exv10w1






 




    Exhibit 10.1




 


 




    1996
    EQUITY PARTICIPATION PLAN

    OF VIASAT, INC.



 




    (As
    Amended and Restated Effective October 2, 2008)



 



    ViaSat, Inc., a Delaware corporation, adopted The 1996 Equity
    Participation Plan of ViaSat, Inc. (the “Plan”),
    effective October 24, 1996, for the benefit of its eligible
    employees, consultants and directors. The Plan consists of two
    plans, one for the benefit of key Employees (as such term is
    defined below) and consultants and one for the benefit of
    Independent Directors (as such term is defined below). The
    following is an amendment and restatement of the Plan effective
    as of October 2, 2008, as further amended.



 



    The purposes of this Plan are as follows:



 



    (1) To provide an additional incentive for directors, key
    Employees and consultants to further the growth, development and
    financial success of ViaSat, Inc. (the “Company”) by
    personally benefiting through the ownership of Company stock
    and/or
    rights which recognize such growth, development and financial
    success.



 



    (2) To enable the Company to obtain and retain the services
    of directors, key Employees and consultants considered essential
    to the long range success of the Company by offering them an
    opportunity to own stock in the Company
    and/or
    rights which will reflect the growth, development and financial
    success of the Company.



 




    ARTICLE I.

    



 




    DEFINITIONS
    



 



    1.1  General.  Wherever the
    following terms are used in this Plan they shall have the
    meanings specified below, unless the context clearly indicates
    otherwise.



 



    1.2  Award Limit.  “Award
    Limit” shall mean Five Hundred Thousand (500,000) shares of
    Common Stock with respect to Options or Stock Appreciation
    Rights granted under the Plan and One Hundred Fifty Thousand
    (150,000) shares of Common Stock with respect to awards of
    Restricted Stock, Performance Awards, Dividend Equivalents,
    Restricted Stock Units, or Stock Payments granted under the
    Plan; provided, however, that in connection with
    an individual’s initial service as an Employee, such limit
    will be Three Hundred Thousand (300,000) shares of Common Stock
    with respect to awards of Restricted Stock, Performance Awards,
    Dividend Equivalents, Restricted Stock Units or Stock Payments
    granted under the Plan. The maximum aggregate amount of cash
    that may be paid to an individual in cash during any fiscal year
    of the Company with respect to awards designated to be paid in
    cash shall be $1,000,000.



 



    1.3  Board.  “Board”
    shall mean the Board of Directors of the Company.



 



    1.4  Change in
    Control.  “Change in Control” shall
    mean a change in ownership or control of the Company effected
    through either of the following transactions:



 



    (a) any person or related group of persons (other than the
    Company or a person that directly or indirectly controls, is
    controlled by, or is under common control with, the Company)
    directly or indirectly acquires beneficial ownership (within the
    meaning of
    Rule 13d-3
    under the Exchange Act) of securities possessing more than fifty
    percent (50%) of the total combined voting power of the
    Company’s outstanding securities pursuant to a tender or
    exchange offer made directly to the Company’s stockholders
    which the Board does not recommend such stockholders to
    accept; or



 



    (b) there is a change in the composition of the Board over
    a period of thirty-six (36) consecutive months (or less)
    such that a majority of the Board members (rounded up to the
    nearest whole number) ceases, by reason of one or more proxy
    contests for the election of Board members, to be comprised of
    individuals who either (i) have been Board members
    continuously since the beginning of such period or
    (ii) have been elected or nominated for election as Board
    members during such period by at least a majority of the Board
    members




    

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    described in clause (i) who were still in office at the
    time such election or nomination was approved by the Board.



 



    1.5  Code.  “Code”
    shall mean the Internal Revenue Code of 1986, as amended.



 



    1.6  Committee.  “Committee”
    shall mean the Compensation Committee of the Board, or another
    committee of the Board, appointed as provided in
    Section 9.1.



 



    1.7  Common
    Stock.  “Common Stock” shall mean
    the common stock of the Company, par value $0.0001 per share,
    and any equity security of the Company issued or authorized to
    be issued in the future, but excluding any preferred stock and
    any warrants, options or other rights to purchase Common Stock.
    Debt securities of the Company convertible into Common Stock
    shall be deemed equity securities of the Company.



 



    1.8  Company.  “Company”
    shall mean ViaSat, Inc., a Delaware corporation.



 



    1.9  Corporate
    Transaction.  “Corporate
    Transaction” shall mean any of the following
    stockholder-approved transactions to which the Company is a
    party:



 



    (a) a merger or consolidation in which the Company is not
    the surviving entity, except for a transaction the principal
    purpose of which is to change the State in which the Company is
    incorporated, form a holding company or effect a similar
    reorganization as to form whereupon this Plan and all Options
    are assumed by the successor entity;



 



    (b) the sale, transfer, exchange or other disposition of
    all or substantially all of the assets of the Company, in
    complete liquidation or dissolution of the Company in a
    transaction not covered by the exceptions to clause (a),
    above; or



 



    (c) any reverse merger in which the Company is the
    surviving entity but in which securities possessing more than
    fifty percent (50%) of the total combined voting power of the
    Company’s outstanding securities are transferred or issued
    to a person or persons different from those who held such
    securities immediately prior to such merger.



 



    1.10  Director.  “Director”
    shall mean a member of the Board.



 



    1.11  Dividend
    Equivalent.  “Dividend Equivalent”
    shall mean a right to receive the equivalent value (in cash or
    Common Stock) of dividends paid on Common Stock, awarded under
    Article VII of this Plan.



 



    1.12  Employee.  “Employee”
    shall mean any officer or other employee (as defined in
    accordance with Section 3401(c) of the Code) of the
    Company, or of any corporation which is a Subsidiary.



 



    1.13  Equity
    Restructuring.  “Equity
    Restructuring” shall mean a nonreciprocal transaction
    between the Company and its stockholders, such as a stock
    dividend, stock split, spin-off, rights offering or
    recapitalization through a large, nonrecurring cash dividend,
    that affects the number or kind of shares of Common Stock (or
    other securities of the Company) or the share price of Common
    Stock (or other securities) and causes a change in the per share
    value of the Common Stock underlying outstanding awards.



 



    1.14  Exchange
    Act.  “Exchange Act” shall mean the
    Securities Exchange Act of 1934, as amended.



 



    1.15  Fair Market
    Value.  “Fair Market Value” of a
    share of Common Stock as of a given date shall be (i) the
    closing price of a share of Common Stock on the principal
    exchange on which shares of Common Stock are then trading or
    quoted, if any (or as reported on any composite index which
    includes such principal exchange), on such date, or if shares
    were not traded on such date, then on the next following date on
    which a trade occurs, or (ii) if Common Stock is not traded
    on an exchange but is quoted on NASDAQ or a successor quotation
    system, the closing price of a share of Common Stock on such
    date as reported by NASDAQ or such successor quotation system;
    or (iii) if Common Stock is not publicly traded on an exchange
    and not quoted on NASDAQ or a successor quotation system, the
    Fair Market Value of a share of Common Stock as established by
    the Committee (or the Board, in the case of awards granted to
    Independent Directors) acting in good faith.”




    

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    1.16  Grantee.  “Grantee”
    shall mean an Employee, Director or consultant granted a
    Performance Award, Dividend Equivalent, Stock Payment or Stock
    Appreciation Right, or an award of Restricted Stock Units, under
    this Plan.



 



    1.17  Incentive Stock
    Option.  “Incentive Stock Option”
    shall mean an option which conforms to the applicable provisions
    of Section 422 of the Code and which is designated as an
    Incentive Stock Option by the Committee.



 



    1.18  Independent
    Director.  “Independent Director”
    shall mean a member of the Board who is not an Employee of the
    Company.



 



    1.19  Non-Qualified Stock
    Option.  “Non-Qualified Stock
    Option” shall mean an Option which is not designated as an
    Incentive Stock Option by the Committee.



 



    1.20  Option.  “Option”
    shall mean a stock option granted under Article III of this
    Plan. An Option granted under this Plan shall, as determined by
    the Committee, be either a Non-Qualified Stock Option or an
    Incentive Stock Option; provided, however, that
    Options granted to Independent Directors and consultants shall
    be Non-Qualified Stock Options.



 



    1.21  Optionee.  “Optionee”
    shall mean an Employee, Director or consultant granted an Option
    under this Plan.



 



    1.22  Performance
    Award.  “Performance Award” shall
    mean a cash bonus, stock bonus or other performance or incentive
    award that is paid in cash, Common Stock or a combination of
    both, awarded under Article VII of this Plan.



 



    1.23  Plan.  “Plan”
    shall mean The 1996 Equity Participation Plan of ViaSat, Inc.



 



    1.24  QDRO.  “QDRO”
    shall mean a qualified domestic relations order as defined by
    the Code or Title I of the Employee Retirement Income
    Security Act of 1974, as amended, or the rules thereunder.



 



    1.25  Restricted
    Stock.  “Restricted Stock” shall
    mean Common Stock awarded under Article VI of this Plan.



 



    1.26  Restricted Stock
    Unit.  “Restricted Stock Unit” shall
    mean a right to receive Common Stock awarded under
    Article VII of this Plan.



 



    1.27  Restricted
    Stockholder.  “Restricted
    Stockholder” shall mean an Employee, Director or consultant
    granted an award of Restricted Stock under Article VI of
    this Plan.



 



    1.28  Rule 16b-3.  “Rule 16b-3”
    shall mean that certain
    Rule 16b-3
    under the Exchange Act, as such Rule may be amended from time to
    time.



 



    1.29  Stock Appreciation
    Right.  “Stock Appreciation Right”
    shall mean a stock appreciation right granted under
    Article VIII of this Plan.



 



    1.30  Stock
    Payment.  “Stock Payment” shall mean
    (i) a payment in the form of shares of Common Stock, or
    (ii) an option or other right to purchase shares of Common
    Stock, as part of a deferred compensation arrangement, made in
    lieu of all or any portion of the compensation, including
    without limitation, salary, bonuses and commissions, that would
    otherwise become payable to a key Employee, Director or
    consultant in cash, awarded under Article VII of this Plan.



 



    1.31  Subsidiary.  “Subsidiary”
    shall mean any corporation in an unbroken chain of corporations
    beginning with the Company if each of the corporations other
    than the last corporation in the unbroken chain then owns stock
    possessing 50 percent (50%) or more of the total combined
    voting power of all classes of stock in one of the other
    corporations in such chain.



 



    1.32  Termination of
    Consultancy.  “Termination of
    Consultancy” shall mean the time when the engagement of an
    Optionee, Grantee or Restricted Stockholder as a consultant to
    the Company or a Subsidiary is terminated for any reason, with
    or without cause, including, but not by way of limitation, by
    resignation, discharge, death or retirement; but excluding
    terminations where there is a simultaneous commencement of
    employment with the




    

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    Company or any Subsidiary. The Committee, in its absolute
    discretion, shall determine the effect of all matters and
    questions relating to Termination of Consultancy, including, but
    not by way of limitation, the question of whether a Termination
    of Consultancy resulted from a discharge for good cause, and all
    questions of whether particular leaves of absence constitute
    Terminations of Consultancy. Notwithstanding any other provision
    of this Plan, the Company or any Subsidiary has an absolute and
    unrestricted right to terminate a consultant’s service at
    any time for any reason whatsoever, with or without cause,
    except to the extent expressly provided otherwise in writing.



 



    1.33  Termination of
    Directorship.  “Termination of
    Directorship” shall mean the time when an Optionee who is
    an Independent Director ceases to be a Director for any reason,
    including, but not by way of limitation, a termination by
    resignation, failure to be elected, death or retirement. The
    Board, in its sole and absolute discretion, shall determine the
    effect of all matters and questions relating to Termination of
    Directorship with respect to Independent Directors.



 



    1.34  Termination of
    Employment.  “Termination of
    Employment” shall mean the time when the employee-employer
    relationship between an Optionee, Grantee or Restricted
    Stockholder and the Company or any Subsidiary is terminated for
    any reason, with or without cause, including, but not by way of
    limitation, a termination by resignation, discharge, death,
    disability or retirement; but excluding (i) terminations
    where there is a simultaneous reemployment or continuing
    employment of an Optionee, Grantee or Restricted Stockholder by
    the Company or any Subsidiary, (ii) at the discretion of
    the Committee, terminations which result in a temporary
    severance of the employee-employer relationship, and
    (iii) terminations which are followed by the simultaneous
    establishment of a consulting relationship by the Company or a
    Subsidiary with the former employee. The Committee, in its
    absolute discretion, shall determine the effect of all matters
    and questions relating to Termination of Employment, including,
    but not by way of limitation, the question of whether a
    Termination of Employment resulted from a discharge for good
    cause, and all questions of whether particular leaves of absence
    constitute Terminations of Employment. Notwithstanding any other
    provision of this Plan, the Company or any Subsidiary has an
    absolute and unrestricted right to terminate an Employee’s
    employment at any time for any reason whatsoever, with or
    without cause, except to the extent expressly provided otherwise
    in writing.



 




    ARTICLE II.

    



 




    SHARES
    SUBJECT TO PLAN
    



 



    2.1  Shares Subject to Plan.  



 



    (a) The shares of stock subject to Options, awards of
    Restricted Stock, Performance Awards, Dividend Equivalents,
    awards of Restricted Stock Units, Stock Payments or Stock
    Appreciation Rights shall be Common Stock, initially shares of
    the Company’s Common Stock, par value $0.0001 per share.
    The aggregate number of such shares which may be issued upon
    exercise of such options or rights or upon any such awards under
    the Plan shall not exceed 12,600,000. The shares of Common Stock
    issuable upon exercise of such options or rights or upon any
    such awards may be either previously authorized but unissued
    shares or treasury shares.



 



    (b) Any shares subject to Options or Stock Appreciation
    Rights shall be counted against the numerical limit of
    Section 2.1(a) as one share for every share subject
    thereto. Any shares subject to awards of Restricted Stock,
    Performance Awards, Dividend Equivalents, awards of Restricted
    Stock Units, or Stock Payments with a per share purchase price
    lower than 100% of Fair Market Value on the date of grant will
    be counted against the numerical limit of Section 2.1(a) as
    two shares for every one share subject thereto. To the extent
    that a share that was subject to an award that counted as two
    shares against the Plan reserve pursuant to the preceding
    sentence is recycled back into the Plan under Section 2.2,
    the Plan will be credited with two shares. To the extent that
    shares are delivered pursuant to the exercise of a Stock
    Appreciation Right, the number of underlying shares as to which
    the exercise related shall be counted against the Plan’s
    share limits set forth above, as opposed to only counting the
    shares actually issued. For example, if a Stock Appreciation
    Right relates to 100,000 shares and is exercised at a time
    when the payment due to the holder is 50,000 shares,
    100,000 shares shall be charged against the Plan’s
    share limits with respect to such exercise.



 



    (c) The maximum number of shares which may be subject to
    awards granted under the Plan to any individual in any fiscal
    year, and the maximum aggregate amount of cash that may be paid
    in cash during any fiscal year with




    

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    respect to awards designated to be paid in cash, shall not
    exceed the applicable Award Limit. To the extent required by
    Section 162(m) of the Code, shares subject to Options which are
    canceled continue to be counted against the Award Limit and if,
    after grant of an Option, the Company stockholders approve an
    option exchange program whereby the price of shares subject to
    such Option is reduced, the transaction is treated as a
    cancellation of the Option and a grant of a new Option and both
    the Option deemed to be canceled and the Option deemed to be
    granted are counted against the Award Limit. Furthermore, to the
    extent required by Section 162(m) of the Code, if, after
    grant of a Stock Appreciation Right, the base amount on which
    stock appreciation is calculated is reduced to reflect a
    reduction in the Fair Market Value of the Company’s Common
    Stock, the transaction is treated as a cancellation of the Stock
    Appreciation Right and a grant of a new Stock Appreciation Right
    and both the Stock Appreciation Right deemed to be canceled and
    the Stock Appreciation Right deemed to be granted are counted
    against the Award Limit.



 



    2.2  Add-Back of Options and Other
    Rights.  If any Option, or other right to
    acquire shares of Common Stock under any other award under this
    Plan, expires or is canceled without having been fully
    exercised, or an award is settled in cash without the delivery
    of shares of Common Stock to the award holder, the number of
    shares subject to such Option or other right but as to which
    such Option or other right was not exercised prior to its
    expiration or cancellation may again be optioned, granted or
    awarded hereunder, subject to the limitations of
    Section 2.1. Furthermore, any shares subject to Options or
    other awards which are adjusted pursuant to Section 10.3
    and become exercisable with respect to shares of stock of
    another corporation shall be considered canceled and may again
    be optioned, granted or awarded hereunder, subject to the
    limitations of Section 2.1. If any share of Restricted
    Stock is forfeited by the Restricted Stockholder or repurchased
    by the Company pursuant to Section 6.6 hereof, such share
    may again be optioned, granted or awarded hereunder, subject to
    the limitations of Section 2.1. Any shares of Common Stock
    tendered or withheld to satisfy (a) the exercise price of
    an Option or (b) the tax withholding obligation pursuant to
    any award may not again be optioned, granted or awarded
    hereunder.



 




    ARTICLE III.

    



 




    GRANTING OF
    OPTIONS
    



 



    3.1  Eligibility.  Any
    Employee or consultant selected by the Committee pursuant to
    Section 3.4(a)(i) shall be eligible to be granted an
    Option. Each Independent Director of the Company shall be
    eligible to be granted Options at the times and in the manner
    set forth in Section 3.4(d).



 



    3.2  Disqualification for Stock
    Ownership.  No person may be granted an
    Incentive Stock Option under this Plan if such person, at the
    time the Incentive Stock Option is granted, owns stock
    possessing more than ten percent (10%) of the total combined
    voting power of all classes of stock of the Company or any then
    existing Subsidiary or parent corporation (within the meaning of
    Section 422 of the Code) unless such Incentive Stock Option
    conforms to the applicable provisions of Section 422 of the
    Code.



 



    3.3  Qualification of Incentive Stock
    Options.  No Incentive Stock Option shall be
    granted to any person who is not an Employee.



 



    3.4  Granting of Options.  



 



    (a) The Committee shall from time to time, in its absolute
    discretion, and subject to applicable limitations of this Plan:



 



    (i) Determine which Employees are key Employees and select
    from among the key Employees or consultants (including Employees
    or consultants who have previously received Options or other
    awards under this Plan) such of them as in its opinion should be
    granted Options;



 



    (ii) Subject to the Award Limit, determine the number of
    shares to be subject to such Options granted to the selected key
    Employees or consultants;



 



    (iii) Subject to Section 3.3, determine whether such
    Options are to be Incentive Stock Options or Non-Qualified Stock
    Options and whether such Options are to qualify as
    performance-based compensation as described in
    Section 162(m)(4)(C) of the Code; and




    

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    (iv) Determine the terms and conditions of such Options,
    consistent with this Plan; provided, however, that the
    terms and conditions of Options intended to qualify as
    performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall include, but not be
    limited to, such terms and conditions as may be necessary to
    meet the applicable provisions of Section 162(m) of the
    Code.



 



    (b) Upon the selection of a key Employee or consultant to
    be granted an Option, the Committee shall instruct the Secretary
    of the Company to issue the Option and may impose such
    conditions on the grant of the Option as it deems appropriate.
    Without limiting the generality of the preceding sentence, the
    Committee may, in its discretion and on such terms as it deems
    appropriate, require as a condition on the grant of an Option to
    an Employee or consultant that the Employee or consultant
    surrender for cancellation some or all of the unexercised
    Options, awards of Restricted Stock or Restricted Stock Units,
    Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments or other rights which have been
    previously granted to him under this Plan or otherwise. An
    Option, the grant of which is conditioned upon such surrender,
    may have an option price lower (or higher) than the exercise
    price of such surrendered Option or other award, may cover the
    same (or a lesser or greater) number of shares as such
    surrendered Option or other award, may contain such other terms
    as the Committee deems appropriate, and shall be exercisable in
    accordance with its terms, without regard to the number of
    shares, price, exercise period or any other term or condition of
    such surrendered Option or other award; provided,
    however, except as permitted under Section 10.3 of the
    Plan, no Option or Stock Appreciation Right shall, without
    stockholder approval, be (i) repriced, exchanged for an
    Option or Stock Appreciation Right with a lower price or
    otherwise modified where the effect would be to reduce the
    exercise price of the Option or Stock Appreciation Right; or
    (ii) exchanged for cash or an alternate award under the
    Plan.



 



    (c) Any Incentive Stock Option granted under this Plan may
    be modified by the Committee to disqualify such option from
    treatment as an “incentive stock option” under
    Section 422 of the Code.



 



    (d) During the term of the Plan, each person who is an
    Independent Director as of the date of the consummation of the
    initial public offering of Common Stock automatically shall be
    granted (i) an Option to purchase Fifteen Thousand (15,000)
    shares of Common Stock (subject to adjustment as provided in
    Section 10.3) on the date of such initial public offering
    and (ii) an Option to purchase Ten Thousand (10,000) shares
    of Common Stock (subject to adjustment as provided in Section
    10.3) on the date of each annual meeting of stockholders after
    such initial public offering at which directors are elected to
    the Board. During the term of the Plan, a person who is
    initially elected to the Board after the consummation of the
    initial public offering of Common Stock and who is an
    Independent Director at the time of such initial election
    automatically shall be granted (i) an Option to purchase
    Fifteen Thousand (15,000) shares of Common Stock (subject to
    adjustment as provided in Section 10.3) on the date of such
    initial election and (ii) an Option to purchase Ten
    Thousand (10,000) shares of Common Stock (subject to adjustment
    as provided in Section 10.3) on the date of each annual
    meeting of stockholders after such initial election at which
    directors are elected to the Board. Members of the Board who are
    employees of the Company who subsequently retire from the
    Company and remain on the Board will not receive an initial
    Option grant pursuant to clause (i) of the preceding
    sentence, but to the extent that they are otherwise eligible,
    will receive, after retirement from employment with the Company,
    Options as described in clause (ii) of the preceding
    sentence.



 




    ARTICLE IV.

    



 




    TERMS OF
    OPTIONS
    



 



    4.1  Option Agreement.  Each
    Option shall be evidenced by a written Stock Option Agreement,
    which shall be executed by the Optionee and an authorized
    officer of the Company and which shall contain such terms and
    conditions as the Committee (or the Board, in the case of
    Options granted to Independent Directors) shall determine,
    consistent with this Plan. Stock Option Agreements evidencing
    Options intended to qualify as performance-based compensation as
    described in Section 162(m)(4)(C) of the Code shall contain
    such terms and conditions as may be necessary to meet the
    applicable provisions of Section 162(m) of the Code. Stock
    Option Agreements evidencing Incentive Stock Options shall
    contain such terms and conditions as may be necessary to meet
    the applicable provisions of Section 422 of the Code.




    

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    4.2  Option Price.  The price
    per share of the shares subject to each Option shall be set by
    the Committee; provided, however, that such price shall
    not be less than 100% of the Fair Market Value of a share of
    Common Stock on the date the Option is granted and in the case
    of Incentive Stock Options granted to an individual then owning
    (within the meaning of Section 424(d) of the Code) more
    than 10% of the total combined voting power of all classes of
    stock of the Company or any Subsidiary or parent corporation
    thereof (within the meaning of Section 422 of the Code)
    such price shall not be less than 110% of the Fair Market Value
    of a share of Common Stock on the date the Option is granted.



 



    4.3  Option Term.  The term of
    an Option shall be set by the Committee in its discretion;
    provided, however, that no Option shall have a term
    longer than six (6) years from the date the Option is
    granted and in the case of Incentive Stock Options granted to an
    individual then owning (within the meaning of
    Section 424(d) of the Code) more than 10% of the total
    combined voting power of all classes of stock of the Company or
    any Subsidiary or parent corporation thereof (within the meaning
    of Section 422 of the Code) the term may not exceed five
    (5) years from such date if the Incentive Stock Option is
    granted. Except as limited by requirements of Section 422
    of the Code and regulations and rulings thereunder applicable to
    Incentive Stock Options, the Committee may extend the term of
    any outstanding Option in connection with any Termination of
    Employment or Termination of Consultancy of the Optionee, or
    amend any other term or condition of such Option relating to
    such a termination.



 



    4.4  Option Vesting.  



 



    (a) The period during which the right to exercise an Option
    in whole or in part vests in the Optionee shall be set by the
    Committee and the Committee may determine that an Option may not
    be exercised in whole or in part for a specified period after it
    is granted; provided, however, that, Options granted to
    Independent Directors shall become (i) exercisable in
    cumulative annual installments of 331/3% on each of the first,
    second and third anniversaries of the date of Option grant for
    grants made on the initial election of a Independent Director
    and (ii) fully exercisable on the one year anniversary of
    the date of Option grant for grants made on the date of each
    annual meeting after such initial election at which directors
    are elected to the Board, without variation or acceleration
    hereunder except as provided in Section 10.3(b). At any
    time after grant of an Option, the Committee may, in its sole
    and absolute discretion and subject to whatever terms and
    conditions it selects, accelerate the period during which an
    Option (except an Option granted to an Independent Director)
    vests. The Committee may also provide that the vesting of an
    Option granted under the Plan which is intended to qualify as
    performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1.



 



    (b) No portion of an Option which is unexercisable at
    Termination of Employment, Termination of Directorship or
    Termination of Consultancy, as applicable, shall thereafter
    become exercisable, except as may be otherwise provided by the
    Committee (or the Board, in the case of Options granted to
    Independent Directors) in the case of Options granted to
    Employees or consultants either in the Stock Option Agreement or
    by action of the Committee (or the Board, in the case of Options
    granted to Independent Directors) following the grant of the
    Option.



 



    (c) To the extent that the aggregate Fair Market Value of
    stock with respect to which “incentive stock options”
    (within the meaning of Section 422 of the Code, but without
    regard to Section 422(d) of the Code) are exercisable for
    the first time by an Optionee during any calendar year (under
    the Plan and all other incentive stock option plans of the
    Company and any Subsidiary) exceeds $100,000, such Options shall
    be treated as Non-Qualified Options to the extent required by
    Section 422 of the Code. The rule set forth in the
    preceding sentence shall be applied by taking Options into
    account in the order in which they were granted. For purposes of
    this Section 4.4(c), the Fair Market Value of stock shall
    be determined as of the time the Option with respect to such
    stock is granted.



 



    4.5  Consideration.  In
    consideration of the granting of an Option, the Optionee shall
    agree, in the written Stock Option Agreement, to remain in the
    employ of (or to consult for or to serve as an Independent
    Director of, as applicable) the Company or any Subsidiary for a
    period of at least one year (or such shorter period as may be
    fixed in the Stock Option Agreement or by action of the
    Committee following grant of the Option) after the Option is
    granted (or, in the case of an Independent Director, until the
    next annual meeting of stockholders of the Company). Nothing in
    this Plan or in any Stock Option Agreement hereunder shall
    confer upon any Optionee any right to continue in the employ of,
    or as a consultant for, the Company or any Subsidiary, or as a
    director of the Company, or shall interfere with or restrict in
    any way the rights of the Company and any Subsidiary, which are
    hereby expressly reserved, to discharge any Optionee at any time
    for any reason whatsoever, with or without good cause.




    

    7








 







    ARTICLE V.

    



 




    EXERCISE OF
    OPTIONS
    



 



    5.1  Partial Exercise.  An
    exercisable Option may be exercised in whole or in part.
    However, an Option shall not be exercisable with respect to
    fractional shares and the Committee (or the Board, in the case
    of Options granted to Independent Directors) may require that,
    by the terms of the Option, a partial exercise be with respect
    to a minimum number of shares.



 



    5.2  Manner of Exercise.  All
    or a portion of an exercisable Option shall be deemed exercised
    upon delivery of all of the following to the Secretary of the
    Company or his office:



 



    (a) A written notice complying with the applicable rules
    established by the Committee (or the Board, in the case of
    Options granted to Independent Directors) stating that the
    Option, or a portion thereof, is exercised. The notice shall be
    signed by the Optionee or other person then entitled to exercise
    the Option or such portion;



 



    (b) Such representations and documents as the Committee (or
    the Board, in the case of Options granted to Independent
    Directors), in its absolute discretion, deems necessary or
    advisable to effect compliance with all applicable provisions of
    the Securities Act of 1933, as amended, and any other federal or
    state securities laws or regulations. The Committee or Board
    may, in its absolute discretion, also take whatever additional
    actions it deems appropriate to effect such compliance
    including, without limitation, placing legends on share
    certificates and book entries and issuing stop-transfer notices
    to agents and registrars;



 



    (c) In the event that the Option shall be exercised
    pursuant to Section 10.1 by any person or persons other
    than the Optionee, appropriate proof of the right of such person
    or persons to exercise the Option; and



 



    (d) Full cash payment to the Secretary of the Company for
    the shares with respect to which the Option, or portion thereof,
    is exercised. However, the Committee (or the Board, in the case
    of Options granted to Independent Directors), may in its
    discretion, (i) allow a delay in payment up to thirty
    (30) days from the date the Option, or portion thereof, is
    exercised; (ii) allow payment, in whole or in part, through
    the delivery of shares of Common Stock owned by the Optionee,
    duly endorsed for transfer to the Company with a Fair Market
    Value on the date of delivery equal to the aggregate exercise
    price of the Option or exercised portion thereof;
    (iii) allow payment, in whole or in part, through the
    surrender of shares of Common Stock then issuable upon exercise
    of the Option having a Fair Market Value on the date of Option
    exercise equal to the aggregate exercise price of the Option or
    exercised portion thereof; (iv) allow payment, in whole or
    in part, through the delivery of property of any kind which
    constitutes good and valuable consideration; (v) allow
    payment, in whole or in part, through the delivery of a full
    recourse promissory note bearing interest (at no less than such
    rate as shall then preclude the imputation of interest under the
    Code) and payable upon such terms as may be prescribed by the
    Committee or the Board; (vi) allow payment, in whole or in
    part, through the delivery of a notice that the Optionee has
    placed a market sell order with a broker with respect to shares
    of Common Stock then issuable upon exercise of the Option, and
    that the broker has been directed to pay a sufficient portion of
    the net proceeds of the sale to the Company in satisfaction of
    the Option exercise price; or (vii) allow payment through
    any combination of the consideration provided in the foregoing
    subparagraphs (ii), (iii), (iv), (v) and (vi). In the case
    of a promissory note, the Committee (or the Board, in the case
    of Options granted to Independent Directors) may also prescribe
    the form of such note and the security to be given for such
    note. The Option may not be exercised, however, by delivery of a
    promissory note or by a loan or other extension of credit from
    the Company when or where such loan or other extension of credit
    is prohibited by law.



 



    5.3  Conditions to Issuance of
    Shares.  The Company shall not be required to
    issue or deliver any certificate or certificates, or make any
    book entries, for shares of stock purchased upon the exercise of
    any Option or portion thereof prior to fulfillment of all of the
    following conditions:



 



    (a) The admission of such shares to listing on all stock
    exchanges on which such class of stock is then listed;



 



    (b) The completion of any registration or other
    qualification of such shares under any state or federal law, or
    under the rulings or regulations of the Securities and Exchange
    Commission or any other governmental regulatory body which the
    Committee or Board shall, in its absolute discretion, deem
    necessary or advisable;




    

    8








 






    (c) The obtaining of any approval or other clearance from
    any state or federal governmental agency which the Committee (or
    Board, in the case of Options granted to Independent Directors)
    shall, in its absolute discretion, determine to be necessary or
    advisable;



 



    (d) The lapse of such reasonable period of time following
    the exercise of the Option as the Committee (or Board, in the
    case of Options granted to Independent Directors) may establish
    from time to time for reasons of administrative
    convenience; and



 



    (e) The receipt by the Company of full payment for such
    shares, including payment of any applicable withholding tax.



 



    Notwithstanding any other provision of the Plan, unless
    otherwise determined by the Committee (or the Board, in the case
    of Options granted to Independent Directors) or required by any
    applicable law, rule or regulation, the Company shall not
    deliver to any Optionee certificates evidencing shares of Common
    Stock issued in connection with any Option and instead such
    shares of Common Stock shall be recorded in the books of the
    Company (or, as applicable, its transfer agent or stock plan
    administrator).



 



    5.4  Rights as
    Stockholders.  The holders of Options shall
    not be, nor have any of the rights or privileges of,
    stockholders of the Company in respect of any shares purchasable
    upon the exercise of any part of an Option unless and until
    certificates representing such shares have been issued by the
    Company to such holders or book entries evidencing such shares
    have been made by the Company.



 



    5.5  Ownership and Transfer
    Restrictions.  The Committee (or Board, in the
    case of Options granted to Independent Directors), in its
    absolute discretion, may impose such restrictions on the
    ownership and transferability of the shares purchasable upon the
    exercise of an Option as it deems appropriate. Any such
    restriction shall be set forth in the respective Stock Option
    Agreement and may be referred to on the certificates or book
    entries evidencing such shares. The Committee may require the
    Employee to give the Company prompt notice of any disposition of
    shares of Common Stock acquired by exercise of an Incentive
    Stock Option within (i) two years from the date of granting
    such Option to such Employee or (ii) one year after the
    transfer of such shares to such Employee. The Committee may
    direct that the certificates or book entries evidencing shares
    acquired by exercise of an Option refer to such requirement to
    give prompt notice of disposition.



 



    5.6  Limitations on Exercise of Options Granted
    to Independent Directors.  No Option granted
    to an Independent Director may be exercised to any extent by
    anyone after the first to occur of the following events:



 



    (a) The expiration of twelve (12) months from the date
    of the Optionee’s death;



 



    (b) The expiration of twelve (12) months from the date
    of the Optionee’s Termination of Directorship, Termination
    of Consultancy or Termination of Employment by reason of his
    permanent and total disability (within the meaning of
    Section 22(e)(3) of the Code);



 



    (c) The expiration of three (3) months from the last
    to occur of the Optionee’s Termination of Directorship,
    Termination of Consultancy or Termination of Employment, unless
    the Optionee dies within said three-month period; or



 



    (d) The expiration of six (6) years from the date the
    Option was granted.



 




    ARTICLE VI.

    



 




    AWARD OF
    RESTRICTED STOCK
    



 



    6.1  Award of Restricted Stock.



 



    (a) The Committee (or the Board, in the case of Restricted
    Stock awarded to Independent Directors) may from time to time,
    in its absolute discretion:



 



    (i) Select from among the key Employees, consultants or
    Independent Directors (including Employees, consultants or
    Independent Directors who have previously received other awards
    under this Plan) such of them as in its opinion should be
    awarded Restricted Stock; and




    

    9








 






    (ii) Determine the purchase price, if any, and other terms
    and conditions applicable to such Restricted Stock, consistent
    with this Plan.



 



    (b) The Committee (or the Board, in the case of Restricted
    Stock awarded to Independent Directors) shall establish the
    purchase price, if any, and form of payment for Restricted
    Stock; provided, however, that such purchase price shall
    be no less than the par value of the Common Stock to be
    purchased, unless otherwise permitted by applicable state law.
    In all cases, legal consideration shall be required for each
    issuance of Restricted Stock.



 



    (c) Upon the selection of a key Employee, consultant or
    Independent Director to be awarded Restricted Stock, the
    Committee (or the Board, in the case of Restricted Stock awarded
    to Independent Directors) shall instruct the Secretary of the
    Company to issue such Restricted Stock and may impose such
    conditions on the issuance of such Restricted Stock as it deems
    appropriate.



 



    6.2  Restricted Stock
    Agreement.  Restricted Stock shall be issued
    only pursuant to a written Restricted Stock Agreement, which
    shall be executed by the selected key Employee, consultant or
    Independent Director and an authorized officer of the Company
    and which shall contain such terms and conditions as the
    Committee (or the Board, in the case of Restricted Stock granted
    to an Independent Director) shall determine, consistent with
    this Plan. The issuance of any shares of Restricted Stock shall
    be made subject to satisfaction of all provisions of
    Section 5.3.



 



    6.3  Consideration.  As
    consideration for the issuance of Restricted Stock, in addition
    to payment of any purchase price, the Restricted Stockholder
    shall agree, in the written Restricted Stock Agreement, to
    remain in the employ of, to consult for, or to remain as an
    Independent Director of, as applicable, the Company or any
    Subsidiary for a period of at least one year after the
    Restricted Stock is issued (or such shorter period as may be
    fixed in the Restricted Stock Agreement or by action of the
    Committee (or the Board, in the case of Restricted Stock granted
    to an Independent Director) following grant of the Restricted
    Stock or, in the case of an Independent Director, until the next
    annual meeting of stockholders of the Company). Nothing in this
    Plan or in any Restricted Stock Agreement hereunder shall confer
    on any Restricted Stockholder any right to continue in the
    employ of, as a consultant for or as an Independent Director of
    the Company or any Subsidiary or shall interfere with or
    restrict in any way the rights of the Company and any
    Subsidiary, which are hereby expressly reserved, to discharge
    any Restricted Stockholder at any time for any reason
    whatsoever, with or without good cause.



 



    6.4  Rights as
    Stockholders.  Upon delivery of the shares of
    Restricted Stock to the escrow holder pursuant to
    Section 6.7, the Restricted Stockholder shall have, unless
    otherwise provided by the Committee (or the Board, in the case
    of Restricted Stock granted to an Independent Director), all the
    rights of a stockholder with respect to said shares, subject to
    the restrictions in his Restricted Stock Agreement, including
    the right to receive all dividends and other distributions paid
    or made with respect to the shares; provided, however,
    that in the discretion of the Committee (or the Board, in the
    case of Restricted Stock granted to an Independent Director),
    any extraordinary distributions with respect to the Common Stock
    shall be subject to the restrictions set forth in
    Section 6.5.



 



    6.5  Restriction.  All shares
    of Restricted Stock issued under this Plan (including any shares
    received by holders thereof with respect to shares of Restricted
    Stock as a result of stock dividends, stock splits or any other
    form of recapitalization) shall, in the terms of each individual
    Restricted Stock Agreement, be subject to such restrictions as
    the Committee (or the Board, in the case of Restricted Stock
    granted to an Independent Director) shall provide, which
    restrictions may include, without limitation, restrictions
    concerning voting rights and transferability and vesting
    restrictions based on duration of employment with the Company,
    Company performance and individual performance; provided,
    further, that by action taken after the Restricted Stock is
    issued, the Committee (or the Board, in the case of Restricted
    Stock granted to an Independent Director) may, on such terms and
    conditions as it may determine to be appropriate, remove any or
    all of the restrictions imposed by the terms of the Restricted
    Stock Agreement. The Committee may also provide that the vesting
    of Restricted Stock granted under the Plan which is intended to
    qualify as performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1.
    Notwithstanding the foregoing, except as permitted under
    Section 10.3 of the Plan, shares of Restricted Stock will
    vest no more rapidly than ratably over a three (3) year
    period from the date of grant, unless the Committee (or the
    Board, in the case of Restricted Stock granted to an Independent
    Director) determines that the Restricted Stock award is to vest
    upon the achievement of one or more performance goals, in which
    case the period for




    

    10








 






    measuring performance will be at least twelve (12) months.
    Restricted Stock may not be sold or encumbered until all
    restrictions are terminated or expire.



 



    6.6  Repurchase or Forfeiture of Restricted
    Stock.  The Committee (or the Board, in the
    case of Restricted Stock granted to an Independent Director)
    shall provide in the terms of each individual Restricted Stock
    Agreement that the Company shall have the right to repurchase
    from the Restricted Stockholder the Restricted Stock then
    subject to restrictions under the Restricted Stock Agreement
    immediately upon a Termination of Employment, Termination of
    Consultancy or Termination of Directorship between the
    Restricted Stockholder and the Company, at a cash price per
    share equal to the price paid by the Restricted Stockholder for
    such Restricted Stock; provided, however, that provision
    may be made that no such right of repurchase shall exist in the
    event of a Termination of Employment, Termination of Consultancy
    or Termination of Directorship without cause, or following a
    change in control of the Company or because of the Restricted
    Stockholder’s retirement, death or disability, or
    otherwise. Unless provided otherwise by the Committee (or the
    Board, in the case of Restricted Stock granted to an Independent
    Director), if no cash consideration was paid by the Restricted
    Stockholder upon issuance, a Restricted Stockholder’s
    rights in unvested Restricted Stock shall lapse upon the last to
    occur of Termination of Employment, Termination of Consultancy
    or Termination of Directorship with the Company.



 



    6.7  Escrow.  The Secretary of
    the Company or such other escrow holder as the Committee (or the
    Board, in the case of Restricted Stock granted to an Independent
    Director) may appoint shall retain physical custody of each
    certificate representing Restricted Stock until all of the
    restrictions imposed under the Restricted Stock Agreement with
    respect to the shares evidenced by such certificate expire or
    shall have been removed.



 



    6.8  Legend.  In order to
    enforce the restrictions imposed upon shares of Restricted Stock
    hereunder, the Committee (or the Board, in the case of
    Restricted Stock granted to an Independent Director) shall cause
    a legend or legends to be placed on certificates or book entries
    representing all shares of Restricted Stock that are still
    subject to restrictions under Restricted Stock Agreements, which
    legend or legends shall make appropriate reference to the
    conditions imposed thereby.



 




    ARTICLE VII.

    



 




    PERFORMANCE
    AWARDS, DIVIDEND EQUIVALENTS, RESTRICTED STOCK UNITS,

    





    STOCK
    PAYMENTS
    



 



    7.1  Performance Awards.  Any
    key Employee, consultant or Independent Director selected by the
    Committee (or the Board, in the case of an award to an
    Independent Director) may be granted one or more Performance
    Awards. The Committee shall select the performance criteria (and
    any permissible adjustments) for each Performance Award for
    purposes of establishing the performance goal or performance
    goals applicable to such Performance Award for the designated
    performance period. The performance criteria that shall be used
    to establish such performance goals shall be limited to the
    following: (a) net earnings (either before or after one or
    more of the following: (i) interest, (ii) taxes,
    (iii) depreciation and (iv) amortization),
    (b) gross or net sales or revenue, (c) net income
    (either before or after taxes), (d) operating earnings or
    profit, (e) cash flow (including, but not limited to,
    operating cash flow and free cash flow), (f) return on
    assets, (g) return on capital, (h) return on
    stockholders’ equity, (i) return on sales,
    (j) gross or net profit or operating margin,
    (k) costs, (l) funds from operations,
    (m) expenses, (n) working capital, (o) earnings
    per share, or (p) price per share of the Common Stock, any
    of which may be measured either in absolute terms or as compared
    to any incremental increase or decrease or as compared to
    results of a peer group or to market performance indicators. The
    performance goals for a performance period shall be established
    in writing by the Committee (or the Board, in the case of an
    award to an Independent Director) based on one or more of the
    foregoing performance criteria, which goals may be expressed in
    terms of overall Company performance or the performance of a
    division, business unit or an individual. In making such
    determinations, the Committee (or the Board, in the case of an
    award to an Independent Director) shall consider (among such
    other factors as it deems relevant in light of the specific type
    of award) the contributions, responsibilities and other
    compensation of the particular key Employee, consultant or
    Independent Director.



 



    7.2  Dividend
    Equivalents.  Any key Employee, consultant or
    Independent Director selected by the Committee (or the Board, in
    the case of an award to an Independent Director) may be granted
    Dividend Equivalents




    

   11








 






    based on the dividends declared on Common Stock, to be credited
    as of dividend payment dates, during the period between the date
    an Option, Stock Appreciation Right, Restricted Stock Unit or
    Performance Award is granted, and the date such Option, Stock
    Appreciation Right, Restricted Stock Unit or Performance Award
    is exercised, vests or expires, as determined by the Committee
    (or the Board, in the case of an award to an Independent
    Director). Such Dividend Equivalents shall be converted to cash
    or additional shares of Common Stock by such formula and at such
    time and subject to such limitations as may be determined by the
    Committee (or the Board, in the case of an award to an
    Independent Director). Notwithstanding the foregoing, no
    Dividend Equivalents shall be payable with respect to Options or
    Stock Appreciation Rights.



 



    7.3  Stock Payments.  Any key
    Employee, consultant or Independent Director selected by the
    Committee (or the Board, in the case of an award to an
    Independent Director) may receive Stock Payments in the manner
    determined from time to time by the Committee. The number of
    shares shall be determined by the Committee (or the Board, in
    the case of an award to an Independent Director) and may be
    based upon the Fair Market Value, book value, net profits or
    other measure of the value of Common Stock or other specific
    performance criteria determined appropriate by the Committee (or
    the Board, in the case of an award to an Independent Director),
    determined on the date such Stock Payment is made or on any date
    thereafter. The Committee may provide that the vesting of Stock
    Payments granted under the Plan which are intended to qualify as
    performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1.



 



    7.4  Restricted Stock
    Units.  Any key Employee, consultant or
    Independent Director selected by the Committee (or the Board, in
    the case of an award to an Independent Director) may be granted
    an award of Restricted Stock Units in the manner determined from
    time to time by the Committee. The number of shares subject to a
    Restricted Stock Unit award shall be determined by the Committee
    (or the Board, in the case of an award to an Independent
    Director). The Committee may provide that the vesting of
    Restricted Stock Units granted under the Plan which are intended
    to qualify as performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1. Common Stock
    underlying a Restricted Stock Unit award will not be issued
    until the Restricted Stock Unit award has vested. Unless
    otherwise provided by the Committee (or the Board, in the case
    of an award to an Independent Director), a Grantee of Restricted
    Stock Units shall have no rights as a Company stockholder with
    respect to the shares of Common Stock underlying such Restricted
    Stock Units until such time as the award has vested and such
    Common Stock underlying the award has been issued.



 



    7.5  Performance Award Agreement, Dividend
    Equivalent Agreement, Restricted Stock Unit Agreement, Stock
    Payment Agreement.  Each Performance Award,
    Dividend Equivalent, award of Restricted Stock Units
    and/or Stock
    Payment shall be evidenced by a written agreement, which shall
    be executed by the Grantee and an authorized Officer of the
    Company and which shall contain such terms and conditions as the
    Committee (or the Board, in the case of an award to an
    Independent Director) shall determine, consistent with this Plan.



 



    7.6  Term.  The term of a
    Performance Award, Dividend Equivalent, award of Restricted
    Stock Unit
    and/or Stock
    Payment shall be set by the Committee (or the Board, in the case
    of an award to an Independent Director) in its discretion.



 



    7.7  Exercise Upon Termination of
    Employment.  A Performance Award, Dividend
    Equivalent, award of Restricted Stock Unit
    and/or Stock
    Payment is exercisable or payable only while the Grantee is an
    Employee, consultant or Independent Director; provided that the
    Committee may (or the Board, in the case of an award to an
    Independent Director) determine that the Performance Award,
    Dividend Equivalent, award of Restricted Stock Unit
    and/or Stock
    Payment may be exercised or paid subsequent to Termination of
    Employment, Termination of Consultancy or Termination of
    Directorship without cause, or following a change in control of
    the Company, or because of the Grantee’s retirement, death
    or disability, or otherwise.



 



    7.8  Payment on
    Exercise.  Payment of the amount determined
    under Section 7.1 or 7.2 above shall be in cash, in Common
    Stock or a combination of both, as determined by the Committee
    (or the Board, in the case of an award to an Independent
    Director). To the extent any payment under this Article VII
    is effected in Common Stock, it shall be made subject to
    satisfaction of all provisions of Section 5.3.




    

    12








 






    7.9  Consideration.  As
    consideration for the issuance of a Performance Award, Dividend
    Equivalent, award of Restricted Stock Unit
    and/or Stock
    Payment, the Grantee shall agree, in a written agreement, to
    remain in the employ of, to consult for, or to remain as an
    Independent Director of, as applicable, the Company or any
    Subsidiary for a period of at least one year after such
    Performance Award, Dividend Equivalent, award of Restricted
    Stock Unit
    and/or Stock
    Payment is granted (or such shorter period as may be fixed in
    such agreement or by action of the Committee (or the Board, in
    the case of an award to an Independent Director) following such
    grant or, in the case of an Independent Director, until the next
    annual meeting of stockholders of the Company). Nothing in this
    Plan or in any agreement hereunder shall confer on any Grantee
    any right to continue in the employ of, as a consultant for or
    as an Independent Director of the Company or any Subsidiary or
    shall interfere with or restrict in any way the rights of the
    Company and any Subsidiary, which are hereby expressly reserved,
    to discharge any Grantee at any time for any reason whatsoever,
    with or without good cause.



 




    ARTICLE VIII.

    



 




    STOCK
    APPRECIATION RIGHTS
    



 



    8.1  Grant of Stock Appreciation
    Rights.  A Stock Appreciation Right may be
    granted to any key Employee, consultant or Independent Director
    selected by the Committee (or the Board, in the case of an award
    to an Independent Director). A Stock Appreciation Right may be
    granted (i) in connection and simultaneously with the grant
    of an Option, (ii) with respect to a previously granted
    Option, or (iii) independent of an Option. A Stock
    Appreciation Right shall be subject to such terms and conditions
    not inconsistent with this Plan as the Committee (or the Board,
    in the case of an award to an Independent Director) shall impose
    and shall be evidenced by a written Stock Appreciation Right
    Agreement, which shall be executed by the Grantee and an
    authorized officer of the Company; provided,
    however, that no Stock Appreciation Right shall have a
    term longer than six (6) years from the date the Stock
    Appreciation Right is granted. The Committee, in its discretion,
    may determine whether a Stock Appreciation Right is to qualify
    as performance-based compensation as described in
    Section 162(m)(4)(C) of the Code and Stock Appreciation
    Right Agreements evidencing Stock Appreciation Rights intended
    to so qualify shall contain such terms and conditions as may be
    necessary to meet the applicable provisions of
    Section 162(m) of the Code, including providing that the
    vesting of such Stock Appreciation Rights shall occur upon the
    satisfaction of one or more performance goals based on the
    performance criteria set forth in Section 7.1. Without
    limiting the generality of the foregoing, the Committee may, in
    its discretion and on such terms as it deems appropriate,
    require as a condition of the grant of a Stock Appreciation
    Right to an Employee, consultant or Independent Director that
    the Employee, consultant or Independent Director surrender for
    cancellation some or all of the unexercised Options, awards of
    Restricted Stock or Restricted Stock Units, Performance Awards,
    Stock Appreciation Rights, Dividend Equivalents or Stock
    Payments, or other rights which have been previously granted to
    him under this Plan or otherwise. Subject to
    Section 3.4(b), a Stock Appreciation Right, the grant of
    which is conditioned upon such surrender, may have an exercise
    price lower (or higher) than the exercise price of the
    surrendered Option or other award, may cover the same (or a
    lesser or greater) number of shares as such surrendered Option
    or other award, may contain such other terms as the Committee
    deems appropriate, and shall be exercisable in accordance with
    its terms, without regard to the number of shares, price,
    exercise period or any other term or condition of such
    surrendered Option or other award.



 



    8.2  Coupled Stock Appreciation Rights.



 



    (a) A Coupled Stock Appreciation Right (“CSAR”)
    shall be related to a particular Option and shall be exercisable
    only when and to the extent the related Option is exercisable.



 



    (b) A CSAR may be granted to the Grantee for no more than
    the number of shares subject to the simultaneously or previously
    granted Option to which it is coupled.



 



    (c) A CSAR shall entitle the Grantee (or other person
    entitled to exercise the Option pursuant to this Plan) to
    surrender to the Company unexercised a portion of the Option to
    which the CSAR relates (to the extent then exercisable pursuant
    to its terms) and to receive from the Company in exchange
    therefor an amount determined by multiplying the difference
    obtained by subtracting the Option exercise price from the Fair
    Market Value of a share




    

    13








 






    of Common Stock on the date of exercise of the CSAR by the
    number of shares of Common Stock with respect to which the CSAR
    shall have been exercised, subject to any limitations the
    Committee may impose.



 



    8.3  Independent Stock Appreciation
    Rights.



 



    (a) An Independent Stock Appreciation Right
    (“ISAR”) shall be unrelated to any Option and shall
    have a term set by the Committee. An ISAR shall be exercisable
    in such installments as the Committee may determine. An ISAR
    shall cover such number of shares of Common Stock as the
    Committee may determine; provided, however, that unless
    the Committee otherwise provides in the terms of the ISAR or
    otherwise, no ISAR granted to a person subject to
    Section 16 of the Exchange Act shall be exercisable until
    at least six months have elapsed from (but excluding) the date
    on which the Option was granted. The exercise price per share of
    Common Stock subject to each ISAR shall be set by the Committee;
    provided, however, that such price shall not be less than
    100% of the Fair Market Value of a share of Common Stock on the
    date the ISAR is granted. An ISAR is exercisable only while the
    Grantee is an Employee, consultant or Independent Director;
    provided that the Committee may determine that the ISAR may be
    exercised subsequent to Termination of Employment, Termination
    of Consultancy or Termination of Directorship without cause, or
    following a change in control of the Company, or because of the
    Grantee’s retirement, death or disability, or otherwise.



 



    (b) An ISAR shall entitle the Grantee (or other person
    entitled to exercise the ISAR pursuant to this Plan) to exercise
    all or a specified portion of the ISAR (to the extent then
    exercisable pursuant to its terms) and to receive from the
    Company an amount determined by multiplying the difference
    obtained by subtracting the exercise price per share of the ISAR
    from the Fair Market Value of a share of Common Stock on the
    date of exercise of the ISAR by the number of shares of Common
    Stock with respect to which the ISAR shall have been exercised,
    subject to any limitations the Committee may impose.



 



    8.4  Payment and Limitations on Exercise.



 



    (a) Payment of the amount determined under
    Sections 8.2(c) and 8.3(b) above shall be in cash, in
    Common Stock (based on its Fair Market Value as of the date the
    Stock Appreciation Right is exercised) or a combination of both,
    as determined by the Committee. To the extent such payment is
    effected in Common Stock it shall be made subject to
    satisfaction of all provisions of Section 5.3 above
    pertaining to Options.



 



    (b) Grantees of Stock Appreciation Rights may be required
    to comply with any timing or other restrictions with respect to
    the settlement or exercise of a Stock Appreciation Right,
    including a window-period limitation, as may be imposed in the
    discretion of the Board or Committee.



 



    8.5  Consideration.  As
    consideration for the granting of a Stock Appreciation Right,
    the Grantee shall agree, in the written Stock Appreciation Right
    Agreement, to remain in the employ of, to consult for or to
    remain as an Independent Director of, as applicable, the Company
    or any Subsidiary for a period of at least one year after the
    Stock Appreciation Right is granted (or such shorter period as
    may be fixed in the Stock Appreciation Right Agreement or by
    action of the Committee (or the Board, in the case of an award
    to an Independent Director) following grant of the Stock
    Appreciation Right or, in the case of an Independent Director,
    until the next annual meeting of stockholders of the Company).
    Nothing in this Plan or in any Stock Appreciation Right
    Agreement hereunder shall confer on any Grantee any right to
    continue in the employ of, as a consultant for or as an
    Independent Director of the Company or any Subsidiary or shall
    interfere with or restrict in any way the rights of the Company
    and any Subsidiary, which are hereby expressly reserved, to
    discharge any Grantee at any time for any reason whatsoever,
    with or without good cause.



 




    ARTICLE IX.

    



 




    ADMINISTRATION
    



 



    9.1  Compensation
    Committee.  The Compensation Committee (or
    another committee or a subcommittee of the Board assuming the
    functions of the Committee under this Plan) shall consist solely
    of two or more Independent Directors appointed by and holding
    office at the pleasure of the Board, each of whom is both a
    “non-employee director” as defined by
    Rule 16b-3
    and an “outside director” for purposes of
    Section 162(m) of the Code.




    

    14








 






    Appointment of Committee members shall be effective upon
    acceptance of appointment. Committee members may resign at any
    time by delivering written notice to the Board. Vacancies in the
    Committee may be filled by the Board.



 



    9.2  Duties and Powers of
    Committee.  It shall be the duty of the
    Committee to conduct the general administration of this Plan in
    accordance with its provisions. The Committee shall have the
    power to interpret this Plan and the agreements pursuant to
    which Options, awards of Restricted Stock or Restricted Stock
    Units, Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments are granted or awarded, and to
    adopt such rules for the administration, interpretation, and
    application of this Plan as are consistent therewith and to
    interpret, amend or revoke any such rules. Notwithstanding the
    foregoing, the full Board, acting by a majority of its members
    in office, shall conduct the general administration of the Plan
    with respect to awards granted to Independent Directors. Any
    such grant or award under this Plan need not be the same with
    respect to each Optionee, Grantee or Restricted Stockholder. Any
    such interpretations and rules with respect to Incentive Stock
    Options shall be consistent with the provisions of
    Section 422 of the Code. In its absolute discretion, the
    Board may at any time and from time to time exercise any and all
    rights and duties of the Committee under this Plan except with
    respect to matters which under
    Rule 16b-3
    or Section 162(m) of the Code, or any regulations or rules
    issued thereunder, are required to be determined in the sole
    discretion of the Committee. To the extent permitted by
    applicable law, the Committee may from time to time delegate to
    a committee of one or more members of the Board or one or more
    officers of the Company the authority to grant or amend awards
    to Participants other than (a) senior executives of the
    Company who are subject to Section 16 of the Exchange Act,
    (b) any Employee who is, or could be, a “covered
    employee” within the meaning of Section 162(m) of the
    Code, or (c) officers of the Company (or members of the
    Board) to whom authority to grant or amend awards has been
    delegated hereunder. Any delegation hereunder shall be subject
    to the restrictions and limits that the Committee specifies at
    the time of such delegation, and the Committee may at any time
    rescind the authority so delegated or appoint a new delegatee.
    At all times, the delegatee appointed under this Section shall
    serve in such capacity at the pleasure of the Committee.



 



    9.3  Majority Rule; Unanimous Written
    Consent.   The Committee shall act by a
    majority of its members in attendance at a meeting at which a
    quorum is present or by a memorandum or other written instrument
    signed by all members of the Committee.



 



    9.4  Compensation; Professional Assistance; Good
    Faith Actions.  Members of the Committee shall
    receive such compensation for their services as members as may
    be determined by the Board. All expenses and liabilities which
    members of the Committee incur in connection with the
    administration of this Plan shall be borne by the Company. The
    Committee may, with the approval of the Board, employ attorneys,
    consultants, accountants, appraisers, brokers, or other persons.
    The Committee, the Company and the Company’s officers and
    Directors shall be entitled to rely upon the advice, opinions or
    valuations of any such persons. All actions taken and all
    interpretations and determinations made by the Committee or the
    Board in good faith shall be final and binding upon all
    Optionees, Grantees, Restricted Stockholders, the Company and
    all other interested persons. No members of the Committee or
    Board shall be personally liable for any action, determination
    or interpretation made in good faith with respect to this Plan,
    Options, awards of Restricted Stock or Restricted Stock Units,
    Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments, and all members of the Committee
    and the Board shall be fully protected by the Company in respect
    of any such action, determination or interpretation.



 




    ARTICLE X.

    



 




    MISCELLANEOUS
    PROVISIONS
    



 



    10.1  Not
    Transferable.  Options, Restricted Stock
    awards, Restricted Stock Unit awards, Performance Awards, Stock
    Appreciation Rights, Dividend Equivalents or Stock Payments
    under this Plan may not be sold, pledged, assigned, or
    transferred in any manner other than by will or the laws of
    descent and distribution or pursuant to a QDRO, unless and until
    such rights or awards have been exercised, or the shares
    underlying such rights or awards have been issued, and all
    restrictions applicable to such shares have lapsed. No Option,
    Restricted Stock award, Restricted Stock Unit award, Performance
    Award, Stock Appreciation Right, Dividend Equivalent or Stock
    Payment or interest or right therein shall be liable for the
    debts, contracts or engagements of the Optionee, Grantee or
    Restricted Stockholder or his successors in interest or shall be
    subject to disposition by transfer, alienation, anticipation,
    pledge, encumbrance, assignment or any other means whether such
    disposition be voluntary or




    

    15








 






    involuntary or by operation of law by judgment, levy,
    attachment, garnishment or any other legal or equitable
    proceedings (including bankruptcy), and any attempted
    disposition thereof shall be null and void and of no effect,
    except to the extent that such disposition is permitted by the
    preceding sentence.



 



    During the lifetime of the Optionee or Grantee, only he may
    exercise an Option or other right or award (or any portion
    thereof) granted to him under the Plan, unless it has been
    disposed of pursuant to a QDRO. After the death of the Optionee
    or Grantee, any exercisable portion of an Option or other right
    or award may, prior to the time when such portion becomes
    unexercisable under the Plan or the applicable Stock Option
    Agreement or other agreement, be exercised by his personal
    representative or by any person empowered to do so under the
    deceased Optionee’s or Grantee’s will or under the
    then applicable laws of descent and distribution.



 



    10.2  Amendment, Suspension or Termination of
    this Plan.  Except as otherwise provided in
    this Section 10.2, this Plan may be wholly or partially
    amended or otherwise modified, suspended or terminated at any
    time or from time to time by the Board or the Committee.
    However, without approval of the Company’s stockholders
    given within twelve months before or after the action by the
    Board or the Committee, no action of the Board or the Committee
    may, except as provided in Section 10.3, increase the
    limits imposed in Section 2.1 on the maximum number of
    shares which may be issued under this Plan or modify the Award
    Limit, and no action of the Board or the Committee may be taken
    that would otherwise require stockholder approval as a matter of
    applicable law, or the rules and regulations of any stock
    exchange or national market system on which the Common Stock is
    then listed. No amendment, suspension or termination of this
    Plan shall, without the consent of the holder of Options,
    Restricted Stock awards, Restricted Stock Unit awards,
    Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments, alter or impair any rights or
    obligations under any Options, Restricted Stock awards,
    Restricted Stock Unit awards, Performance Awards, Stock
    Appreciation Rights, Dividend Equivalents or Stock Payments
    theretofore granted or awarded, unless the award itself
    otherwise expressly so provides. No Options, Restricted Stock,
    Restricted Stock Units, Performance Awards, Stock Appreciation
    Rights, Dividend Equivalents or Stock Payments may be granted or
    awarded during any period of suspension or after termination of
    this Plan, and in no event may any Incentive Stock Option be
    granted under this Plan after the first to occur of the
    following events:



 



    (a) The expiration of ten years from the date the Plan is
    adopted by the Board; or



 



    (b) The expiration of ten years from the date the Plan is
    approved by the Company’s stockholders under
    Section 10.4.



 



    10.3 Changes in Common Stock or Assets of the
    Company, Acquisition or Liquidation of the Company and Other
    Corporate Events.



 



    (a) Subject to Section 10.3(d), in the event that the
    Committee (or the Board, in the case of awards granted to
    Independent Directors) determines that any dividend or other
    distribution (whether in the form of cash, Common Stock, other
    securities, or other property) (other than normal cash
    dividends), recapitalization, reclassification, stock split,
    reverse stock split, reorganization, merger, consolidation,
    split-up,
    spin-off, combination, repurchase, liquidation, dissolution, or
    sale, transfer, exchange or other disposition of all or
    substantially all of the assets of the Company (including, but
    not limited to, a Corporate Transaction), or exchange of Common
    Stock or other securities of the Company, issuance of warrants
    or other rights to purchase Common Stock or other securities of
    the Company, or other similar corporate transaction or event
    (other than an Equity Restructuring), in the Committee’s
    sole discretion (or in the case of awards granted to Independent
    Directors, the Board’s sole discretion), affects the Common
    Stock such that an adjustment is determined by the Committee to
    be appropriate in order to prevent dilution or enlargement of
    the benefits or potential benefits intended to be made available
    under the Plan or with respect to an Option, Restricted Stock
    award, Performance Award, Stock Appreciation Right, Dividend
    Equivalent, Restricted Stock Unit award or Stock Payment, then
    the Committee (or the Board, in the case of awards granted to
    Independent Directors) shall, in such manner as it may deem
    equitable, adjust any or all of:



 



    (i) the number and kind of shares of Common Stock (or other
    securities or property) with respect to which Options,
    Restricted Stock Units, Performance Awards, Stock Appreciation
    Rights, Dividend Equivalents or Stock Payments may be granted
    under the Plan, or which may be granted as Restricted Stock
    (including, but not limited to, adjustments of the limitations
    in Section 2.1 on the maximum number and kind




    

    16








 






    of shares which may be issued, adjustments of the Award Limit
    and adjustments of the manner in which shares subject to Full
    Value Awards will be counted),



 



    (ii) the number and kind of shares of Common Stock (or
    other securities or property) subject to outstanding Options,
    Restricted Stock Units, Performance Awards, Stock Appreciation
    Rights, Dividend Equivalents, or Stock Payments, and in the
    number and kind of shares of outstanding Restricted
    Stock, and



 



    (iii) the grant or exercise price with respect to any
    Option, Restricted Stock Unit, Performance Award, Stock
    Appreciation Right, Dividend Equivalent or Stock
    Payment, and



 



    (iv) the number and kind of shares of Common Stock (or
    other securities or property) for which automatic grants of
    Options are subsequently to be made to new and continuing
    Independent Directors pursuant to Section 3.4(d).



 



    (b) Subject to Sections 10.3(b)(vii), 10.3(d) and
    10.3(e) in the event of any Corporate Transaction or other
    transaction or event described in Section 10.3(a) or any
    unusual or nonrecurring transactions or events affecting the
    Company, any affiliate of the Company, or the financial
    statements of the Company or any affiliate, or of changes in
    applicable laws, regulations, or accounting principles, the
    Committee (or the Board, in the case of awards granted to
    Independent Directors) in its discretion is hereby authorized to
    take any one or more of the following actions whenever the
    Committee (or the Board, in the case of awards granted to
    Independent Directors) determines that such action is
    appropriate in order to prevent dilution or enlargement of the
    benefits or potential benefits intended to be made available
    under the Plan or with respect to any option, right or other
    award under this Plan, to facilitate such transactions or events
    or to give effect to such changes in laws, regulations or
    principles:



 



    (i) In its sole and absolute discretion, and on such terms
    and conditions as it deems appropriate, the Committee (or the
    Board, in the case of awards granted to Independent Directors)
    may provide, either by the terms of the agreement or by action
    taken prior to the occurrence of such transaction or event and
    either automatically or upon the optionee’s request, for
    either the purchase of any such Option, Performance Award, Stock
    Appreciation Right, Dividend Equivalent, or Stock Payment, or
    any Restricted Stock or Restricted Stock Unit for an amount of
    cash equal to the amount that could have been attained upon the
    exercise of such option, right or award or realization of the
    optionee’s rights had such option, right or award been
    currently exercisable or payable or fully vested or the
    replacement of such option, right or award with other rights or
    property selected by the Committee (or the Board, in the case of
    awards granted to Independent Directors) in its sole discretion;



 



    (ii) In its sole and absolute discretion, the Committee (or
    the Board, in the case of awards granted to Independent
    Directors) may provide, either by the terms of such Option,
    Performance Award, Stock Appreciation Right, Dividend
    Equivalent, or Stock Payment, or Restricted Stock or Restricted
    Stock Unit award or by action taken prior to the occurrence of
    such transaction or event that it cannot be exercised after such
    event;



 



    (iii) In its sole and absolute discretion, and on such
    terms and conditions as it deems appropriate, the Committee (or
    the Board, in the case of awards granted to Independent
    Directors) may provide, either by the terms of such Option,
    Performance Award, Stock Appreciation Right, Dividend
    Equivalent, or Stock Payment, or Restricted Stock or Restricted
    Stock Unit award or by action taken prior to the occurrence of
    such transaction or event, that for a specified period of time
    prior to such transaction or event, such option, right or award
    shall be vested
    and/or
    exercisable as to all shares covered thereby, notwithstanding
    anything to the contrary in (i) Section 4.4 or
    (ii) the provisions of such Option, Performance Award,
    Stock Appreciation Right, Dividend Equivalent, or Stock Payment,
    or Restricted Stock or Restricted Stock Unit award;



 



    (iv) In its sole and absolute discretion, and on such terms
    and conditions as it deems appropriate, the Committee (or the
    Board, in the case of awards granted to Independent Directors)
    may provide, either by the terms of such Option, Performance
    Award, Stock Appreciation Right, Dividend Equivalent, or Stock
    Payment, or Restricted Stock or Restricted Stock Unit award or
    by action taken prior to the occurrence of such transaction or
    event, that upon such event, such option, right or award be
    assumed by the successor or survivor corporation, or a parent or
    subsidiary thereof, or shall be substituted for by similar
    options, rights or awards




    

    17








 






    covering the stock of the successor or survivor corporation, or
    a parent or subsidiary thereof, with appropriate adjustments as
    to the number and kind of shares and prices;



 



    (v) In its sole and absolute discretion, and on such terms
    and conditions as it deems appropriate, the Committee (or the
    Board, in the case of awards granted to Independent Directors)
    may make adjustments in the number and type of shares of Common
    Stock (or other securities or property) subject to outstanding
    Options, Restricted Stock Units, Performance Awards, Stock
    Appreciation Rights, Dividend Equivalents, or Stock Payments,
    and in the number and kind of outstanding Restricted Stock
    and/or in
    the terms and conditions of (including the grant or exercise
    price), and the criteria included in, outstanding options,
    rights and awards and options, rights and awards which may be
    granted in the future;



 



    (vi) In its sole and absolute discretion, and on such terms
    and conditions as it deems appropriate, the Committee may
    provide either by the terms of a Restricted Stock award or by
    action taken prior to the occurrence of such event that, for a
    specified period of time prior to such event, the restrictions
    imposed under a Restricted Stock Agreement upon some or all
    shares of Restricted Stock may be terminated, and, some or all
    shares of such Restricted Stock may cease to be subject to
    repurchase under Section 6.6 or forfeiture under
    Section 6.5 after such event; and



 



    (vii) None of the foregoing discretionary actions taken
    under this Section 10.3(b) shall be permitted with respect
    to awards granted to Independent Directors to the extent that
    such discretion would be inconsistent with the applicable
    exemptive conditions of
    Rule 16b-3.
    In the event of a Change in Control or a Corporate Transaction,
    to the extent that the Board does not have the ability under
    Rule 16b-3
    to take or to refrain from taking the discretionary actions set
    forth in Section 10.3(b)(iii) above, each award granted to
    an Independent Director shall be exercisable as to all shares
    covered thereby upon such Change in Control or during the five
    days immediately preceding the consummation of such Corporate
    Transaction and subject to such consummation, notwithstanding
    anything to the contrary in Section 4.4 or the vesting
    schedule of such Options. In the event of a Corporate
    Transaction, to the extent that the Board does not have the
    ability under
    Rule 16b-3
    to take or to refrain from taking the discretionary actions set
    forth in Section 10.3(b)(ii) above, no Option granted to an
    Independent Director may be exercised following such Corporate
    Transaction unless such Option is, in connection with such
    Corporate Transaction, either assumed by the successor or
    survivor corporation (or parent or subsidiary thereof) or
    replaced with a comparable right with respect to shares of the
    capital stock of the successor or survivor corporation (or
    parent or subsidiary thereof).



 



    (c) Subject to Sections 10.3(d) and 10.8, the
    Committee (or the Board, in the case of awards granted to
    Independent Directors) may, in its discretion, include such
    further provisions and limitations in any Option, Performance
    Award, Stock Appreciation Right, Dividend Equivalent, or Stock
    Payment, or Restricted Stock or Restricted Stock Unit agreement
    or certificate, as it may deem equitable and in the best
    interests of the Company.



 



    (d) With respect to Incentive Stock Options and awards
    intended to qualify as performance-based compensation under
    Section 162(m), no adjustment or action described in this
    Section 10.3 or in any other provision of the Plan shall be
    authorized to the extent that such adjustment or action would
    cause the Plan to violate Section 422(b)(1) of the Code or
    would cause such award to fail to so qualify under Section
    162(m), as the case may be, or any successor provisions thereto.
    Furthermore, no such adjustment or action shall be authorized to
    the extent such adjustment or action would result in short-swing
    profits liability under Section 16 or violate the exemptive
    conditions of Rule
    16b-3 unless
    the Committee (or the Board, in the case of awards granted to
    Independent Directors) determines that the option or other award
    is not to comply with such exemptive conditions. The number of
    shares of Common Stock subject to any option, right or award
    shall always be rounded to the next whole number.



 



    (e) In connection with the occurrence of any Equity
    Restructuring, and notwithstanding anything to the contrary in
    Sections 10.3(a) and 10.3(b):



 



    (i) The number and type of securities subject to each
    outstanding award and the exercise price or grant price thereof,
    if applicable, shall be equitably adjusted. The adjustments
    provided under this Section 10(e) shall be nondiscretionary
    and shall be final and binding on the affected holder and the
    Company.



 



    (ii) The Committee (or the Board, in the case of awards
    granted to Independent Directors) shall make such equitable
    adjustments, if any, as the Committee may deem appropriate to
    reflect such Equity




    

    18








 






    Restructuring with respect to the aggregate number and kind of
    shares that may be issued under the Plan (including, but not
    limited to, adjustments of the limitations in Section 2.1
    on the maximum number and kind of shares which may be issued
    under the Plan or the Award Limit and adjustments of the manner
    in which shares subject to Full Value Awards will be counted).



 



    10.4  Approval of Plan by
    Stockholders.  This Plan will be submitted for
    the approval of the Company’s stockholders within twelve
    months after the date of the Board’s initial adoption of
    this Plan. Options, Restricted Stock Units, Performance Awards,
    Stock Appreciation Rights, Dividend Equivalents or Stock
    Payments may be granted and Restricted Stock may be awarded
    prior to such stockholder approval, provided that such Options,
    Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments shall not be exercisable and such
    Restricted Stock or Restricted Stock Units shall not vest prior
    to the time when this Plan is approved by the stockholders, and
    provided further that if such approval has not been obtained at
    the end of said twelve-month period, all Options, Performance
    Awards, Stock Appreciation Rights, Dividend Equivalents or Stock
    Payments previously granted and all Restricted Stock or
    Restricted Stock Units previously awarded under this Plan shall
    thereupon be canceled and become null and void.



 



    10.5  Tax Withholding.  The
    Company shall be entitled to require payment in cash or
    deduction from other compensation payable to each Optionee,
    Grantee or Restricted Stockholder of any sums required by
    federal, state or local tax law to be withheld with respect to
    the issuance, vesting or exercise of any Option, Restricted
    Stock, Restricted Stock Unit, Performance Award, Stock
    Appreciation Right, Dividend Equivalent or Stock Payment. The
    Committee (or the Board, in the case of awards granted to
    Independent Directors) may in its discretion and in satisfaction
    of the foregoing requirement allow such Optionee, Grantee or
    Restricted Stockholder to elect to have the Company withhold
    shares of Common Stock otherwise issuable under such Option or
    other award (or allow the return of shares of Common Stock)
    having a Fair Market Value equal to the minimum amounts required
    to be withheld.



 



    10.6  Loans.  The Committee
    may, in its discretion, and to the extent permitted by law
    extend one or more loans to key Employees in connection with the
    exercise or receipt of an Option, Performance Award, Stock
    Appreciation Right, Dividend Equivalent or Stock Payment granted
    under this Plan, or the issuance, vesting or distribution of
    Restricted Stock or Restricted Stock Units awarded under this
    Plan. The terms and conditions of any such loan shall be set by
    the Committee (or the Board, in the case of awards granted to
    Independent Directors). No loans will be made to key Employees
    if such loans would be prohibited by Section 402 of the
    Sarbanes-Oxley Act of 2002.



 



    10.7  Forfeiture
    Provisions.  Pursuant to its general authority
    to determine the terms and conditions applicable to awards under
    the Plan, the Committee (or the Board, in the case of awards
    granted to Independent Directors) shall have the right (to the
    extent consistent with the applicable exemptive conditions of
    Rule 16b-3)
    to provide, in the terms of Options or other awards made under
    the Plan, or to require the recipient to agree by separate
    written instrument, that (i) any proceeds, gains or other
    economic benefit actually or constructively received by the
    recipient upon any receipt or exercise of the award, or upon the
    receipt or resale of any Common Stock underlying such award,
    must be paid to the Company, and (ii) the award shall
    terminate and any unexercised portion of such award (whether or
    not vested) shall be forfeited, if (a) a Termination of
    Employment, Termination of Consultancy or Termination of
    Directorship occurs prior to a specified date, or within a
    specified time period following receipt or exercise of the
    award, or (b) the recipient at any time, or during a
    specified time period, engages in any activity in competition
    with the Company, or which is inimical, contrary or harmful to
    the interests of the Company, as further defined by the
    Committee (or the Board, as applicable).



 



    10.8  Limitations Applicable to
    Section 16 Persons and Performance-Based
    Compensation.  Notwithstanding any other
    provision of this Plan, this Plan, and any Option, Performance
    Award, Stock Appreciation Right, Dividend Equivalent or Stock
    Payment granted, or Restricted Stock or Restricted Stock Unit
    awarded, to any individual who is then subject to
    Section 16 of the Exchange Act, shall be subject to any
    additional limitations set forth in any applicable exemptive
    rule under Section 16 of the Exchange Act (including any
    amendment to
    Rule 16b-3
    of the Exchange Act) that are requirements for the application
    of such exemptive rule. To the extent permitted by applicable
    law, the Plan, Options, Performance Awards, Stock Appreciation
    Rights, Dividend Equivalents, Stock Payments, Restricted Stock
    and Restricted Stock Units granted or awarded hereunder shall




    

    19








 






    be deemed amended to the extent necessary to conform to such
    applicable exemptive rule. Furthermore, notwithstanding any
    other provision of this Plan, any Option, Performance Award,
    Stock Appreciation Right, Dividend Equivalent, Stock Payment,
    Restricted Stock or Restricted Stock Unit intended to qualify as
    performance-based compensation as described in
    Section 162(m)(4)(C) of the Code shall be subject to any
    additional limitations set forth in Section 162(m) of the
    Code (including any amendment to Section 162(m) of the
    Code) or any regulations or rulings issued thereunder that are
    requirements for qualification as performance-based compensation
    as described in Section 162(m)(4)(C) of the Code, and this
    Plan shall be deemed amended to the extent necessary to conform
    to such requirements.



 



    10.9  Effect of Plan Upon Options and
    Compensation Plans.  The adoption of this Plan
    shall not affect any other compensation or incentive plans in
    effect for the Company or any Subsidiary. Nothing in this Plan
    shall be construed to limit the right of the Company (i) to
    establish any other forms of incentives or compensation for
    Employees, Directors or Consultants of the Company or any
    Subsidiary or (ii) to grant or assume options or other
    rights otherwise than under this Plan in connection with any
    proper corporate purpose including but not by way of limitation,
    the grant or assumption of options in connection with the
    acquisition by purchase, lease, merger, consolidation or
    otherwise, of the business, stock or assets of any corporation,
    partnership, limited liability company, firm or association.



 



    10.10  Compliance with
    Laws.  This Plan, the granting and vesting of
    Options, Restricted Stock awards, Restricted Stock Unit awards,
    Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments under this Plan and the issuance
    and delivery of shares of Common Stock and the payment of money
    under this Plan or under Options, Performance Awards, Stock
    Appreciation Rights, Dividend Equivalents or Stock Payments
    granted or Restricted Stock or Restricted Stock Units awarded
    hereunder are subject to compliance with all applicable federal
    and state laws, rules and regulations (including but not limited
    to state and federal securities law and federal margin
    requirements) and to such approvals by any listing, regulatory
    or governmental authority as may, in the opinion of counsel for
    the Company, be necessary or advisable in connection therewith.
    Any securities delivered under this Plan shall be subject to
    such restrictions, and the person acquiring such securities
    shall, if requested by the Company, provide such assurances and
    representations to the Company as the Company may deem necessary
    or desirable to assure compliance with all applicable legal
    requirements. To the extent permitted by applicable law, the
    Plan, Options, Restricted Stock awards, Restricted Stock Unit
    awards, Performance Awards, Stock Appreciation Rights, Dividend
    Equivalents or Stock Payments granted or awarded hereunder shall
    be deemed amended to the extent necessary to conform to such
    laws, rules and regulations.



 



    10.11  Titles.  Titles are
    provided herein for convenience only and are not to serve as a
    basis for interpretation or construction of this Plan.



 



    10.12  Governing Law.  This
    Plan and any agreements hereunder shall be administered,
    interpreted and enforced under the internal laws of the State of
    California without regard to conflicts of laws thereof.



 



    10.13  Section 409A.  To
    the extent that the Committee (or the Board, in the case of
    awards granted to Independent Directors) determines that any
    award granted under the Plan is subject to Section 409A of
    the Code, the award agreement evidencing such award shall
    incorporate the terms and conditions required by
    Section 409A of the Code. To the extent applicable, the
    Plan and award agreements shall be interpreted in accordance
    with Section 409A of the Code and Department of Treasury
    regulations and other interpretive guidance issued thereunder.
    Notwithstanding any provision of the Plan to the contrary, in
    the event that the Committee (or the Board, in the case of
    awards granted to Independent Directors) determines that any
    award may be subject to Section 409A of the Code and
    related Department of Treasury guidance (including Department of
    Treasury guidance), the Committee (or the Board, in the case of
    awards granted to Independent Directors) may adopt such
    amendments to the Plan and the applicable award agreement or
    adopt other policies and procedures (including amendments,
    policies and procedures with retroactive effect), or take any
    other actions, that the Committee (or the Board, in the case of
    awards granted to Independent Directors) determines are
    necessary or appropriate to (a) exempt the award from
    Section 409A of the Code
    and/or
    preserve the intended tax treatment of the benefits provided
    with respect to the award, or (b) comply with the
    requirements of Section 409A of the Code and related
    Department of Treasury guidance.




    

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