shall be surrendered and any
certificates cancelled.  The participants shall have the same rights and privileges, and be subject to the same forfeiture provisions, with respect to any additional shares received pursuant to
Section 12.5 due to a recapitalization or other change in capitalization.

7.7   Expiration of Restricted Period.  Upon the expiration or termination of the Restricted Period and the satisfaction of any other conditions prescribed by the
Committee, the restrictions applicable to the restricted stock shall lapse and, unless otherwise instructed by the participant, a stock certificate for the number of shares of restricted stock with
respect to which the restrictions have lapsed shall be delivered, free of all such restrictions and legends, except any that may be imposed by law, to the participant or the participant's estate, as
the case may be.


7.8   Rights as a Stockholder.  Subject to the terms and conditions of the Plan and subject to any restrictions on the receipt of dividends that may be imposed in
the Incentive Agreement, each participant receiving restricted stock shall have all the rights of a stockholder with respect to shares of stock during the Restricted Period, including without
limitation, the right to vote any shares of Common Stock.


8.   Restricted Stock Units.



8.1   Grant of Restricted Stock Units.  A restricted stock unit, or RSU, represents the right to receive from the Company on the respective scheduled vesting or
payment date for such RSU, one share of Common Stock.  An award of restricted stock units may be subject to the attainment of specified performance goals or targets, forfeitability provisions
and such other terms and conditions as the Committee may determine, subject to the provisions of the Plan.  To the extent an award of restricted stock units is intended to qualify as
performance-based compensation under Section 162(m), it must be granted subject to the attainment of performance goals as described in Section 11 and meet the additional requirements
imposed by Section 162(m).

8.2   Vesting Period.  At the time an award of restricted stock units is made, the Committee shall establish a period of time during which the restricted stock units
shall vest (the "Vesting Period").  The Vesting Period shall be a minimum of three years with incremental vesting over the three-year period permitted, with the following
exceptions:





	 (a) If the vesting of the shares of restricted stock units is based upon the attainment of performance goals as described in Section 11, a minimum Vesting
Period of one year is allowed.



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	No minimum Restricted Period applies to grants of restricted stock units to non-employee directors, to grants issued in payment of cash amounts earned under the
Company's annual incentive plan, or to grants under Section 5.3(c) hereof.


	Each award of restricted stock units may have a different Vesting Period.  The acceleration of the expiration of the Vesting Period shall also occur: (1) as provided
under Section 12.3 in the event of termination of employment under the circumstances provided in the Incentive Agreement, and (2) as described in Section 12.10 in the event of a Change of
Control of the Company.

8.3   Dividend Equivalent Accounts.  Subject to the terms and conditions of this Plan and the applicable Incentive Agreement, as well as any procedures
established by the Committee, the Committee may determine to pay dividend equivalent rights with respect to RSUs, in which case, unless determined by the Committee to be paid currently,
the Company shall establish an account for the participant and reflect in that account any securities, cash or other property comprising any dividend or property distribution with respect to the
share of Common Stock underlying each RSU.  The participant shall have rights to the amounts or other property credited to such account.

8.4   Rights as a Stockholder.  Subject to the restrictions imposed under the terms and conditions of this Plan and subject to any other restrictions that may be
imposed in the Incentive Agreement, each participant receiving restricted stock units shall have no rights as a stockholder with respect to such restricted stock units until such time as shares of
Common Stock are issued to the participant.


8.5   Compliance with Section 409A of the Code.  Restricted stock unit awards shall be designed and operated in such a manner that they are either exempt
from the application or comply with the requirements of Section 409A of the Code.


9.   Stock Appreciation Rights.



9.1   Grant of Stock Appreciation Rights.  A stock appreciation right, or SAR, is a right to receive, without payment to the Company, a number of shares of
Common Stock, cash or any combination thereof, the number or amount of which is determined pursuant to the formula set forth in Section 9.5.  Each SAR granted by the Committee under the
Plan shall be subject to the terms and conditions provided herein.

9.2   Number.  Each SAR granted to any participant shall relate to such number of shares of Common Stock as shall be determined by the Committee, subject
to adjustment as provided in Section 12.5.

9.3   Duration and Time for Exercise.  The term of each SAR shall be determined by the Committee, but shall not exceed a maximum term of ten years.  Each
SAR shall become exercisable at such time or times during its term as shall be determined by the Committee.  Notwithstanding the foregoing, the Committee may accelerate the exercisability
of any SAR at any time in its discretion in addition to the automatic acceleration of SARs under Section 12.10.


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9.4   Exercise.  A SAR may be exercised, in whole or in part, by giving written notice to the Company, specifying the number of SARs that the holder wishes to
exercise.  The date that the Company receives such written notice shall be referred to herein as the "Exercise Date."  The Company shall, within 30 days of an Exercise
Date, deliver to the exercising holder certificates for the shares of Common Stock to which the holder is entitled pursuant to Section 9.5 or cash or both, as provided in the Incentive
Agreement.

9.5   Payment.  The number of shares of Common Stock which shall be issuable upon the exercise of a SAR payable in Common Stock shall be determined by
dividing:




	the number of shares of Common Stock as to which the SAR is exercised, multiplied by the amount of the appreciation in each such share (for this purpose, the
"appreciation" shall be the amount by which the Fair Market Value of a share of Common Stock subject to the SAR on the trading day prior to the Exercise Date exceeds the
"Base Price," which is an amount, not less than the Fair Market Value of a share of Common Stock on the date of grant, which shall be determined by the Committee at the
time of grant, subject to adjustment under Section 12.5); by


	the Fair Market Value of a share of Common Stock on the Exercise Date.


	No fractional shares of Common Stock shall be issued upon the exercise of a SAR; instead, the holder of a SAR shall be entitled to purchase the portion necessary
to make a whole share at its Fair Market Value on the Exercise Date.


	If so provided in the Incentive Agreement, a SAR may be exercised for cash equal to the Fair Market Value of the shares of Common Stock that would be issuable
under this Section 9.5, if the exercise had been for Common Stock.


10.   Other Stock-Based Awards.



10.1   Grant of Other Stock-Based Awards.  Subject to the limitations described in Section 10.2 hereof, the Committee may grant to eligible participants
"Other Stock-Based Awards," which shall consist of awards (other than options, restricted stock, restricted stock units or SARs described in Sections 6 through 9 hereof)
paid out in shares of Common Stock or the value of which is based in whole or in part on the value of shares of Common Stock.  Other Stock-Based Awards may be awards of shares of
Common Stock, awards of phantom stock or may be denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to, shares of, or appreciation in the
value of, Common Stock (including, without limitation, securities convertible or exchangeable into or exercisable for shares of Common Stock), as deemed by the Committee consistent with the
purposes of this Plan.  The Committee shall determine the terms and conditions of any Other Stock-Based Award (including which rights of a stockholder, if any, the recipient shall have with
respect to Common Stock associated with any such award) and may provide that such award is payable in whole or in part in cash.  An Other Stock-Based Award may be subject to the
attainment of such specified performance goals or targets as the Committee may determine, subject to the provisions of this Plan.  To the extent that an Other Stock-Based Award is intended
to qualify as "performance-based compensation" under Section 162(m), it must be granted subject to the attainment of performance goals as described in Section 11 below and
meet the additional requirements imposed by Section 162(m).


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10.2   Limitations.  Except as permitted in Section 5.3(c) and except for grants to non-employee directors and grants of shares issued in payment of cash
amounts earned under the Company's annual incentive plan, Other Stock-Based Awards granted under this Section 10 shall be subject to a vesting period of at least three years, with
incremental vesting of portions of the award over the three-year period permitted; provided, however, that if the vesting of the award is based upon the attainment of performance goals, a
minimum vesting period of one year is allowed, with incremental vesting of portions of the award over the one-year period permitted.

10.3   Compliance with Section 409A of the Code.  Other Stock-Based Awards shall be designed and operated in such a manner that they are either exempt from
the application or comply with the requirements of Section 409A of the Code.


11.   Performance Goals for Section 162(m) Awards
.  To the extent that shares of restricted stock, restricted stock units or Other Stock-Based Awards granted under the Plan are intended to qualify as
"performance-based compensation" under Section 162(m), the vesting, grant, or payment of such awards shall be conditioned on the achievement of one or more performance
goals and must satisfy the other requirements of Section 162(m).  The performance goals pursuant to which such awards shall vest, be granted, or be paid out shall be any or a combination of
the following performance measures applied to the Company, Pernix, a division, or a subsidiary:  earnings per share; return on assets; an economic value-added measure; shareholder return;
earnings or earnings before interest, taxes and amortization; stock price; total shareholder return; return on equity; return on total capital; return on assets or net assets; revenue; reduction of
expenses; free cash flow; income or net income; income before tax; operating income or net operating income; gross profit; operating profit or net operating profit; operating margin or profit
margin; return on operating revenue; return on invested capital; or market segment share.  For any performance period, such performance objectives may be measured on an absolute basis,
relative to a group of peer companies selected by the Committee, relative to internal goals, or relative to levels attained in prior years.  The performance goals may be subject to such
adjustments as are specified in advance by the Committee in accordance with Section 162(m).


12.   General.



12.1   Duration.  No Incentives may be granted under the Plan after June 23, 2021, the tenth anniversary of the date the Plan was most recently
approved by Pernix stockholders; provided, however, that subject to Section 12.9, the Plan shall remain in effect after such date with respect to Incentives granted prior to that date, until all
such Incentives have either been satisfied by the issuance of shares of Common Stock or otherwise been terminated under the terms of the Plan and all restrictions imposed on shares of
Common Stock in connection with their issuance under the Plan have lapsed.


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12.2   Transferability.  No Incentives granted hereunder may be transferred, pledged, assigned or otherwise encumbered by a participant except: (a) by will; (b)
by the laws of descent and distribution; (c) pursuant to a domestic relations order, as defined in the Code; or (d) as to options only, if permitted by the Committee and so provided in the
Incentive Agreement or an amendment thereto, (i) to Immediate Family Members, (ii) to a partnership in which the participant and/or Immediate Family Members, or entities in which the
participant and/or Immediate Family Members are the sole owners, members or beneficiaries, as appropriate, are the sole partners, (iii) to a limited liability company in which the participant
and/or Immediate Family Members, or entities in which the participant and/or Immediate Family Members are the sole owners, members or beneficiaries, as appropriate, are the sole members,
or (iv) to a trust for the sole benefit of the participant and/or Immediate Family Members. "Immediate Family Members" shall be defined as the spouse and natural or
adopted children or grandchildren of the participant and their spouses.  To the extent that an incentive stock option is permitted to be transferred during the lifetime of the participant, it shall be
treated thereafter as a nonqualified stock option.  Any attempted assignment, transfer, pledge, hypothecation or other disposition of Incentives, or levy of attachment or similar process upon
Incentives not specifically permitted herein, shall be null and void and without effect.

12.3   Effect of Termination of Employment or Death.  In the event that a participant ceases to be an employee of the Company or to provide services to the
Company for any reason, including death, disability, early retirement or normal retirement, any Incentives may be exercised, shall vest or shall expire at such times as may be determined by
the Committee and provided in the Incentive Agreement.

12.4   Additional Conditions.  Anything in this Plan to the contrary notwithstanding:  (a) the Company may, if it shall determine it necessary or desirable for any
reason, at the time of award of any Incentive or the issuance of any shares of Common Stock pursuant to any Incentive, require the recipient of the Incentive, as a condition to the receipt
thereof or to the receipt of shares of Common Stock issued pursuant thereto, to deliver to the Company a written representation of present intention to acquire the Incentive or the shares of
Common Stock issued pursuant thereto for his own account for investment and not for distribution; and (b) if at any time the Company further determines, in its sole discretion, that the listing,
registration or qualification (or any updating of any such document) of any Incentive or the shares of Common Stock issuable pursuant thereto is necessary on any securities exchange or under
any federal or state securities or blue sky law, or that the consent or approval of any governmental regulatory body is necessary or desirable as a condition of, or in connection with the award of
any Incentive, the issuance of shares of Common Stock pursuant thereto, or the removal of any restrictions imposed on such shares, such Incentive shall not be awarded or such shares of
Common Stock shall not be issued or such restrictions shall not be removed, as the case may be, in whole or in part, unless such listing, registration, qualification, consent or approval shall
have been effected or obtained free of any conditions not acceptable to the Company.

12.5   Adjustment.  In the event of any recapitalization, reclassification, stock dividend, stock split, combination of shares or other similar change in the Common
Stock, the number of shares of Common Stock then subject to the Plan, including shares subject to outstanding Incentives, and any and all other limitations provided in the Plan limiting the
number of shares of Common Stock that may be issued hereunder, shall be adjusted in proportion to the change in outstanding shares of Common Stock.  In the event of any such
adjustments, the price of any option, the Base Price of any SAR and the performance objectives of any Incentive shall also be adjusted to provide participants with the same relative rights
before and after such adjustment.  No substitution or adjustment shall require the Company to issue a fractional share under the Plan and the substitution or adjustment shall be limited by
deleting any fractional share.


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12.6   Withholding.




	The Company shall have the right to withhold from any payments made or stock issued under the Plan or to collect as a condition of payment, issuance or vesting,
any taxes required by law to be withheld.  At any time that a participant is required to pay to the Company an amount required to be withheld under applicable income tax laws in connection
with an Incentive, the participant may, subject to Section 12.6(b) below, satisfy this obligation in whole or in part by electing (the "Election") to deliver currently owned
shares of Common Stock or to have the Company withhold shares of Common Stock, in each case having a value equal to the minimum statutory amount required to be withheld under federal,
state and local law.  The value of the shares to be delivered or withheld shall be based on the Fair Market Value of the Common Stock on the date that the amount of tax to be withheld shall be
determined ("Tax Date").


	Each Election must be made prior to the Tax Date.  For participants who are not subject to Section 16 of the 1934 Act, the Committee may disapprove of any
Election, may suspend or terminate the right to make Elections, or may provide with respect to any Incentive that the right to make Elections shall not apply to such Incentive.  If a participant
makes an election under Section 83(b) of the Code with respect to shares of restricted stock, an Election to have shares withheld to satisfy withholding taxes is not permitted to be
made.

12.7   No Continued Employment.  No participant under the Plan shall have any right, because of his or her participation, to continue in the employ of the
Company for any period of time or to any right to continue his or her present or any other rate of compensation.

12.8   Deferral Permitted.  Payment of an Incentive may be deferred at the option of the participant if permitted in the Incentive Agreement.  Any deferral
arrangements shall comply with Section 409A of the Code.

12.9   Amendments to or Termination of the Plan.  The Board may amend or discontinue this Plan at any time; provided, however, that no such amendment
may:





	materially revise the Plan without the approval of the stockholders.  A material revision of the Plan includes (i) except for adjustments permitted herein, a material
increase to the maximum number of shares of Common Stock that may be issued through the Plan, (ii) a material increase to the benefits accruing to participants under the Plan, (iii) a material
expansion of the classes of persons eligible to participate in the Plan, (iv) an expansion of the types of awards available for grant under the Plan, (v) a material extension of the term of the Plan
and (vi) a material change that reduces the price at which shares of Common Stock may be offered through the Plan;



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	amend Section 6.6 to permit repricing of options or SARs without the approval of stockholders; or


	materially impair, without the consent of the recipient, an Incentive previously granted, except that the Company retains all of its rights under Section
12.10.


13.   Change of Control.





	Unless otherwise defined in an Incentive Agreement, "Change of Control" shall mean:



	the acquisition by any individual, entity, or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the 1934 Act) (a "Person") of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the 1934 Act) of 30% or more of the outstanding shares of Common Stock, or 30% or more of the combined voting
power of the Company's then outstanding securities entitled to vote generally in the election of directors; provided, however, that for purposes of this subsection (i), the following acquisitions
shall not constitute a Change of Control:



	any acquisition (other than a Business Combination which constitutes a Change of Control under Section 12.10(a)(iii) hereof) of Common Stock directly from the
Company,


	any acquisition of Common Stock by the Company or its subsidiaries,


	any acquisition of Common Stock by (i) Cooper C. Collins, Jim E. Smith, Jr. or their Immediate Family Members, (ii) any entity controlled by Cooper C. Collins,
James E. Smith, Jr. and/or their Immediate Family Members, and (iii) any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the 1934 Act) that includes Cooper C. Collins,
James E. Smith, Jr. and/or any of their Immediate Family Members,


	any acquisition of Common Stock by any employee benefit plan (or related trust) sponsored or maintained by the Company or any entity controlled by the Company,
or


	any acquisition of Common Stock by any entity pursuant to a Business Combination that does not constitute a Change of Control under Section 12.10(a)(iii) hereof;
or



	individuals who, as of the date this Plan was adopted by the Board of Directors (the "Approval Date"), constitute the Board (the
"Incumbent Board") cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the
Approval Date whose election, or nomination for election by the Company's stockholders, was approved by a vote of at least two-thirds of the directors then comprising the Incumbent Board
shall be considered a member of the Incumbent Board, unless such individual's initial assumption of office occurs as a result of an actual or threatened election contest with respect to the
election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Incumbent Board; or




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	consummation of a reorganization, share exchange, merger, or consolidation (including any such transaction involving any direct or indirect subsidiary of the
Company), or sale or other disposition of all or substantially all of the assets of the Company (a "Business Combination"); provided, however, that in no such case shall any
such transaction constitute a Change of Control if immediately following such Business Combination,



	all or substantially all of the individuals and entities who were the beneficial owners of the outstanding Common Stock and the Company's voting securities entitled
to vote generally in the election of directors immediately prior to such Business Combination have direct or indirect beneficial ownership, respectively, of more than 50% of the then outstanding
shares of Common Stock, and more than 50% of the combined voting power of the then outstanding voting securities entitled to vote generally in the election of directors, of the corporation
resulting from such Business Combination (which, for purposes of this paragraph (1) and paragraphs (2) and (3), shall include a corporation which as a result of such transaction owns the
Company or all or substantially all of its assets either directly or through one or more subsidiaries), and


	except to the extent that such ownership existed prior to the Business Combination, no Person (excluding any corporation resulting from such Business
Combination and any employee benefit plan or related trust of the Company, the corporation resulting from such Business Combination, or any subsidiary of either corporation) beneficially
owns, directly or indirectly, 20% or more of the then outstanding shares of common stock of the corporation resulting from such Business Combination or 20% or more of the combined voting
power of the then outstanding voting securities of such corporation, and


	at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at
the time of the execution of the initial agreement, or of the action of the Board, providing for such Business Combination; or


	approval by the stockholders of the Company of a plan of complete liquidation or dissolution of the Company.




	Upon a Change of Control, or immediately prior to the closing of a transaction that will result in a Change of Control if consummated, all outstanding Incentives
granted pursuant to the Plan shall automatically become fully vested and exercisable, all restrictions or limitations on any Incentives shall lapse and all performance criteria and other conditions
relating to the payment of Incentives shall be deemed to be achieved or waived by Pernix without the necessity of action by any person.



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	No later than 30 days after the approval by the Board of a Change of Control of the types described in subsections (iii) or (iv) of Section 12.10(a) and no later than
30 days after a Change of Control of the type described in subsections (i) and (ii) of Section 12.10(a), the Committee (as the Committee was composed immediately prior to such Change of
Control and notwithstanding any removal or attempted removal of some or all of the members thereof as directors or Committee members), acting in its sole discretion without the consent or
approval of any participant, may act to effect one or more of the alternatives listed below and such act by the Committee may not be revoked or rescinded by persons not members of the
Committee immediately prior to the Change of Control:



	require that all outstanding options and stock appreciation rights be exercised on or before a specified date (before or after such Change of Control) fixed by the
Committee, after which specified date all unexercised options shall terminate;


	make such equitable adjustments to Incentives then outstanding as the Committee deems appropriate to reflect such Change of Control (provided, however, that
the Committee may determine in its sole discretion that no adjustment is necessary);


	provide for mandatory conversion of some or all of the outstanding options and stock appreciation rights held by some or all participants as of a date, before or after
such Change of Control, specified by the Committee, in which event such options and stock appreciation rights shall be deemed automatically cancelled and the Company shall pay, or cause
to be paid, to each such participant an amount of cash per share equal to the excess, if any, of the Change of Control Value of the shares subject to such option and stock appreciation right, as
defined and calculated below, over the exercise price(s) of such options and stock appreciation rights or, in lieu of such cash payment, the issuance of Common Stock or securities of an
acquiring entity having a Fair Market Value equal to such excess; or


	provide that thereafter upon any exercise of an option or stock appreciation right the participant shall be entitled to purchase under such option or stock appreciation
right, in lieu of the number of shares of Common Stock then covered by such option or stock appreciation right, the number and class of shares of stock or other securities or property
(including, without limitation, cash) to which the participant would have been entitled pursuant to the terms of the agreement providing for the reorganization, merger, consolidation or asset
sale, if, immediately prior to such Change of Control, the participant had been the holder of record of the number of shares of Common Stock then covered by such options and stock
appreciation rights.



	For the purpose of paragraph (iii) of Section 12.10(c), the "Change of Control Value" shall equal the amount determined by whichever of the
following items is applicable:



	the per share price to be paid to stockholders of Pernix in any such merger, consolidation or other reorganization;




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	the price per share offered to stockholders of Pernix in any tender offer or exchange offer whereby a Change of Control takes place;


	in all other events, the Fair Market Value per share of Common Stock into which such options being converted are exercisable, as determined by the Committee as
of the date determined by the Committee to be the date of conversion of such options; or


	in the event that the consideration offered to stockholders of Pernix in any transaction described in this Section 12.10 consists of anything other than cash, the
Committee shall determine the fair cash equivalent of the portion of the consideration offered that is other than cash.


13.2.   Definition of Fair Market Value.  Whenever "Fair Market Value" of Common Stock shall be determined for purposes of this Plan,
except as provided below in connection with a cashless exercise through a broker, it shall be determined as follows: (i) if the Common Stock is listed on an established stock exchange or any
automated quotation system that provides sale quotations, the closing sale price for a share of the Common Stock on such exchange or quotation system on the date as of which fair market
value is to be determined, (ii) if the Common Stock is not listed on any exchange or quotation system, but bid and asked prices are quoted and published, the mean between the quoted bid and
asked prices on the date as of which fair market value is to be determined, and if bid and asked prices are not available on such day, on the next preceding day on which such prices were
available and (iii) if the Common Stock is not regularly quoted, the fair market value of a share of Common Stock on the date as of which fair market value is to be determined, as established
by the Committee in good faith.  In the context of a cashless exercise through a broker, the "Fair Market Value" shall be the price at which the Common Stock subject to the stock
option is actually sold in the market to pay the option exercise price.




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