PALATIN TECHNOLOGIES, INC.

2005 STOCK PLAN
(as amended on December 7, 2007 and March 10, 2009)

|1. | DEFINITIONS.
|-- | ------------

| | Unless otherwise specified or
unless the context otherwise requires, the following terms, as used in this Palatin Technologies, Inc.
2005 Stock Plan, have the following meanings:
| | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Administrator means the
Board of Directors, unless it has delegated power to act on its behalf to the Committee, in which case
the Administrator means the Committee.
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Affiliate means a
corporation which, for purposes of Section 424 of the Code, is a parent or subsidiary of the Company,
direct or indirect.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------

| |  | Agreement means an
agreement between the Company and a Participant delivered pursuant to the Plan, in such form as the
Administrator shall approve.
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Board of Directors means
the Board of Directors of the Company.
| |  | ---------------------------------------------------------------

| |  | Code means the United
States Internal Revenue Code of 1986, as amended.
| |  | -----------------------------------------------------------------------

| |  | Committee means the
committee of the Board of Directors to which the Board of Directors has delegated power to act under or
pursuant to the provisions of the Plan.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Common Stock means shares
of the Company's common stock, $.01 par value per share.
| |  | ----------------------------------------------------------------------------------

| |  | Company means Palatin
Technologies, Inc., a Delaware corporation.
| |  | -----------------------------------------------------------------

| |  | Disability or Disabled
means permanent and total disability as defined in Section 22(e)(3) of the Code.
| |  | -------------------------------------------------------------------------------------------------------

| |  | Employee means any employee
of the Company or of an Affiliate (including, without limitation, an employee who is also serving as an
officer or director of the Company or of an Affiliate), designated by the Administrator to be eligible
to be granted one or more Stock Rights under the Plan.
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Fair Market Value of a Share of
Common Stock means:
| |  | ---------------------------------------------------

| |  | (1)      If
the Common Stock is listed on a national securities exchange or traded in the over-the-counter market
and sales prices are regularly reported for the Common Stock, the closing or last price of the Common
Stock on the composite tape or other comparable reporting system for the trading day on the applicable
date and if such date is not a trading day, the last market trading day prior to such date;
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | (2)      If
the Common Stock is not traded on a national securities exchange but is traded on the over-the-counter
market, if sales prices are not regularly reported for
| |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2005 Stock Plan – Page 1

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| |  | the Common Stock are regularly
reported, the mean between the bid and the asked price for the Common Stock at the close of trading in
the over-the-counter market for the trading day on which Common Stock was traded on the applicable date
and if such date is not a trading day, the last market trading day prior to such date; and
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| |  | (3)      If
the Common Stock is neither listed on a national securities exchange nor traded in the over-the-counter
market, such value as the Administrator, in good faith, shall determine.
| |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | ISO means an option meant
to qualify as an incentive stock option under Section 422 of the Code.
| |  | ------------------------------------------------------------------------------------------------

| |  | Non-Qualified Option means
an option which is not intended to qualify as an ISO.
| |  | --------------------------------------------------------------------------------

| |  | Option means an ISO or Non-
Qualified Option granted under the Plan.
| |  | --------------------------------------------------------------------

| |  | Participant means an
Employee, director or consultant of the Company or an Affiliate to whom one or more Stock Rights are
granted under the Plan. As used herein, "Participant" shall include "Participant's Survivors" where the
context requires.
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Plan means this Palatin
Technologies, Inc. 2005 Stock Plan.
| |  | -----------------------------------------------------------

| |  | Shares means shares of the
Common Stock as to which Stock Rights have been or may be granted under the Plan or any shares of
capital stock into which the Shares are changed or for which they are exchanged within the provisions
of Paragraph 3 of the Plan. The Shares issued under the Plan may be authorized and unissued shares or
shares held by the Company in its treasury, or both.
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Stock-Based Award means a
grant by the Company under the Plan of an equity award or equity based award which is not an Option or
Stock Grant.
| |  | ---------------------------------------------------------------------------------------------------------------------------------------------

| |  | Stock Grant means a grant
by the Company of Shares under the Plan.
| |  | ------------------------------------------------------------------

| |  | Stock Right means a right
to Shares or the value of Shares of the Company granted pursuant to the Plan -- an ISO, a Non-Qualified
Option, a Stock Grant or Stock-Based Award.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | Survivor means a deceased
Participant's legal representatives and/or any person or persons who acquired the Participant's rights
to a Stock Right by will or by the laws of descent and distribution.
| |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|2. | PURPOSES OF THE PLAN.
|-- | ---------------------

The
Plan is intended to encourage ownership of Shares by Employees and directors of and certain consultants
to the Company in order to attract such people, to induce them to work for the benefit of the Company
or of an Affiliate and to provide additional incentive for them to promote the success of the Company
or of an Affiliate. The Plan provides for the granting of ISOs, Non-Qualified Options, Stock Grants and
Stock-Based Awards.

2005 Stock Plan  Page 2

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|3. | SHARES SUBJECT TO THE PLAN.
|-- | ---------------------------

(a)
     The number of Shares which may be issued from time to time pursuant to this
Plan shall be 15,000,000, or the equivalent of such number of
Shares after the Administrator, in its sole discretion, has interpreted the effect of any stock split,
stock dividend, combination, recapitalization or similar transaction in accordance with Paragraph 24 of
the Plan.

(b)
     If an Option ceases to be outstanding, in whole or in part (other than by
exercise), or if the Company shall reacquire (at no more than its original issuance price) any Shares
issued pursuant to a Stock Grant or Stock-Based Award, or if any Stock Right expires or is forfeited,
cancelled, or otherwise terminated or results in any Shares not being issued, the unissued or
reacquired Shares which were subject to such Stock Right shall again be available for issuance from
time to time pursuant to this Plan. Notwithstanding the foregoing, if a Stock Right is exercised, in
whole or in part, by tender of Shares or if the Company or an Affiliate's tax withholding obligation is
satisfied by withholding Shares, the number of Shares deemed to have been issued under the Plan for
purposes of the limitation set forth in Paragraph 3(a) above shall be the number of Shares that were
subject to the Stock Right or portion thereof, and not the net number of Shares actually issued.

|4. | ADMINISTRATION OF THE PLAN.
|-- | ---------------------------

The
Administrator of the Plan will be the Board of Directors, except to the extent the Board of Directors
delegates its authority to the Committee, in which case the Committee shall be the Administrator.
Subject to the provisions of the Plan, the Administrator is authorized to:

| | a. | Interpret the provisions of the
Plan and all Stock Rights and to make all rules and determinations which it deems necessary or
advisable for the administration of the Plan;
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b. | Determine which Employees,
directors and consultants shall be granted Stock Rights;
| | -- | -----------------------------------------------------------------------------------

| | c. | Determine the number of Shares for
which a Stock Right or Stock Rights shall be granted; provided, however, that in no event shall Stock
Rights with respect to more than 500,000 Shares be granted to any Participant in any fiscal year;
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | d. | Specify the terms and conditions
upon which a Stock Right or Stock Rights may be granted;
| | -- | -----------------------------------------------------------------------------------------

| | e. | Adopt any sub-plans applicable to
residents of any specified jurisdiction as it deems necessary or appropriate in order to comply with or
take advantage of any tax or other laws applicable to the Company or to Plan Participants or to
otherwise facilitate the administration of the Plan, which sub-plans may include additional
restrictions or conditions applicable to Stock Rights or Shares issuable pursuant to a Stock Right;
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

provided, however, that all such interpretations,
rules, determinations, terms and conditions shall be made and prescribed in the context of not causing
any adverse tax consequences under Section 409A of the Code and preserving the tax status under Section
422 of the Code of those Options which are designated as ISOs. Subject to the foregoing, the
interpretation and construction by the Administrator of any provisions of the Plan or of any Stock
Right granted under it shall be final, unless otherwise determined by the Board of Directors, if the
Administrator is the Committee. In addition, if the Administrator is the Committee, the Board of
Directors may take any action under the Plan that would otherwise be the responsibility of the
Committee.

2005 Stock Plan  Page 3

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To the
extent permitted under applicable law, the Board of Directors or the Committee may allocate all or any
portion of its responsibilities and powers to any one or more of its members and may delegate all or
any portion of its responsibilities and powers to any other person selected by it. The Board of
Directors or the Committee may revoke any such allocation or delegation at any time.

|5. | ELIGIBILITY FOR
PARTICIPATION.
|-- | ------------------------------

The
Administrator will, in its sole discretion, name the Participants in the Plan, provided, however, that
each Participant must be an Employee, director or consultant of the Company or of an Affiliate at the
time a Stock Right is granted. Notwithstanding the foregoing, the Administrator may authorize the grant
of a Stock Right to a person not then an Employee, director or consultant of the Company or of an
Affiliate; provided, however, that the actual grant of such Stock Right shall be conditioned upon such
person becoming eligible to become a Participant at or prior to the time of the execution of the
Agreement evidencing such Stock Right. ISOs may be granted only to Employees. Non-Qualified Options,
Stock Grants and Stock-Based Awards may be granted to any Employee, director or consultant of the
Company or an Affiliate. The granting of any Stock Right to any individual shall neither entitle that
individual to, nor disqualify him or her from, participation in any other grant of Stock Rights.

|6. | TERMS AND CONDITIONS OF
OPTIONS.
|-- | --------------------------------

Each
Option shall be set forth in writing in an Option Agreement, duly executed by the Company and, to the
extent required by law or requested by the Company, by the Participant. The Administrator may provide
that Options be granted subject to such terms and conditions, consistent with the terms and conditions
specifically required under this Plan, as the Administrator may deem appropriate including, without
limitation, subsequent approval by the shareholders of the Company of this Plan or any amendments
thereto. The Option Agreements shall be subject to at least the following terms and conditions:

| | A. | Non-Qualified Options: Each
Option intended to be a Non-Qualified Option shall be subject to the terms and conditions which the
Administrator determines to be appropriate and in the best interest of the Company, subject to the
following minimum standards for any such Non-Qualified Option:
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a. | Option Price: Each Option
Agreement shall state the option price (per share) of the Shares covered by each Option, which option
price shall be determined by the Administrator but shall not be less than the Fair Market Value per
share of Common Stock.
| |  | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b. | Number of Shares: Each
Option Agreement shall state the number of Shares to which it pertains.
| |  | -- | ----------------------------------------------------------------------------------------------

| |  | c. | Option Periods: Each Option
Agreement shall state the date or dates on which it first is exercisable and the date after which it
may no longer be exercised, and may provide that the Option rights accrue or become exercisable in
installments over a period of months or years, or upon the occurrence of certain conditions or the
attainment of stated goals or events.
| |  | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | d. | Option Conditions: Exercise
of any Option may be conditioned upon the Participant's execution of a Share purchase agreement in form
satisfactory to the Administrator providing for certain protections for the Company
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2005 Stock Plan  Page 4

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| |  |  | and its other
shareholders, including requirements that:
| |  |  | --------------------------------------------------------

| |  |  | i. | The Participant's or the
Participant's Survivors' right to sell or transfer the Shares may be restricted; and
| |  |  | -- | -------------------------------------------------------------------------------------------------------------

| |  |  | ii. | The Participant or the
Participant's Survivors may be required to execute letters of investment intent and must also
acknowledge that the Shares will bear legends noting any applicable restrictions.
| |  |  | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | e. | Term of Option: Each Option
shall terminate not more than ten years from the date of the grant or at such earlier time as the
Option Agreement may provide.
| |  | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | ISOs: Each Option intended
to be an ISO shall be issued only to an Employee and be subject to the following terms and conditions,
with such additional restrictions or changes as the Administrator determines are appropriate but not in
conflict with Section 422 of the Code and relevant regulations and rulings of the Internal Revenue
Service::
| |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | a. | Minimum standards: The ISO
shall meet the minimum standards required of Non-Qualified Options, as described in Paragraph 6(A)
above, except clauses (a) and (e) thereunder.
| |  | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | b. | Option Price: Immediately
before the ISO is granted, if the Participant owns, directly or by reason of the applicable attribution
rules in Section 424(d) of the Code:
| |  | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  | i. | 10% or less of the total combined
voting power of all classes of stock of the Company or an Affiliate, the Option price per share of the
Shares covered by each ISO shall not be less than 100% of the Fair Market Value per share of the Shares
on the date of the grant of the Option; or
| |  |  | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  | ii. | More than 10% of the total
combined voting power of all classes of stock of the Company or an Affiliate, the Option price per
share of the Shares covered by each ISO shall not be less than 110% of the Fair Market Value on the
date of grant.
| |  |  | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | c. | Term of Option: For
Participants who own:
| |  | -- | -----------------------------------------

| |  |  | i. | 10% or less of the total combined
voting power of all classes of stock of the Company or an Affiliate, each ISO shall terminate not more
than ten years from the date of the grant or at such earlier time as the Option Agreement may provide;
or
| |  |  | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  | ii. | More than 10% of the total
combined voting power of all classes of stock of the Company or an Affiliate, each ISO shall terminate
not more than five years from the date of the grant or at such earlier time as the Option Agreement may
provide.
| |  |  | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  | d. | Limitation on Yearly
Exercise: The Option Agreements shall restrict the amount of ISOs which may become exercisable in
any calendar year (under this or any other ISO plan of the Company or an Affiliate) so that the
aggregate Fair Market Value (determined at the time each ISO is granted) of the stock with respect to
which ISOs are exercisable for the first time by the Participant in any calendar year does not exceed
$100,000.
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2005 Stock Plan  Page 5

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|7. | TERMS AND CONDITIONS OF STOCK
GRANTS.
|-- | -------------------------------------

Each
offer of a Stock Grant to a Participant shall state the date prior to which the Stock Grant must be
accepted by the Participant, and the principal terms of each Stock Grant shall be set forth in an
Agreement, duly executed by the Company and, to the extent required by law or requested by the Company,
by the Participant. The Agreement shall be in a form approved by the Administrator and shall contain
terms and conditions which the Administrator determines to be appropriate and in the best interest of
the Company, subject to the following minimum standards:

| | (a) | Each Agreement shall state the
purchase price (per share), if any, of the Shares covered by each Stock Grant, which purchase price
shall be determined by the Administrator but shall not be less than the minimum consideration required
by the Delaware General Corporation Law on the date of the grant of the Stock Grant;
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | (b) | Each Agreement shall state the
number of Shares to which the Stock Grant pertains; and
| | --- | --------------------------------------------------------------------------------------

| | (c) | Each Agreement shall include the
terms of any right of the Company to restrict or reacquire the Shares subject to the Stock Grant,
including the time and events upon which such rights shall accrue and the purchase price therefor, if
any.
| | --- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|8. | TERMS AND CONDITIONS OF OTHER
STOCK-BASED AWARDS.
|-- | -------------------------------------------------

The
Board shall have the right to grant other Stock-Based Awards based upon the Common Stock having such
terms and conditions as the Board may determine, including, without limitation, the grant of Shares
based upon certain conditions, the grant of securities convertible into Shares and the grant of stock
appreciation rights, phantom stock awards or stock units. The principal terms of each Stock-Based Award
shall be set forth in an Agreement, duly executed by the Company and, to the extent required by law or
requested by the Company, by the Participant. The Agreement shall be in a form approved by the
Administrator and shall contain terms and conditions which the Administrator determines to be
appropriate and in the best interest of the Company.

The
Company intends that the Plan and any Stock-Based Awards granted hereunder be exempt from the
application of Section 409A of the Code or meet the requirements of paragraphs (2), (3) and (4) of
subsection (a) of Section 409A of the Code, to the extent applicable, and be operated in accordance
with Section 409A so that any compensation deferred under any Stock-Based Award (and applicable
investment earnings) shall not be included in income under Section 409A of the Code. Any ambiguities in
the Plan shall be construed to effect the intent as described in this Paragraph 8.

|9. | EXERCISE OF OPTIONS AND ISSUE
OF SHARES.
|-- | ----------------------------------------

An
Option (or any part or installment thereof) shall be exercised by giving written notice to the Company
or its designee, together with provision for payment of the full purchase price in accordance with this
Paragraph for the Shares as to which the Option is being exercised, and upon compliance with any other
condition(s) set forth in the Option Agreement. Such notice shall be signed by the person exercising
the Option, shall state the number of Shares with respect to which the Option is being exercised and
shall contain any representation required by the Plan

2005 Stock Plan  Page 6

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or the Option Agreement. Payment of the purchase
price for the Shares as to which such Option is being exercised shall be made (a) in United States
dollars in cash or by check, or (b) at the discretion of the Administrator, through delivery of shares
of Common Stock having a Fair Market Value equal as of the date of the exercise to the cash exercise
price of the Option, or (c) at the discretion of the Administrator, by having the Company retain from
the shares otherwise issuable upon exercise of the Option, a number of shares having a Fair Market
Value equal as of the date of exercise to the exercise price of the Option, or (d) at the discretion of
the Administrator, by delivery of the grantee's personal recourse note, bearing interest payable not
less than annually at no less than 100% of the applicable Federal rate, as defined in Section 1274(d)
of the Code, with or without the pledge of such Shares as collateral, or (e) at the discretion of the
Administrator, in accordance with a cashless exercise program established with a securities brokerage
firm, and approved by the Administrator, or (f) at the discretion of the Administrator, by any
combination of (a), (b), (c), (d) and (e) above, or (g) at the discretion of the Administrator, payment
of such other lawful consideration as the Board may determine. Notwithstanding the foregoing, the
Administrator shall accept only such payment on exercise of an ISO as is permitted by Section 422 of
the Code.

The
Company shall then reasonably promptly deliver the Shares as to which such Option was exercised to the
Participant (or to the Participant's Survivors, as the case may be). In determining what constitutes
"reasonably promptly," it is expressly understood that the issuance and delivery of the Shares may be
delayed by the Company in order to comply with any law or regulation (including, without limitation,
state securities or "blue sky" laws) which requires the Company to take any action with respect to the
Shares prior to their issuance. The Shares shall, upon delivery, be fully paid, non-assessable Shares.

The
Administrator shall have the right to accelerate the date of exercise of any installment of any Option;
provided that the Administrator shall not accelerate the exercise date of any installment of any Option
granted to an Employee as an ISO (and not previously converted into a Non-Qualified Option pursuant to
Paragraph 27) if such acceleration would violate the annual vesting limitation contained in Section
422(d) of the Code, as described in Paragraph 6.B.d.

The
Administrator may, in its discretion, amend any term or condition of an outstanding Option provided (i)
such term or condition as amended is permitted by the Plan, (ii) any such amendment shall be made only
with the consent of the Participant to whom the Option was granted, or in the event of the death of the
Participant, the Participant's Survivors, if the amendment is adverse to the Participant, and (iii) any
such amendment of any Option shall be made only after the Administrator determines whether such
amendment would constitute a "modification" of any Option which is an ISO (as that term is defined in
Section 424(h) of the Code) or would cause any adverse tax consequences for the holder of such Option
including, but not limited to, pursuant to Section 409A of the Code.

|10. | ACCEPTANCE OF STOCK GRANTS AND
STOCK-BASED AWARDS AND ISSUE OF SHARES.
|--- | ----------------------------------------------------------------------

A Stock
Grant or Stock-Based Award (or any part or installment thereof) shall be accepted by executing the
applicable Agreement and delivering it to the Company or its designee, together with provision for
payment of the full purchase price, if any, in accordance

2005 Stock Plan  Page 7

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with this Paragraph for the Shares as to
which such Stock Grant or Stock-Based Award is being accepted, and upon compliance with any other
conditions set forth in the applicable Agreement. Payment of the purchase price for the Shares as to
which such Stock Grant or Stock-Based Award is being accepted shall be made (a) in United States
dollars in cash or by check, or (b) at the discretion of the Administrator, through delivery of shares
of Common Stock having a Fair Market Value equal as of the date of acceptance of the Stock Grant or
Stock-Based Award to the purchase price of the Stock Grant or Stock-Based Award, or (c) at the
discretion of the Administrator, by delivery of the grantee's personal recourse note bearing interest
payable not less than annually at no less than 100% of the applicable Federal rate, as defined in
Section 1274(d) of the Code, or (d) at the discretion of the Administrator, by any combination of (a),
(b) and (c) above.

The
Company shall then, if required pursuant to the applicable Agreement, reasonably promptly deliver the
Shares as to which such Stock Grant or Stock-Based Award was accepted to the Participant (or to the
Participant's Survivors, as the case may be), subject to any escrow provision set forth in the
applicable Agreement. In determining what constitutes "reasonably promptly," it is expressly understood
that the issuance and delivery of the Shares may be delayed by the Company in order to comply with any
law or regulation (including, without limitation, state securities or "blue sky" laws) which requires
the Company to take any action with respect to the Shares prior to their issuance.

The
Administrator may, in its discretion, amend any term or condition of an outstanding Stock Grant, Stock-
Based Award or applicable Agreement provided (i) such term or condition as amended is permitted by the
Plan, (ii) any such amendment shall be made only with the consent of the Participant to whom the Stock
Grant or Stock-Based Award was made, if the amendment is adverse to the Participant and (iii) any such
amendment shall be made only after the Administrator determines whether such amendment would cause any
adverse tax consequences to the Participant, including, but not limited to, pursuant to Section 409A of
the Code.

|11. | RIGHTS AS A SHAREHOLDER.
|--- | ------------------------

No
Participant to whom a Stock Right has been granted shall have rights as a shareholder with respect to
any Shares covered by such Stock Right, except after due exercise of the Option or acceptance of the
Stock Grant or as set forth in any Agreement and tender of the full purchase price, if any, for the
Shares being purchased pursuant to such exercise or acceptance and registration of the Shares in the
Company's share register in the name of the Participant.

|12. | ASSIGNABILITY AND
TRANSFERABILITY OF STOCK RIGHTS.
|--- | --------------------------------------------------

By its
terms, a Stock Right granted to a Participant shall not be transferable by the Participant other than
(i) by will or by the laws of descent and distribution, or (ii) as approved by the Administrator in its
discretion and set forth in the applicable Agreement provided that no Stock Right may be transferred by
a Participant for value. Notwithstanding the foregoing, an ISO transferred except in compliance with
clause (i) above shall no longer qualify as an ISO. The designation of a beneficiary of a Stock Right
by a Participant, with the prior approval of the Administrator and in such form as the Administrator
shall prescribe, shall not be deemed a transfer prohibited by this Paragraph. Except as provided above,
a Stock Right shall only be exercisable or may only be accepted, during the Participant's lifetime, by
such Participant (or by his or her legal representative) and shall not be assigned, pledged or
hypothecated in any way

2005 Stock Plan  Page 8

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(whether by operation of law or otherwise) and shall not be subject to
execution, attachment or similar process. Any attempted transfer, assignment, pledge, hypothecation or
other disposition of any Stock Right or of any rights granted thereunder contrary to the provisions of
this Plan, or the levy of any attachment or similar process upon a Stock Right, shall be null and void.

|13. | EFFECT ON OPTIONS OF
TERMINATION OF SERVICE OTHER THAN "FOR CAUSE" OR DEATH OR DISABILITY.
|--- | ------------------------------------------------------------------------------------------

Except
as otherwise provided in a Participant's Option Agreement, in the event of a termination of service
(whether as an employee, director or consultant) with the Company or an Affiliate before the
Participant has exercised an Option, the following rules apply:

| | a. | A Participant who ceases to be an
employee, director or consultant of the Company or of an Affiliate (for any reason other than
termination "for cause", Disability, or death for which events there are special rules in Paragraphs
14, 15, and 16, respectively), may exercise any Option granted to him or her to the extent that the
Option is exercisable on the date of such termination of service, but only within such term as the
Administrator has designated in a Participant's Option Agreement.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b. | Except as provided in Subparagraph
(c) below, or Paragraph 15 or 16, in no event may an Option intended to be an ISO, be exercised later
than three months after the Participant's termination of employment.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | c. | The provisions of this Paragraph,
and not the provisions of Paragraph 15 or 16, shall apply to a Participant who subsequently becomes
Disabled or dies after the termination of employment, director status or consultancy; provided,
however, in the case of a Participant's Disability or death within three months after the termination
of employment, director status or consultancy, the Participant or the Participant's Survivors may
exercise the Option within one year after the date of the Participant's termination of service, but in
no event after the date of expiration of the term of the Option.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | d. | Notwithstanding anything herein to
the contrary, if subsequent to a Participant's termination of employment, termination of director
status or termination of consultancy, but prior to the exercise of an Option, the Board of Directors
determines that, either prior or subsequent to the Participant's termination, the Participant engaged
in conduct which would constitute "cause", then such Participant shall forthwith cease to have any
right to exercise any Option.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | e. | A Participant to whom an Option
has been granted under the Plan who is absent from the Company or an Affiliate because of temporary
disability (any disability other than a Disability as defined in Paragraph 1 hereof), or who is on
leave of absence for any purpose, shall not, during the period of any such absence, be deemed, by
virtue of such absence alone, to have terminated such Participant's employment, director status or
consultancy with the Company or with an Affiliate, except as the Administrator may otherwise expressly
provide.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | f. | Except as required by law or as
set forth in a Participant's Option Agreement, Options granted under the Plan shall not be affected by
any change of a Participant's status within or among the Company and any Affiliates, so long as the
Participant continues to be an employee, director or consultant of the Company or any Affiliate.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

2005 Stock Plan  Page 9

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|14. | EFFECT ON OPTIONS OF
TERMINATION OF SERVICE "FOR CAUSE".
|--- | --------------------------------------------------------

Except
as otherwise provided in a Participant's Option Agreement, the following rules apply if the
Participant's service (whether as an employee, director or consultant) with the Company or an Affiliate
is terminated "for cause" prior to the time that all his or her outstanding Options have been
exercised:

| | a. | All outstanding and unexercised
Options as of the time the Participant is notified his or her service is terminated "for cause" will
immediately be forfeited.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b. | For purposes of this Plan, "cause"
shall include (and is not limited to) dishonesty with respect to the Company or any Affiliate,
insubordination, substantial malfeasance or non-feasance of duty, unauthorized disclosure of
confidential information, breach by the Participant of any provision of any employment, consulting,
advisory, nondisclosure, non-competition or similar agreement between the Participant and the Company,
and conduct substantially prejudicial to the business of the Company or any Affiliate. The
determination of the Administrator as to the existence of "cause" will be conclusive on the Participant
and the Company.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | c. | "Cause" is not limited to events
which have occurred prior to a Participant's termination of service, nor is it necessary that the
Administrator's finding of "cause" occur prior to termination. If the Administrator determines,
subsequent to a Participant's termination of service but prior to the exercise of an Option, that
either prior or subsequent to the Participant's termination the Participant engaged in conduct which
would constitute "cause", then the right to exercise any Option is forfeited.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | d. | Any provision in an agreement
between the Participant and the Company or an Affiliate, which contains a conflicting definition of
"cause" for termination and which is in effect at the time of such termination, shall supersede the
definition in this Plan with respect to that Participant.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|15. | EFFECT ON OPTIONS OF
TERMINATION OF SERVICE FOR DISABILITY.
|--- | -----------------------------------------------------------

Except
as otherwise provided in a Participant's Option Agreement, a Participant who ceases to be an employee,
director or consultant of the Company or of an Affiliate by reason of Disability may exercise any
Option granted to such Participant:

| | a. | To the extent that the Option has
become exercisable but has not been exercised on the date of Disability; and
| | -- | --------------------------------------------------------------------------------------------------------------

| | b. | In the event rights to exercise
the Option accrue periodically, to the extent of a pro rata portion through the date of Disability of
any additional vesting rights that would have accrued on the next vesting date had the Participant not
become Disabled. The proration shall be based upon the number of days accrued in the current vesting
period prior to the date of Disability.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

A
Disabled Participant may exercise such rights only within the period ending one year after the date of
the Participant's termination of employment, directorship or consultancy, as the case may be,
notwithstanding that the Participant might have been able to exercise the Option as to some or all of
the Shares on a later date if the Participant had not become Disabled and had continued to be an
employee, director or consultant or, if earlier, within the originally prescribed term of the Option.

2005 Stock Plan  Page 10

---

The
Administrator shall make the determination both of whether Disability has occurred and the date of its
occurrence (unless a procedure for such determination is set forth in another agreement between the
Company and such Participant, in which case such procedure shall be used for such determination). If
requested, the Participant shall be examined by a physician selected or approved by the Administrator,
the cost of which examination shall be paid for by the Company.

|16. | EFFECT ON OPTIONS OF DEATH
WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT.
|--- | ---------------------------------------------------------------------

Except
as otherwise provided in a Participant's Option Agreement, in the event of the death of a Participant
while the Participant is an employee, director or consultant of the Company or of an Affiliate, such
Option may be exercised by the Participant's Survivors:

| | a. | To the extent that the Option has
become exercisable but has not been exercised on the date of death; and
| | -- | ---------------------------------------------------------------------------------------------------------

| | b. | In the event rights to exercise
the Option accrue periodically, to the extent of a pro rata portion through the date of death of any
additional vesting rights that would have accrued on the next vesting date had the Participant not
died. The proration shall be based upon the number of days accrued in the current vesting period prior
to the Participant's date of death.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

If the
Participant's Survivors wish to exercise the Option, they must take all necessary steps to exercise the
Option within one year after the date of death of such Participant, notwithstanding that the decedent
might have been able to exercise the Option as to some or all of the Shares on a later date if he or
she had not died and had continued to be an employee, director or consultant or, if earlier, within the
originally prescribed term of the Option.

|17. | EFFECT OF TERMINATION OF
SERVICE ON UNACCEPTED STOCK GRANTS.
|--- | ------------------------------------------------------------

In the
event of a termination of service (whether as an employee, director or consultant) with the Company or
an Affiliate for any reason before the Participant has accepted a Stock Grant, such offer shall
terminate.

For
purposes of this Paragraph 17 and Paragraph 18 below, a Participant to whom a Stock Grant has been
offered and accepted under the Plan who is absent from work with the Company or with an Affiliate
because of temporary disability (any disability other than a permanent and total Disability as defined
in Paragraph 1 hereof), or who is on leave of absence for any purpose, shall not, during the period of
any such absence, be deemed, by virtue of such absence alone, to have terminated such Participant's
employment, director status or consultancy with the Company or with an Affiliate, except as the
Administrator may otherwise expressly provide.

In
addition, for purposes of this Paragraph 17 and Paragraph 18 below, any change of employment or other
service within or among the Company and any Affiliates shall not be treated as a termination of
employment, director status or consultancy so long as the Participant continues to be an employee,
director or consultant of the Company or any Affiliate.

|18. | EFFECT ON STOCK GRANTS OF
TERMINATION OF SERVICE OTHER THAN "FOR CAUSE" OR DEATH OR DISABILITY.
|--- | -----------------------------------------------------------------------------------------------

Except
as otherwise provided in a Participant's Agreement, in the event of a termination of service (whether
as an employee, director or consultant), other than termination "for cause,"

2005 Stock Plan  Page 11

---

Disability, or death for
which events there are special rules in Paragraphs 19, 20, and 21, respectively, before all Company
rights of repurchase shall have lapsed, then the Company shall have the right to repurchase that number
of Shares subject to a Stock Grant as to which the Company's repurchase rights have not lapsed.

|19. | EFFECT ON STOCK GRANTS OF
TERMINATION OF SERVICE "FOR CAUSE".
|--- | -------------------------------------------------------------

Except
as otherwise provided in a Participant's Agreement, the following rules apply if the Participant's
service (whether as an employee, director or consultant) with the Company or an Affiliate is terminated
"for cause":

| | a. | All Shares subject to any Stock
Grant shall be immediately subject to repurchase by the Company at the purchase price, if any, thereof.
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------

| | b. | For purposes of this Plan, "cause"
shall include (and is not limited to) dishonesty with respect to the employer, insubordination,
substantial malfeasance or non-feasance of duty, unauthorized disclosure of confidential information,
breach by the Participant of any provision of any employment, consulting, advisory, nondisclosure, non-
competition or similar agreement between the Participant and the Company, and conduct substantially
prejudicial to the business of the Company or any Affiliate. The determination of the Administrator as
to the existence of "cause" will be conclusive on the Participant and the Company.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | c. | "Cause" is not limited to events
which have occurred prior to a Participant's termination of service, nor is it necessary that the
Administrator's finding of "cause" occur prior to termination. If the Administrator determines,
subsequent to a Participant's termination of service, that either prior or subsequent to the
Participant's termination the Participant engaged in conduct which would constitute "cause," then the
Company's right to repurchase all of such Participant's Shares shall apply.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | d. | Any provision in an agreement
between the Participant and the Company or an Affiliate, which contains a conflicting definition of
"cause" for termination and which is in effect at the time of such termination, shall supersede the
definition in this Plan with respect to that Participant.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|20. | EFFECT ON STOCK GRANTS OF
TERMINATION OF SERVICE FOR DISABILITY.
|--- | ----------------------------------------------------------------

Except
as otherwise provided in a Participant's Agreement, the following rules apply if a Participant ceases
to be an employee, director or consultant of the Company or of an Affiliate by reason of Disability: to
the extent the Company's rights of repurchase have not lapsed on the date of Disability, they shall be
exercisable; provided, however, that in the event such rights of repurchase lapse periodically, such
rights shall lapse to the extent of a pro rata portion of the Shares subject to such Stock Grant
through the date of Disability as would have lapsed had the Participant not become Disabled. The
proration shall be based upon the number of days accrued prior to the date of Disability.

The
Administrator shall make the determination both of whether Disability has occurred and the date of its
occurrence (unless a procedure for such determination is set forth in another agreement between the
Company and such Participant, in which case such procedure shall be used for such determination). If
requested, the Participant shall be examined by a physician

2005 Stock Plan  Page 12

---

selected or approved by the Administrator,
the cost of which examination shall be paid for by the Company.

|21. | EFFECT ON STOCK GRANTS OF DEATH
WHILE AN EMPLOYEE, DIRECTOR OR CONSULTANT..
|--- | ---------------------------------------------------------------------------

Except
as otherwise provided in a Participant's Agreement, the following rules apply in the event of the death
of a Participant while the Participant is an employee, director or consultant of the Company or of an
Affiliate: to the extent the Company's rights of repurchase have not lapsed on the date of death, they
shall be exercisable; provided, however, that in the event such rights of repurchase lapse
periodically, such rights shall lapse to the extent of a pro rata portion of the Shares subject to such
Stock Grant through the date of death as would have lapsed had the Participant not died. The proration
shall be based upon the number of days accrued prior to the Participant's death.

|22. | PURCHASE FOR INVESTMENT.
|--- | ------------------------

Unless
the offering and sale of the Shares to be issued upon the particular exercise or acceptance of a Stock
Right shall have been effectively registered under the Securities Act of 1933, as now in force or
hereafter amended (the "1933 Act"), the Company shall be under no obligation to issue the Shares
covered by such exercise unless and until the following conditions have been fulfilled:

| | a. | The person(s) who exercise(s) or
accept(s) such Stock Right shall warrant to the Company, prior to the receipt of such Shares, that such
person(s) are acquiring such Shares for their own respective accounts, for investment, and not with a
view to, or for sale in connection with, the distribution of any such Shares, in which event the
person(s) acquiring such Shares shall be bound by the provisions of the following legend which shall be
endorsed upon the certificate(s) evidencing their Shares issued pursuant to such exercise or such
grant:
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |  | "The shares represented by this
certificate have been taken for investment and they may not be sold or otherwise transferred by any
person, including a pledgee, unless (1) either (a) a Registration Statement with respect to such shares
shall be effective under the Securities Act of 1933, as amended, or (b) the Company shall have received
an opinion of counsel satisfactory to it that an exemption from registration under such Act is then
available, and (2) there shall have been compliance with all applicable state securities laws."
| |  |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | b. | At the discretion of the
Administrator, the Company shall have received an opinion of its counsel that the Shares may be issued
upon such particular exercise or acceptance in compliance with the 1933 Act without registration
thereunder.
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|23. | DISSOLUTION OR LIQUIDATION OF
THE COMPANY.
|--- | ------------------------------------------

Upon
the dissolution or liquidation of the Company, all Options granted under this Plan which as of such
date shall not have been exercised and all Stock Grants and Stock-Based Awards which have not been
accepted will terminate and become null and void; provided, however, that if the rights of a
Participant or a Participant's Survivors have not otherwise terminated and expired, the Participant or
the Participant's Survivors will have the right immediately prior to such dissolution or liquidation to
exercise or accept any Stock Right to the

2005 Stock Plan  Page 13

---

extent that the Stock Right is exercisable or subject to
acceptance as of the date immediately prior to such dissolution or liquidation. Upon the dissolution or
liquidation of the Company, any outstanding Stock-Based Awards shall immediately terminate unless
otherwise determined by the Administrator or specifically provided in the applicable Agreement.

|24. | ADJUSTMENTS.
|--- | ------------

Upon
the occurrence of any of the following events, a Participant's rights with respect to any Stock Right
granted to him or her hereunder shall be adjusted as hereinafter provided, unless otherwise
specifically provided in a Participant's Agreement:

A.
     Stock Dividends and Stock Splits. If (i) the shares of Common Stock
shall be subdivided or combined into a greater or smaller number of shares or if the Company shall
issue any shares of Common Stock as a stock dividend on its outstanding Common Stock, or (ii)
additional shares or new or different shares or other securities of the Company or other noncash assets
are distributed with respect to such shares of Common Stock, the number of shares of Common Stock
deliverable upon the exercise of an Option or acceptance of a Stock Grant may be appropriately
increased or decreased proportionately, and appropriate adjustments may be made including, in the
purchase price per share, to reflect such events. The number of Shares subject to the limitation in
Paragraphs 3 and 4(c) shall also be proportionately adjusted upon the occurrence of such events.

B.
     Corporate Transactions. If the Company is to be consolidated with or
acquired by another entity in a merger, sale of all or substantially all of the Company's assets other
than a transaction to merely change the state of incorporation (a "Corporate Transaction"), the
Administrator or the board of directors of any entity assuming the obligations of the Company hereunder
(the "Successor Board"), shall, as to outstanding Options, either (i) make appropriate provision for
the continuation of such Options by substituting on an equitable basis for the Shares then subject to
such Options either the consideration payable with respect to the outstanding shares of Common Stock in
connection with the Corporate Transaction or securities of any successor or acquiring entity; or (ii)
upon written notice to the Participants, provide that all Options must be exercised (either (a) to the
extent then exercisable or, (b) at the discretion of the Administrator, all Options being made fully
exercisable for purposes of this Subparagraph), within a specified number of days of the date of such
notice, at the end of which period the Options shall terminate; or (iii) terminate all Options in
exchange for a cash payment equal to the excess of the Fair Market Value of the Shares subject to such
Options (either (a) to the extent then exercisable or, (b) at the discretion of the Administrator, all
Options being made fully exercisable for purposes of this Subparagraph) over the exercise price
thereof.

With
respect to outstanding Stock Grants, the Administrator or the Successor Board, shall either (i) make
appropriate provisions for the continuation of such Stock Grants by substituting on an equitable basis
for the Shares then subject to such Stock Grants either the consideration payable with respect to the
outstanding Shares of Common Stock in connection with the Corporate Transaction or securities of any
successor or acquiring entity; or (ii) upon written notice to the Participants, provide that all Stock
Grants must be accepted (to the extent then subject to acceptance) within a specified number of days of
the date of such notice, at the end of which period the offer of the Stock Grants shall terminate; or
(iii) terminate all Stock Grants in exchange for a cash payment equal to the excess of the Fair Market
Value of the Shares subject

2005 Stock Plan  Page 14

---

to such Stock Grants over the purchase price thereof, if any. In addition,
in the event of a Corporate Transaction, the Administrator may waive any or all Company repurchase
rights with respect to outstanding Stock Grants.

C.
     Recapitalization or Reorganization. In the event of a recapitalization
or reorganization of the Company, other than a Corporate Transaction pursuant to which securities of
the Company or of another corporation are issued with respect to the outstanding shares of Common
Stock, a Participant upon exercising an Option or accepting a Stock Grant after the recapitalization or
reorganization shall be entitled to receive for the purchase price paid upon such exercise or
acceptance the number of replacement securities which would have been received if such Option had been
exercised or Stock Grant accepted prior to such recapitalization or reorganization.

D.
     Adjustments to Stock-Based Awards. Upon the happening of any of the
events described in Subparagraphs A, B or C above, any outstanding Stock-Based Award shall be
appropriately adjusted to reflect the events described in such Subparagraphs. The Administrator or the
Successor Board shall determine the specific adjustments to be made under this Paragraph 24 and,
subject to Paragraph 4, its determination shall be conclusive.

E.
     Modification of Options. Notwithstanding the foregoing, any adjustments
made pursuant to Subparagraph A, B or C above with respect to Options shall be made only after the
Administrator determines whether such adjustments would constitute a "modification" of any ISOs (as
that term is defined in Section 424(h) of the Code) or would cause any adverse tax consequences for the
holders of Options, including, but not limited to, pursuant to Section 409A of the Code. If the
Administrator determines that such adjustments made with respect to Options would constitute a
modification or other adverse tax consequence, it may refrain from making such adjustments, unless the
holder of an Option specifically agrees in writing that such adjustment be made and such writing
indicates that the holder has full knowledge of the consequences of such "modification" on his or her
income tax treatment with respect to the Option.

|25. | ISSUANCES OF SECURITIES.
|--- | ------------------------

Except
as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares subject to Stock Rights. Except as expressly
provided herein, no adjustments shall be made for dividends paid in cash or in property (including
without limitation, securities) of the Company prior to any issuance of Shares pursuant to a Stock
Right.

|26. | FRACTIONAL SHARES.
|--- | ------------------

No
fractional shares shall be issued under the Plan and the person exercising a Stock Right shall receive
from the Company cash in lieu of such fractional shares equal to the Fair Market Value thereof.

|27. | CONVERSION OF ISOs INTO NON-
QUALIFIED OPTIONS; TERMINATION OF ISOs.
|--- | --------------------------------------------------------------------

The
Administrator, at the written request of any Participant, may in its discretion take such actions as
may be necessary to convert such Participant's ISOs (or any portions thereof)

2005 Stock Plan  Page 15

---

that have not been
exercised on the date of conversion into Non-Qualified Options at any time prior to the expiration of
such ISOs, regardless of whether the Participant is an employee of the Company or an Affiliate at the
time of such conversion. At the time of such conversion, the Administrator (with the consent of the
Participant) may impose such conditions on the exercise of the resulting Non-Qualified Options as the
Administrator in its discretion may determine, provided that such conditions shall not be inconsistent
with this Plan. Nothing in the Plan shall be deemed to give any Participant the right to have such
Participant's ISOs converted into Non-Qualified Options, and no such conversion shall occur until and
unless the Administrator takes appropriate action. The Administrator, with the consent of the
Participant, may also terminate any portion of any ISO that has not been exercised at the time of such
conversion.

|28. | WITHHOLDING.
|--- | ------------

In the
event that any federal, state, or local income taxes, employment taxes, Federal Insurance Contributions
Act ("F.I.C.A.") withholdings or other amounts are required by applicable law or governmental
regulation to be withheld from the Participant's salary, wages or other remuneration in connection with
the exercise or acceptance of a Stock Right or in connection with a Disqualifying Disposition (as
defined in Paragraph 29) or upon the lapsing of any right of repurchase, the Company may withhold from
the Participant's compensation, if any, or may require that the Participant advance in cash to the
Company, or to any Affiliate of the Company which employs or employed the Participant, the statutory
minimum amount of such withholdings unless a different withholding arrangement, including the use of
shares of the Company's Common Stock or a promissory note, is authorized by the Administrator (and
permitted by law). For purposes hereof, the fair market value of the shares withheld for purposes of
payroll withholding shall be determined in the manner provided in Paragraph 1 above, as of the most
recent practicable date prior to the date of exercise. If the fair market value of the shares withheld
is less than the amount of payroll withholdings required, the Participant may be required to advance
the difference in cash to the Company or the Affiliate employer. The Administrator in its discretion
may condition the exercise of an Option for less than the then Fair Market Value on the Participant's
payment of such additional withholding.

|29. | NOTICE TO COMPANY OF
DISQUALIFYING DISPOSITION.
|--- | -----------------------------------------------

Each
Employee who receives an ISO must agree to notify the Company in writing immediately after the Employee
makes a Disqualifying Disposition of any shares acquired pursuant to the exercise of an ISO. A
Disqualifying Disposition is defined in Section 424(c) of the Code and includes any disposition
(including any sale or gift) of such shares before the later of (a) two years after the date the
Employee was granted the ISO, or (b) one year after the date the Employee acquired Shares by exercising
the ISO, except as otherwise provided in Section 424(c) of the Code. If the Employee has died before
such stock is sold, these holding period requirements do not apply and no Disqualifying Disposition can
occur thereafter.

|30. | TERMINATION OF THE PLAN.
|--- | ------------------------

The
Plan will terminate on March 10, 2015, the date which is ten years from the earlier of the date of its
adoption by the Board of Directors and the date of its approval by the shareholders of the Company. The
Plan may be terminated at an earlier date by vote of the shareholders or the Board of Directors of the
Company; provided, however, that any such earlier termination shall not affect any Agreements executed
prior to the effective date of such termination.

2005 Stock Plan  Page 16

---

|31. | AMENDMENT OF THE PLAN AND
AGREEMENTS.
|--- | -------------------------------------

The
Plan may be amended by the shareholders of the Company. The Plan may also be amended by the
Administrator, including, without limitation, to the extent necessary to qualify any or all outstanding
Stock Rights granted under the Plan or Stock Rights to be granted under the Plan for favorable federal
income tax treatment (including deferral of taxation upon exercise) as may be afforded incentive stock
options under Section 422 of the Code, and to the extent necessary to qualify the shares issuable upon
exercise or acceptance of any outstanding Stock Rights granted, or Stock Rights to be granted, under
the Plan for listing on any national securities exchange or quotation in any national automated
quotation system of securities dealers. Any amendment approved by the Administrator which the
Administrator determines is of a scope that requires shareholder approval shall be subject to obtaining
such shareholder approval. Any modification or amendment of the Plan shall not, without the consent of
a Participant, adversely affect his or her rights under a Stock Right previously granted to him or her.
With the consent of the Participant affected, the Administrator may amend outstanding Agreements in a
manner which may be adverse to the Participant but which is not inconsistent with the Plan. In the
discretion of the Administrator, outstanding Agreements may be amended by the Administrator in a manner
which is not adverse to the Participant. In addition, if the stock exchange on which the Shares are
traded amends its corporate governance rules so that such rules no longer require stockholder approval
of "material amendments" of equity compensation plans, then, from and after the effective date of such
an amendment to those rules, no amendment of the Plan which (i) materially increases the number of
shares to be issued under the Plan (other than to reflect a reorganization, stock split, merger, spin-
off or similar transaction); (ii) materially increases the benefits to Participants, including any
material change to: (a) permit a repricing (or decrease in exercise price) of outstanding Options, (b)
reduce the price at which Shares or Options may be offered, or (c) extend the duration of the Plan;
(iii) materially expands the class of Participants eligible to participate in the Plan; or (iv) expands
the types of awards provided under the Plan shall become effective unless stockholder approval is
obtained.

|32. | EMPLOYMENT OR OTHER
RELATIONSHIP.
|--- | ---------------------------------

Nothing
in this Plan or any Agreement shall be deemed to prevent the Company or an Affiliate from terminating
the employment, consultancy or director status of a Participant, nor to prevent a Participant from
terminating his or her own employment, consultancy or director status or to give any Participant a
right to be retained in employment or other service by the Company or any Affiliate for any period of
time.

|33. | GOVERNING LAW.
|--- | --------------

This
Plan shall be construed and enforced in accordance with the law of the State of Delaware.

2005 Stock Plan  Page 17