Unassociated Document


     

    EXHIBIT
10.13(i)

    


    DBT
BIOPHARMACEUTICALS INC.

    


    2004
STOCK INCENTIVE PLAN


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    DBT
BIOPHARMACEUTICALS INC.

     

      
        

      

       

    

    2004
STOCK INCENTIVE PLAN

     

    
      

    

     

    ARTICLE
I

     

    PURPOSE

     

    The
purpose of this DBT Biopharmaceuticals Inc. 2004 Stock Incentive Plan is to enhance the
profitability and value of the Company for the benefit of its stockholders by
enabling the Company to offer employees of and Consultants (as defined below) to
and Non-Employee Directors (as defined below) of the Company and its Affiliates
(as defined below) stock options, restricted stock and other stock-based awards,
thereby creating a means to raise the level of stock ownership by such
individuals to attract, retain and reward such individuals and strengthen the
mutuality of interests between such individuals and the Company’s
stockholders.

     

    ARTICLE
II

     

    DEFINITIONS

     

    For
purposes of this Plan, the following terms shall have the following
meanings:

     

    2.1         “Acquisition
Events” has the meaning set forth in Section 4.2(d).

     

    2.2         “Affiliate”
means each of the following: (a) any Subsidiary; (b) any Parent; (c) any
corporation, trade or business (including, without limitation, a partnership or
limited liability company) which is directly or indirectly controlled 50% or
more (whether by ownership of stock, assets or an equivalent ownership interest
or voting interest) by the Company or one of its Affiliates; and (d) any other
entity in which the Company or any of its Affiliates has a material equity
interest and which is designated as an “Affiliate” by resolution of the
Committee.

     

    2.3         “Award”
shall mean any Award under this Plan of any Stock Option, Restricted Stock or
Other Stock-Based Award. All Awards shall be confirmed by, and subject to the
terms of, a written agreement executed by the Company and the
Participant.

     

    2.4         “Board”
means the Board of Directors of the Company.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    2.5         “Cause”
means, with respect to a Participant’s Termination of Employment or Termination
of Consultancy, the following: (a) in the case where there is no employment
agreement, consulting agreement, change in control agreement or similar
agreement in effect between the Company or an Affiliate and the Participant at
the time of the grant of the Award (or where there is such an agreement but it
does not define “cause” (or words of like import)), termination due to a
Participant’s insubordination, dishonesty, fraud, incompetence, moral turpitude,
willful misconduct, refusal to perform his or her duties or responsibilities in
any material respect for any reason other than illness or incapacity or
materially unsatisfactory performance of his or her duties for the Company or an
Affiliate, as determined by the Committee in its sole discretion; or (b) in the
case where there is an employment agreement, consulting agreement, change in
control agreement or similar agreement in effect between the Company or an
Affiliate and the Participant at the time of the grant of the Award that defines
“cause” (or words of like import), “cause” as defined under such agreement;
provided, however, that with regard to any agreement under which the definition
of “cause” only applies on occurrence of a change in control, such definition of
“cause” shall not apply until a change in control actually takes place and then
only with regard to a termination thereafter. With respect to a Participant’s
Termination of Directorship, “cause” means an act or failure to act that
constitutes cause for removal of a director under applicable Delaware
law.

     

    2.6         “Code”
means the Internal Revenue Code of 1986, as amended. Any reference to any
section of the Code shall also be a reference to any successor provision and any
Treasury Regulation promulgated thereunder.

     

    2.7         “Committee”
means (a) prior to the Registration Date, a committee or subcommittee of the
Board appointed from time to time by the Board and (b) following the
Registration Date, a committee or subcommittee appointed from time to time by
the Board which committee or subcommittee shall consist of two or more
non-employee directors, each of whom is intended to be, to the extent required
by Rule 16b-3, a “non-employee director” as defined in Rule 16b-3; provided,
however, that if for any reason the appointed Committee does not meet the
requirements of Rule 16b-3 such noncompliance shall not affect the validity of
grants, interpretations or other actions of the Committee. With respect to the
application of the Plan to Non-Employee Directors, the Committee shall refer to
the Board. Notwithstanding the foregoing, if, and to the extent that no
Committee exists which has the authority to administer this Plan, the functions
of the Committee shall be exercised by the Board and all references herein to
the Committee shall be deemed to be references to the Board.

     

    2.8         “Common
Stock” means the common stock, $.01 par value per share, of the
Company.

     

    2.9         “Company”
means DBT Biopharmaceuticals Inc., a Delaware corporation, and its successors by
operation of law.

     

    2.10       “Consultant”
means any natural person who is an advisor or consultant that provides bona fide
services to the Company or its Affiliates, provided that such services are not
in connection with the offer or sale of securities in a capital raising
transaction, and do not directly or indirectly promote or maintain a market for
the Company’s or its Affiliates securities.


    
      
         


      

      
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    2.11       “Disability”
means, with respect to a Participant’s Termination, the following: (a) in the
case where there is no employment agreement, consulting agreement, change in
control agreement or similar agreement in effect between the Company or an
Affiliate and the Participant at the time of the grant of an Award (or where
there is such an agreement but it does not define “disability” or words of like
import), termination as a result of a permanent and total disability as defined
in Section 22(e)(3) of the Code, provided that a Disability shall only be deemed
to occur at the time of the determination by the Committee of the Disability; or
(b) in the case where there is an employment agreement, consulting agreement,
change in control agreement or similar agreement in effect between the Company
or an Affiliate and the Participant at the time of the grant of an Award that
defines “disability” (or words of like import), “disability” as defined under
such agreement.

     

    2.12       “Effective
Date” means the effective date of this Plan as defined in Article
XIII.

     

    2.13       “Eligible
Employee” means each employee of the Company or an Affiliate.

     

    2.14       “Exchange
Act” means the Securities Exchange Act of 1934, as amended. Any references to
any section of the Exchange Act shall also be a reference to any successor
provision.

     

    2.15       “Fair
Market Value” means, for purposes of this Plan, unless otherwise required by any
applicable provision of the Code or any regulations issued thereunder, as of any
date and except as provided below, the last sales price reported for the Common
Stock on the applicable date: (a) as reported on the principal national
securities exchange in the United States on which it is then traded or The
Nasdaq Stock Market; or (b) if not traded on any such national securities
exchange or The Nasdaq Stock Market, as quoted on an automated quotation system
sponsored by the National Association of Securities Dealers, Inc.; or (c) if the
Common Stock shall not have been reported or quoted on such date, on the first
day prior thereto on which the Common Stock was reported or quoted; provided,
that the Committee may modify the definition of Fair Market Value to reflect any
changes in the trading practices of any exchange on which the Common Stock is
listed or traded. If the Common Stock is not readily tradable on a national
securities exchange. The Nasdaq Stock Market or any automated quotation system
sponsored by the National Association of Securities Dealers, Inc., its Fair
Market Value shall be set in good faith by the Committee. Notwithstanding
anything herein to the contrary, for purposes of granting Incentive Stock
Options, “Fair Market Value” means the price for Common Stock set by the
Committee in good faith based on reasonable methods set forth under Section 422
of the Code and the regulations thereunder including, without limitation, a
method utilizing the average of prices of the Common Stock reported on the
principal national securities exchange on which it is then traded during a
reasonable period designated by the Committee. For purposes of the grant of any
Stock Option, the applicable date shall be the date for which the last sales
price is available at the time of the grant.


    
      
         


      

      
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      2.16       “Family
Member” means “family member” as defined in Rule 701 under the Securities Act
or, following the filing of a Form S-8 pursuant to the Securities Act with
respect to the Plan, any child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law,
father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law,
including adoptive relationships, any person sharing the employee's household
(other than a tenant or employee), a trust in which these persons have more than
50% of the beneficial interest, a foundation in which these persons (or the
employee) control the management of assets, and any other entity in which these
persons (or the employee) own more than 50% of the voting interests or as
otherwise defined in Rule 701 under the Securities Act or in Section A1(5) of
the general instructions of Form S-8, as applicable.

       

      2.17       “Incentive
Stock Option” means any Stock Option awarded to an Eligible Employee under this
Plan intended to be and designated as an “Incentive Stock Option” within the
meaning of Section 422 of the Code.

       

      2.18       “Non-Employee
Director” means a director of the Company who is not an active employee of the
Company or an Affiliate.

       

      2.19       “Non-Qualified
Stock Option” means any Stock Option awarded under this Plan that is not an
Incentive Stock Option.

       

      2.20       “Other
Stock-Based Award” means an Award of Common Stock and other awards (including
awards of cash) made pursuant to Article VIII that are valued in whole or in
part by reference to, or are payable in or otherwise based on, Common Stock,
including, without limitation, an Award valued by reference to an
Affiliate.

       

      2.21       “Parent”
means any parent corporation of the Company within the meaning of Section 424(e)
of the Code.

       

      2.22       “Participant”
means any Eligible Employee, Consultant or Non-Employee Director to whom an
Award has been granted under this Plan.

       

      2.23       “Person”
means any individual, corporation, partnership, limited liability company, firm,
joint venture, association joint-stock company, trust, incorporated
organization, or governmental, regulatory or other entity.

       

      2.24       “Plan”
means this DBT Biopharmaceuticals Inc 2004 Stock Incentive Plan, as amended from
time to time.

       

      2.25       “Registration
Date” means the first date (a) on which the Company sells its Common Stock in a
bona fide, firm commitment underwriting pursuant to a registration statement
under the Securities Act or (b) any class of common equity securities of the
Company are registered under Section 12 of the Exchange Act.

       

      2.26       “Restricted
Stock” means an Award of Common Stock under this Plan that is subject to Article
VII.


      
        
           


        

        
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    2.27       “Restriction
Period” shall have the meaning set forth in Section 7.1.

     

    2.28       “Retirement”
means a Termination of Employment or Termination of Consultancy for any reason
other than for Cause at or after age 65 or such earlier date after age 50 as may
be approved by the Committee with regard to such Participant. With respect to a
Participant’s Termination of Directorship, Retirement means the failure to stand
for reelection (other than a Termination for Cause) on or after a Participant
has attained age 65 or, with the consent of the Board, before age 65 but after
age 50.

     

    2.29       “Rule
16b-3” means Rule 16b-3 under Section 16(b) of the Exchange Act as then in
effect or any successor provision.

     

    2.30       “Securities
Act” means the Securities Act of 1933, as amended and all rules and regulations
promulgated thereunder. Any reference to any section of the Securities Act shall
also be a reference to any successor provision.

     

    2.31       “Stock
Option” or “Option” means any option to purchase shares of Common Stock granted
to Eligible Employees, Non-Employee Directors or Consultants under Article
VI.

     

    23.2       “Subsidiary”
means any subsidiary corporation of the Company within the meaning of Section
424(f) of the Code.

     

    2.33       “Ten
Percent Stockholder” means a person owning stock possessing more than 10% of the
total combined voting power of all classes of stock of the Company, its
Subsidiaries or its Parent.

     

    2.34       “Termination”
means a Termination of Consultancy, Termination of Directorship or Termination
of Employment, as applicable.

     

    2.35       “Termination
of Consultancy” means: (a) that the Consultant is no longer acting as a
consultant to the Company or an Affiliate; or (b) when an entity which is
retaining a Participant as a Consultant ceases to be an Affiliate unless the
Participant otherwise is, or thereupon becomes, a Consultant to the Company or
another Affiliate at the time the entity ceases to be an Affiliate. In the event
that a Consultant becomes an Eligible Employee or a Non-Employee Director upon
the termination of his or her consultancy, unless otherwise determined by the
Committee, in its sole discretion, no Termination of Consultancy shall be deemed
to occur until such time as such Consultant is no longer a Consultant, Eligible
Employee or Non-Employee Director. Notwithstanding the foregoing, the Committee
may otherwise define Termination of Consultancy in the Award agreement or, if no
rights of a Participant are reduced, may otherwise define Termination of
Consultancy thereafter.

     

    2.36      
“Termination of Directorship” means that the Non-Employee Director has ceased to
be a director of the Company; except that if a Non-Employee Director becomes an
Eligible Employee or a Consultant upon the termination of his or her
directorship, his or her ceasing to be a director of the Company shall not be
treated as a Termination of Directorship unless and until the Participant has a
Termination of Employment or Termination of Consultancy, as the case may
be.


    
      
         


      

      
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    2.37       “Termination
of Employment” means: (a) a termination of employment (for reasons other than a
military or personal leave of absence granted by the Company) of a Participant
from the Company and its Affiliates; or (b) when an entity which is employing a
Participant ceases to be an Affiliate, unless the Participant otherwise is, or
thereupon becomes, employed by the Company or another Affiliate at the time the
entity ceases to be an Affiliate. In the event that an Eligible Employee becomes
a Consultant or Non-Employee Director upon the termination of his or her
employment, unless otherwise determined by the Committee, in its sole
discretion, no Termination of Employment shall be deemed to occur until such
time as such Eligible Employee is no longer an Eligible Employee, Consultant or
Non-Employee Director. Notwithstanding the foregoing, the Committee may
otherwise define Termination of Employment in the Award agreement or, if no
rights of a Participant are reduced, may otherwise define Termination of
Employment thereafter.

     

    2.38       “Transfer”
means: (a) when used as a noun, any direct or indirect transfer, sale,
assignment, pledge, hypothecation, encumbrance or other disposition (including
the issuance of equity in a Person), whether for value or no value and whether
voluntary or involuntary (including by operation of law), and (b) when used as a
verb, to directly or indirectly transfer, sell, assign, pledge, encumber,
charge, hypothecate or otherwise dispose of (including the issuance of equity in
a Person) whether for value or no value and whether voluntarily or involuntarily
(including by operation of law), “Transferred” and “Transferable” shall have a
correlative meaning.

     

    ARTICLE
III

     

    ADMINISTRATION

     

    3.1        
The Committee.
The Plan shall be administered and interpreted by the Committee.

     

    3.2        
Grants of
Awards. The Committee shall have full authority to grant Awards to
Eligible Employees, Consultants and Non-Employee Directors pursuant to the terms
of this Plan. All Awards shall be granted by, confirmed by, and subject to the
terms of, a written agreement executed by the Company and the Participant. In
particular, the Committee shall have the authority:

     

    (a)          to
select the Eligible Employees, Consultants and Non-Employee Directors to whom
Awards may from time to time be granted hereunder;

     

    (b)          to
determine whether and to what extent Awards are to be granted hereunder to one
or more Eligible Employees, Consultants and Non-Employee
Directors;


    
      
         


      

      
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    (c)        to
determine, in accordance with the terms of this Plan, the number of shares of
Common Stock to be covered by each Award granted hereunder;

     

    (d)        to
determine the terms and conditions, not inconsistent with the terms of this
Plan, of any Award granted hereunder (including, but not limited to, the
exercise or purchase price (if any), any restriction or limitation, any vesting
schedule or acceleration thereof and any forfeiture restrictions or waiver
thereof, regarding any Award and the shares of Common Stock relating thereto,
based on such factors, if any, as the Committee shall determine, in its sole
discretion);

     

    (e)        to
determine whether and under what circumstances a Stock Option may be settled in
cash, Common Stock and/or restricted stock under Section 6.3(d);

     

    (f)        
to determine whether, to what extent and under what circumstances to provide
loans (which may be on a recourse basis and shall bear interest at the rate the
Committee shall provide) to Participants in order to exercise Stock Options
under this Plan, provided that on and after the Registration Date senior
executive officers and directors are not eligible to receive such loans, and
provided further, that all outstanding loans shall be repaid before the
Registration Date;

     

    (g)        to
determine whether a Stock Option is an Incentive Stock Option or Non-Qualified
Stock Option;

     

    (h)        to
determine whether to require an Eligible Employee, Non-Employee Director or
Consultant, as a condition of the granting of any Option, not to sell or
otherwise dispose of shares of Common Stock acquired pursuant to the exercise of
an Option for a period of time as determined by the Committee, in its sole
discretion, following the date of the acquisition of the Stock
Option;

     

    (i)        
to modify, extend or renew a Stock Option, subject to Article X hereof;
provided, however, that if a Stock Option is modified, extended or renewed and
thereby deemed to be the issuance of a new Stock Option under the Code or the
applicable accounting rules, the exercise price of a Stock Option may continue
to be the original exercise price even if less than the Fair Market Value of the
Common Stock at the time of such modification, extension or
renewal;

     

    (j)         to
offer to buy out an Option previously granted, based on such terms and
conditions as the Committee shall establish and communicate to the Participant
at the time such offer is made; and

     

    (k)        to
authorize the addition of one of more appendices to the Plan to govern the
administration of the Plan and Awards as applied to Participants residing in, or
otherwise subject to the laws of, jurisdictions outside of the United States, to
the extent the Committee deems necessary or desirable to reflect local law or
custom.


    
      
         


      

      
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    3.3         Guidelines. Subject
to Article X hereof, the Committee shall have the authority to adopt, alter and
repeal such administrative rules, guidelines and practices governing this Plan
and perform all acts, including the delegation of its administrative
responsibilities, as it shall, from time to time, deem advisable; to construe
and interpret the terms and provisions of this Plan and any Award granted under
this Plan (and any agreements relating thereto); and to otherwise supervise the
administration of this Plan. The Committee may correct any defect, supply any
omission or reconcile any inconsistency in this Plan or in any agreement
relating thereto in the manner and to the extent it shall deem necessary to
effectuate the purpose and intent of this Plan. The Committee may adopt special
guidelines and provisions for persons who are residing in or employed in, or
subject to, the taxes of, any domestic or foreign jurisdictions to comply with
applicable tax and securities laws and may impose any limitations and
restrictions that it deems necessary to comply with the applicable tax and
securities laws of such domestic or foreign jurisdictions. To the extent
applicable, this Plan is intended to comply with the applicable requirements of
Rule 16b-3 and shall be limited, construed and interpreted in a manner so as to
comply therewith.

     

    3.4         Decisions Final. Any
decision, interpretation or other action made or taken in good faith by or at
the direction of the Company, the Board or the Committee (or any of its members)
arising out of or in connection with this Plan shall be within the absolute
discretion of all and each of them, as the case may be, and shall be final,
binding and conclusive on the Company and all employees and Participants and
their respective heirs, executors, administrators, successors and
assigns.

     

    3.5         Reliance on Counsel.
The Company, the Board or the Committee may consult with legal counsel, who may
be counsel for the Company or other counsel, with respect to its obligations or
duties hereunder, or with respect to any action or proceeding or any question of
law, and shall not be liable with respect to any action taken or omitted by it
in good faith pursuant to the advice of such counsel.

     

    3.6         Procedures. If the
Committee is appointed, the Board shall designate one of the members of the
Committee as chairman and the Committee shall hold meetings, subject to the
By-Laws of the Company, at such times and places as it shall deem advisable,
including, without limitation, by telephone conference or by written consent to
the extent permitted by applicable law. A majority of the Committee members
shall constitute a quorum. All determinations of the Committee shall be made by
a majority of its members. Any decision or determination reduced to writing and
signed by all the Committee members in accordance with the By-Laws of the
Company, shall be fully as effective as if it had been made by a vote at a
meeting duly called and held. The Committee shall keep minutes of its meetings
and shall make such rules and regulations for the conduct of its business as it
shall deem advisable.


    
      
         


      

      
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    3.7         Designation of
Consultants/Liability. (a)   The Committee may designate
employees of the Company and professional advisors to assist the Committee in
the administration of this Plan and may grant authority to officers to execute
agreements or other documents on behalf of the Committee.

     

      
(b)     The Committee may employ such legal counsel,
consultants and agents as it may deem desirable for the administration of this
Plan and may rely upon any opinion received from any such counsel or consultant
and any computation received from any such consultant or agent. Expenses
incurred by the Committee or the Board in the engagement of any such counsel,
consultant or agent shall be paid by the Company. The Committee, its members and
any person designated pursuant to this Section 3.7 above shall not be liable for
any action or determination made in good faith with respect to this Plan. To the
maximum extent permitted by applicable law, no officer of the Company or member
or former member of the Committee or of the Board shall be liable for any action
or determination made in good faith with respect to this Plan or any Award
granted under it.

     

    3.8         Indemnification. To
the maximum extent permitted by applicable law and the Certificate of
Incorporation and By-Laws of the Company and to the extent not covered by
insurance directly insuring such person, each officer and member or former
member of the Committee or the Board shall be indemnified and held harmless by
the Company against any cost or expense (including reasonable fees of counsel
reasonably acceptable to the Committee) or liability (including any sum paid in
settlement of a claim with the approval of the Committee), and advanced amounts
necessary to pay the foregoing at the earliest time and to the fullest extent
permitted, arising out of any act or omission to act in connection with the
administration of this Plan, except to the extent arising out of such officer’s,
member’s or former member’s own fraud or bad faith. Such indemnification shall
be in addition to any rights of indemnification the employees, officers,
directors or members or former officers, directors or members may have under
applicable law or under the Certificate of Incorporation or By-Laws of the
Company or any Affiliate. Notwithstanding anything else herein, this
indemnification will not apply to the actions or determinations made by an
individual with regard to Awards granted to him or her under this
Plan.

     

    ARTICLE
IV

     

    SHARE AND
OTHER LIMITATIONS

     

    4.1        Shares. The aggregate
number of shares of Common Stock which may be issued or used for reference
purposes under this Plan or with respect to which Awards (including, without
limitation, Incentive Stock Options) may be granted under this Plan shall not
exceed 13,750 (subject to any increase or decrease pursuant to Section 4.2),
which may be either authorized and unissued Common Stock or Common Stock held in
or acquired for the treasury of the Company or both. If any Stock Option granted
under this Plan expires, terminates or is canceled for any reason without having
been exercised in full or the Company repurchases any Stock Option, the number
of shares of Common Stock underlying such unexercised or repurchased Stock
Option shall again be available for the purposes of Awards under this Plan. If
Restricted Stock or an Other Stock-Based Award is forfeited for any reason, the
number of forfeited shares of Restricted Stock or shares subject to an Other
Stock-Based Award shall again be available for purposes of Awards under the
Plan. If any Award expires, terminates or is cancelled, forfeited or
repurchased, the number of shares of Common Stock underlying such Awards shall
not count against the limits in the second sentence of this Section 4.1. In
addition, in determining the number of shares of Common Stock available for
Awards, if Common Stock has been delivered or exchanged by a Participant as full
or partial payment to the Company for payment of the exercise price, or for
payment of withholding taxes, or if the number of shares of Common Stock
otherwise deliverable has been reduced for payment of the exercise price or for
payment of withholding taxes, the number of shares of Common Stock exchanged as
payment in connection with the exercise or for withholding or so reduced shall
be available for purposes of Awards under this Plan.


    
      
         


      

      
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    4.2          Changes.

     

    (a)         The
existence of this Plan and the Award granted hereunder shall not affect in any
way the right or power of the Board or the stockholders of the Company to make
or authorize (i) any adjustment, recapitalization, reorganization or other
change in the Company’s capital structure or its business, (ii) any merger or
consolidation of the Company or any Affiliate, (iii) any issuance of bonds,
debentures, preferred or prior preference stock ahead of or affecting the Common
Stock, (iv) the dissolution or liquidation of the Company or any Affiliate, (v)
any sale or transfer of all or part of the assets or business of the Company or
any Affiliate or (vi) any other corporate act or proceeding.

     

    (b)         Subject
to the provisions of Section 4.2(d), in the event of any such change in the
capital structure or business of the Company by reason of any stock split,
reverse stock split, stock dividend, combination or reclassification of shares,
recapitalization, or other change in capital structure of the Company, merger,
consolidation, spin-off, reorganization, partial or complete liquidation,
issuance of rights or warrants to purchase any Common Stock or securities
convertible into Common Stock, any sale or transfer of all or part of the
Company’s assets or business, or any other corporate transaction or event having
an effect similar to any of the foregoing and effected without receipt of
consideration by the Company, then the aggregate number and kind of shares which
thereafter may be issued under this Plan, the number and kind of shares or other
property (including cash) to be issued upon exercise of an outstanding Award or
under other Awards granted under this Plan and the purchase or exercise price
thereof shall be appropriately adjusted consistent with such change in such
manner as the Committee may deem equitable to prevent substantial dilution or
enlargement of the rights granted to, or available for, Participants under this
Plan, and any such adjustment determined by the Committee in good faith shall be
final, binding and conclusive on the Company and all Participants and employees
and their respective heirs, executors, administrators, successors and assigns.
In connection with any event described in this paragraph, the Committee may
provide, in its sole discretion, for the cancellation of any outstanding Awards
and payment in cash or other property in exchange therefor. Except as provided
in this Section 4.2, a Participant shall have no rights by reason of any
issuance by the Company of any class or securities convertible into stock of any
class, any subdivision or consolidation of shares of stock of any class, the
payment of any stock dividend, any other increase or decrease in the number of
shares of stock of any class, any sale or transfer of all or part of the
Company’s assets or business or any other change affecting the Company’s capital
structure or business.


    
      
         


      

      
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    (c)          Fractional
shares of Common Stock resulting from any adjustment in Awards pursuant to
Section 4.2(a) or (b) shall be aggregated until, and eliminated at the time of
such adjustment by rounding-down for fractions less than one-half and
rounding-up for fractions equal to or greater than one-half. No fractional
shares of Common Stock shall be issued under the Plan. Notice of any adjustment
shall be given by the Committee to each Participant whose Award has been
adjusted and such adjustment (whether or not such notice is given) shall be
effective and binding for all purposes of this Plan.

     

    (d)         In
the event of a merger or consolidation in which the Company is not the surviving
entity or in the event of any transaction that results in the acquisition of all
or substantially all of the Company’s outstanding Common Stock by a single
person or entity or by a group of persons and/or entities acting in concert, or
in the event of the sale or transfer of all or substantially all of the
Company’s assets (all of the foregoing being referred to as “Acquisition
Events”), the Committee may, in its sole discretion, terminate all outstanding
exercisable Awards, effective as of the date of the Acquisition Event, by
delivering notice of termination to each Participant at least 20 days prior to
the date of consummation of the Acquisition Event, in which case during the
period from the date on which such notice of termination is delivered to the
consummation of the Acquisition Event, each such Participant shall have the
right to exercise in full all of his or her Awards that are then outstanding
(without regard to any limitations on exercisability otherwise contained in the
Award agreements), but any such exercise shall be contingent upon and subject to
the occurrence of the Acquisition Event, and, provided that, if the Acquisition
Event does not take place within a specified period after giving such notice for
any reason whatsoever, the notice and exercise pursuant thereto shall be null
and void.

     

    If an
Acquisition Event occurs but the Committee does not terminate the outstanding
Awards pursuant to this Section 4.2(d), then the provisions of Section 4.2(b)
shall apply.

     

    4.3        
  Minimum
Purchase Price. Notwithstanding any provision of this Plan to the
contrary, if authorized but previously unissued shares of Common Stock are
issued under this Plan, such shares shall not be issued for a consideration
which is less than as permitted under applicable law.


    
      
         


      

      
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    ARTICLE
V

     

    ELIGIBILITY

     

    5.1        
  General Eligibility. All
Eligible Employees, Non-Employee Directors and Consultants and prospective
Eligible Employees, Consultants and Non-Employee Directors are eligible to be
granted Non-Qualified Stock Options, Restricted Stock and Other Stock-Based
Awards. Eligibility for the grant of Awards and actual participation in this
Plan shall be determined by the Committee in its sole discretion.

     

    5.2      
    Incentive Stock Options. All
Eligible Employees of the Company, its Subsidiaries and its Parent (if any) are
eligible to be granted Incentive Stock Options and other Awards under this Plan.
Eligibility for the grant of an Award and actual participation in this Plan
shall be determined by the Committee in its sole discretion.

     

    5.3     
     General Requirement. The vesting and exercise of Awards granted to a
prospective Eligible Employee, Consultant or Non-Employee Director are
conditioned upon such individual actually becoming an Eligible Employee,
Consultant or Non-Employee Director.

     

    ARTICLE
VI

     

    STOCK
OPTIONS

     

    6.1      
    Stock Options. Each
Stock Option granted hereunder shall be one of two types: (a) an Incentive Stock
Option intended to satisfy the requirements of Section 422 of the Code; or (b) a
Non-Qualified Stock Option.

     

    6.2      
    Grants. Subject to
the provisions of Article V, the Committee shall have the authority to grant to
any Eligible Employee one or more Incentive Stock Options, Non-Qualified Stock
Options or both types of Stock Options. To the extent that any Stock Option does
not qualify as an Incentive Stock Option (whether because of its provisions or
the time or manner of its exercise or otherwise), such Stock Option or the
portion thereof which does not qualify, shall constitute a separate
Non-Qualified Stock Option. The Committee shall have the authority to grant any
Consultant or Non-Employee Director one or more Non-Qualified Stock Options.
Notwithstanding any other provision of this plan to the contrary or any
provision in an agreement evidencing the grant of a Stock Option to the
contrary, any Stock Option granted to an Eligible Employee of an Affiliate
(other than an Affiliate which is a Parent or a Subsidiary) shall be a
Non-Qualified Stock Option.

     

    6.3       
   Terms of Stock
Options. Stock Options granted under this Plan shall be subject to the
following terms and conditions, and shall be in such form and contain such
additional terms and conditions, not inconsistent with the terms of this Plan,
as the Committee shall deem desirable:


    
      
         


      

      
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    (a)         Exercise Price. The exercise price per
share of Common Stock subject to a Stock Option shall be determined by the
Committee at the time of grant; provided that the per share exercise price of an
Incentive Stock Option shall not be less than 100% of the Fair Market Value of
the share of Common Stock at the time of grant; and provided, further, that if
an Incentive Stock Option is granted to a Ten Percent Stockholder, the exercise
price per share shall be no less than 110% of the Fair Market Value of the
Common Stock.

     

    (b)         Stock Option Term. The term of each
Stock Option shall be fixed by the Committee; provided, however, that no Stock
Option shall be exercisable more than 10 years after the date such Stock Option
is granted; and further provided that the term of an Incentive Stock Option
granted to a Ten Percent Stockholder shall not exceed five years.

     

    (c)         Exercisability. Stock Options shall be
exercisable at such time or times and subject to such terms and conditions as
shall be determined by the Committee at grant. If the Committee provides, in its
discretion, that any Stock Option is exercisable subject to certain limitations
(including, without limitation, that such Stock Option is exercisable only in
installments or within certain time periods or upon the attainment of certain
financial results), the Committee may waive such limitations on the
exercisability at any time at or after grant in whole or in part (including,
without limitation, waiver of the installment exercise provisions or
acceleration of the time at which such Stock Option may be exercised), based on
such factors, if any, as the Committee shall determine, in its sole
discretion.

     

    (d)         Method of Exercise. Subject
to whatever installment exercise and waiting period provisions apply under
sub-section (c) above, to the extent vested, a Stock Option may be exercised in
whole or in part at any time and from time to time during the Stock Option term
by giving written notice of exercise to the Committee specifying the number of
shares to be acquired. Such notice shall be accompanied by payment in full of
the purchase price as follows: (i) in cash or by check, bank draft or money
order payable to the order of the Company; (ii) to the extent permitted by law,
if the Common Stock is traded on a national securities exchange, The Nasdaq
Stock Market, Inc. or quoted on a national quotation system sponsored by the
National Association of Securities Dealers, through a procedure whereby the
Participant delivers irrevocable instructions to a broker reasonably acceptable
to the Committee to deliver promptly to the Company an amount equal to the
purchase price, to the extent authorized by the Committee; or (iii) on such
other terms and conditions as may be acceptable to the Committee (including,
without limitation, the relinquishment of Stock Options or by payment in full or
in part in the form of Common Stock owned by the Participant for a period of at
least six months or such other period necessary to avoid a charge, for
accounting purposes, against the Company’s earnings as reported in the Company’s
financial statements (and for which the Participant has good title free and
clear of any liens and encumbrances) based on the Fair Market Value of the
Common Stock on the payment date as determined by the Committee). No shares of
Common Stock shall be issued until payment therefor, as provided herein, has
been made or provided for.


    
      
         


      

      
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    (e)         Incentive Stock Option
Limitations. To the extent that the aggregate Fair
Market Value (determined as of the time of grant) of the Common Stock with
respect to which Incentive Stock Options are exercisable for the first time by
an Eligible Employee during any calendar year under this Plan and/or any other
stock option plan of the Company, any Subsidiary or any Parent exceeds $100,000,
such Options shall be treated as Non-Qualified Stock Options. In addition, if an
Eligible Employee does not remain employed by the Company, any Subsidiary or any
Parent at all times from the time an Incentive Stock Option is granted until
three months prior to the date of exercise thereof (or such other period as
required by applicable law), such Stock Option shall be treated as a
Non-Qualified Stock Option. Should any provision of this Plan not be necessary
in order for the Stock Options to qualify as Incentive Stock Options, or should
any additional provisions be required, the Committee may amend this Plan
accordingly, without the necessity of obtaining the approval of the stockholders
of the Company.

     

    (f)         Form, Modification, Extension and
Renewal of Stock Options. Subject to the terms and conditions and within
the limitations of this Plan, Stock Options shall be evidenced by such form of
agreement or grant as is approved by the Committee, and the Committee may (i)
modify, extend or renew outstanding Stock Options granted under this Plan
(provided that the rights of a Participant are not reduced without his or her
consent), and (ii) accept the surrender of outstanding Stock Options (up to the
extent not theretofore exercised) and authorize the granting of new Stock
Options in substitution therefor (to the extent not theretofore
exercised).

     

    (g)        Deferred Delivery of Common Shares.
The Committee may in its discretion permit Participants to defer delivery
of Common Stock acquired pursuant to a Participant’s exercise of an Option in
accordance with the terms and conditions established by the
Committee.

     

    (h)        Early Exercise. The Committee
may provide that a Stock Option include a provision whereby the Participant may
elect at any time before the Participant’s Termination to exercise the Stock
Option as to any part or all of the shares of Common Stock subject to the Stock
Option prior to the full vesting of the Stock Option and such shares shall be
subject to certain restrictions as determined by the Committee and be treated as
restricted stock. Any unvested shares of Common Stock so purchased may be
subject to a repurchase option in favor of the Company or to any other
restriction the Committee determines to be appropriate.


    
      
         


      

      
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    (i)          Other Terms and Conditions.
Stock Options may contain such other provisions, which shall not be inconsistent
with any of the terms of this Plan, as the Committee shall deem
appropriate.

    


    ARTICLE
VII

     

    RESTRICTED
STOCK

     

    7.1          Awards of Restricted
Stock. Restricted Stock may be issued to all eligible Participants
pursuant to Article V of the Plan either alone or in addition to other Awards
granted under the Plan. The Committee shall determine the eligible Participants
to whom, and the time or times at which, grants of Restricted Stock will be
made, the number of shares to be awarded, the purchase price (if any) to be paid
by the Participant (subject to Section 7.2), the time or times at which such
Awards may be subject to forfeiture (if any), the vesting schedule (if any) and
rights to acceleration thereof, and all other terms and conditions of the
Awards. The Committee may condition the grant or vesting of Restricted Stock
upon the attainment of specified performance targets or such other factors as
the Committee may determine, in its sole discretion. Unless otherwise determined
by the Committee, the Participant shall not be permitted to transfer shares of
Restricted Stock awarded under this Plan during a period set by the Committee
(if any) (the “Restriction Period”) commencing with the date of such Award, as
set forth in the applicable Award agreement.

     

    7.2          Awards and
Certificates. A Participant selected to receive Restricted Stock shall
not have any rights with respect to such Award, unless and until such
Participant has delivered a fully executed copy of the Award agreement
evidencing the Award to the Company and has otherwise complied with the
applicable terms and conditions of such Award. Further, such Award shall be
subject to the following conditions:

     

    (a)         Purchase Price. The purchase
price of Restricted Stock shall be determined by the Committee, but shall not be
less than as permitted under applicable law.

     

    (b)         Acceptance. Awards of
Restricted Stock must be accepted within a period of 60 days (or such shorter
period as the Committee may specify at grant) after the grant date, by executing
an Award agreement and by paying whatever price (if any) the Committee has
designated thereunder.

     

    (c)         Legend. Each Participant
receiving Restricted Stock shall be issued a stock certificate in respect of
such shares of Restricted Stock, unless the Committee elects to use another
system, such as book entries by the transfer agent, as evidencing ownership of
Restricted Stock. Such certificate shall be registered in the name of such
Participant, and shall bear an appropriate legend referring to the terms,
conditions, and restrictions applicable to such Award, substantially in the
following form:


    
      
         


      

      
        15

        
          

        

      

      
         


      

    


    “The
anticipation, alienation, attachment, sale, transfer, assignment, pledge,
encumbrance or charge of the shares of stock represented hereby are subject to
the terms and conditions (including forfeiture) of the DBT Biopharmaceuticals
Inc. (the “Company”) 2004 Stock Incentive Plan, and an Award agreement entered
into between the registered owner and the Company dated ______________. Copies
of such Plan and Award agreement are on file at the principal office of the
Company.”

     

    (d)        Custody. The Committee may
require that any stock certificates evidencing such shares be held in custody by
the Company until the restrictions thereon shall have lapsed, and that, as a
condition of any Restricted Stock Award, the Participant shall have delivered a
duly signed stock power, endorsed in blank, relating to the Common Stock covered
by such Award.

     

    (e)         Rights as Stockholder. Except
as provided in this subsection and subsection (d) above and as otherwise
determined by the Committee, the Participant shall have, with respect to the
shares of Restricted Stock, all of the rights of a holder of shares of Common
Stock of the Company including, without limitation, the right to receive any
dividends, the right to vote such shares and, subject to and conditioned upon
the full vesting of shares of Restricted Stock, the right to tender such shares.
Notwithstanding the foregoing, the payment of dividends shall be deferred until,
and conditioned upon, the expiration of the applicable Restriction Period,
unless the Committee, in its sole discretion, specifies otherwise at the time of
the Award.

     

    (f)          Lapse of Restrictions. If and
when the Restriction Period expires without a prior forfeiture of the Restricted
Stock subject to such Restriction Period, the certificates for such shares shall
be delivered to the Participant. All legends shall be removed from said
certificates at the time of delivery to the Participant except as otherwise
required by applicable law. Notwithstanding the foregoing, actual certificates
shall not be issued to the extent that book entry recordkeeping is
used.

     

    ARTICLE
VIII

     

    OTHER
STOCK-BASED AWARDS

     

    8.1          Other Awards. Other Stock-Based Awards
(including, without limitation, restricted stock units and performance share
awards) may be granted either alone or in addition to or other Awards granted
under the Plan to all eligible Participants pursuant to Article V of the
Plan.

     

    8.2          Committee. Subject to the provisions of
the Plan, the Committee shall have the authority to determine the persons to
whom and the time or times at which Other Stock-Based Awards shall be made, the
number of shares of Common Stock to be awarded pursuant to such Awards, and all
other conditions of the Awards. The Committee may also provide for the
grant of Common Stock under such Awards upon the completion of a specified
performance period.


    
      
         


      

      
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    8.3         
Terms and Conditions. Other
Stock-Based Awards made pursuant to this Article VIII shall be subject to the
following terms and conditions:

     

    (a)     
Dividends. Unless
otherwise determined by the Committee at the time of award, subject to the
provisions of the Award agreement or grant
letter and the Plan, the recipient of an Award under this Article VIII shall be
entitled to receive, currently or on a deferred basis, dividends or dividend
equivalents with respect to the number of shares of Common Stock covered by the
Award, as determined at the time of the Award by the Committee, in its sole
discretion.

     

    (b)  Vesting. Any Award under this Article VIII and
any Common Stock covered by any such Award shall vest or be forfeited to the
extent so provided in the Award agreement, as determined by the Committee, in
its sole discretion.

     

    (c)  Waiver of
Limitation. The Committee may, in its sole discretion, waive in
whole or in part any or all of the limitations imposed hereunder (if any) with
respect to all or any portion of an Award under this Article VIII.

     

    (d)  Price. Common Stock or Other
Stock-Based Awards issued on a bonus basis under this Article VIII may be issued
for no cash consideration; Common Stock or Other Stock-Based Awards purchased
pursuant to a purchase right awarded under this Article VIII shall be priced as
determined by the Committee. Subject to Section 4.3, the purchase price of
shares of Common Stock or Other Stock-Based Awards may be zero to the extent
permitted by applicable law, and, to the extent not so permitted, such purchase
price may not be less than par value. The purchase of shares of Common Stock or
Other Stock-Based Awards may be made on either an after-tax or pre-tax basis, as
determined by the Committee; provided, however, that if the purchase is made on
a pre-tax basis, such purchase shall be made pursuant to a deferred compensation
program established by the Committee, which will be deemed a part of the
Plan.

    


    ARTICLE
IX

    


    NON-TRANSFERABILITY
AND TERMINATION OF

    EMPLOYMENT/CONSULTANCY/DIRECTORSHIP

     

    9.1         
Non-Transferability

     

    (a)     Except
as otherwise specifically provided herein, no Stock Option shall be Transferable
by the Participant otherwise than by will or by the laws of descent and
distribution. All Stock Options shall be exercisable, during the Participant's
lifetime, only by the Participant. Shares of Restricted Stock or Other
Stock-Based Awards may not be Transferred prior to the date on which shares
are issued, or if later, the date on which any applicable restriction,
performance or deferred period lapses. Any attempt to Transfer any such Award
shall be void and immediately cancelled, and no Award shall in any manner be
liable for or subject to the debts, contracts, liabilities, engagements or torts
of any person who shall be entitled to such Award, nor shall it be subject to
attachment or legal process for or against such person.


    
      
         


      

      
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    (b)     Notwithstanding
the foregoing, the Committee may determine, in its sole discretion, at the time
of grant or thereafter that a Non-Qualified Stock Option that is otherwise not
Transferable pursuant to this Section 9.1 is Transferable to a Family Member in
whole or in part and in such circumstances, and under such conditions, as
specified by the Committee. A Non-Qualified Stock Option that is Transferred to
a Family Member pursuant to the preceding sentence (i) may not be subsequently
Transferred otherwise than by will or by the laws of descent and distribution
and (ii) remains subject to the terms of this Plan and the Stock Option
agreement. Any shares of Common Stock acquired upon the exercise of a Stock
Option by a permissible transferee of a Stock Option or a permissible transferee
pursuant to a Transfer after the exercise of the Stock Option shall be subject
to the terms of this Plan and the Stock Option agreement, including, without
limitation, the provisions of Article XI hereof.

    


     

    9.2         Termination. The
following rules apply with regard to the Termination of a
Participant.

     

    (a)         
Rules Applicable to Stock
Options. Unless otherwise determined by the Committee at grant or, if no
rights of the Participant are reduced, thereafter:

     

    (i)          Termination by Reason of Death,
Disability or Retirement. If a Participant's Termination is by reason of
death, Disability or Retirement, all Stock Options that are held by such
Participant that are vested and exercisable at the time of the Participant's
Termination may be exercised by the Participant (or, in the case of death, by
the legal representative of the Participant's estate) at any time within a
period of one year from the date of such Termination, but in no event beyond the
expiration of the stated term of such Stock Options; provided, however, that in
the case of Retirement, if the Participant dies within such exercise period, all
unexercised Stock Options held by such Participant shall thereafter be
exercisable, to the extent to which they were exercisable at the time of death,
for a period of one year
from the date of such death, but in no event beyond the expiration of the stated
term of such Stock Options.

     

    (ii)         Involuntary Termination Without
Cause. If a Participant's Termination is by involuntary termination
without Cause, all Stock Options that are held by such Participant that are
vested and exercisable at the time of the Participant's Termination may be
exercised by the Participant at any time within a period of 90 days from the
date of such Termination, but in no event beyond the expiration of the stated
term of such Stock Options.


    
      
         


      

      
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    (iii)         Voluntary Termination. If a
Participant's Termination is voluntary (other than a voluntary termination
described in Section 9.2(a)(iv)(2) below), all Stock Options that are held by
such Participant that are vested and exercisable at the time of the
Participant's Termination may be exercised by the Participant at any time within
a period of 30 days from the date of such Termination, but in no event beyond
the expiration of the stated terms of such Stock Options.

     

    (iv)         Termination for Cause. If a
Participant's Termination: (1) is for Cause or (2) is a voluntary Termination
(as provided in sub-section (iii) above) after the occurrence of an event that
would be grounds for a Termination for Cause, all Stock Options, whether vested
or not vested, that are held by such Participant shall thereupon terminate and
expire as of the date of such Termination.

     

    (v)         Unvested Stock Options.
Unless otherwise determined in an employment agreement or Award
agreement, Stock Options that are not vested as of the date of a Participant's
Termination for any reason shall terminate and expire as of the date of such
Termination.

     

    (b)         
Rules Applicable to Restricted
Stock and Other Stock-Based Awards. Unless otherwise determined by the
Committee at grant or thereafter, upon a Participant's Termination for any
reason: (i) during the relevant Restriction Period, all Restricted Stock still
subject to restriction shall be forfeited; and (ii) any unvested Other
Stock-Based Awards shall be forfeited.

     

    ARTICLE
X

     

    TERMINATION
OR AMENDMENT OF PLAN

     

    Notwithstanding
any other provision of this Plan, the Board or the Committee may at any time,
and from time to time, amend, in whole or in part, any or all of the provisions
of this Plan (including any amendment deemed necessary to ensure that the
Company may comply with any regulatory requirement), or suspend or terminate it
entirely, retroactively or otherwise; provided, however, that if the Committee,
in its sole discretion, determines that the rights of a Participant with respect
to Awards granted prior to such amendment, suspension or termination, may be
adversely impaired, the consent of such Participant shall be required; and
provided further, without the approval of the stockholders of the Company
entitled to vote in accordance with applicable law, no amendment may be made
that would: (i) increase the aggregate number of shares of Common Stock that may
be issued under this Plan (other than due to an adjustment under Section 4.2);
(ii) change the classification of individuals eligible to receive Awards under
this Plan; (iii) decrease the minimum exercise price of any Stock Option; (iv)
extend the maximum Stock Option period under Section 6.3; or (v) require
stockholder approval in order for the Plan to continue to comply with Section
422 of the Code to the extent applicable to Incentive Stock Options or the rules
of any exchange or system on which the Company's securities are listed or traded
at the request of the Company.


    
      
         


      

      
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    The
Committee may amend the terms of any Award theretofore granted, prospectively or
retroactively, but, subject to Article IV above or as otherwise specifically
provided herein, no such amendment or other action by the Committee shall
adversely impair the rights of any holder without the holder's
consent.

    


    ARTICLE
XI

     

    COMPANY
CALL RIGHTS; RIGHTS OF FIRST REFUSAL

     

    11.1         Company
Call Rights. (a) In the event of a Participant's Termination for
Cause or a Participant's voluntary Termination within 90 days after the
occurrence of an event that would be grounds for a Termination for Cause, the
Company may repurchase from the Participant (or his or her transferee) any
shares of Common Stock previously acquired by the Participant through the
exercise of a Stock Option or pursuant to Restricted Stock or Other Stock-Based
Awards granted under this Plan at a repurchase price
equal to the lesser of (A) the original purchase price or exercise price (as
applicable), if any or (B) the Fair Market Value of a share of Common Stock on
the date of Termination or the date of repurchase, as selected by the
Committee.

     

    (b)            If
the Company elects to exercise call rights under this Section 11.1, it shall do
so by delivering to the Participant a notice of such election, specifying the
number of shares to be purchased. Such closing shall take place at the Company's
principal executive offices. At such closing, the Company shall pay the
Participant the repurchase price as specified in this Section 11.1 in cash, or
by cancellation of indebtedness of the Participant to the Company.

     

    11.2         Transfer Limit. (a)   No Participant shall,
directly or indirectly, prior to the Registration Date or such other date
determined by the Committee. Transfer any shares of Common Stock acquired
through the exercise of a Stock Option or pursuant to Restricted Stock or Other
Stock-Based Award under this Plan prior to the Participant's Termination and
expiration of the one-year period ending on the later of one year after (i) a
Participant incurs a Termination other than for Cause or (ii) the date a
Participant acquires shares of Common Stock upon the exercise of a Stock Option
following his or her Termination for any reason other than for Cause (the
“Transfer Restriction Period”). Notwithstanding the foregoing, the Participant
shall have the right to Transfer such shares of Common Stock to a “Permissible
Transferee” who takes the shares subject to the terms of the Plan and applicable
Award agreement. Permissible Transferees shall mean Family
Members.


    
      
         


      

      
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    (b)    After the
Transfer Restriction Period, no Participant shall Transfer any Common Stock
acquired through the exercise of a Stock Option or pursuant to Restricted Stock
or Other Stock-Based Award under this Plan to any Person other than a
Permissible Transferee unless in each such instance the Participant (or his or
her estate or legal representative) shall have first offered to the Company the
Common Stock proposed to be Transferred pursuant to a bona fide offer to a third
party.

     

    (c)            Notice of Proposed Transfer.
Prior to any proposed Transfer of the Common Stock acquired through the
exercise of a Stock Option or pursuant to Restricted Stock or Other Stock-Based
Award under this Plan, the Participant shall give a written notice (the
“Transfer Notice”) to the Company describing fully the proposed Transfer,
including the number of shares of Common Stock, the name and address of the
proposed Transferee (the “Proposed Transferee”) and, if the Transfer is
voluntary, the proposed Transfer price, and containing such information
necessary to show that the Participant has obtained a bona fide binding offer to
Transfer the Common Stock for cash from a third party. The Participant shall
provide a separate Transfer Notice with regard to each Proposed Transferee. The
Transfer Notice shall be signed by both the Participant and the Proposed
Transferee and must constitute a binding and unconditional commitment of the
Participant and the Proposed Transferee for the Transfer of the Common Stock to
the Proposed Transferee for cash subject only to the right of first refusal
specified herein.

     

    (d)            Bona Fide Transfer. If the
Company determines that the information provided by the Participant in the
Transfer Notice is insufficient to establish the bona fide nature of a proposed
voluntary Transfer, the Company shall give the Participant written notice of the
Participant's failure to comply with the procedure described herein, and the
Participant shall have no right to Transfer the Common Stock without first
complying with this procedure. The Participant shall not be permitted to
Transfer the Common Stock if the proposed Transfer is not bona
fide.

     

    (e)            Exercise of Right of First Refusal.
If the Company determines the proposed Transfer to be a bona fide
Transfer, the Company shall have the right to repurchase all or any part of the
shares of Common Stock at the proposed Transfer price per share, by delivering
to the Participant (or his or her estate or legal representative) written notice
of such exercise within 30 days after the date the Company has determined that
the proposed Transfer is bona fide. The Company's exercise or failure to
exercise the right of first refusal with respect to any proposed Transfer
described in a Transfer Notice shall not affect the Company's right to exercise
the right of first refusal with respect to any proposed Transfer described in
any other Transfer Notice, whether or not such other Transfer Notice is issued
by the Participant or issued by a person other than the Participant with respect
to a proposed Transfer to the same Proposed Transferee. If the Company exercises
the right of first refusal, the Company and the Participant shall thereupon
consummate the sale of the Common Stock to the Company within five days after
the date the Company has decided to exercise the right of first refusal
described herein (unless a longer period is offered by the Proposed Transferee).
For purposes of the foregoing, cancellation of any indebtedness of the
Participant to the Company shall be treated as payment to the Participant in
cash to the extent of the unpaid principal and any accrued interest
canceled.


    
      
         


      

      
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    (f)             Failure to Exercise Right of First
Refusal. If the Company fails to
exercise the right of first refusal with respect to any share of Common Stock
within the period specified in sub-section (c) above, and the Company has not
given notice to the Participant that the proposed Transfer is not a bona fide
Transfer pursuant to sub-section (d) above, the Participant may conclude a
Transfer to the Proposed Transferee of the Common Stock on the terms and
conditions described in the Transfer Notice, provided such Transfer occurs not
later than five days after the date the Company has determined not to exercise
the right of first refusal described herein. The Company shall have the right to
demand further assurances from the Participant and the Proposed Transferee (in a
form satisfactory to the Company) that the Transfer of the Common Stock was
actually carried out on the terms and conditions described in the Transfer
Notice. No Common Stock shall be transferred on the books of the Company until
the Company has received such assurances, if so demanded, and has approved the
proposed Transfer as bona fide. Any proposed Transfer on terms and conditions
different from those described in the Transfer Notice, as well as any subsequent
proposed Transfer by the Participant (or his or her estate or legal
representative), shall again be subject to the right of first refusal and shall
require compliance by the Participant with the procedure described in this
Section 11.2.

     

    (g)            Assignment of Right of First
Refusal. The Company shall have the right to assign the right of first
refusal at any time, whether or not there has been an attempted Transfer, to one
or more persons as may be selected by the Company, from time to
time.

     

    (h)            Application to Transferees.
This Section 11.2 shall apply to any Permissible Transferee in the same
manner as it applies to a Participant.

     

    11.3         Alternative
Call Rights and Rights of First Refusal. The Committee may
provide in the applicable Award agreement alternative (or no) call rights and/or
rights of first refusal at the time of grant (or, thereafter, if no rights of
the Participant are reduced) as it may decide in its sole discretion.
Notwithstanding anything herein to the contrary, if a Participant executes a
stockholder's agreement (or similar agreement) that provides call rights and/or
rights of first refusal, the provisions in the stockholder's agreement (or
similar agreement) shall control to the extent they are inconsistent with this
Article XI.

     

    11.4         Effect of Registration.
Notwithstanding the foregoing, unless otherwise determined by the Committee, the
Company shall cease to have rights pursuant to this Article XI on and after the
Registration Date.


    
      
         


      

      
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    ARTICLE
XII

     

    GENERAL
PROVISIONS

     

    12.1         Legend.
(a)   The Committee may require each person receiving shares
pursuant to an Award granted under this Plan to represent to and agree with the
Company in writing that the Participant is acquiring the shares without a view
to distribution thereof and such other securities law related representations as
the Committee shall request. In addition to any legend required by this Plan,
the certificates for such shares may include any legend which the Committee
deems appropriate to reflect any restrictions on Transfer.

     

    (b)    All
certificates for shares of Common Stock delivered under this Plan shall be
subject to such stock transfer orders and other restrictions as the Committee
may deem advisable under the rules, regulations and other requirements of the
Securities and Exchange Commission, any stock exchange upon which the Common
Stock is then listed or any national securities association system upon whose
system the Common Stock is then quoted, any applicable Federal or state
securities law, and any applicable corporate law, and the Committee may cause a
legend or legends to be put on any such certificates to make appropriate
reference to such restrictions.

     

    12.2         Other Plans. Nothing contained in this Plan
shall prevent the Board from adopting other or additional compensation
arrangements, subject to stockholder approval if such approval is required; and
such arrangements may be either generally applicable or applicable only in
specific cases.

     

    12.3         No Right
to Employment/Consultancy/Directorship. Neither this Plan nor the grant
of any Award hereunder shall give any Participant or other employee, Consultant
or Non-Employee Director any right with respect to continuance of employment,
consultancy or directorship by the Company or any Affiliate, nor shall there be
a limitation in any way on the right of the Company or any Affiliate by which an
employee is employed or a Consultant or Non-Employee Director is retained to
terminate his or her employment, consultancy or directorship at any
time.

     

    12.4         Taxes. (a) The Company shall have the
right to deduct from any payment to be made to a Participant, or to otherwise
require, prior to the issuance or delivery of any shares of Common Stock or the
payment of any cash hereunder, payment by the Participant of, any Federal, state
or local taxes required by law to be withheld. Upon the vesting of Restricted
Stock, or upon making an election under Section 83(b) of the Code, a Participant
shall pay all required withholding to the Company.

     

    (b)    Any
statutorily required withholding obligation with regard to any Eligible Employee
may be satisfied, subject to the consent of the Committee, by reducing the
number of shares of Common Stock otherwise deliverable or by delivering shares
of Common Stock already owned.  Any fraction of a share of Common
Stock required to satisfy such tax obligations shall be disregarded and the
amount due shall be paid instead in cash by the Participant.


    
      
         


      

      
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    (c)    Participants are strongly encouraged
to consult their own tax advisors with regard to the tax consequences of
participation in the Plan in light of their personal
circumstances.

     

    12.5         Listing and Other
Conditions.

     

    (a)    If at any
time counsel to the Company shall be of the opinion that any sale or delivery of
shares of Common Stock pursuant to an Award is or may in the circumstances be
unlawful or result in the imposition of excise taxes on the Company under the
statutes, rules or regulations of any applicable jurisdiction, the Company shall
have no obligation to make such sale or delivery, or to make any application or
to effect or to maintain any qualification or registration under the Securities
Act or otherwise with respect to shares of Common Stock, and the right to
exercise any Stock Option shall be suspended until, in the opinion of said
counsel, such sale or delivery shall be lawful and will not result in the
imposition of excise taxes on the Company.

     

    (b)    Upon
termination of any period of suspension under this Section 12.5, an Award
affected by such suspension which shall not then have expired or terminated
shall be reinstated as to all shares available before such suspension and as to
shares which would otherwise have become available during the period of such
suspension, but no such suspension shall extend the term of any
Award.

    


     

    (c)    A Participant
shall be required to supply the Company with any certificates, representations
and information that the Company requests and otherwise cooperate with the
Company in obtaining any listing, registration, qualification, exemption,
consent or approval the Company deems necessary or appropriate.

    


     

    12.6         Stockholders Agreement and
Other Requirements. Notwithstanding anything herein to the contrary, as a
condition to the receipt of shares of Common Stock pursuant to an Award granted
under this Plan, to the extent required by the Committee, the Participant shall
execute and deliver a stockholder's agreement or such other documentation which
shall set forth certain restrictions on transferability of the shares of Common
Stock acquired upon exercise or purchase, a right of first refusal of the
Company with respect to shares, and such other terms or restrictions as the
Board or Committee shall from time to time establish. Such stockholder's
agreement or other documentation shall apply to the Common Stock acquired under
the Plan and covered by such stockholder's agreement or other documentation. The
Company may require, as a condition of exercise, the Participant to become a
party to any other existing stockholder agreement or other
agreement.


    
      
         


      

      
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    12.7         Governing Law. This
Plan shall be governed and construed in accordance with the laws of the State of
Delaware (regardless of the law that might otherwise govern under applicable
Delaware principles of conflict of laws).

     

    12.8         Construction.
Wherever any words are used in
this Plan in
the masculine gender they shall be construed as though they were also
used in the feminine gender in
all cases where they would so apply, and wherever any words are used
herein in the singular form they shall be construed as though they were also
used in the plural form in all cases where they would so apply.

     

    12.9         Other Benefits. No
Award granted under this Plan shall be deemed compensation for purposes of
computing benefits under any retirement plan of the Company or its subsidiaries
nor affect any benefits under any other benefit plan now or subsequently in
effect under which the availability or amount of benefits is related to the
level of compensation.

     

    12.10       Costs. The Company
shall bear all expenses included in administering this Plan, including expenses
of issuing Common Stock pursuant to any Award granted hereunder.

     

    12.11       No Right to
Same Benefits. The provisions of Awards need not be the same with
respect to each Participant, and Awards granted to individual Participants need
not be the same in subsequent years.

     

    12.12       Death/Disability. The
Committee may in its discretion require the transferee of a Participant to
supply it with written notice of the Participant's death or Disability and to
supply it with a copy of the will (in the case of the Participant's death) or
such other evidence as the Committee deems necessary to establish the validity
of the transfer of an Award. The Committee may also require the agreement of the
transferee to be bound by all of the terms and conditions of this
Plan.

     

    12.13       Section 16(b) of the
Exchange Act. On and after the Registration Date, all elections and
transactions under this Plan by persons subject to Section 16 of the Exchange
Act involving shares of Common Stock are intended to comply with any applicable
exemptive condition under Rule 16b-3. The Committee may establish and adopt
written administrative guidelines, designed to facilitate compliance with
Section 16(b) of the Exchange Act, as it may deem necessary or proper for the
administration and operation of this Plan and the transaction of business
thereunder.

     

    12.14       Severability of
Provisions. If any provision of this Plan shall be held invalid or
unenforceable, such invalidity or unenforceability shall not affect any other
provisions hereof, and this Plan shall be construed and enforced as if such
provisions had not been included; provided, however, that if the Company's call
rights and rights of first refusal set forth in Article XI shall be held invalid
or unenforceable, the Awards granted under the Plan shall be cancelled and
terminated.


    
      
         


      

      
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    12.15       Headings
and Captions. The
headings and captions herein are provided for reference and convenience only,
shall not be considered part of this Plan, and shall not be employed in the
construction of this Plan.

     

    12.16       Securities Act
Compliance. Except as the Company or Committee shall otherwise determine,
this Plan is intended to comply with Section 4(2) or Rule 701 of the Securities
Act, and any provisions inconsistent with such Section or Rule of the Securities
Act shall be inoperative and shall not affect the validity of the
Plan.

     

    12.17       Successors and
Assigns. The Plan shall be binding on all successors and permitted
assigns of a Participant, including, without limitation, the estate of such
Participant and the executor, administrator or trustee of such
estate.

     

    12.18       Payment to Minors,
Etc. Any benefit payable to or for the benefit of a minor, an incompetent
person or other person incapable of receipt thereof shall be deemed paid when
paid to such person's guardian or to the party providing or reasonably appearing
to provide for the care of such person, and such payment shall fully discharge
the Committee, the Board, the Company, its Affiliates and their employees,
agents and representatives with respect thereto.

     

    12.19       Agreement. As a
condition to the grant of an Award, if requested by the Company and the lead
underwriter of any public offering of the Common Stock (the “Lead Underwriter”),
a Participant shall irrevocably agree not to sell, contract to sell, grant any
option to purchase, transfer the economic risk of ownership in, make any short
sale of, pledge or otherwise transfer or dispose of, any interest in any Common
Stock or any securities convertible into, derivative of, or exchangeable or
exercisable for, or any other rights to purchase or acquire Common Stock (except
Common Stock included in such public offering or acquired on the public market
after such offering) during such period of time following the effective date of
a registration statement of the Company filed under the Securities Act that the
Lead Underwriter shall specify (the “Lock-up Period”). The Participant shall
further agree to sign such documents as may be requested by the Lead Underwriter
to effect the foregoing and agree that the Company may impose stop-transfer
instructions with respect to Common Stock acquired pursuant to an Award until
the end of such Lock-up Period.

     

    12.20       No Rights as
Stockholder. Except as provided in Article VII with respect to Restricted
Stock or Article VIII with respect to Other Stock-Based Awards, subject to the
provisions of the Award agreement, no Participant or Permitted Transferee shall
have any rights as a stockholder of the Company with respect to any Award until
such individual becomes the holder of record of the shares of Common Stock
underlying the Award.


    
      
         


      

      
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    ARTICLE
XIII

     

    EFFECTIVE
DATE OF PLAN

     

    The Plan
shall become effective upon adoption by the Board or such later date as provided
in the adopting resolution, subject to the approval of this Plan by the
stockholders of the Company within 12 months before or after
adoption of the Plan by the Board in accordance with the laws of the State of
Delaware.

     

    ARTICLE
XIV

     

    TERM OF
PLAN

     

    No Award
shall be granted pursuant to this Plan on or after the tenth anniversary of the
earlier of the date this Plan is adopted or the date of stockholder approval,
but Awards granted prior to such tenth anniversary may, and the Committee's
authority to administer the terms of such Awards shall, extend beyond that
date.


    
      
         


      

      
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    APPENDIX
A – ISRAELI RESIDENTS

     

    DBT
BIOPHARMACEUTICALS, INC.

    2004
STOCK INCENTIVE PLAN

    


     

    1.   Special Provisions for
Persons who are Israeli Residents

     

    1.1   This Appendix (the
“Appendix”) to the DBT
Biopharmaceuticals, Inc. 2004 Stock Incentive Plan (the “Plan”) is effective as of
__________, 2004 (the “Effective
Date”).

     

    1.2           The
provisions specified hereunder apply only to persons who are deemed to be
residents of the State of Israel for tax purposes.

     

    1.3   This Appendix
applies with respect to Awards granted as (a) Stock Options and (b) Restricted
Stock, where such Stock Options or shares of Restricted Stock are granted or
issued under the Plan. The purpose of this Appendix is to establish certain
rules and limitations applicable to Stock Options and shares of Common Stock
that may be granted or issued under the Plan from time to time, in compliance
with the securities and other applicable laws currently in force in
the State of Israel. Except as otherwise provided by this Appendix, all
grants made pursuant to this Appendix shall be governed by the terms of the
Plan. This Appendix is applicable only to grants made after the Effective Date.
This Appendix complies with, and is subject to the ITO and Section
102.

     

    1.4   The Plan and this
Appendix shall be read together. In any case of contradiction, whether explicit
or implied, between the provisions of this Appendix and the Plan, the provisions
of this Appendix shall govern.

     

    2.    Definitions

     

    Capitalized
terms not otherwise defined herein shall have the meaning assigned to them under
Section 2 of the Plan. The following additional definitions will apply to grants
made pursuant to this Appendix:

     

    “3(l)
Option” means an Option which is subject to taxation pursuant to Section 3(1) of
the ITO which has been granted to any person who is not an Eligible 102
Participant.

     

    “102
Capital Gains Track” means the tax alternative set forth in Section 102(b)(2) of
the ITO pursuant to which income resulting from the sale of Common Stock derived
from Options is taxed as a capital gain.

     

    “102
Capital Gains Track Grant” means a 102 Trustee Grant qualifying for the special
tax treatment under the 102 Capital Gains Track.

     

    “102
Ordinary Income Track” means the tax alternative set forth in
Section l02(b)(1) of the ITO pursuant to which income resulting from the
sale of Stock derived from Options is taxed as ordinary income.

     

    “102
Ordinary Income Track Grant” means a 102 Trustee Grant qualifying for the
ordinary income tax treatment under the 102 Ordinary Income Track.

     

    “l02
Trustee Grant” means an
Award granted pursuant to Section 102(b) of the ITO and held in trust by
a Trustee for the benefit of the Participant, and includes both 102 Capital
Gains Track Grants and 102 Ordinary Income Track Grants.

     

    “Affiliate”
means any “employing Company” within the meaning of Section 102(a) of the
ITO.

     

    “Controlling
Shareholder” shall have the meaning ascribed to it in Section 32(9) of the
ITO.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    “Election”
means the Company’s choice of the type (as between capital gains track or
ordinary income track) of 102 Trustee Grants it will make under the Plan, as
filed with the ITA.

     

    “Eligible
102 Participant” means a person who is employed by the Company or its
Affiliates, including an individual who is serving as a director or an office
holder, who is not a Controlling Shareholder.

     

    “Fair
Market Value” shall have the meaning ascribed to it in the Plan; provided,
however, that with respect to 102 Capital Gains Track Grants only, for the sole
purpose of determining tax liability pursuant to Section 102(b)(3) of the ITO,
if at the date of grant the Company's shares are listed on any established stock
exchange or a national market system or if the Company's shares will be
registered for trading within ninety (90) days following the date of grant, the
fair market value of the Shares at the date of grant shall be determined in
accordance with the average value of the Company's shares on the thirty (30)
trading days preceding the date of grant or on the thirty (30) trading days
following the date of registration for trading, as the case may be.

     

    “ITA”
means the Israeli Tax Authorities.

     

    “ITO”
means the Israeli Income Tax Ordinance (New Version) 1961 and the rules,
regulations, orders or procedures promulgated thereunder and
any amendments thereto, including specifically the Rules, all as may be
amended from time to time.

     

    “Non-Trustee
Grant” means an Award granted pursuant to Section 102(c) of the ITO and not held
in trust by a
Trustee.

     

    “Required
Holding Period” means the requisite period prescribed by the ITO and the Rules,
or such other period as may be required by the ITA, with respect to 102 Trustee
Grants, during which Options or Common Stock granted by the Company must be held
by the Trustee for the benefit of the person to whom it was
granted.

     

    “Rules”
means the Income Tax Rides (Tax benefits in Stock Issuance to Employees)
5763-2003.

     

    “Section
102” shall mean the provisions of Section 102 of the ITO, as amended from time
to time, including most recently by the Law Amending the Income Tax Ordinance
(Number 132) 2002, effective as of January 1, 2003.

     

    “Shares”
means shares of Common Stock, including Restricted Stock or shares of Common
Stock issues upon exercise of Stock Options.

     

    “Stock
Options” means a Non-Qualified Stock Option granted pursuant to the terms and
conditions of the Plan and the Appendix.

     

    “Trustee”
means a person designated by the Board to serve as a trustee and approved by the
ITA in
accordance with the provisions of Section 102(a)
of the ITO.

     

    3.    Types of
Awards and
Section
102 Election

     

    3.1   Awards made
pursuant to Section 102, whether as grants of Stock Options or as issuances of
Common Stock under the Plan, shall be made pursuant to either (a) Section
102(b)(2) of the ITO as 102 Capital Gains Track Options or (b) Section 102(b)(1)
of the ITO as 102 Ordinary Income Track Options. The Company's Election
regarding the type of 102 Trustee Grant it chooses to make has to be filed with
the ITA. Once the Company has filed such Election, it may change the type of 102
Trustee Grant that it chooses to make only after the passage of at least 12
months from the end of the calendar year in which the first grant was made in
accordance with the previous Election, in accordance with Section 102. For the
avoidance of doubt, such Election shall not prevent the Company from granting
Non-Trustee Grants at any time.


    
      
         


      

      
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    3.2   Eligible 102 Participants
may receive only 102 Trustee Grants or Non-Trustee Grants. Participants who are
not Eligible 102 Participants may be granted only 3(I) Options under this
Appendix.

     

    3.3   No 102 Trustee
Grants may be made effective pursuant to this Appendix until 30 days after the
requisite filings required by the ITO and the Rules have been made with the
ITA.

     

    3.4   The option
agreement or documents evidencing the Options granted or Shares issued pursuant
to the Plan and this Appendix shall indicate whether the grant is a 102 Trustee
Grant, a Non-Trustee Grant or a 3(I) Grant; and, if the grant is a 102 Trustee
Grant, whether it is a 102 Capital Gains Track Grant or a 102 Ordinary Income
Track Grant.

     

    4.    Terms And Conditions Of
102 Trustee
Options

     

    4.1   Each 102 Trustee
Grant will be deemed granted on the date stated in a written notice by the
Company, provided that on or before such date (i) the Company has provided such
notice to the Trustee and (ii) the Participant has signed all documents required
pursuant to this Section 4.

     

    4.2   Each 102 Trustee
Grant granted to an Participant and each certificate for shares of Common Stock
acquired pursuant to the exercise of a Stock Option or issued directly as
Restricted Stock shall be issued to and registered in the name of a Trustee and
shall be held in trust for the benefit of the Participant for the Required
Holding Period. After termination of the Required Holding Period, the Trustee
may release such Option and any such shares, provided that (i) the Trustee has
received an acknowledgment from the Israeli Income Tax Authority that the
Participant has paid any applicable tax due pursuant to the ITO or (ii) the
Trustee and/or the Company or its Affiliate withholds any applicable tax due
pursuant to the ITO. The Trustee shall not release any 102 Trustee Options or
shares issued upon exercise of such Option prior to the full payment of the
Participant's tax liabilities.

     

    4.3   Each 102 Trustee
Grant (whether a 102 Capital Gains Track Grant or a 102 Ordinary Income Track
Grant, as applicable) shall be subject to the relevant terms of Section 102 and
the ITO, which shall be deemed an integral part of the 102 Trustee Option and
shall prevail over any term contained in the Plan, this Appendix or any
agreement that is not consistent therewith. Any provision of the ITO and any
approvals by the Income Tax Commissioner not expressly specified in this ISOP or
Option Agreement which are necessary to receive or maintain any tax benefit
pursuant to the Section 102 shall be binding on the Participant. The Trustee and
the Participant granted a 102 Trustee Grant shall comply with the ITO, and the
terms and conditions of the Trust Agreement entered into between the Company and
the Trustee. For avoidance of doubt, it is reiterated that compliance with the
ITO specifically includes compliance with the Rules. Further, the Participant
agrees to execute any and all documents which the Company or the Trustee may
reasonably determine to be necessary in order to comply with the provision of
any applicable law, and, particularly, Section 102.

     

    4.4   During the
Restricted Holding Period, the Participant shall not require the Trustee to
release or sell the Stock Options or Shares and other shares received
subsequently following any realization of rights derived from Shares or Stock
Options (including stock dividends) to the Participant or to a third party,
unless permitted to do so by applicable law. Notwithstanding the foregoing, the
Trustee may, pursuant to a written request and subject to applicable law,
release and transfer such Shares to a designated third party, provided that both
of the following conditions have been fulfilled prior to such transfer: (i)
payment has been rendered to the tax authorities of all taxes required to be
paid upon the release and transfer of the shares, and confirmation of such
payment has been received by the Trustee and (ii) the Trustee has received
written confirmation from the Company that all requirements for such release and
transfer have been fulfilled according to the terms of the Company's corporate
documents, the Plan, any applicable agreement and any applicable law. To avoid
doubt such sale or release during the Restricted Holding Period will result in
different tax ramifications under Section 102 of the ITO and the Rules and/or
any other regulations or orders or procedures promulgated thereunder, which
shall apply to and shall be borne solely by such Participant.


    
      
         


      

      
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    4.5   In the event a
stock dividend is declared on Shares which derive from Awards granted as 102
Trustee Grants, such dividend shall also be subject to the provisions of this
Section 4 and the Required Holding Period for such dividend shares shall be
measured from the commencement of the Required Holding Period for the Stock
Option or Shares with respect to which the dividend was declared.

     

    4.6   If a Stock Option
granted as a 102 Trustee Grant is exercised during the Required Holding Period,
the Shares issued upon such exercise shall be issued in the name of the Trustee
for the benefit of the Participant. If such an Option is exercised after the
Required Holding Period ends, the Shares issued upon such exercise shall, at the
election of the Participant, either (i) be issued in the name of the Trustee, or
(ii) be transferred to the Participant directly, provided that the Participant
first complies with all applicable provisions of the Plan.

     

    5.    Assignability

     

    As long
as Options or Shares are held by the Trustee on behalf of the Eligible 102
Participant, all rights of the Eligible 102 Participant over the shares are
personal, cannot be transferred, assigned, pledged or mortgaged, other than by
will or laws of descent and distribution.

     

    6.    Tax
Consequences

     

    6.1   Any tax
consequences arising from the grant or exercise of any Option, from the payment
for Shares covered thereby, or from any other event or act (of the Company,
and/or its Affiliates, and the Trustee or the Participant), hereunder, shall be
borne solely by the Participant. The Company and/or its Affiliates, and/or the
Trustee shall withhold taxes according to the requirements under the applicable
laws, rules, and regulations, including withholding taxes at source.
Furthermore, the Participant shall agree to indemnify the Company and/or its
Affiliates and/or the Trustee and hold them harmless against and from any and
all liability for any such tax or interest or penalty thereon, including without
limitation, liabilities relating to the necessity to withhold, or to have
withheld, any such tax from any payment made to the Participant. The Company or
any of its Affiliates and the Trustee may make such provisions and take such
steps as it may deem necessary or appropriate for the withholding of all taxes
required by law to be withheld with respect to Options granted under the Plan
and the exercise thereof, including, but not limited, to (i) deducting the
amount so required to be withheld from any other amount then or thereafter
payable to a Participant, and/or (ii) requiring a Participant to pay to the
Company or any of its Affiliates the amount so required to be withheld as a
condition of the issuance, delivery, distribution or release of any Shares. In
addition, the Participant will be required to pay any amount which exceeds the
tax to be withheld and transferred to the tax authorities, pursuant to
applicable Israeli tax regulations.

     

    6.2   With respect to
Non-Trustee Grants, if the Participant ceases to be employed by the Company or
any Affiliate, the Participant shall extend to the Company and/or its Affiliate
a security or guarantee for the payment of tax due at the time of sale of
Shares, all in accordance with the provisions of Section 102 of the ITO and the
Rules.

     

    7.    Governing Law and
Jurisdiction

     

    Notwithstanding
any other provision of the Plan, with respect to Participants subject to this
Appendix, the Plan and all instruments issued thereunder or in connection
therewith shall be governed by, and interpreted in accordance with, the laws of
the State of Israel applicable to contracts made and to be performed
therein.


    
      
         


      

      
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