Exhibit 10.1


 


IMCLONE SYSTEMS INCORPORATED

2005 INDUCEMENT STOCK
OPTION PLAN


 


1.  Purpose.  The purpose
of the ImClone Systems Incorporated 2005 Inducement Stock Option Plan (the “Plan”)
is to enhance the ability of ImClone Systems Incorporated (the “Company”) and
its Subsidiaries to attract and retain new key employees by providing them with
an appropriate and material incentive to accept employment with the
Company.   The term “Company” as used in
the Plan with reference to employment or service shall include the Company and
its Subsidiaries, as appropriate.


 


2.  Definitions.


 


(a)  “Board” shall mean the Board
of Directors of the Company.


 


(b)  “Cause” shall mean (i) if a
Participant is party to an employment agreement or similar agreement with the
Company and such agreement includes a definition of Cause, the definition
contained therein or (ii) if no such employment or similar agreement exists, “Cause”
shall mean (A) the Participant’s failure to substantially perform the duties
reasonably assigned to him or her by the Company, which has not been cured by
the Participant within 10 days following written notice from the Company, (B) a
good faith finding by the Company of the Participant’s dishonesty, gross
negligence or misconduct, (C) a material breach by the Participant of any
written Company employment policies or rules, or (D) the Participant’s
conviction for, or his or her plea of guilty or nolo contendere to, a felony or
for any other crime which involves fraud, dishonesty or moral turpitude.


 


(c)  “Change in Control” of the
Company means the occurrence of one of the following events:


 


(i) 
individuals who, on the Effective Date, constitute the Board (the “Incumbent
Directors”) cease for any reason to constitute at least a majority of the
Board, provided that any person becoming a director subsequent to the Effective
Date whose election or nomination for election was approved by a vote of at
least two-thirds of the Incumbent Directors then on the Board (either by
a specific vote or by approval of the proxy statement of the Company in which
such person is named as a nominee for director, without objection to such
nomination) shall be an Incumbent Director; provided, further, that no
individual initially elected or nominated as a director of the Company as a
result of an actual or threatened election contest with respect to directors or
as a result of any other actual or threatened solicitation of proxies by or on
behalf of any person other than the Board shall be an Incumbent Director;


 


(ii) 
any “person” (as such term is defined in Section 3(a)(9) of the
Securities Exchange Act of 1934 (the “Exchange Act”) and as used in Sections
13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes, after the Effective
Date, a “beneficial owner” (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company representing 35% or
more of the combined voting power of the


 


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Company’s
then outstanding securities eligible to vote for the election of the Board (the
“Company Voting Securities”); provided, however, that an event described in
this paragraph (ii) shall not be deemed to be a Change in Control if any of the
following becomes such a beneficial owner: (A) the Company or any majority-owned
subsidiary (provided, that this exclusion applies solely to the ownership
levels of the Company or the majority-owned subsidiary), (B) any tax-qualified,
broad-based employee benefit plan sponsored or maintained by the Company
or any majority-owned subsidiary, (C) any underwriter temporarily holding
securities pursuant to an offering of such securities, or (D) any person
pursuant to a Non-Qualifying Transaction (as defined in paragraph (iii));


 


(iii) 
the consummation of a merger, consolidation, statutory share exchange or
similar form of corporate transaction involving the Company or any of its
Subsidiaries that requires the approval of the Company’s stockholders, whether
for such transaction or the issuance of securities in the transaction (a “Business
Combination”), unless immediately following such Business Combination: (A) 60%
or more of the total voting power of (x) the corporation resulting from such
Business Combination (the “Surviving Corporation”), or (y) if applicable, the
ultimate parent corporation that directly or indirectly has beneficial
ownership of 100% of the voting securities eligible to elect directors of the
Surviving Corporation (the “Parent Corporation”), is represented by Company
Voting Securities that were outstanding immediately prior to such Business
Combination (or, if applicable, is represented by shares into which such
Company Voting Securities were converted pursuant to such Business
Combination), and such voting power among the holders thereof is in
substantially the same proportion as the voting power of such Company Voting
Securities among the holders thereof immediately prior to the Business
Combination, (B) no person (other than any employee benefit plan (or related
trust) sponsored or maintained by the Surviving Corporation or the Parent
Corporation), is or becomes the beneficial owner, directly or indirectly, of
35% or more of the total voting power of the outstanding voting securities
eligible to elect directors of the Parent Corporation (or, if there is no Parent
Corporation, the Surviving Corporation) and (C) at least a majority of the
members of the board of directors of the Parent Corporation (or if there is no
Parent Corporation, the Surviving Corporation) following the consummation of
the Business Combination were Incumbent Directors at the time of the Board’s
approval of the execution of the initial agreement providing for such Business
Combination (any Business Combination which satisfies all of the criteria
specified in (A), (B) and (C) above shall be deemed to be a “Non-Qualifying
Transaction”); or


 


(iv) 
stockholder approval of a liquidation or dissolution of the Company,
unless the voting common equity interests of an ongoing entity (other than a
liquidating trust) are beneficially owned, directly or indirectly, by the
Company’s shareholders in substantially the same proportions as such
shareholders owned the Company’s outstanding voting common equity interests
immediately prior to such liquidation and such ongoing entity assumes all
existing obligations of the Company under the Plan.


 


Notwithstanding the foregoing, a Change in
Control of the Company shall not be deemed to occur solely because any person
acquires beneficial ownership of more than


 


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35% of the
Company Voting Securities as a result of the acquisition of Company Voting
Securities by the Company which reduces the number of Company Voting Securities
outstanding; provided, that, if after such acquisition by the Company such
person becomes the beneficial owner of Company Voting Securities that increases
the percentage of outstanding Company Voting Securities beneficially owned by
such person, a Change in Control of the Company shall then occur.


 


(d)  “Code” shall mean the
Internal Revenue Code of 1986, as amended.


 


(e)  “Committee” shall mean a
committee of at least two members of the Board appointed by the Board to
administer the Plan and to perform the functions set forth herein and who are “non-employee
directors” within the meaning of paragraph (b)(3)(i) of Rule 16b-3 as
promulgated under Section 16 of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”) and who are also “outside directors” within the meaning of
Section 162(m) of the Code.


 


(f)  “Common Stock” shall mean
the common stock of the Company.


 


(g)  “Continuous Service” means
that the Participant’s service as an employee, with the Company or a Subsidiary
is not interrupted or terminated.  The
Participant’s Continuous Service shall not be deemed to have terminated merely
because of a change in the capacity in which the Participant renders service to
the Company or a Subsidiary following the date the option is granted to the
participant under the Plan (i.e., as an employee, director or consultant) or a
change in the entity for which the Participant renders such service; provided,
that, there is no interruption or termination of the Participant’s Continuous
Service other than an approved leave of absence.  The Committee, in its sole discretion, may
determine whether Continuous Service shall be considered interrupted.


 


(h)  “Disability” shall have the
same meaning as provided in any long-term disability plan maintained by
the Company or any Subsidiary in which a Participant then participates (the “LTD
Plans”); provided, that, if no such plan exists, it shall have the meaning set
forth in Section 22(e)(3) of the Code.


 


(i)  “Fair Market Value” per
share as of a particular date shall mean, unless otherwise determined by the
Board, the last reported sale price of the Common Stock on the NASDAQ (or any
other exchange or national market system upon which price quotations for the
Company’s Common Stock is regularly available) for such date.


 


(j)  “Immediate Family Members”
shall mean, except as otherwise determined by the Committee, a Participant’s
spouse, ancestors and descendants.


 


(k)  “Nonqualified Stock Option”
shall mean a stock option which is not intended to be an Incentive Stock Option
within the meaning of Section 422 of the Code.


 


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(l)  “Option” shall mean an
option to purchase Common Stock granted under the Plan.  Each Option granted hereunder shall be a
Non-Qualified Stock Option and shall be clearly identified as such in the
applicable Stock Option Agreement.


 


(m)  “Participant” shall mean
anyone who is selected to participate in the Plan in accordance with Section 5.


 


(n)  “Stock Option Agreement”
shall mean, with respect to any Option, a written document entered into by the
Company and a Participant evidencing the grant of the Option to such
Participant and setting forth the terms and conditions, as determined by the
Committee, which apply to such Option, in addition to the terms and conditions
set forth in the Plan.


 


(o)  “Subsidiary” shall mean any
affiliate of the Company selected by the Board.


 


(p)  “Substitute Awards” shall
mean Options granted or shares issued by the Company in assumption of, or in
substitution or exchange for, awards previously granted, or the right or
obligation to make future awards, by a company acquired by the Company or with
which the Company is combined.


 


3.  Shares Subject to the Plan.  Subject to adjustment in
accordance with Section 12, the total number of shares of Common Stock which
shall be available for the grant of Options under the Plan shall not exceed
600,000 shares of Common Stock; provided, that, for purposes of this
limitation, any Common Stock subject to an Option granted under the Plan which
is canceled, forfeited or expires prior to exercise shall again become
available for grant under the Plan.  In
addition, any shares of Common Stock tendered and/or withheld for the payment
of all or a part of an Option granted under the Plan or any applicable
withholding taxes shall again become available for the grant of an Option under
the Plan.  The Company may, but is not
required to, use the proceeds it receives in connection with the exercise of an
Option under the Plan for exercises occurring after the Effective Date, to
purchase shares of its Common Stock in the open market and any such shares of
Common Stock so purchased may be used for the issuance of Options under the
Plan.  Substitute Awards shall not reduce
the shares of Common Stock available for grants under the Plan or to a
Participant over a period of time. 
Subject to adjustment in accordance with Section 12, no employee shall
be granted during any three (3) year period, Options to purchase more than
3,300,000 shares of Common Stock.  Common
Stock available for issue or distribution under the Plan shall be authorized
and unissued shares or shares reacquired by the Company in any manner.


 


4.  Administration.


 


(a)  The Plan shall be
administered by the Committee.  All
references to the Committee hereinafter shall mean the Board if no such
Committee has been appointed, provided that under such circumstances the grant
of an Option under the Plan shall be approved by a majority of the “independent
directors” of the Board.


 


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(b)  The Committee shall (i)
approve the selection of Participants, (ii) determine the number of shares of
Common Stock subject to Options, (iii) determine the terms and conditions of
any Option granted hereunder (including, but not limited to, any forfeiture
conditions on such Option) and (iv) have the authority to interpret the Plan,
to establish, amend, and rescind any rules and regulations relating to the
Plan, to determine the terms and provisions of any agreements entered into
hereunder, and to make all other determinations necessary or advisable for the
administration of the Plan.  The
Committee may correct any defect, supply any omission or reconcile any
inconsistency in the Plan or in any Option in the manner and to the extent it
shall deem desirable to carry it into effect.


 


(c)  Any action, decision,
interpretation or determination by the Committee with respect to the
application or administration of the Plan, any Option or any Stock Option
Agreement shall be final, conclusive and binding on all persons, including the
Company and its Subsidiaries and shareholders, Participants and persons
claiming rights from or through a Participant.


 


(d)  The Committee may delegate
to officers or employees of the Company or any Subsidiary, and to service
providers, the authority, subject to such terms as the Committee shall determine,
to perform administrative functions with respect to the Plan, the Options and
the Stock Option Agreements.


 


(e)  Members of the Committee and
any officer or employee of the Company or any Subsidiary acting at the
direction of, or on behalf of, the Committee shall not be personally liable for
any action or determination taken or made in good faith with respect to the
Plan, any Option or any Stock Option Agreement, and shall, to the extent
permitted by law, be fully indemnified by the Company with respect to any such
action or determination.


 


5.  Eligibility.  Individuals
eligible to receive Options under the Plan shall be individuals who have not
been previously employed by the Company or served as a member of the Board and
who are new employees of the Company, including individuals who become new
employees of the Company in connection with a merger or acquisition, as
selected by the Committee.  The Options
may be granted to any such individual, as selected by the Committee as a
material inducement to such individual accepting employment with the Company,
provided, however, that any such grant of an Option shall not become effective
unless and until such individual actually commences employment with the
Company.


 


6.  Options.  Options may
be granted under the Plan in such form as the Committee may from time to time
approve pursuant to terms set forth in the Plan and any applicable Stock Option
Agreement.


 


(a)  Option Price.  The purchase price per share of the Common
Stock purchasable under an Option shall be determined by the Committee and
shall not be less than 100% of the Fair Market Value of the Common Stock on the
date of grant, which such


 


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date of
grant shall be the date specified by the Committee and specified in the
applicable Stock Option Agreement.


 


(b)  Option Term.  Unless otherwise provided in the applicable
Stock Option Agreement, the term of each Option shall be ten (10) years from
the date the Option is granted.  
Notwithstanding the foregoing, unless otherwise provided in a Stock
Option Agreement, upon the death or Disability of a Participant, Options that
would otherwise remain exercisable following such death or Disability shall
remain exercisable for one year following such death or Disability
notwithstanding the term of such Option.


 


(c)  Exercisability.  Each Option shall vest and become exercisable
at a rate determined by the Committee on the date of grant and set forth in the
applicable Stock Option Agreement.


 


(d)  Termination of Continuous
Service.  Unless otherwise provided in
the applicable Stock Option Agreement, any Options held by a Participant upon
termination of Continuous Service shall remain exercisable as follows:


 


(i)  If
the Participant’s termination of Continuous Service is due to the Participant’s
death, all unvested Options shall automatically terminate and all vested
Options shall be exercisable by the Participant’s designated beneficiary, or,
if none, the person(s) to whom such Participant’s rights under the Option are
transferred by will or the laws of descent and distribution for one year
following such termination of Continuous Service (but in no event beyond the
term of the Option, except as provided in clause (b) above), and shall
thereafter terminate.


 


(ii) 
If the Participant’s termination of Continuous Service is due to
Disability, all unvested Options shall automatically terminate and all vested
Options shall be exercisable by the Participant for one year following such
termination of Continuous Service due to Disability (but in no event beyond the
term of the Option, except as provided in clause (b) above), and shall
thereafter terminate.


 


(iii) 
If the Participant’s termination of Continuous Service is for Cause, all
Options shall automatically terminate on the commencement of business on the
date such Participant’s Continuous Service is terminated for Cause, regardless
of whether such Options were then vested and exercisable.


 


(iv) 
If the Participant’s termination of Continuous Service is for any other
reason, all unvested Options shall terminate on the date of termination of
Continuous Service and all Options which are exercisable as of the date of
termination shall be exercisable for a period of 30-days following such
date of termination of Continuous Service (but in no event beyond the term of
the Option), and shall thereafter terminate. 
The Participant’s status as an employee shall not be considered
terminated in the case of a leave of absence agreed to in writing by the
Company (including, but not limited to, military and sick leave).


 


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(e)  Method of Exercise.  Options may be exercised, in whole or in
part, by giving written notice of exercise to the Company in a form approved by
the Committee specifying the number of shares of Common Stock to be
purchased.  Such notice shall be
accompanied by the payment in full of the Option exercise price.  Unless otherwise provided at the time of grant,
the exercise price of the Option may be paid by (i) cash or certified or bank
check, (ii) surrender of Common Stock held by the Participant for at least six
(6) months prior to exercise (or such longer or shorter period as may be
required to avoid a charge to earnings for financial accounting purposes) or
the attestation of ownership of such shares, in either case, if so permitted by
the Company, (iii) through a “same day sale” commitment from a Participant and
a broker-dealer, which is reasonably acceptable to the Company and which
is a member of the National Association of Securities Dealers, under such terms
and conditions which are reasonably acceptable to the Company, (iv) through
additional methods prescribed by the Committee, as deemed appropriate by the
Committee in its discretion, or (v) by any combination of the foregoing, and,
in all instances, to the extent permitted by applicable law.  A Participant’s subsequent transfer or
disposition of any Common Stock acquired upon exercise of an Option shall be
subject to any Federal and state laws then applicable, specifically securities
law, and the terms and conditions of the Plan.


 


7.  Special Provisions.


 


(a)  Change in Control.  Unless otherwise provided in a Stock Option
Agreement or a change in control plan with the Company in which the Participant
participates, upon the occurrence of a Change in Control, all Options shall
automatically become vested and exercisable in full.  The Committee may, in its discretion, include
such further provisions and limitations in any award documenting such Options
as it may deem equitable and in the best interests of the Company.


 


(b)  Forfeiture.  Notwithstanding anything in the Plan to the
contrary and unless otherwise specifically provided in a Stock Option
Agreement, in the event of a serious breach of conduct by a Participant or
former Participant (including, without limitation, any conduct prejudicial to
or in conflict with the Company or its Subsidiary) the Committee may (i) cancel
any outstanding Option granted to such Participant or former Participant, in
whole or in part, whether or not vested, and/or (ii) if such conduct or
activity occurs within one year following the exercise of an Option, require
such Participant or former Participant to repay to the Company any gain
realized upon the exercise of such Option (with such gain or payment valued as
of the date of exercise).  Such
cancellation or repayment obligation shall be effective as of the date
specified by the Committee.  Any
repayment obligation shall be satisfied in cash or, if permitted in the sole
discretion of the Committee, it may be satisfied in shares of Common Stock
(based upon the Fair Market Value of the share of Common Stock on the date of
payment), and the Committee may provide for an offset to any future payments
owed by the Company or any Subsidiary to the Participant or former Participant
if necessary to satisfy the repayment obligation.  The determination of whether a Participant or
former Participant has engaged in a serious breach of conduct shall be
determined by the Committee in good faith and in its sole discretion.


 


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8.  Withholding.  Upon (a)
exercise of an Option or (b) under any other circumstances determined by the
Committee in its sole discretion, the Company shall have the right to require
any Participant, and such Participant by accepting the Options granted under
the Plan agrees, to pay to the Company the amount of any taxes which the
Company shall be required to withhold with respect thereto.  In the event of clauses (a) or (b), with the
consent of the Committee, at its sole discretion, such Participant may elect to
have the Company withhold shares of Common Stock having a Fair Market Value
equal to the amount of the withholding tax obligation as determined by the
Company; provided, however, that no shares of Common Stock are withheld with a
value exceeding the minimum amount of tax required to be withheld by law.  Such shares so delivered to satisfy the
minimum withholding obligation may be either shares withheld by the Company
upon the exercise of the Option or other shares.  At the Committee’s sole discretion, a
Participant may elect to have additional taxes withheld and satisfy such
withholding with cash or shares of Common Stock held for at least six months
prior to exercise, if, in the opinion of the Company’s outside accountants,
doing so, would not result in a charge against earnings.


 


9.  Nontransferability, Beneficiaries. 
Unless otherwise determined by the Committee with respect to
the transferability of Options by a Participant to his Immediate Family Members
(or to trusts or partnerships or limited liability companies established for
such Immediate Family Members), no Options shall be assignable or transferable
by the Participant, otherwise than by will or the laws of descent and
distribution or pursuant to a beneficiary designation, and Options shall be
exercisable, during the Participant’s lifetime, only by the Participant (or by
the Participant’s legal representatives in the event of the Participant’s
incapacity).  Each Participant may designate
a beneficiary to exercise any Option held by the Participant at the time of the
Participant’s death.  If no beneficiary
has been named by a deceased Participant, any Option held by the Participant at
the time of death shall be transferred as provided in his will or by the laws
of descent and distribution.  Except in
the case of the holder’s incapacity, an Option may only be exercised by the
holder thereof.


 


10.  No Right to Continuous Service.  Nothing
contained in the Plan or in any Stock Option Agreement shall confer upon any
Participant any right with respect to the continuation of service with the
Company or any of its Subsidiaries, or interfere in any way with the right of
the Company or its Subsidiaries to terminate his or her Continuous Service at
any time.  Nothing contained in the Plan
shall confer upon any Participant or other person any claim or right to any
Option under the Plan.


 


11.  Governmental Compliance.  Each
Option under the Plan shall be subject to the requirement that if at any time
the Committee shall determine that the listing, registration or qualification
of any shares issuable or deliverable thereunder upon any securities exchange
or under any Federal or state law, or the consent or approval of any
governmental regulatory body, is necessary or desirable as a condition thereof,
or in connection therewith, no such Option may be exercised or shares issued or
delivered unless such listing, registration, qualification, consent or approval
shall have been effected or obtained free of any conditions not acceptable to
the Committee.


 


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12.  Adjustments; Corporate Events.


 


(a)  In the event of any dividend
or other distribution (whether in the form of cash, Common Stock, other
securities, or other property), recapitalization, reclassification, stock
split, reverse stock split, reorganization, merger, consolidation, split-up,
spin-off, combination, repurchase, liquidation, dissolution, or sale,
transfer, exchange or other disposition of all or substantially all of the
assets of the Company, or exchange of Common Stock or other securities of the
Company, issuance of warrants or other rights to purchase Common Stock or other
securities of the Company, or other similar corporate transaction or event (an “Event”),
and in the Committee’s opinion, such Event affects the Common Stock such that
an adjustment is determined by the Committee to be appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits intended
to be made available under the Plan or with respect to an Option, then the
Committee shall, in such manner as it may deem equitable, including, without
limitation, adjust any or all of the following: (i) the number and kind of
shares of Common Stock (or other securities or property) with respect to which
Options may be granted; (ii) the number and kind of shares of Common Stock (or
other securities or property) subject to outstanding Options; and (iii) the
exercise price with respect to any Option. 
The Committee’s determination under this Section 12(a) shall be final,
binding and conclusive.


 


(b)  Upon the occurrence of an
Event in which outstanding Options are not to be assumed or otherwise continued
following such an Event, the Committee may, in its discretion, terminate any
outstanding Option (whether or not vested) without a Participant’s consent and
(i) provide for either (A) the purchase of any such Option for an amount of
cash equal to the product of (I) and (II), where (I) is equal to the number of
shares of Common Stock subject to such Option and (II) is equal to the
difference between (a) the Fair Market Value of one share of Common Stock and
(b) the per share exercise price of such Option; provided, that, if such amount
would result in a negative number, the Option shall automatically terminate and
cease to be exercisable without payment for such termination or (B) the
replacement of such Option with other rights or property selected by the
Committee in its sole discretion and/or (ii) provide that such Option shall be
exercisable (whether or not vested) as to all shares covered thereby for at
least thirty (30) days prior to such Event.


 


(c)  The existence of the Plan,
the Stock Option Agreements and the Options granted hereunder shall not affect
or restrict in any way the right or power of the Company or the shareholders of
the Company to make or authorize any adjustment, recapitalization,
reorganization or other change in the Company’s capital structure or its
business, any merger or consolidation of the Company, any issue of stock or of
options, warrants or rights to purchase stock or of bonds, debentures,
preferred or prior preference stocks whose rights are superior to or affect the
Common Stock or the rights thereof or which are convertible into or exchangeable
for Common Stock, or the dissolution or liquidation of the Company, or any sale
or transfer of all or any part of its assets or business, or any other
corporate act or proceeding, whether of a similar character or otherwise.


 


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13.  Stock Option Agreement.  Each
Option under the Plan shall be evidenced by a Stock Option Agreement.  In the event of a conflict between the terms
of the Plan and the terms of any Stock Option Agreement, the terms of the Plan
shall govern.


 


14.  Amendment.  The Board
may amend, suspend or terminate the Plan or any portion thereof at any time,
provided that (a) no amendment shall be made without shareholder approval if
such approval is necessary to comply with any applicable law, regulation or
stock exchange rule and (b) except as provided in Section 12, no amendment
shall be made that would adversely affect the rights of a Participant under an
Option theretofore granted, without such Participant’s written consent.


 


15.  General Provisions.


 


(a)  The Committee may require
each Participant acquiring shares pursuant to an Option under the Plan to
represent to and agree with the Company in writing that such Participant is
acquiring the shares for investment and without a view to distribution thereof.


 


(b)  All certificates for Common
Stock delivered under the Plan pursuant to any Option 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, and any applicable Federal or state securities law, and
the Committee may cause a legend or legends to be put on any such certificates to
make appropriate reference to such restrictions.  If the Committee determines that the issuance
of Common Stock hereunder is not in compliance with, or subject to an exemption
from, any applicable Federal or state securities laws, such shares shall not be
issued until such time as the Committee determines that the issuance is
permissible.


 


(c)  It is the intent of the
Company that the Plan satisfy, and be interpreted in a manner that satisfies,
the applicable requirements of Rule 16b-3 as promulgated under Section 16
of the Exchange Act so that Participants will be entitled to the benefit of
Rule 16b-3, or any other rule promulgated under Section 16 of the
Exchange Act, and will not be subject to short-swing liability under
Section 16 of the Exchange Act.  Accordingly,
if the operation of any provision of the Plan would conflict with the intent
expressed in this Section 15(c), such provision to the extent possible shall be
interpreted and/or deemed amended so as to avoid such conflict.


 


(d)  Except as otherwise provided
by the Committee in the applicable Stock Option Agreement, a Participant shall
have no rights as a shareholder with respect to any shares of Common Stocks
subject to an Option until a certificate or certificates evidencing shares of
Common Stock shall have been issued to the Participant and, subject to Section
12, no adjustment shall be made for dividends or distributions or other rights
in respect of any share for which the record date is prior to the date on which
Participant shall become the holder of record thereof.


 


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(e)  The law of the State of
Delaware shall apply to all Options and interpretations under the Plan
regardless of the effect of such state’s conflict of laws principles.


 


(f)  Where the context requires,
words in any gender shall include any other gender.


 


(g)  Headings of Sections are
inserted for convenience and reference; they do not constitute any part of the
Plan.


 


16.  Expiration of the Plan.  Subject
to earlier termination pursuant to Section 14, the Plan shall terminate on the
tenth anniversary of the Effective Date.


 


17.  Effective Date.  The
Plan is effective as of the date it is approved by the majority of the members
of the Compensation Committee of the Board.


 


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