EXHIBIT
4.1

    


    ADEONA
PHARMACEUTICALS, INC.

    2010
STOCK INCENTIVE PLAN

     

    ARTICLE
I

    GENERAL

     

    1.1
Purpose

     

    The
purpose of the Adeona Pharmaceuticals, Inc. 2010 Stock Incentive Plan (the
“Plan”) is to provide an incentive for the employees, directors, and consultants
to Adeona, Pharmaceuticals, Inc. (the “Company” or  Adeona”) and its
subsidiaries an incentive (a) to enter into and remain in the service of the
Company, (b) to enhance the long-term performance of the Company and (c) to
acquire a proprietary interest in the success of the Company.

     

    1.2
Administration

     

    1.2.1 The
Plan shall be administered by the Compensation Committee (the “Committee”) of
the board of directors of the Company (the “Board”), which shall consist of not
less than two directors. The members of the Committee shall be appointed by, and
serve at the pleasure of, the Board. To the extent required for transactions
under the Plan to qualify for the exemptions available under Rule 16b-3 (“Rule
16b-3”) promulgated under the Securities Exchange Act of 1934 (the “1934 Act”),
all actions relating to awards to persons subject to Section 16 of the 1934 Act
shall be taken by the Board unless each person who serves on the Committee is a
“non-employee director” within the meaning of Rule 16b-3 or such actions are
taken by a sub-committee of the Committee (or the Board) comprised solely of
“non-employee directors”. To the extent required for compensation realized from
awards under the Plan to be deductible by the Company pursuant to section 162(m)
of the Internal Revenue Code of 1986 (the “Code”), the members of the Committee
shall be “outside directors” within the meaning of section 162(m).

     

    1.2.2 The
Committee shall have the authority (a) to exercise all of the powers granted to
it under the Plan, (b) to construe, interpret and implement the Plan and any
Plan Agreements executed pursuant to Section 2.1, (c) to prescribe, amend and
rescind rules and regulations relating to the Plan, including rules governing
its own operations, (d) to make all determinations necessary or advisable in
administering the Plan, (e) to correct any defect, supply any omission and
reconcile any inconsistency in the Plan, (f) to amend the Plan to reflect
changes in applicable law, (g) to determine whether, to what extent and under
what circumstances awards may be settled or exercised in cash, shares of the
Company’s common stock, par value $.001 (the “Common Stock”), other securities,
other awards or other property, or canceled, forfeited or suspended and the
method or methods by which awards may be settled, canceled, forfeited or
suspended, and (h) to determine whether, to what extent and under what
circumstances cash, shares of the Common Stock, other securities, other awards
or other property and other amounts payable with respect to an award shall be
deferred either automatically or at the election of the holder thereof or of the
Committee.

     

    1.2.3
Actions of the Committee shall be taken by the vote of a majority of its
members. Any action may be taken by a written instrument signed by a majority of
the Committee members, and action so taken shall be fully as effective as if it
had been taken by a vote at a meeting.

     

    1.2.4 The
determination of the Committee on all matters relating to the Plan or any Plan
Agreement shall be final, binding and conclusive.

     

    1.2.5 No
member of the Committee shall be liable for any action or determination made in
good faith with respect to the Plan or any award thereunder.

     

    1.2.6
Notwithstanding anything to the contrary contained herein: (a) until the Board
shall appoint the members of the Committee, the Plan shall be administered by
the Board; and (b) the Board may, in its sole discretion, at any time and from
time to time, grant awards or resolve to administer the Plan. In either of the
foregoing events, the Board shall have all of the authority and responsibility
granted to the Committee herein.

     

    1.3
Persons Eligible for
Awards

     

    Awards
under the Plan may be made to such directors, officers and other employees of
the Company and its subsidiaries (including prospective employees conditioned on
their becoming employees), and to such consultants to the Company and its
subsidiaries (collectively, “key persons”) as the Committee shall in its
discretion select.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    1.4
Types of Awards Under
the Plan

     

    Awards
may be made under the Plan in the form of (a) incentive stock options (within
the meaning of section 422 of the Code), (b) nonqualified stock options, (c)
stock appreciation rights, (d) restricted stock, (e) restricted stock units
and (f) other stock-based awards, all as more fully set forth in Article II. The
term “award” means any of the foregoing. No incentive stock option may be
granted to a person who is not an employee of the Company on the date of
grant.

     

    1.5
Shares Available for
Awards

     

    1.5.1 The
total number of shares of the Common Stock which may be transferred pursuant to
awards granted under the Plan shall not exceed 3,000,000. Such shares may be
authorized but unissued shares of the Common Stock or authorized and issued
shares of the Common Stock held in the Company’s treasury or acquired by the
Company for the purposes of the Plan. The Committee may direct that any stock
certificate evidencing shares issued pursuant to the Plan shall bear a legend
setting forth such restrictions on transferability as may apply to such shares
pursuant to the Plan. If, after the effective date of the Plan, any award is
forfeited or any award otherwise terminates or is cancelled without the delivery
of shares of Stock, then the shares covered by such award or to which such award
relates shall again become available for transfer pursuant to awards granted or
to be granted under this Plan. Any shares of Stock delivered by the Company, any
shares of Stock with respect to which awards are made by the Company and any
shares of Stock with respect to which the Company becomes obligated to make
awards, through the assumption of, or in substitution for, outstanding awards
previously granted by an acquired entity, shall not be counted against the
shares available for awards under this Plan.

     

    1.5.2
Upon certain changes in Stock, the number of shares of Stock available for
issuance with respect to awards under the Plan, as set forth in Sections 1.5.1
and 1.5.2, shall be adjusted pursuant to Section 3.7.1.

     

    1.5.3
Except as provided in this Section 1.5 and in Section 2.3.7, there shall be no
limit on the number or the value of the shares of Stock that may be subject to
awards to any individual under the Plan.

     

    1.6
Definitions of Certain
Terms

     

    1.6.1 The
“Fair Market Value” of a share of Stock on any day shall be determined as
follows.

     

    (a) If
the principal market for the Stock (the “Market”) is a national securities
exchange or the National Association of Securities Dealers Automated Quotation
System (“NASDAQ”) Market, the last sale price or, if no reported sales take
place on the applicable date, the average of the high bid and low asked price of
Stock as reported for such Market on such date or, if no such quotation is made
on such date, on the next preceding day on which there were quotations, provided
that such quotations shall have been made within the ten (10) business days
preceding the applicable date;

     

    (b) If
the Market is the Over the Counter Bulletin Board or another market, the average
of the high bid and low asked price for Stock on the applicable date, or, if no
such quotations shall have been made on such date, on the next preceding day on
which there were quotations, provided that such quotations shall have been made
within the ten (10) business days preceding the applicable date; or

     

    (c) In
the event that neither paragraph (a) nor (b) shall apply, the Fair Market Value
of a share of Stock on any day shall be determined in good faith by the
Committee.

     

    1.6.2 The
term “incentive stock option” means an option that is intended to qualify for
special federal income tax treatment pursuant to sections 421 and 422 of the
Code, as now constituted or subsequently amended, or pursuant to a successor
provision of the Code, and which is so designated in the applicable Plan
Agreement. Any option that is not specifically designated as an incentive stock
option shall under no circumstances be considered an incentive stock option. Any
option that is not an incentive stock option is referred to herein as a
“nonqualified stock option.”

     

    1.6.3 The
term “employment” means, in the case of a grantee of an award under the Plan who
is not an employee of the Company, the grantee’s association with the Company or
a subsidiary as a director, consultant or otherwise.

     

    1.6.4 A
grantee shall be deemed to have a “termination of employment” upon ceasing to be
employed by the Company and all of its subsidiaries or by a corporation assuming
awards in a transaction to which section 424(a) of the Code applies. The
Committee may in its discretion determine (a) whether any leave of absence
constitutes a termination of employment for purposes of the Plan, (b) the
impact, if any, of any such leave of absence on awards theretofore made under
the Plan, and (c) when a change in a non-employee’s association with the Company
constitutes a termination of employment for purposes of the Plan. The Committee
shall have the right to determine whether the termination of a grantee’s
employment is a dismissal for cause and the date of termination in such case,
which date the Committee may retroactively deem to be the date of the action
that is cause for dismissal. Such determinations of the Committee shall be
final, binding and conclusive.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

      

    1.6.5 The
term “cause,” when used in connection with termination of a grantee’s
employment, shall have the meaning set forth in any then-effective employment
agreement between the grantee and the Company or a subsidiary thereof. In the
absence, of or in addition to, as the case may be, such an employment agreement
provision, “cause” means: (a) conviction of any crime (whether or not involving
the Company) constituting a felony in the jurisdiction involved; (b) engaging in
any substantiated act involving moral turpitude; (c) engaging in any act which,
in each case, subjects, or if generally known would subject, the Company to
public ridicule or embarrassment; (d) material violation of the Company’s
policies, including, without limitation, those relating to sexual harassment or
the disclosure or misuse of confidential information; (e) serious neglect or
misconduct in the performance of the grantee’s duties for the Company or a
subsidiary or willful or repeated failure or refusal to perform such duties; in
each case as determined by the Committee, which determination shall be final,
binding and conclusive.

     

    ARTICLE
II

    AWARDS
UNDER THE PLAN

     

    2.1
Agreements Evidencing
Awards

     

    Each
award granted under the Plan shall be evidenced by a written agreement (“Plan
Agreement”) which shall contain such provisions as the Committee in its
discretion deems necessary or desirable. Such provisions may include, without
limitation, a requirement that the grantee become a party to a shareholders’
agreement with respect to any shares of Stock acquired pursuant to the award, a
requirement that the grantee acknowledge that such shares are acquired for
investment purposes only, and a right of first refusal exercisable by the
Company in the event that the grantee wishes to transfer any such shares. The
Committee may grant awards in tandem with or in substitution for any other award
or awards granted under this Plan or any award granted under any other plan of
the Company or any subsidiary. Payments or transfers to be made by the Company
or any subsidiary upon the grant, exercise or payment of an award may be made in
such form as the Committee shall determine, including cash, shares of Stock,
other securities, other awards or other property and may be made in a single
payment or transfer, in installments or on a deferred basis, in each case in
accordance with rules established by the Committee. By accepting an award
pursuant to the Plan, a grantee thereby agrees that the award shall be subject
to all of the terms and provisions of the Plan and the applicable Plan
Agreement.

     

    2.2
No Rights as a
Shareholder

     

    No
grantee of an option or stock appreciation right (or other person having the
right to exercise such award) shall have any of the rights of a shareholder of
the Company with respect to shares subject to such award until the issuance of a
stock certificate to such person for such shares.

     

    2.3
Grant of Stock Options
and Stock Appreciation Rights

     

    2.3.1 The
Committee may grant incentive stock options and nonqualified stock options
(collectively, “options”) to purchase shares of the Common Stock from the
Company, to such key persons, in such amounts and subject to such terms and
conditions, as the Committee shall determine in its discretion, subject to the
provisions of the Plan.

     

    2.3.2 The
Committee may grant stock appreciation rights to such key persons, in such
amounts and subject to such terms and conditions, as the Committee shall
determine in its discretion, subject to the provisions of the Plan. Stock
appreciation rights may be granted in connection with all or any part of, or
independently of, any option granted under the Plan. A stock appreciation right
granted in connection with a nonqualified stock option may be granted at or
after the time of grant of such option. A stock appreciation right granted in
connection with an incentive stock option may be granted only at the time of
grant of such option.

     

    2.3.3 The
grantee of a stock appreciation right shall have the right, subject to the terms
of the Plan and the applicable Plan Agreement, to receive from the Company an
amount equal to (a) the excess of the Fair Market Value of a share of the Common
Stock on the date of exercise of the stock appreciation right over (b) the
exercise price of such right as set forth in the Plan Agreement (or over the
option exercise price if the stock appreciation right is granted in connection
with an option), multiplied by (c) the number of shares with respect to which
the stock appreciation right is exercised. Payment upon exercise of a stock
appreciation right shall be in cash or in shares of the Common Stock (valued at
their Fair Market Value on the date of exercise of the stock appreciation right)
or both, all as the Committee shall determine in its discretion. Upon the
exercise of a stock appreciation right granted in connection with an option, the
number of shares subject to the option shall be correspondingly reduced by the
number of shares with respect to which the stock appreciation right is
exercised. Upon the exercise of an option in connection with which a stock
appreciation right has been granted, the number of shares subject to the stock
appreciation right shall be correspondingly reduced by the number of shares with
respect to which the option is exercised.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    2.3.4
Each Plan Agreement with respect to an option shall set forth the amount (the
“option exercise price”) payable by the grantee to the Company upon exercise of
the option evidenced thereby. The option exercise price per share shall be
determined by the Committee in its discretion; provided, however, that the
option exercise price of an incentive stock option shall be at least 100% of the
Fair Market Value of a share of the Common Stock on the date the option is
granted, and provided further that in no event shall the option exercise price
be less than the par value of a share of the Common Stock.

     

    2.3.5
Each Plan Agreement with respect to an option or stock appreciation right shall
set forth the periods during which the award evidenced thereby shall be
exercisable, whether in whole or in part. Such periods shall be determined by
the Committee in its discretion; provided, however, that no incentive stock
option (or a stock appreciation right granted in connection with an incentive
stock option) shall be exercisable more than 10 years after the date of
grant.

     

    2.3.6 The
Committee may in its discretion include in any Plan Agreement with respect to an
option (the “original option”) a provision that an additional option (the
“additional option”) shall be granted to any grantee who, pursuant to Section
2.4.3(b), delivers shares of the Common Stock in partial or full payment of the
exercise price of the original option. The additional option shall be for a
number of shares of the Common Stock equal to the number thus delivered, shall
have an exercise price equal to the Fair Market Value of a share of the Common
Stock on the date of exercise of the original option, and shall have an
expiration date no later than the expiration date of the original option. In the
event that a Plan Agreement provides for the grant of an additional option, such
Agreement shall also provide that the exercise price of the original option be
no less than the Fair Market Value of a share of Stock on its date of grant, and
that any shares that are delivered pursuant to Section 2.4.3(b) in payment of
such exercise price shall have been held for at least six months.

     

    2.3.7 To
the extent that the aggregate Fair Market Value (determined as of the time the
option is granted) of the stock with respect to which incentive stock options
granted under this Plan and all other plans of the Company and any subsidiary
are first exercisable by any employee during any calendar year shall exceed the
maximum limit (currently, $100,000), if any, imposed from time to time under
section 422 of the Code, such options shall be treated as nonqualified stock
options.

     

    2.3.8
Notwithstanding the provisions of Sections 2.3.4 and 2.3.5, to the extent
required under section 422 of the Code, an incentive stock option may not be
granted under the Plan to an individual who, at the time the option is granted,
owns stock possessing more than 10% of the total combined voting power of all
classes of stock of his employer corporation or of its parent or subsidiary
corporations (as such ownership may be determined for purposes of section
422(b)(6) of the Code) unless (a) at the time such incentive stock option is
granted the option exercise price is at least 110% of the Fair Market Value of
the shares subject thereto and (b) the incentive stock option by its terms is
not exercisable after the expiration of 5 years from the date it is
granted.

     

    2.4
Exercise of Options
and Stock Appreciation Rights

     

    Subject
to the provisions of this Article II, each option or stock appreciation right
granted under the Plan shall be exercisable as follows:

     

    2.4.1
Unless the applicable Plan Agreement otherwise provides, an option or stock
appreciation right may be exercised from time to time as to all or part of the
shares as to which such award is then exercisable (but, in any event, only for
whole shares). A stock appreciation right granted in connection with an option
may be exercised at any time when, and to the same extent that, the related
option may be exercised. An option or stock appreciation right shall be
exercised by the filing of a written notice with the Company, on such form and
in such manner as the Committee shall prescribe.

     

    2.4.2 Any
written notice of exercise of an option shall be accompanied by payment for the
shares being purchased. Such payment shall be made: (a) by certified or official
bank check (or the equivalent thereof acceptable to the Company) for the full
option exercise price; or (b) unless the applicable Plan Agreement provides
otherwise, by delivery of shares of the Common Stock (which, if acquired
pursuant to exercise of a stock option, were acquired at least six months prior
to the option exercise date) and having a Fair Market Value (determined as of
the exercise date) equal to all or part of the option exercise price and a
certified or official bank check (or the equivalent thereof acceptable to the
Company) for any remaining portion of the full option exercise price; or (c) at
the discretion of the Committee and to the extent permitted by law, by such
other provision as the Committee may from time to time prescribe.

     

    2.4.3
Promptly after receiving payment of the full option exercise price, or after
receiving notice of the exercise of a stock appreciation right for which payment
will be made partly or entirely in shares, the Company shall, subject to the
provisions of Section 3.3 (relating to certain restrictions), deliver to the
grantee or to such other person as may then have the right to exercise the
award, a certificate or certificates for the shares of the Common Stock for
which the award has been exercised. If the method of payment employed upon
option exercise so requires, and if applicable law permits, an optionee may
direct the Company to deliver the certificate(s) to the optionee’s
stockbroker.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    2.5
Termination of
Employment; Death

     

    2.5.1
Except to the extent otherwise provided in Section 2.5.2 or 2.5.3 or in the
applicable Plan Agreement, all options and stock appreciation rights not
theretofore exercised shall terminate upon termination of the grantee’s
employment for any reason (including death).

     

    2.5.2 If
a grantee’s employment terminates for any reason other than death or dismissal
for cause, the grantee may exercise any outstanding option or stock appreciation
right on the following terms and conditions: (a) exercise may be made only to
the extent that the grantee was entitled to exercise the award on the date of
employment termination; and (b) exercise must occur within 90 days after
employment terminates, except that this 90 day period shall be increased to one
year if the termination is by reason of disability, but in no event after the
expiration date of the award as set forth in the Plan Agreement. In the case of
an incentive stock option, the term “disability” for purposes of the preceding
sentence shall have the meaning given to it by section 422(c)(6) of the
Code.

     

    2.5.3 If
a grantee dies while employed by the Company or any subsidiary, or after
employment termination but during the period in which the grantee’s awards are
exercisable pursuant to Section 2.5.2, any outstanding option or stock
appreciation right shall be exercisable on the following terms and conditions:
(a) exercise may be made only to the extent that the grantee was entitled to
exercise the award on the date of death; and (b) exercise must occur by the
earlier of the first anniversary of the grantee’s death or the expiration date
of the award. Any such exercise of an award following a grantee’s death shall be
made only by the grantee’s executor or administrator, unless the grantee’s will
specifically disposes of such award, in which case such exercise shall be made
only by the recipient of such specific disposition. If a grantee’s personal
representative or the recipient of a specific disposition under the grantee’s
will shall be entitled to exercise any award pursuant to the preceding sentence,
such representative or recipient shall be bound by all the terms and conditions
of the Plan and the applicable Plan Agreement which would have applied to the
grantee including, without limitation, the provisions of Sections 3.3 and 3.7
hereof.

     

    2.6
Grant of Restricted
Stock

     

    2.6.1 The
Committee may grant restricted shares of Stock to such key persons, in such
amounts, and subject to such terms and conditions as the Committee shall
determine in its discretion, subject to the provisions of the Plan. Restricted
stock awards may be made independently of or in connection with any other award
under the Plan. A grantee of a restricted stock award shall have no rights with
respect to such award unless such grantee accepts the award within such period
as the Committee shall specify by executing a Plan Agreement in such form as the
Committee shall determine and, if the Committee shall so require, makes payment
to the Company by certified or official bank check (or the equivalent thereof
acceptable to the Company) in such amount as the Committee may
determine.

     

    2.6.2
Promptly after a grantee accepts a restricted stock award, the Company shall
issue in the grantee’s name a certificate or certificates for the shares of the
Common Stock covered by the award. Upon the issuance of such certificate(s), the
grantee shall have the rights of a shareholder with respect to the restricted
stock, subject to the nontransferability restrictions and Company repurchase
rights described in Sections 2.6.4 and 2.6.5 and to such other restrictions and
conditions as the Committee in its discretion may include in the applicable Plan
Agreement.

     

    2.6.3
Unless the Committee shall otherwise determine, any certificate issued
evidencing shares of restricted stock shall remain in the possession of the
Company until such shares are free of any restrictions specified in the
applicable Plan Agreement.

     

    2.6.4
Shares of restricted stock may not be sold, assigned, transferred, pledged or
otherwise encumbered or disposed of except as specifically provided in this Plan
or the applicable Plan Agreement. The Committee at the time of grant shall
specify the date or dates (which may depend upon or be related to the attainment
of performance goals and other conditions) on which the nontransferability of
the restricted stock shall lapse. Unless the applicable Plan Agreement provides
otherwise, additional shares of Stock or other property distributed to the
grantee in respect of shares of restricted stock, as dividends or otherwise,
shall be subject to the same restrictions applicable to such restricted
stock.

     

    2.6.5
During the 120 days following termination of the grantee’s employment for any
reason, the Company shall have the right to require the return of any shares to
which restrictions on transferability apply, in exchange for which the Company
shall repay to the grantee (or the grantee’s estate) any amount paid by the
grantee for such shares.

     

    2.7
Grant of Restricted
Stock Units

     

    2.7.1 The
Committee may grant awards of restricted stock units to such key persons, in
such amounts, and subject to such terms and conditions as the Committee shall
determine in its discretion, subject to the provisions of the Plan. Restricted
stock units may be awarded independently of or in connection with any other
award under the Plan.


    
      
         


      

      
         


        
          

        

      

      
         


      

    


    2.7.2 At
the time of grant, the Committee shall specify the date or dates on which the
restricted stock units shall become fully vested and nonforfeitable, and may
specify such conditions to vesting as it deems appropriate. In the event of the
termination of the grantee’s employment by the Company and its subsidiaries for
any reason, restricted stock units that have not become nonforfeitable shall be
forfeited and cancelled. The Committee at any time may accelerate vesting dates
and otherwise waive or amend any conditions of an award of restricted stock
units.

     

    2.7.3 At
the time of grant, the Committee shall specify the maturity date applicable to
each grant of restricted stock units, which may be determined at the election of
the grantee. Such date may be later than the vesting date or dates of the award.
On the maturity date, the Company shall transfer to the grantee one
unrestricted, fully transferable share of the Common Stock for each restricted
stock unit scheduled to be paid out on such date and not previously forfeited.
The Committee shall specify the purchase price, if any, to be paid by the
grantee to the Company for such shares of the Common Stock.

     

    2.8
Other Stock-Based
Awards

     

    The
Committee may grant other types of stock-based awards (including the grant of
unrestricted shares) to such key persons, in such amounts and subject to such
terms and conditions, as the Committee shall in its discretion determine,
subject to the provisions of the Plan. Such awards may entail the transfer of
actual shares of the Common Stock to Plan participants, or payment in cash or
otherwise of amounts based on the value of shares of the Common
Stock.

     

    ARTICLE
III

    MISCELLANEOUS

     

    3.1
Amendment of the Plan;
Modification of Awards

     

    3.1.1 The
Board may from time to time suspend, discontinue, revise or amend the Plan in
any respect whatsoever, except that no such amendment shall materially impair
any rights or materially increase any obligations under any award theretofore
made under the Plan without the consent of the grantee (or, after the grantee’s
death, the person having the right to exercise the award). For purposes of this
Section 3.1, any action of the Board or the Committee that alters or affects the
tax treatment of any award shall not be considered to materially impair any
rights of any grantee.

     

    3.1.2
Stockholder approval of any amendment shall be obtained to the extent necessary
to comply with section 422 of the Code (relating to incentive stock options) or
other applicable law or regulation.

     

    3.1.3 The
Committee may amend any outstanding Plan Agreement, including, without
limitation, by amendment which would accelerate the time or times at which the
award becomes unrestricted or may be exercised, or waive or amend any goals,
restrictions or conditions set forth in the Agreement. However, any such
amendment (other than an amendment pursuant to Section 3.7.2, relating to change
in control) that materially impairs the rights or materially increases the
obligations of a grantee under an outstanding award shall be made only with the
consent of the grantee (or, upon the grantee’s death, the person having the
right to exercise the award).

     

    3.2
Tax
Withholding

     

    3.2.1 As
a condition to the receipt of any shares of the Common Stock pursuant to any
award or the lifting of restrictions on any award, or in connection with any
other event that gives rise to a federal or other governmental tax withholding
obligation on the part of the Company relating to an award (including, without
limitation, FICA tax), the Company shall be entitled to require that the grantee
remit to the Company an amount sufficient in the opinion of the Company to
satisfy such withholding obligation.

     

    3.2.2 If
the event giving rise to the withholding obligation is a transfer of shares of
the Common Stock, then, unless otherwise specified in the applicable Plan
Agreement, the grantee may satisfy the withholding obligation imposed under
Section 3.2.1 by electing to have the Company withhold shares of the Common
Stock having a Fair Market Value equal to the amount of tax to be withheld. For
this purpose, Fair Market Value shall be determined as of the date on which the
amount of tax to be withheld is determined (and any fractional share amount
shall be settled in cash).

     

    3.3
Restrictions

     

    3.3.1 If
the Committee shall at any time determine that any consent (as hereinafter
defined) is necessary or desirable as a condition of, or in connection with, the
granting of any award under the Plan, the issuance or purchase of shares or
other rights thereunder, or the taking of any other action thereunder (each such
action being hereinafter referred to as a “plan action”), then such plan action
shall not be taken, in whole or in part, unless and until such consent shall
have been effected or obtained to the full satisfaction of the
Committee.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

     

    3.3.2 The
term “consent” as used herein with respect to any plan action means (a) any and
all listings, registrations or qualifications in respect thereof upon any
securities exchange or under any federal, state or local law, rule or
regulation, (b) any and all written agreements and representations by the
grantee with respect to the disposition of shares, or with respect to any other
matter, which the Committee shall deem necessary or desirable to comply with the
terms of any such listing, registration or qualification or to obtain an
exemption from the requirement that any such listing, qualification or
registration be made and (c) any and all consents, clearances and approvals in
respect of a plan action by any governmental or other regulatory
bodies.

     

    3.4
Non-assignability

     

    Except to
the extent otherwise provided in the applicable Plan Agreement, no award or
right granted to any person under the Plan shall be assignable or transferable
other than by will or by the laws of descent and distribution, and all such
awards and rights shall be exercisable during the life of the grantee only by
the grantee or the grantee’s legal representative.

     

    3.5
Notification of
Election Under Code Section 83(b)

     

    If any
grantee shall, in connection with the acquisition of shares of the Common Stock
under the Plan, make the election permitted under section 83(b) of the Code
(that is, an election to include in gross income in the year of transfer the
amounts specified in section 83(b)), such grantee shall notify the Company of
such election within 10 days of filing notice of the election with the Internal
Revenue Service, in addition to any filing and notification required pursuant to
regulations issued under the authority of Code section 83(b).

     

    3.6
Notification Upon
Disqualifying Disposition

     

    If any
grantee shall make any disposition of shares of the Common Stock issued pursuant
to the exercise of an incentive stock option under the circumstances described
in section 421(b) of the Code (relating to certain disqualifying dispositions),
such grantee shall notify the Company of such disposition within 10 days
thereof.

     

    3.7
Adjustment Upon
Changes in Stock

     

    3.7.1
Shares Available for
Grants . In the event of any change in the number of shares of Stock
outstanding by reason of any stock dividend or split, reverse stock split,
recapitalization, merger, consolidation, combination or exchange of shares or
similar corporate change, the maximum number of shares of the Common Stock with
respect to which the Committee may grant awards under Article II hereof, as
described in Section 1.5.1, and the individual annual limit described in Section
1.5.2, shall be appropriately adjusted by the Committee. In the event of any
change in the number of shares of the Common Stock outstanding by reason of any
other event or transaction, the Committee may, but need not, make such
adjustments in the number and class of shares of the Common Stock with respect
to which awards: (i) may be granted under Article II hereof and (ii) granted to
any one employee of the Company or a subsidiary during any one calendar year, in
each case as the Committee may deem appropriate, unless such adjustment would
cause any award that would otherwise qualify as performance based compensation
with respect to a “162(m) covered employee” (as defined in Section 162 of the
Code), to cease to so qualify.

     

    3.7.2
Outstanding Restricted
Stock and Restricted Stock Units . Unless the Committee in its absolute
discretion otherwise determines, any securities or other property (including
dividends paid in cash) received by a grantee with respect to a share of
restricted stock, the issue date with respect to which occurs prior to such
event, but which has not vested as of the date of such event, as a result of any
dividend, stock split, reverse stock split, recapitalization, merger,
consolidation, combination, exchange of shares or otherwise will not vest until
such share of restricted stock vests, and shall be promptly deposited with the
Company or otherwise treated as was the certificate for the underlying share of
restricted stock, pursuant to Section 2.6.3 hereof.

     

    The
Committee may, in its absolute discretion, adjust any grant of shares of
restricted stock, the issue date with respect to which has not occurred as of
the date of the occurrence of any of the following events, or any grant of
restricted stock units, to reflect any dividend, stock split, reverse stock
split, recapitalization, merger, consolidation, combination, exchange of shares
or similar corporate change as the Committee may deem appropriate to prevent the
enlargement or dilution of rights of grantees.

     

    3.7.3
Outstanding Options
and Stock Appreciation Rights — Increase or Decrease in Issued Shares Without
Consideration . Subject to any required action by the stockholders of the
Company, in the event of any increase or decrease in the number of issued shares
of Stock resulting from a subdivision or consolidation of shares of Stock or the
payment of a stock dividend (but only on the shares of Stock), or any other
increase or decrease in the number of such shares effected without receipt of
consideration by the Company, the Committee shall proportionally adjust the
number of shares of the Common Stock subject to each outstanding option and
stock appreciation right, and the exercise price-per-share of the Common Stock
of each such option and stock appreciation right.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    3.7.4
Outstanding Options
and Stock Appreciation Rights — Certain Mergers . Subject to any required
action by the stockholders of the Company, in the event that the Company shall
be the surviving corporation in any merger or consolidation (except a merger or
consolidation as a result of which the holders of shares of Stock receive
securities of another corporation), each option and stock appreciation right
outstanding on the date of such merger or consolidation shall pertain to and
apply to the securities which a holder of the number of shares of the Common
Stock subject to such option or stock appreciation right would have received in
such merger or consolidation.

     

    3.7.5
Outstanding Options
and Stock Appreciation Rights — Certain Other Transactions . In the event
of (i) a dissolution or liquidation of the Company, (ii) a sale of all or
substantially all of the Company’s assets, (iii) a merger or consolidation
involving the Company in which the Company is not the surviving corporation or
(iv) a merger or consolidation involving the Company in which the Company is the
surviving corporation but the holders of shares of the Common Stock receive
securities of another corporation and/or other property, including cash, the
Committee shall, in its absolute discretion, have the power to:

    


    
      	
               
      

            	
              (i)

            	
              cancel, effective immediately
      prior to the occurrence of such event, each option and stock appreciation
      right outstanding immediately prior to such event (whether or not then
      exercisable), and, in full  consideration of such cancellation, pay
      to the grantee to whom such option or stock appreciation right  was
      granted an amount in cash, for each share of the Common Stock subject to
      such option or stock appreciation right, respectively, equal to the excess
      of (x) the value, as determined by the Committee in its absolute
      discretion, of the property (including cash) received by the holder of a
      share of the Common Stock as a result of such event over (y) the exercise
      price of such option or stock appreciation 
       right;

            


    

    
      	
               
      

            	
              (ii)

            	
              cancel, effective immediately
      prior to the occurrence of such event, each option and stock appreciation
      right outstanding immediately prior to such event (whether or not then
      exercisable), and, in full consideration of such cancellation, pay to the
      grantee to whom such option or stock appreciation right was granted, for
      each share of the Common Stock subject to such option or stock
      appreciation right, respectively, the property (including cash) received
      by the holder of a share of the Common Stock as a result of such event;
      or

            


    

    


    
      	
               
      

            	
              (iii)

            	
              provide for the exchange of each
      option and stock appreciation right outstanding immediately prior  to
      such event (whether or not then exercisable) for an option on or stock
      appreciation right with respect to, as appropriate, some or all of the
      property which a holder of the number of shares of the Common Stock
      subject to such option or stock appreciation right would have received
      and, incident thereto, make an equitable adjustment as determined by the
      Committee in its absolute discretion in the exercise price of the option
      or stock appreciation right, or the number of shares or amount of property
      subject to the option or stock appreciation right or, if appropriate,
      provide for a cash payment to the grantee to whom such option or stock
      appreciation right was granted in partial consideration for the exchange
      of the option or stock appreciation
  right.

            


    

     

    3.7.6
Outstanding Options
and Stock Appreciation Rights — Other Changes . In the event of any
change in the capitalization of the Company or a corporate change other than
those specifically referred to in Sections 3.7.3, 3.7.4 or 3.7.5 hereof, the
Committee may, in its absolute discretion, make such adjustments in the number
and class of shares subject to options and stock appreciation rights outstanding
on the date on which such change occurs and in the per-share exercise price of
each such option and stock appreciation right as the Committee may consider
appropriate to prevent dilution or enlargement of rights. In addition, if and to
the extent the Committee determines it is appropriate, the Committee may elect
to cancel each option and stock appreciation right outstanding immediately prior
to such event (whether or not then exercisable), and, in full consideration of
such cancellation, pay to the grantee to whom such option or stock appreciation
right was granted an amount in cash, for each share of the Common Stock subject
to such option or stock appreciation right, respectively, equal to the excess of
(i) the Fair Market Value of the Common Stock on the date of such cancellation
over (ii) the exercise price of such option or stock appreciation
right.

     

    3.7.7
No Other Rights
.. Except as expressly provided in the Plan, no grantee shall have any rights by
reason of any subdivision or consolidation of shares of stock of any class, the
payment of any dividend, any increase or decrease in the number of shares of
stock of any class or any dissolution, liquidation, merger or consolidation of
the Company or any other corporation. Except as expressly provided in the Plan,
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 of shares of the
Common Stock subject to an award or the exercise price of any option or stock
appreciation right. Except as otherwise provided in Section 3.7, no adjustment
shall be made for dividends, distributions or other rights (whether ordinary or
extraordinary, and whether in cash, securities or other property) for which the
record date is prior to the date such stock certificate is
issued.


    
      
         


      

      
         


        
          

        

      

      
         


      

    

    


    3.8
Right of Discharge
Reserved

     

    Nothing
in the Plan or in any Plan Agreement shall confer upon any grantee the right to
continue in the employ of the Company or affect any right which the Company may
have to terminate such employment.

     

    3.9
Nature of
Payments

     

    3.9.1 Any
and all grants of awards and issuances of shares of the Common Stock under the
Plan shall be in consideration of services performed for the Company by the
grantee.

     

    3.9.2 All
such grants and issuances shall constitute a special incentive payment to the
grantee and shall not be taken into account in computing the amount of salary or
compensation of the grantee for the purpose of determining any benefits under
any pension, retirement, profit-sharing, bonus, life insurance or other benefit
plan of the Company or under any agreement between the Company and the grantee,
unless such plan or agreement specifically provides otherwise.

     

    3.10
Non-Uniform
Determinations

     

    The
Committee’s determinations under the Plan need not be uniform and may be made by
it selectively among persons who receive, or are eligible to receive, awards
under the Plan (whether or not such persons are similarly situated). Without
limiting the generality of the foregoing, the Committee shall be entitled, among
other things, to make non-uniform and selective determinations, and to enter
into non-uniform and selective Plan agreements, as to (a) the persons to receive
awards under the Plan, (b) the terms and provisions of awards under the Plan,
and (c) the treatment of leaves of absence pursuant to Section
1.6.4.

     

    3.11
Other Payments or
Awards

     

    Nothing
contained in the Plan shall be deemed in any way to limit or restrict the
Company from making any award or payment to any person under any other plan,
arrangement or understanding, whether now existing or hereafter in
effect.

     

    3.12
Section
Headings

     

    The
section headings contained herein are for the purpose of convenience only and
are not intended to define or limit the contents of the sections.

     

    3.13
Effective Date and
Term of Plan

     

    3.13.1
The Plan was adopted by the Board on September 27, 2010, subject to approval by
the Company’s stockholders. All awards under the Plan prior to such stockholder
approval are subject in their entirety to such approval. If such approval is not
obtained prior to the first anniversary of the date of adoption of the Plan, the
Plan and all awards thereunder shall terminate on that date.

     

    3.13.2
Unless sooner terminated by the Board, the Plan will terminate on the close of
business on September 27, 2020, ten years from the original effective date. All
awards made under the Plan prior to its termination shall remain in effect until
such awards have been satisfied or terminated in accordance with the terms and
provisions of the Plan and the applicable Plan Agreements.

     

    3.14
Governing
Law

     

    All
rights and obligations under the Plan shall be construed and interpreted in
accordance with the laws of the State of Nevada, without giving effect to
principles of conflict of laws.