**TABLE OF CONTENTS**               **Page**          1. Purpose of the Plan  1 2. Definitions  1   2.1 Account  1   2.2 Beneficiary  1   2.3 Benefit  1   2.4 Board  1   2.5 Code  2   2.6 Company  2   2.7 Compensation  2   2.8 Compensation Reductions  2   2.9 Deferred Compensation Agreement  2   2.10 Director  2   2.11 Effective Date  2   2.12 Eligible Director  2   2.13 Fair Market Value  2   2.14 Non-Employee Director  2   2.15 Participant  2   2.16 Plan  2   2.17 Plan Year  3   2.18 Post-2004 Deferrals  3   2.19 Pre-2005 Deferrals  3   2.20 Section 409A  3   2.21 Share  3   2.22 Termination of Service  3   2.23 Valuation Date  3 3. Participation  3   3.1 Participation of Eligible Directors  3   3.2 Irrevocability of Participation During the Plan Year  4   3.3 Suspended Participation  4   3.4 Termination of Participation  5 
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               **Page**          4. Plan Accounts  5   4.1 Accounts  5   4.2 Investment of Accounts  5   4.3 Value of Accounts  5   4.4 Funds Unsecured  5 5. Benefits  6   5.1 Termination Benefits- Distribution of Deferrals  6   5.2 Form of Distribution  6   5.3 Timing of Payments  6   5.4 Death Benefits  7   5.5 Acceleration of Payments  7   5.6 No Discretionary Distributions  8   5.7 Special Delay in Distribution Rules  8 6. Source of Benefits  8 7. Administration  8   7.1 General  8   7.2 Procedures  8   7.3 Claims  8 8. Amendment and Termination  9   8.1 Amendment or Termination  9   8.2 Accrued Benefits  9 9. Adjustment of Shares; Sale or Merger of the Company  10   9.1 Adjustment of Shares  10   9.2 Sale or Merger of the Company  10 10. Miscellaneous  10   10.1 Benefits Fully Vested  10   10.2 No Right to Continue as Director  11   10.3 Successors and Assigns  11   10.4 Assignment or Alienation  11   10.5 Entire Agreement  11   10.6 Headings  11   10.7 Gender and Number  11   10.8 Governing Law  11 
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               **Page**            10.9 Compliance with Section 409A of the Code  11   10.10 Scrievener’s Error  11   10.11 Plan Restatement Effective Date  12 
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**IDM PHARMA, INC.****DIRECTORS’ DEFERRED COMPENSATION PLAN**(As Amended through December 31, 2008)     **IDM Pharma, Inc.**, a Delaware corporation (the “Company”), previously adoptedeffective as of March 17, 1995 the IDM Pharma, Inc. Directors’ Deferred Compensation Plan (the“Plan”) as an amendment and restatement of the Cytel Corporation Directors’ Deferred CompensationPlan for the nonemployee directors of the Company upon the terms and conditions set forth below.     The Company believes that it is in its best interests to amend and restate this Plan withrespect to Post-2004 Deferrals for purposes of compliance with Section 409A of the Internal RevenueCode of 1986, as amended, and its regulations and other guidance thereunder.     The benefits payable under the Plan are and at all times will be mere unsecured contractualrights against the Company payable from the Company’s general assets. It is intended that the Planshall constitute an unfunded deferred compensation arrangement for purposes of United Statesfederal income tax laws, and all documents, agreements or instruments made or given pursuant to thePlan shall be interpreted so as to carry out this intent.1. **Purpose of the Plan**     The purpose of this Plan is to provide deferred compensation benefits to nonemployee directorsof the Company, payable by the Company. This Plan will provide benefits derived from contributionsby the Company hereunder of a nonemployee director’s compensation as to which he or she has electedto defer payment under the Plan.2. **Definitions**     The capitalized terms defined in this Section 2 shall have the meanings set forth below:     2.1 **Account.**A separate Plan account, which is a bookkeeping record, established for eachParticipant to which shall be allocated Compensation Reductions in accordance with Section 4.1.     2.2 **Beneficiary.**The beneficiary or beneficiaries designated by a Participant to receive anyremaining Benefits due under the Plan after his or her death. If the Participant has notdesignated a Beneficiary, the Beneficiary shall be the Participant’s surviving spouse or, if none,the Participant’s estate.     2.3 **Benefit.**The benefit or benefits provided under this Plan, which for a Participant shallbe equal to the account balance of such Participant’s Account.     2.4 **Board.**The Board of Directors of the Company.
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     2.5 **Code.**The Internal Revenue Code of 1986, as it may be amended from time to time.     2.6 **Company.**IDM Pharma, Inc., a Delaware corporation, or any successor corporation.     2.7 **Compensation.**All the non-equity fees (paid in cash or by check) received by aParticipant from the Company for a Plan Year for his or her services as a Director, including butnot limited to, the retainer fee and meeting attendance fees.     2.8 **Compensation Reductions.**The percentage of Compensation which a Participant has electedto defer pursuant to a Deferred Compensation Agreement, and that the Company and the Participantmutually agree shall be deferred in accordance with the Plan. Participants may elect to defer anywhole percentage of Compensation up to 100% of Compensation.     2.9 **Deferred Compensation Agreement.**An agreement by which a Participant elects to reduce aselected whole percentage of his or her Compensation for a Plan Year in order for the Company tomake contributions to the Plan on his or her behalf.     2.10 **Director.**A member of the Board.     2.11 **Effective Date.**March 17, 1995.     2.12 **Eligible Director.**A Director who is not an employee of the Company.     2.13 **Fair Market Value.**The fair market value of a share of Common Stock of the Company isthe closing sales price for such stock as quoted on a national securities exchange or the NASDAQNational Market System of the National Association of Securities Dealers, Inc. Automated QuotationSystem on the day of determination, as reported in *The Wall Street Journal*or such other source asthe Company deems reliable.     **2.14 Non-Employee Director.**A Director who either (i) is not a current employee or officer ofthe Company or its parent or subsidiary, does not receive compensation (directly or indirectly)from the Company or its parent or subsidiary for services rendered as a consultant or in anycapacity other than as a Director (except for an amount as to which disclosure would not berequired under Item 404(a)of Regulation S-K promulgated pursuant to the Securities Act of 1933, as amended (“RegulationS-K”)), does not possess an interest in any other transaction as to which disclosure would berequired under Item 404(a) of Regulation S-K, and is not engaged in a business relationship as towhich disclosure would be required under Item 404(b) of Regulation S-K; or (ii) is otherwiseconsidered a “non-employee director” for purposes of Rule 16b-3 promulgated under the Exchange Actof 1934, as amended.     2.15 **Participant.**Any Eligible Director who has elected to participate in the Plan byentering into a Deferred Compensation Agreement.     2.16 **Plan.**This IDM Pharma, Inc. Directors’ Deferred Compensation Plan, as amended from timeto time.
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     2.17 **Plan Year.**The calendar year.     2.18 **Post-2004 Deferrals.**The portion of the Account other than Pre-2005 Deferrals. The Planshall maintain separate accounting for Post-2004 Deferrals.     2.19 **Pre-2005 Deferrals.**That portion of the Account determined as of December 31, 2004, towhich the Participant has a legally binding right to be paid, and the right to which is earned andvested as of December 31, 2004, in accordance with Section 409A and its regulations and otherguidance thereunder, plus earnings and losses allocable to such amounts. The Plan shall maintainseparate accounting for Pre-2005 Deferrals.     2.20 **Section 409A**or **Code Section 409A.**Section 409A of the Internal Revenue Code of 1986, asit may be amended from time to time, and the regulations and other guidance thereunder.     2.21 **Share.**A participating interest under the Plan, which shall be equal to the Fair MarketValue of a share of Common Stock of the Company.     2.22 **Termination of Service.**A Participant’s termination of directorship for any reason thatis a “separation from service” from the Company for purposes of Section 409A of the Code. Thedetermination of whether a Participant has had a Termination of Service shall be made in a mannerconsistent with Section 409A of the Code and Treas. Reg § 1.409A-(1)(h) or as this definition maylater be modified by other regulatory pronouncements.     2.23 **Valuation Date.**The last day of each calendar quarter, or such other date as shall beestablished by the Company.3. **Participation**     3.1 **Participation of Eligible Directors.**          (a) Each Eligible Director may begin to participate in the Plan on the Effective Date;provided, however, that such Eligible Director completes and signs a DeferredCompensation Agreement and returns such Deferred Compensation Agreement to the designatedrepresentative of the Company prior to the Effective Date or such earlier date established by theCompany and announced to the Eligible Director. Such Deferred Compensation Agreement shall beeffective for the period beginning on the Effective Date and ending on December 31, 1995.          (b) Each Director who first becomes an Eligible Director after the Effective Date may begin toparticipate in the Plan by completing and signing a Deferred Compensation Agreement and returningsuch Deferred Compensation Agreement to the designated representative of the Company; provided,however, that such completion and return of the Deferred Compensation Agreement to the Companyoccurs within thirty (30) days after the date that the Director first becomes an Eligible Director.Such Deferred Compensation Agreement shall be effective with respect to the portion ofCompensation attributable to services performed by the Director during the period beginning on thedate the Eligible Director completes and returns the Deferred Compensation Agreement to the Companyand ending on the last day of the
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Plan Year within which such participation begins, which willgenerally include the retainer fees and meeting attendance fees that would otherwise have been paidto the Eligible Director during the remainder of the Plan Year following the return of the DeferredCompensation Agreement. Once the Eligible Director completes and returns the Deferred CompensationAgreement to the Company within the thirty (30) day period after the date that the Director firstbecomes an Eligible Director, the election is irrevocable. Notwithstanding the foregoing, anyDeferred Compensation Agreement completed and returned to the Company on or after December 19, 2005shall continue to be effective for subsequent Plan Years unless and until the Participant completesand returns a new Deferred Compensation Agreement in accordance with Section 3.1(d) below.          (c) An Eligible Director who did not become a Participant in accordance with the terms ofparagraph (a) or (b) may participate in the Plan effective as of the beginning of any Plan Yearfollowing the Plan Year in which he or she becomes an Eligible Director by completing and signing aDeferred Compensation Agreement and returning such Deferred Compensation Agreement to thedesignated representative of the Company prior to the beginning of the Plan Year (or such earlierdate established by the Company and announced to the Eligible Director) for which deferral ofCompensation is intended to commence. For deferral elections made for the 2005 Plan Year and anyprevious Plan Years, such Deferred Compensation Agreement shall be effective only for the Plan Yearfirst following the submission of the Deferred Compensation Agreement. For deferral elections madefor the 2006 Plan Year and any subsequent Plan Years, such Deferred Compensation Agreement shallcontinue to be effective for subsequent Plan Years unless and until the Participant completes andreturns a new Deferred Compensation Agreement in accordance with Section 3.1(d) below.          (d) If a Participant wishes to commence deferrals of Compensation under the terms of the Planor change his or her elected percentage of deferred Compensation for any Plan Year subsequent tothe first Plan Year in which the Participant began to participate in the Plan, such Participantmust complete and sign a new Deferred Compensation Agreement and return such Deferred CompensationAgreement to the designated representative of the Company prior to the beginning of the Plan Year(or such earlier date established by the Company and announced to the Participant) for which suchelection is to be effective. For deferral electionsmade for the 2005 Plan Year and any previous Plan Years, such Deferred Compensation Agreement shallbe effective only for that Plan Year. For deferral elections made for the 2006 Plan Year and anysubsequent Plan Years, such Deferred Compensation Agreement shall continue to be effective forsubsequent Plan Years unless and until the Participant completes and returns a new DeferredCompensation Agreement.     3.2 **Irrevocability of Participation During the Plan Year.**A Participant may not terminate ormodify his or her Deferred Compensation Agreement with respect to a Plan Year on or after the firstday of such Plan Year.     3.3 **Suspended Participation.**If a Participant ceases to be an Eligible Director, butcontinues to be a Director, he or she shall not be eligible to make future elections to deferCompensation under the Plan for subsequent Plan Years. Distributions shall be made to suchParticipant as would otherwise be permitted in accordance with the distribution provisions underthis Plan. If such Participant again becomes an Eligible Director in a Plan Year following the
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last Plan Year for which a Deferred Compensation Agreement was in effect, such Participant mayelect to participate in the Plan by following the procedures specified in Section 3.1(c).     3.4 **Termination of Participation.**A Participant shall cease to be a Participant as of thedate he or she ceases serving as a Director.4. **Plan Accounts**     4.1 **Accounts.**The Company shall maintain or cause to be maintained for each Participant anAccount with respect to which the Company shall allocate amounts equal to the Participant’sCompensation Reductions for each Plan Year, effective as of the date such Compensation Reductionswould have been paid to the Participant as Compensation in the absence of a Deferred CompensationAgreement.     4.2 **Investment of Accounts.**          **(a)**Each Compensation Reduction allocated to a Participant’s Account shall be converted intothat number of Shares that equal the amount of such Compensation Reduction divided by the FairMarket Value of the Common Stock of the Company as of the date such Compensation Reduction wouldhave been paid to the Participant as Compensation in the absence of a Deferred CompensationAgreement. The calculation of the number of Shares need not be rounded to the nearest whole Share,so that a fraction of a Share (calculated to the nearest one-hundredth of a Share) may be allocatedto a Participant’s Account.          **(b)**In the event any dividends or distributions are made with respect to the Common Stock ofthe Company, the Company shall allocate an amount to the Participant’s Account that is equal to theamount of such dividends or distributions that would have been made with respect to the Sharesallocated to a Participant’s Account if they were shares of the Common Stock of the Company. Suchdividend/distribution allocations shall be converted intothat number of whole and/or fractional Shares that equal the amount of such allocation divided bythe Fair Market Value of the Common Stock of the Company as of the date such dividends ordistributions are made with respect to the Common Stock of the Company to the Company’sstockholders of record.     4.3 **Value of Accounts.**The value of a Participant’s Account as of any Valuation Date shall beequal to the number of Shares allocated to a Participant’s Account multiplied by the Fair MarketValue of one share of the Common Stock of the Company.     4.4 **Funds Unsecured.**Notwithstanding any other provisions of this Plan, all Benefits payableunder the Plan are subject to the claims of the general creditors of the Company. No trust shallbe established to hold any assets which may be set aside by the Company to pay the Benefits underthe Plan and the Company shall be under no obligation to set aside any amounts to pay Benefits.The maintenance of separate Accounts by the Company as provided herein shall neither require nor beconsidered a segregation of any funds or property from the Company’s general assets. Participantsshall have no preferred claim on or beneficial ownership interest in any assets of the Companyprior to the time actual payments of Benefits are received, and all rights of the Participants toBenefits are mere unsecured contractual rights against the Company.
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5. **Benefits**     5.1 **Termination Benefits—Distribution of Deferrals.**          (a) For Pre-2005 Deferrals, when a Participant ceases serving as a Director, the Participantshall be entitled to receive the value of his or her Account determined as of the Valuation Datecoinciding with or next preceding the date of the distribution.          (b) For Post-2004 Deferrals, when a Participant has a Termination of Service, the Participantshall be entitled to receive the value of his or her Account determined as of the Valuation Datecoinciding with or next preceding the date of the distribution.     5.2 **Form of Distribution.**          (a) If at the time the Participant is entitled to a distribution pursuant to Section 5.1, thetotal distributable amount is less than $50,000, the distribution shall be paid out by the Companyin cash (or by check) in a single lump sum payment in accordance with Section 5.3.          (b) If at the time the Participant is entitled to a distribution pursuant to Section 5.1, thetotal distributable amount is at least $50,000, the distribution shall be paid out by the Companyin cash (or by check) in equal annual installments (by reference to the number of Shares allocatedto a Participant’s Account) as follows. The number of installment payments shall be the lesser of(i) ten (10) or (ii) two (2) times the number of Plan Years the Participant elected to deferCompensation under the Plan.          (c) Notwithstanding the foregoing, to the extent permitted by Section 409A of the Code and theregulations and other guidance thereunder, the Administrator may, in it sole discretion, overrideor modify the timing of payment of a Participant’s Benefits under this Plan at any time and for anyreason to either accelerate or delay the timing of payment of such Benefits in whole or in part.Such modifications may apply to some or all one or more Participant Accounts, as determined in theAdministrator’s discretion, even as to future installments payable to a Participant under adistribution that has already commenced pursuant to Section 5.2(b).     5.3 **Timing of Payments.**If a Participant ceases serving as a Director on or before June 30 ofany Plan Year, the lump sum payment or the first installment payment shall be paid by the Companyno later than the last day of such Plan Year. If the Participant ceases serving as a Director onor after July 1 of any Plan Year, the lump sum payment or the first installment payment shall bepaid by the Company no later than January 31 of the following Plan Year. If the payment of aParticipant’s Account is made in installment payments, the second installment payment shall be paidduring January of the Plan Year following the Plan Year in which the first installment payment waspaid and all remaining installment payments shall be paid annually in the month of January. Thevalue of an installment shall be determined by multiplying the number of Shares to be paid out insuch installment by the Fair Market Value of one share of the Company’s Common Stock on the lasttrading day immediately preceding such installment payment.
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     5.4 **Death Benefits.**In the event the Participant dies prior to receiving all of his or herBenefits, his or her remaining Benefits shall be paid by the Company in cash (or by check) to theParticipant’s Beneficiary in a lump sum payment as soon as administratively feasible after theParticipant’s death, but in no event later than ninety (90) days after the Participant’s death.     5.5 **Acceleration of Payments.**Except as provided in Section 5.2(c), payments under the Planmay be accelerated only upon the occurrence of an event specified in this Section 5.3.          (a) Domestic Relations Order. A payment may be accelerated if such payment is made to analternate payee pursuant to and following the receipt and qualification of a domestic relationsorder as defined in Section 414(p) of the Code.          (b) Compliance with Ethics Agreements and Legal Requirements. A payment may be accelerated asmay be necessary to comply with ethics agreements with the Federal government or as may bereasonably necessary to avoid the violation of Federal, state, local or foreign ethics law orconflicts of interest law, in accordance with the requirements of Section 409A.          (c) Divestiture. payment may be accelerated as may be necessary to comply with a certificateof divestiture as defined in Section 1043(b)(2) of the Code.          (d) Section 409A Additional Tax. A payment may be accelerated to the extent required to payany income tax imposed under Section 409A of the Code (the “Section409A Amount”) if at any time the Participant’s deferred compensation arrangement fails to meetthe requirements of Section 409A of the Code. The total payment under this Section 5.5 may notexceed the Section 409A Amount.          (e) A payment may be accelerated in the Administrator’s discretion in connection with any ofthe following events, in accordance with the requirements of Section 409A of the Code and theregulations and other guidance thereunder:          (1) a corporate dissolution taxed under Section 331 of the Code,          (2) with the approval of a bankruptcy court pursuant to 11 U.S.C. Section 503(b)(1)(A);          (3) a change in control event for purposes of Section 409A of the Code, as defined inTreas. Reg. § 1.409A-3(i)(5), or as these definitions may later be modified by otherregulatory pronouncements;          (4) the termination of the Plan and all other plans that would be aggregated with thePlan for purposes of Section 409A of the Code; and          (5) such other events and conditions as permitted by Section 409A of the Code and theregulations and other guidance thereunder.
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          (f) Offset. A payment may be accelerated in the Administrator’s’s discretion as satisfactionof a debt of the Participant to the Company, where such debt is incurred in the ordinary course ofthe service relationship between the Participant and the Company, the entire amount of thereduction in any of the Company’s taxable years does not exceed $5,000, and the reduction is madeat the same time and in the same amount as the debt otherwise would have been due and collectedfrom the Participant.     5.6 **No Discretionary Distributions.**Except as expressly provided herein, the Administratorshall not exercise discretion with respect to the timing or form of distribution of Benefits fromthe Plan, but shall make distributions at the time and in the manner elected by the Participant onthe Deferred Compensation Agreement or as otherwise specified in the Plan.     **5.7 Special Delay in Distribution Rules.**Notwithstanding anything to the contrary set forthherein, the Administrator retains the right, in its sole discretion, to delay distributions underthe Plan to the extent permitted by Section 409A of the Code and its regulations and other guidancethereunder.6. **Source of Benefits**     Benefits payable under this Plan shall be paid out of the Company’s general assets andallocated as payments out of the appropriate Participant’s Account under the Plan.7. **Administration**     7.1 **General.**This Plan shall be administered by the Board of Directors of the Company, unlessand until the Board delegates administration to a committee composed of not fewer than two membersof the Board. All members of such committee shall be Non-Employee Directors, unless the Boardexpressly declares otherwise. The Board or, if applicable, such committee (the “Administrator”)shall exercise all administrative powers and duties under the Plan in accordance with the terms andpurposes of the Plan. The Administrator shall determine the amount of the Benefits due to eachParticipant or Beneficiary from this Plan and shall cause them to be paid accordingly in accordancewith the Plan.     7.2 **Procedures.**The Administrator may adopt such rules and regulations not inconsistent withthe provisions of the Plan as deemed necessary or appropriate for the proper administration of thePlan and shall have the authority, in the Administrator’s sole discretion, to interpret andconstrue any provision of the Plan. To the extent permitted by law, (i) all such rules,regulations, interpretations and constructions shall be final and binding on the Company and allParticipants and their legal representatives, beneficiaries, successors, and assigns, subject toreview as provided in Section 7.3, (ii) the Administrator shall not be subject to any individualliability with respect to the Plan and (iii) the Administrator shall be indemnified by the Companyfor any action or omission made with respect to the Plan which does not demonstrate bad faith,willful misconduct, criminal act, or gross negligence.     7.3 **Claims.**Any denial by the Administrator of a claim for benefits under the Plan by aParticipant or Beneficiary shall be stated in writing by the Administrator and delivered or mailedto the Participant or Beneficiary. Such notice shall set forth the specific reasons for thedenial, written to the best of the Administrator’s ability in a manner that may be understood
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without legal counsel. In addition, the Administrator shall afford a reasonable opportunity to anyParticipant or Beneficiary whose claim for benefits has been denied for a review of the decisiondenying the claim. In the event of further disagreement following any further decision of theAdministrator after such a review, either the Participant or the Administrator may appeal to thefull Board, which decision shall be final.8. **Amendment and Termination**     8.1 **Amendment or Termination.**While the Company intends and expects the Plan to continue tofulfill its purposes and serve the best interests of the Company in its present form, the Companyreserves the right to amend or terminate the Plan at any time and for any reason, subject to theprovisions in this Section 8.1, Section 8.2, and Section 9.          (a) The Administrator may determine that a Participant who has not had a Termination ofService shall no longer be eligible to participate in the Plan. If the Administrator terminates aParticipant’s eligibility to participate in the Plan prior to the Participant’s Termination ofService, then the Participant’s Account balance, if any, shall remain in the Plan and will be paidout in accordance with the terms of this Plan and the applicable deferral election.          (b) Notwithstanding any provision of the Plan to the contrary, in the event that the Companydetermines that any provision of the Plan may cause amounts deferred under the Plan to becomeimmediately taxable to any Participant under Section 409A of the Code, the Company may (i) adoptsuch amendments to the Plan and appropriate policies and procedures, including amendments andpolicies with retroactive effect, that the Company determines necessary or appropriate to preservethe intended tax treatment of the Plan benefits provided by the Plan and/or (ii) take such otheractions as the Company determines necessary or appropriate to comply with the requirements ofSection 409A of the Code.     8.2 **Accrued Benefits.**          (a) No termination of the Plan or any amendments thereto which affect Benefits under the Planshall, without the written consent of a Participant, eliminate or reduce any Benefit of theParticipant under the Plan to which, as of the date of such termination or amendment, suchParticipant would be entitled under the provisions of Section 5 had he or she ceased serving as aDirector immediately prior to such date.          (b) In the event of any amendment of the Plan which affects the amount of Benefits payableunder the Plan, Participants shall be entitled to receive the greater of (i) the Benefit providedunder the Plan as amended, or (ii) the Benefit described above in Section 8.2(a).          (c) For Pre-2005 Deferrals, upon termination of the Plan, all Deferred Compensation Agreementsshall terminate immediately and all Participants’ full Compensation on a non-deferred basis will berestored. Each and every Participant shall receive payment of the value of his or her Account inaccordance with the provisions of Section 5 as if such Participant had ceased serving as a Directoron the date of the Plan’s termination.
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          (d) For Post-2004 Deferrals, upon termination of the Plan, all Deferred CompensationAgreements shall terminate immediately and all Participants’ full Compensation on a non-deferredbasis will be restored. Additionally, with respect to Post-2004 Deferrals, the Plan may beterminated and liquidated at any time by the Company and payment of distributionsmay be accelerated, provided that, to the extent required by Section 409A (i) the terminationand liquidation does not occur proximate to a downturn in the financial health of the Company; (ii)all other plans are terminated with respect to all Participants, (iii) no Participant Accountbalances are paid, other than those otherwise payable under the terms of the Plan absent atermination of the Plan, within 12 months of the termination of the Plan, (iv) all ParticipantAccount balances are paid within 24 months of the termination of the Plan, and (v) the Company doesnot adopt another Account Balance Plan with respect to the Plan’s Participants at any time for aperiod of three years following the date of termination of the Plan.9. **Adjustment of Shares; Sale or Merger of the Company**     9.1 **Adjustment of Shares.**If any change is made in the Common Stock of the Company pursuantto which the value of a Share is determined, without the receipt of consideration by the Company(through merger, consolidation, reorganization, recapitalization, reincorporation, stock dividend,dividend in property other than cash, stock split, liquidating dividend, combination of shares,exchange of shares, change in corporate structure or other transaction not involving the receipt ofconsideration by the Company), the number of Shares held in a Participant’s Account will beappropriately adjusted. The Board shall make such adjustments, and its determination shall befinal, binding and conclusive. For this purpose, the conversion of any convertible securities ofthe Company shall not be treated as a transaction “without receipt of consideration” by theCompany.     9.2 **Sale or Merger of the Company.**In the event of a sale, merger, reorganization,consolidation or other similar transaction (a “Change of Ownership Transaction”) involving theCompany, no Participant in the Plan will be considered to have ceased serving as a Director forpurposes of the Plan, nor will any such Participant be entitled to receive Benefits pursuant toSection 5, until such Participant actually ceases serving as Director of the Company or anyacquiring or successor company or entity. Notwithstanding the foregoing, to the extent permittedby Section 409A of the Code and the regulations and other guidance thereunder, in connection with aChange of Ownership Transaction, immediate payment of Benefits may be directed by the Administratorof the Plan. In any event, no Change of Ownership Transaction involving the Company shall, withoutthe written consent of a Participant, eliminate or reduce any Benefit of the Participant under thePlan to which, as of the date of such Change of Ownership Transaction, such Participant would beentitled under the provisions of Section 5 had he or she ceased serving as a Director immediatelyprior to such date.10. **Miscellaneous**     10.1 **Benefits Fully Vested.**All Benefits under the Plan, to the extent accrued, shall befully vested at all times hereunder.
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     10.2 **No Right to Continue as Director.**Nothing contained in this Plan or in any agreement orinstrument executedpursuant to the Plan shall be construed as conferring upon any Participant the right to continueserving as a Director.     10.3 **Successors and Assigns.**This Plan shall be binding upon the Company and its successorsand assigns as well as each Participant and his or her representatives, successors, heirs, assigns,and Beneficiary.     10.4 **Assignment or Alienation.**To the extent permitted by law, benefits of Participants underthis Plan may not be anticipated, assigned (either by law or in equity), transferred, alienated orsubject to attachment, garnishment, levy, execution or other legal or equitable process.     10.5 **Entire Agreement.**The Plan and a Participant’s Deferred Compensation Agreement, and anysubsequently adopted amendment to either of these documents, shall constitute the total agreementor contract between the Company and such Participant regarding the Plan. No oral statementregarding the Plan may be relied upon by the Participant. If there are any conflicts between theterms of the Plan and a Participant’s Deferred Compensation Agreement, the terms of the Plan shallcontrol.     10.6 **Headings.**The headings herein are for reference only. In the event of a conflictbetween a heading and content of a Section of this Plan, the content of the Section shall control.     10.7 **Gender and Number.**Whenever used herein, the masculine shall be interpreted to includethe feminine and neuter, the neuter to include the masculine and feminine, the singular to includethe plural and the plural to include the singular, unless the context requires otherwise.     10.8 **Governing Law.**The place of administration of this Plan shall conclusively be deemed tobe within the State of California, and the Plan shall be governed by and in all respectsconstrued in accordance with the substantive laws of the State of California, except where suchlaws are superseded by federal laws.     10.9 **Compliance with Section 409A of the Code.**This Plan is intended to comply with therequirements of Section 409A of the Code and regulations and other guidance thereunder. TheAdministrator shall interpret the Plan provisions with respect to Post-2004 Deferrals in a mannerconsistent with the requirements of Section 409A of the Code and regulations and other guidancethereunder. To the extent one or more provisions of this Plan do not comply with Section 409A ofthe Code, such provision shall be automatically and immediately voided, and shall be amended assoon as administratively feasible and shall be administered to so comply.     10.10 **Scrivener’s Error.**Notwithstanding any other provision of this Plan to the contrary, ifthere is a scrivener’s error in properly transcribing this Plan document, it shall not be aviolation of the Plan terms to operate the Plan in accordance with its proper provisions, ratherthan in accordance with the terms of the Plan document, pending correction of the Plan documentthrough an amendment. In addition, any provisions of the Plan document improperlyadded as a result of scrivener’s error shall be considered null and void as of the date sucherror occurred.
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     10.11 **Plan Restatement Effective Date.**This Restatement of the Plan shall be effective withrespect to all Participants, Beneficiaries and any person claiming benefits under the Plan on orfollowing January 1, 2005, except as otherwise expressly indicated to the contrary.     **In Witness Whereof**, the Company has executed this Restatement of the Plan as of this31st day of December, 2008.      **IDM Pharma, Inc.**