Unassociated Document


    GENESIS
BIOPHARMA, INC.

     

    2010
EQUITY COMPENSATION PLAN

     

    


     

    I.  ESTABLISHMENT
OF PLAN; DEFINITIONS

     

    1.          Purpose.  The
purpose of the Genesis Biopharma, Inc. 2010 Equity Compensation Plan is to
encourage certain, officers, employees, directors, and consultants of Genesis
Biopharma, Inc., a Nevada corporation (the "Company"), to acquire and hold stock
in the Company as an added incentive to remain with the Company and increase
their efforts in promoting the interests of the Company, and to enable the
Company to attract and retain capable individuals.

     

    2.          Definitions.  Unless
the context clearly indicates otherwise, the following terms shall have the
meanings set forth below:

     

    (a)           "Board"
shall mean the Board of Directors of the Company.

     

    (b)           "Code"
shall mean the Internal Revenue Code of 1986, as it may be amended from time to
time.

     

    (c)           "Committee"
shall mean (i) a committee made up of members of the Board who shall, from time
to time, be appointed by the Board, or (ii) if no such committee is formed, the
Board.

     

    (d)           "Company"
shall mean Genesis Biopharma, Inc., a Nevada corporation.

     

    (e)           "Consultants"
shall mean individuals who provide services to the Company and any Subsidiary
who are not Employees or Directors.

     

    (f)           "Directors"
shall mean the members of the Board of Directors of the Company.

     

    (g)           "Disability"
shall mean a medically determinable physical or mental condition which causes an
Employee, Director, or Consultant to be unable to engage in any substantial
gainful activity and which can be expected to result in death or to be of
long-continued and indefinite duration.

     

    (h)           "Employee"
shall mean any common law employee, including officers, of the Company or any
Subsidiary as determined under the Code and the Treasury Regulations
thereunder.

     

    (i)           "Fair
Market Value" shall mean (i) if the Stock is listed on a national securities
exchange or the NASDAQ system, the mean between the highest and lowest sales
prices for the Stock on such date, or, if no such prices are reported for such
day, then on the next preceding day on which there were reported prices; (ii) if
the Stock is not listed on a national securities exchange or the NASDAQ system,
the mean between the bid and asked prices for the shares on such date, or if no
such prices are reported for such day, then on the next preceding day on which
there were reported prices; or (iii) as determined in good faith by the
Company’s Board of Directors.

     

    (j)           "Grantee"
shall mean an officer, Employee, Director, or Consultant granted a Stock Option
or Stock Award under this Plan.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (k)          "Incentive
Stock Option" shall mean an option granted pursuant to the Incentive Stock
Option provisions as set forth in Part II of this Plan.

     

    (l)           "Non-Qualified
Stock Option" shall mean an option granted pursuant to the Non-Qualified Stock
Option provisions as set forth in Part III of this Plan.

     

    (m)         "Plan"
shall mean the Genesis Biopharma, Inc. 2010 Equity Compensation Plan as set
forth herein and as amended from time to time.

     

    (n)          "Restricted
Stock" shall mean Stock which is issued pursuant to the Restricted Stock Award
provisions as set forth in Part IV of this Plan.

     

    (o)          "Stock"
shall mean authorized but unissued shares of the Common Stock of the Company or
reacquired shares of the Company's Common Stock.

     

    (p)          "Stock
Appreciation Right" shall mean a stock appreciation right granted pursuant to
the Stock Appreciation Right provisions as set forth in Part II and III of this
Plan.

     

    (q)          "Stock
Award" shall mean an award of Restricted or Unrestricted Stock granted pursuant
to this Plan.

     

    (r)          "Stock
Option" shall mean an option granted pursuant to the Plan to purchase shares of
Stock.

     

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

     

    (t)          "Ten
Percent Shareholder" shall mean an Employee who at the time a Stock Option is
granted owns stock representing more than ten percent (10%) of the total
combined voting power of all stock of the Company or of its parent or subsidiary
corporation.

     

    (u)           "Unrestricted
Stock" shall mean Stock which is issued pursuant to the Unrestricted Stock
provisions as set forth in Part V of this Plan.

     

    3.           Shares of Stock Subject to
the Plan.  Subject to the provisions of Paragraph 2 of Part VI
of the Plan, the Stock which may be issued or transferred pursuant to Stock
Options and Stock Awards granted under the Plan and the Stock which is subject
to outstanding but unexercised Stock Options under the Plan shall not exceed
Three Million Five Hundred Thousand (3,500,000) shares in the
aggregate.  If a Stock Option shall expire and terminate for any
reason, in whole or in part, without being exercised or, if Stock Awards are
forfeited because the restrictions with respect to such Stock Awards shall not
have been met or have lapsed, the number of shares of Stock which are no longer
outstanding as Stock Awards or subject to Stock Options may again become
available for the grant of Stock Awards or Stock Options.  There shall
be no terms and conditions in a Stock Award or Stock Option which provide that
the exercise of an Incentive Stock Option reduces the number of shares of Stock
for which an outstanding Non-Qualified Stock Option may be exercised; and there
shall be no terms and conditions in a Stock Award or Stock Option which provide
that the exercise of a Non-Qualified Stock Option reduces the number of shares
of Stock for which an outstanding Incentive Stock Option may be
exercised.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    4.          Administration of the
Plan.  The Plan shall be administered by the
Committee.  Subject to the express provisions of the Plan, the
Committee shall have authority to interpret the Plan, to prescribe, amend, and
rescind rules and regulations relating to it, to determine the terms and
provisions of Stock Option agreements, and to make all other determinations
necessary or advisable for the administration of the Plan.  Any
controversy or claim arising out of or related to this Plan shall be determined
unilaterally by and at the sole discretion of the Committee.

     

    5.          Amendment or
Termination.  The Board may, at any time, alter, amend,
suspend, discontinue, or terminate this Plan; provided, however, that such
action shall not adversely affect the right of Grantees to Stock Awards or Stock
Options previously granted and no amendment, without the approval of the
stockholders of the Company, shall increase the maximum number of shares which
may be awarded under the Plan in the aggregate, materially increase the benefits
accruing to Grantees under the Plan, change the class of Employees eligible to
receive options under the Plan, or materially modify the eligibility
requirements for participation in the Plan.

     

    6.          Effective Date and Duration
of the Plan.  This Plan shall become effective on March 29,
2010.  This Plan shall terminate at such time as may be determined by
the Board, and no Stock Award or Stock Option may be issued or granted under the
Plan thereafter, but such termination shall not affect any Stock Award or Stock
Option theretofore issued or granted.

     

     

    II.  INCENTIVE
STOCK OPTION PROVISIONS

     

    1.          Granting of Incentive Stock
Options.

     

    (a)          Only
Employees of the Company shall be eligible to receive Incentive Stock Options
under the Plan.  Officers, Directors, and Consultants of the Company
who are not also Employees shall not be eligible to receive Incentive Stock
Options.

     

    (b)          The
purchase price of each share of Stock subject to an Incentive Stock Option shall
not be less than 100% of the Fair Market Value of a share of the Stock on the
date the Incentive Stock Option is granted; provided, however, that the purchase
price of each share of Stock subject to an Incentive Stock Option granted to a
Ten Percent Shareholder shall not be less than 110% of the Fair Market Value of
a share of the Stock on the date the Incentive Stock Option is
granted.

     

    (c)          No
Incentive Stock Option shall be exercisable more than ten (10) years from the
date the Incentive Stock Option was granted; provided, however, that an
Incentive Stock Option granted to a Ten Percent Shareholder shall not be
exercisable more than five (5) years from the date the Incentive Stock Option
was granted.

     

    (d)          The
Committee shall determine and designate from time to time those Employees who
are to be granted Incentive Stock Options and specify the number of shares
subject to each Incentive Stock Option.

     

    (e)          The
Committee, in its sole discretion, shall determine whether any particular
Incentive Stock Option shall become exercisable in one or more installments,
specify the installment dates, and, within the limitations herein provided,
determine the total period during which the Incentive Stock Option is
exercisable.  Further, the Committee may make such other provisions as
may appear generally acceptable or desirable to the Committee or necessary to
qualify its grants under the provisions of Section 422 of the Code.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (f)           The
Committee may grant at any time new Incentive Stock Options to an Employee who
has previously received Incentive Stock Options or other options whether such
prior Incentive Stock Options or other options are still outstanding, have
previously been exercised in whole or in part, or are canceled in connection
with the issuance of new Incentive Stock Options.  The purchase price
of the new Incentive Stock Options may be established by the Committee without
regard to the existing Incentive Stock Options or other options.

     

    (g)          Notwithstanding
any other provisions hereof, the aggregate fair market value (determined at the
time the option is granted) of the Stock with respect to which Incentive Stock
Options are exercisable for the first time by the Employee during any calendar
year (under all such plans of the Grantee's employer corporation and its parent
and subsidiary corporation) shall not exceed $100,000.

     

    2.          Exercise of Incentive Stock
Options.  The option price of an Incentive Stock Option shall
be payable on exercise of the option (i) in cash or by check, bank draft,
or postal or express money order, (ii) by the surrender of Stock then owned
by the Grantee, (iii) the proceeds of a loan from an independent broker-dealer
whereby the loan is secured by the option or the stock to be received upon
exercise, or (iv) any combination of the foregoing;
provided, that each such method and time for payment and each such
borrowing and terms and conditions of repayment shall then be permitted by and
be in compliance with applicable law.  Shares of Stock so surrendered
in accordance with clause (ii) or (iv) shall be valued at the Fair Market Value
thereof on the date of exercise, surrender of such Stock to be evidenced by
delivery of the certificate(s) representing such shares in such manner, and
endorsed in such form, or accompanied by stock powers endorsed in such form, as
the Committee may determine.

     

    3.          Termination of
Employment.

     

    (a)          If
a Grantee's employment with the Company is terminated other than by Disability
or death, the terms of any then outstanding Incentive Stock Option held by the
Grantee shall extend for a period ending on the earlier of the date on which
such Stock Option would otherwise expire or three months after such termination
of employment, and such Stock Option shall be exercisable to the extent it was
exercisable as of such last date of employment.

     

    (b)          If
a Grantee's employment with the Company is terminated by reason of Disability,
the term of any then outstanding Incentive Stock Option held by the Grantee
shall extend for a period ending on the earlier of the date on which such Stock
Option would otherwise expire or twelve months after such termination of
employment, and such Stock Option shall be exercisable to the extent it was
exercisable as of such last date of employment.

     

    (c)          If
a Grantee's employment with the Company is terminated by reason of death, the
representative of his estate or beneficiaries thereof to whom the Stock Option
has been transferred shall have the right during the period ending on the
earlier of the date on which such Stock Option would otherwise expire or twelve
months after such date of death, to exercise any then outstanding Incentive
Stock Options in whole or in part.  If a Grantee dies without having
fully exercised any then outstanding Incentive Stock Options, the representative
of his estate or beneficiaries thereof to whom the Stock Option has been
transferred shall have the right to exercise such Stock Options in whole or in
part.

     

    4.          Stock Appreciation
Rights

     

    (a)          Grant.  Stock
Appreciation Rights related to all or any portion of an Incentive Stock Option
may be granted by the Committee to any Grantee in connection with the grant of
an Incentive Stock Option or unexercised portion thereof held by the Grantee at
any time and from time to time during the term thereof.  Each Stock
Appreciation Right shall be granted at least at Fair Market Value on the date of
grant and be subject to such terms and conditions not inconsistent with the
provisions of this Part II as shall be determined by the Committee and included
in the agreement relating to such Stock Appreciation Right, subject in any
event, however, to the following terms and conditions of this Section
4.  Each Stock Appreciation Right may include limitations as to the
time when such Stock Appreciation Right becomes exercisable and when it ceases
to be exercisable that are more restrictive than the limitations on the exercise
of the Incentive Stock Option to which it relates.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b)          Exercise.  No
Stock Appreciation Right shall be exercisable with respect to such related
Incentive Stock Option or portion thereof unless such Incentive Stock Option or
portion shall itself be exercisable at that time.  A Stock
Appreciation Right shall be exercised only upon surrender of the related
Incentive Stock Option or portion thereof in respect of which the Stock
Appreciation Right is then being exercised.

     

    (c)          Amount of
Payment.  On exercise of a Stock Appreciation Right, a Grantee
shall be entitled to receive an amount equal to the product of (i) the amount by
which the Fair Market Value of a share of Stock on the date of exercise of the
Stock Appreciation Right exceeds the option price per share specified in the
related Incentive Stock Option and (ii) the number of shares of Stock in respect
of which the Stock Appreciation Right shall have been exercised.

     

    (d)          Form of
Payment.  Stock Appreciation Rights may be settled in the form
of cash or Stock.  If the form of payment is cash, then the amount
shall be calculated pursuant to subsection (c) of this Section 4.  If
the form of payment is Stock, then the number of shares of Stock to be
distributed shall be the largest whole number obtained by dividing the amount
otherwise distributable in respect of such settlement by the Fair Market Value
of a share of Stock on the date of exercise of the Stock Appreciation
Right.  The value of fractional shares of Stock shall be paid in
cash.

     

    (e)          Effect of Exercise of Right
or Related Option.  If the related Incentive Stock Option is
exercised in whole or in part, then the Stock Appreciation Right with respect to
the Stock purchased pursuant to such exercise (but not with respect to any
unpurchased Stock) shall be terminated as of the date of exercise if such Stock
Appreciation Right is not exercised on such date.

     

    (f)           Non-transferability.  A
Stock Appreciation Right shall not be transferable or assignable by the Grantee
other than by will or the laws of descent and distribution, and shall be
exercisable during the Grantee's lifetime only by the Grantee.

     

    (g)          Termination of
Employment.  If the Grantee ceases to be an Employee of the
Company for any reason, each outstanding Stock Appreciation Right shall be
exercisable for such period and to such extent as the related Incentive Stock
Option or portion thereof.

     

     

    III.  NON-QUALIFIED
STOCK OPTION PROVISIONS

     

    1.          Granting of Stock
Options.

     

    (a)          Officers,
Employees, Directors, and Consultants shall be eligible to receive Non-Qualified
Stock Options under the Plan.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (b)          The
Committee shall determine and designate from time to time those officers,
Employees, Directors, and Consultants who are to be granted Non-Qualified Stock
Options and the amount subject to each Non-Qualified Stock Option.

     

    (c)          The
Committee may grant at any time new Non-Qualified Stock Options to an Employee,
Director, or Consultant who has previously received Non-Qualified Stock Options
or other Stock Options, whether such prior Non-Qualified Stock Options or other
Stock Options are still outstanding, have previously been exercised in whole or
in part, or are canceled in connection with the issuance of new Non-Qualified
Stock Options.

     

    (d)          The
Committee shall determine the purchase price of each share of Stock subject to a
Non-Qualified Stock Option.  Such price shall not be less than 100% of
the Fair Market Value of such Stock on the date the Non-Qualified Stock Option
is granted.

     

    (e)          The
Committee, in its sole discretion, shall determine whether any particular
Non-Qualified Stock Option shall become exercisable in one or more installments,
specify the installment dates, and, within the limitations herein provided,
determine the total period during which the Non-Qualified Stock Option is
exercisable.  Further, the Committee may make such other provisions as
may appear generally acceptable or desirable to the Committee, including
providing for a cashless exercise provision or the extension of a Non-Qualified
Stock Option, provided that such extension does not extend the option beyond the
period specified in paragraph (f) below.

     

    (f)           No
Non-Qualified Stock Option shall be exercisable more than ten (10) years from
the date such option is granted.

     

    2.          Exercise of Stock
Options.   The option price of a Non-Qualified Stock
Option shall be payable on exercise of the Stock Option (i) in cash or by
check, bank draft, or postal or express money order, (ii) by the surrender
of Stock then owned by the Grantee, (iii) the proceeds of a loan from an
independent broker-dealer whereby the loan is secured by the option or the stock
to be received upon exercise, (iv) by a cashless exercise if so granted by
the Committee, or (v) any combination of the foregoing;
provided, that each such method and time for payment and each such
borrowing and terms and conditions of repayment shall then be permitted by and
be in compliance with applicable law.  Shares of Stock so surrendered
in accordance with clause (ii) or (v) shall be valued at the Fair Market Value
thereof on the date of exercise, surrender of such Stock to be evidenced by
delivery of the certificate(s) representing such shares in such manner, and
endorsed in such form, or accompanied by stock powers endorsed in such form, as
the Committee may determine.

     

     3.         Termination of
Relationship.

     

    (a)          If
a Grantee's employment with the Company is terminated, a Director Grantee ceases
to be a Director, or a Consultant Grantee ceases to be a Consultant, other than
by reason of Disability or death, the terms of any then outstanding
Non-Qualified Stock Option held by the Grantee shall extend for a period ending
on the earlier of the date established by the Committee at the time of grant or
three months after the Grantee's last date of employment or cessation of being a
Director or Consultant, and such Stock Option shall be exercisable to the extent
it was exercisable as of the date of termination of employment or cessation of
being a Director or Consultant.

     

    (b)          If
a Grantee's employment is terminated by reason of Disability, a Director Grantee
ceases to be a Director by reason of Disability or a Consultant Grantee ceases
to be a Consultant by reason of Disability, the term of any then outstanding
Non-Qualified Stock Option held by the Grantee shall extend for a period ending
on the earlier of the date on which such Stock Option would otherwise expire or
twelve months after the Grantee's last date of employment or cessation of being
a Director or Consultant, and such Stock Option shall be exercisable to the
extent it was exercisable as of such last date of employment or cessation of
being a Director or Consultant.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (c)          If
a Grantee's employment is terminated by reason of death, a Director Grantee
ceases to be a Director by reason of death or a Consultant Grantee ceases to be
a Consultant by reason of death, the representative of his estate or
beneficiaries thereof to whom the Stock Option has been transferred shall have
the right during the period ending on the earlier of the date on which such
Stock Option would otherwise expire or twelve months following his death to
exercise any then outstanding Non-Qualified Stock Options in whole or in
part.  If a Grantee dies without having fully exercised any then
outstanding Non-Qualified Stock Options, the representative of his estate or
beneficiaries thereof to whom the Stock Option has been transferred shall have
the right to exercise such Stock Options in whole or in part.

     

    4.         
Stock Appreciation
Rights

     

    (a)          Grant.  Stock
Appreciation Rights related to all or any portion of a Non-Qualified Stock
Option may be granted by the Committee to any Grantee in connection with the
grant of a Non-Qualified Stock Option or unexercised portion thereof held by the
Grantee at any time and from time to time during the term
thereof.  Each Stock Appreciation Right shall be granted at least at
Fair Market Value on the date of grant and be subject to such terms and
conditions not inconsistent with the provisions of this Part III as shall be
determined by the Committee and included in the agreement relating to such Stock
Appreciation Right, subject in any event, however, to the following terms and
conditions of this Section 4.  Each Stock Appreciation Right may
include limitations as to the time when such Stock Appreciation Right becomes
exercisable and when it ceases to be exercisable that are more restrictive than
the limitations on the exercise of the Non-Qualified Stock Option to which it
relates.

     

    (b)          Exercise.  No
Stock Appreciation Right shall be exercisable with respect to such related
Non-Qualified Stock Option or portion thereof unless such Non-Qualified Stock
Option or portion shall itself be exercisable at that time.  A Stock
Appreciation Right shall be exercised only upon surrender of the related
Non-Qualified Stock Option or portion thereof in respect of which the Stock
Appreciation Right is then being exercised.

     

    (c)          Amount of
Payment.  On exercise of a Stock Appreciation Right, a Grantee
shall be entitled to receive an amount equal to the product of (i) the amount by
which the Fair Market Value of a share of Stock on the date of exercise of the
Stock Appreciation Right exceeds the option price per share specified in the
related Non-Qualified Stock Option and (ii) the number of shares of Stock in
respect of which the Stock Appreciation Right shall have been
exercised.

     

    (d)          Form of
Payment.  Stock Appreciation Rights may be settled in the form
of cash or Stock.  If the form of payment is cash, then the amount
shall be calculated pursuant to subsection (c) of this Section 4.  If
the form of payment is Stock, then the number of shares of Stock to be
distributed shall be the largest whole number obtained by dividing the amount
otherwise distributable in respect of such settlement by the Fair Market Value
of a share of Stock on the date of exercise of the Stock Appreciation
Right.  The value of fractional shares of Stock shall be paid in
cash.

     

    (e)          Effect of Exercise of Right
or Related Option.  If the related Non-Qualified Stock Option
is exercised in whole or in part, then the Stock Appreciation Right with respect
to the Stock purchased pursuant to such exercise (but not with respect to any
unpurchased Stock) shall be terminated as of the date of exercise if such Stock
Appreciation Right is not exercised on such date.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (f)           Non-transferability.  A
Stock Appreciation Right shall not be transferable or assignable by the Grantee
other than by will or the laws of descent and distribution, and shall be
exercisable during the Grantee's lifetime only by the Grantee.

     

    (g)          Termination of
Employment.  If the Grantee ceases to be an officer, Employee,
Director, or Consultant of the Company for any reason, each outstanding Stock
Appreciation Right shall be exercisable for such period and to such extent as
the related Non-Qualified Stock Option or portion thereof.

     

     

    IV.  RESTRICTED
STOCK AWARDS

     

    1.          Grant of Restricted
Stock.

     

    (a)  Officers, Employees,
Directors and Consultants shall be eligible to receive grants of Restricted
Stock under the Plan.

     

    (b)          The
Committee shall determine and designate from time to time those officers,
Employees, Directors and Consultants who are to be granted Restricted Stock and
the number of shares of Stock subject to such Stock Award.

     

    (c)          The
Committee, in its sole discretion, shall make such terms and conditions
applicable to the grant of Restricted Stock as may appear generally acceptable
or desirable to the Committee.

     

    2.          Termination of
Relationship.

     

    (a)          If
a Grantee's employment with the Company is terminated, a Director Grantee ceases
to be a Director, or a Consultant Grantee ceases to be a Consultant, prior to
the lapse of any restrictions applicable to the Restricted Stock, such Stock
shall be forfeited and the Grantee shall return the certificates representing
such Stock to the Company.

     

    (b)          If
the restrictions applicable to a grant of Restricted Stock shall lapse, the
Grantee shall hold such Stock free and clear of all such restrictions except as
otherwise provided in the Plan.

     

     

    V.  UNRESTRICTED
STOCK AWARDS

     

    1.          Grant of Unrestricted
Stock.

     

    (a)          Officers,
Employees, Directors, and Consultants shall be eligible to receive grants of
Unrestricted Stock under the Plan.

     

    (b)          The
Committee shall determine and designate from time to time those officers,
Employees, Directors and Consultants who are to be granted Unrestricted Stock
and the number of shares of Stock subject to such Stock Award.

     

    2.          Issuance of
Stock.  The Grantee shall hold Stock issued pursuant to an
Unrestricted Stock award free and clear of all restrictions except as otherwise
provided in the Plan.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    VI.  GENERAL
PROVISIONS

     

    1.          Substitution of
Options.  In the event of a corporate merger or consolidation,
or the acquisition by the Company of property or stock of an acquired
corporation or any reorganization or other transaction qualifying under Section
424 of the Code, the Committee may, in accordance with the provisions of that
Section, substitute Stock Options, Stock Awards and Stock Appreciation Rights
under this Plan for Stock Options, Stock Awards and Stock Appreciation Rights
under the plan of the acquired corporation provided (i) the excess of the
aggregate fair market value of the shares of Stock subject to a Stock Option
immediately after the substitution over the aggregate option price of such Stock
is not more than the similar excess immediately before such substitution and
(ii) the new Stock Option does not give the Grantee additional benefits,
including any extension of the exercise period.   Alternatively,
the Committee may provide that each Stock Option, Stock Award and Stock
Appreciation Right granted under the Plan shall terminate as of a date to be
fixed by the Board; provided, that no
less than thirty (30) days written notice of the date so fixed shall be given to
each holder, and each holder shall have the right, during the period of thirty
(30) days preceding such termination, to exercise the Stock Options, Stock
Awards and Stock Appreciation Rights as to all or any part of the Stock covered
thereby, including Stock as to which such Stock Options, Stock Awards and Stock
Appreciation Rights would not otherwise be exercisable.

     

    2.          Adjustment
Provisions.

     

    (a)          In
the event that a dividend shall be declared upon the Stock payable in shares of
the Company's common stock, the number of shares of Stock then subject to any
Stock Option or Stock Award outstanding under the Plan and the number of shares
reserved for the grant of Stock Options or Stock Awards pursuant to the Plan
shall be adjusted by adding to each such share the number of shares which would
be distributable in respect thereof if such shares had been outstanding on the
date fixed for determining the shareholders of the Company entitled to receive
such share dividend.

     

    (b)          If
the shares of Stock outstanding are changed into or exchanged for a different
number or class or other securities of the Company or of another corporation,
whether through split-up, merger, consolidation, reorganization,
reclassification or recapitalization, then there shall be substituted for each
share of Stock subject to any such Stock Option or Stock Award and for each
share of Stock reserved for the grant of Stock Options or Stock Awards pursuant
to the Plan the number and kind of shares or other securities into which each
outstanding share of Stock shall have been so changed or for which each share
shall have been exchanged.

     

    (c)          In
the event there shall be any change, other than as specified above in this
Section 2, in the number or kind of outstanding shares of Stock or of any shares
or other securities into which such shares shall have been changed or for which
they shall have been exchanged, then if the Board shall, in its sole discretion,
determine that such change equitably requires an adjustment in the number or
kind of shares theretofore reserved for the grant of Stock Options or Stock
Awards pursuant to the Plan and of the shares then subject to Stock Options or
Stock Awards, such adjustment shall be made by the Board and shall be effective
and binding for all purposes of the Plan and of each Stock Option and Stock
Award outstanding thereunder.

     

    (d)          Each
Stock Appreciation Right outstanding at the time of any adjustment pursuant to
this Section 2 and the number of outstanding Stock Appreciation Rights, shall be
adjusted, changed or exchanged in the same manner as related Stock
Options.

     

    (e)          In
the case of any such substitution or adjustment as provided for in this Section
2, the option price set forth in each outstanding Stock Option for each share
covered thereby prior to such substitution or adjustment will be the option
price for all shares or other securities which shall have been substituted for
such share or to which such share shall have been adjusted pursuant to this
Section 2, and the price per share shall be adjusted accordingly.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (f)           No
adjustment or substitution provided for in this Section 2 shall require the
Company to sell a fractional share, and the total substitution or adjustment
with respect to each outstanding Stock Option shall be limited
accordingly.

     

    (g)         
Upon any adjustment made pursuant to this Section 2 the Company will, upon
request, deliver to the Grantee a certificate setting forth the option price
thereafter in effect and the number and kind of shares or other securities
thereafter purchasable on the exercise of such Stock Option.

     

    3.          General.

     

    (a)          Each
Stock Option, Stock Award and Stock Appreciation Right shall be evidenced by a
written instrument containing such terms and conditions, not inconsistent with
this Plan, as the Committee shall approve.

     

    (b)          The
granting of a Stock Option, Stock Award or Stock Appreciation Right in any year
shall not give the Grantee any right to similar grants in future years or any
right to be retained in the employ of the Company, and all Employees shall
remain subject to discharge to the same extent as if the Plan were not in
effect.

     

    (c)          No
officer, Employee, Director, or Consultant and no beneficiary or other person
claiming under or through him, shall have any right, title or interest by reason
of any Stock Option or any Stock Award to any particular assets of the Company,
or any shares of Stock allocated or reserved for the purposes of the Plan or
subject to any Stock Option or any Stock Award except as set forth
herein.  The Company shall not be required to establish any fund or
make any other segregation of assets to assure the payment of any Stock Option
or Stock Award.

     

    (d)          No
right under the Plan shall be subject to anticipation, sale, assignment, pledge,
encumbrance, or charge except by will or the laws of descent and distribution,
and a Stock Option shall be exercisable during the Grantee's lifetime only by
the Grantee or his conservator.

     

    (e)          Notwithstanding
any other provision of this Plan or agreements made pursuant thereto, the
Company's obligation to issue or deliver any certificate or certificates for
shares of Stock under a Stock Option or Stock Award, and the transferability of
Stock acquired by exercise of a Stock Option or grant of a Stock Award, shall be
subject to all of the following conditions:

     

    (i)           Any
registration or other qualification of such shares under any state or federal
law or regulation, or the maintaining in effect of any such registration or
other qualification which the Board shall, in its absolute discretion upon the
advice of counsel, deem necessary or advisable; and

     

    (ii)           The
obtaining of any other consent, approval, or permit from any state or federal
governmental agency which the Board shall, in its absolute discretion upon the
advice of counsel, determine to be necessary or advisable.

     

    (f)           All
payments to Grantees or to their legal representatives shall be subject to any
applicable tax, community property, or other statutes or regulations of the
United States or of any state or country having jurisdiction over such
payments.  The Grantee may be required to pay to the Company the
amount of any withholding taxes which the Company is required to withhold with
respect to a Stock Option or its exercise or a Stock Award.  In the
event that such payment is not made when due, the Company shall have the right
to deduct, to the extent permitted by law, from any payment of any kind
otherwise due to such person all or part of the amount required to be
withheld.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    (g)          In
the case of a grant of a Stock Option or Stock Award to any Employee of a
Subsidiary, the Company may, if the Committee so directs, issue or transfer the
shares, if any, covered by the Stock Option or Stock Award to such Subsidiary,
for such lawful consideration as the Committee may specify, upon the condition
or understanding that such Subsidiary will transfer the shares to the Employee
in accordance with the terms of the Stock Option or Stock Award specified by the
Committee pursuant to the provisions of the Plan.

     

    (h)          A
Grantee entitled to Stock as a result of the exercise of a Stock Option or grant
of a Stock Award shall not be deemed for any purpose to be, or have rights as, a
shareholder of the Company by virtue of such exercise, except to the extent that
a stock certificate is issued therefor and then only from the date such
certificate is issued.  No adjustments shall be made for dividends or
distributions or other rights for which the record date is prior to the date
such stock certificate is issued.  The Company shall issue any stock
certificates required to be issued in connection with the exercise of a Stock
Option with reasonable promptness after such exercise.

     

    (i)           The
grant or exercise of Stock Options granted under the Plan or the grant of a
Stock Award under the Plan shall be subject to, and shall in all respects comply
with, applicable law relating to such grant or exercise, or to the number of
shares of Stock which may be beneficially owned or held by any
Grantee.

     

    (j)          
The Company intends that the Plan shall comply with the requirements of Rule
16b-3 (the “Rule”) under the Securities Exchange Act of 1934, as amended, during
the term of this Plan. Should any additional provisions be necessary for the
Plan to comply with the requirements of the Rule, the Board may amend this Plan
to add to or modify the provisions of this Plan accordingly.

     

    (k)          The
Company intends that the Plan shall comply with the requirements of Section 409A
of the Code, to the extent applicable.  Should any changes to the Plan
be necessary for the Plan to comply with the requirements of Code Section 409A,
the Board may amend this Plan to add to or modify the provisions of this Plan
accordingly.

     

    (l)           The
Company will seek stockholder approval in the manner and to the degree required
under applicable laws.  If the Company fails to obtain any required
stockholder approval of the Plan within twelve (12) months after the date this
Plan is adopted by the Board, pursuant to Section 422 of the Code, any Option
granted as an Incentive Stock Option at any time under the Plan will not qualify
as an Incentive Stock Option within the meaning of the Code and will be deemed
to be a Non-Qualified Stock Option.

    


    [End
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