Exhibit 10.1



 


EXHIBIT 10.1


COLLECTORS UNIVERSE, INC.


1999 STOCK INCENTIVE PLAN


     This 1999 STOCK INCENTIVE PLAN (the “Plan”), which was established by
COLLECTORS UNIVERSE, INC., a Delaware corporation (the “Company” or “CUI”),
pursuant to action taken by its Board of Directors as of the 3rd day of
February 1999 (the “Effective Date”), is amended as of September 13, 2000 by
action of its Board of Directors taken as of such date, and as approved by the
stockholders of the Company, to read in its entirety as follows:


ARTICLE 1


PURPOSES OF THE PLAN


     1.1 Purposes. The purposes of the Plan are (a) to enhance the Company’s
ability to attract and retain the services of qualified employees, officers,
employee and non-employee directors and Service Providers, upon whose judgment,
initiative and efforts the successful conduct and development of the Company’s
business largely depends, and (b) to provide additional incentives to such
Persons to devote their utmost effort and skill to the advancement and
betterment of the Company, by providing them an opportunity to participate in
the success and increased value of the Company through ownership of shares of
stock in the Company.


ARTICLE 2


DEFINITIONS


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


     2.1 Acquiring Person. “Acquiring Person” means the Person that acquires
direct or indirect ownership of a majority or all of the outstanding shares of
voting stock of the Company or of any other corporation in which the Company
may be merged, in a Change of Control transaction effectuated by means of a
merger of the Company with and into another corporation, a reverse or forward
triangular merger or an exchange of shares of the Company’s Common Stock for
shares of stock, cash or other property of the Acquiring Person and any Person
that acquires ownership of all or substantially all of the assets of the
Company in a single or series of related transactions.


     2.2 Administrator. “Administrator” means the Board or, if the Board
delegates any of its administrative responsibilities under the Plan to the
Committee, the term Administrator as to such delegated responsibilities shall
mean the Committee.


     2.3 Affiliated Company. “Affiliated Company” means any “parent
corporation” or “subsidiary corporation” of the Company, whether now existing
or hereafter created or acquired, as those terms are defined in Sections 424(e)
and 424(f) of the Code, respectively.


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


     2.5 Change in Control. “Change in Control” shall mean (i) the
acquisition, directly or indirectly, by any Person or group (within the meaning
of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended) of the
beneficial ownership of securities of the Company possessing more than fifty
percent (50%) of the total combined voting power of all outstanding securities
of the Company, unless the Person or group of Persons acquiring such beneficial
ownership owned more than 25% of the outstanding common stock of the Company on
the date of adoption of this Plan, (ii) a merger or consolidation in


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which the Company is not the surviving entity, except for a transaction in
which holders of outstanding voting securities of the Company immediately prior
to such merger or consolidation hold, in the aggregate, securities possessing
more than fifty percent (50%) of the total combined voting power of all
outstanding voting securities of the surviving entity immediately after such
merger or consolidation; (iii) a reverse merger in which the Company is the
surviving entity but in which securities possessing more than fifty percent
(50%) of the total combined voting power of all outstanding voting securities
of the Company are transferred to or acquired by a Person or Persons different
from the persons holding those securities immediately prior to such merger;
(iv) the sale, transfer or other disposition (in one transaction or a series of
related transactions) of all or substantially all of the assets of the Company;
or (v) the approval by the shareholders of a plan or proposal for the
liquidation or dissolution of the Company.


     2.6 Code. “Code” means the Internal Revenue Code of 1986, as amended from
time to time.


     2.7 Committee. “Committee” means a committee of two or more members of
the Board appointed to administer the Plan, as set forth in Section 7.1 hereof.


     2.8 Common Stock. “Common Stock” means the Common Stock, $.01 par value
of the Company, subject to adjustment pursuant to Section 4.2 hereof.


     2.9 Disability. “Disability” means permanent and total disability as
defined in Section 22(e)(3) of the Code. The Administrator’s determination of
a Disability or the absence thereof shall be conclusive and binding on all
interested parties.


     2.10 Effective Date. “Effective Date” means the date on which the Plan is
adopted by the Board, as set forth on the first page hereof.


     2.11 Exercise Price. “Exercise Price” means the purchase price per share
of Common Stock payable upon exercise of an Option.


     2.12 Fair Market Value. “Fair Market Value” on any given date means the
value of one share of Common Stock, determined as follows:


          (a) If the Common Stock is then listed or admitted to trading on a NASDAQ
market system or a stock exchange which reports closing sale prices, the Fair
Market Value shall be the closing sale price on the date of valuation on such
NASDAQ market system or principal stock exchange on which the Common Stock is
then listed or admitted to trading, or, if no closing sale price is quoted on
such day, then the Fair Market Value shall be the closing sale price of the
Common Stock on such NASDAQ market system or such exchange on the next
preceding day for which a closing sale price is reported.



          (b) If the Common Stock is not then listed or admitted to trading on a
NASDAQ market system or a stock exchange which reports closing sale prices, the
Fair Market Value shall be the average of the closing bid and asked prices of
the Common Stock in the over-the-counter market on the date of valuation.



          (c) If neither (a) nor (b) is applicable as of the date of valuation, then
the Fair Market Value shall be determined by the Administrator in good faith
using any reasonable method of evaluation, which determination shall be
conclusive and binding on all interested parties.



     2.13 Incentive Option. “Incentive Option” means any Option designated and
qualified as an “incentive stock option” as defined in Section 422 of the Code.


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     2.14 Incentive Option Agreement. “Incentive Option Agreement” means an
Option Agreement with respect to an Incentive Option.


     2.15 NASD Dealer. “NASD Dealer” means a broker-dealer that is a member of
the National Association of Securities Dealers, Inc.


     2.16 Nonqualified Option. “Nonqualified Option” means any Option that is
not an Incentive Option. To the extent that any Option designated as an
Incentive Option fails in whole or in part to qualify as an Incentive Option,
including, without limitation, for failure to meet the limitations applicable
to a 10% Shareholder or because it exceeds the annual limit provided for in
Section 5.6 below, it shall to that extent constitute a Nonqualified Option.


     2.17 Nonqualified Option Agreement. “Nonqualified Option Agreement” means
an Option Agreement with respect to a Nonqualified Option.


     2.18 Offeree. “Offeree” means a Participant to whom a Right to Purchase
has been offered or who has acquired Restricted Stock under the Plan.


     2.19 Option. “Option” means any option to purchase Common Stock granted
pursuant to the Plan.


     2.20 Option Agreement. “Option Agreement” means the written agreement
entered into between the Company and the Optionee with respect to an Option
granted under the Plan.


     2.21 Optionee. “Optionee” means a Participant who holds an Option.


     2.22 Participant. “Participant” means a Person who holds an Option, a
Right to Purchase or Restricted Stock under the Plan.


     2.23 Person. “Person” means any natural person and any corporation,
limited liability company, partnership, trust, association or other entity.


     2.24 Purchase Price. “Purchase Price” means the purchase price per share
of Restricted Stock payable upon acceptance of a Right to Purchase.


     2.25 Restricted Stock. “Restricted Stock” means shares of Common Stock
issued pursuant to Article 6 hereof, subject to any restrictions and conditions
as are established pursuant to such Article 6.


     2.26 Right to Purchase. “Right to Purchase” means a right to purchase
Restricted Stock granted to an Offeree pursuant to Article 6 hereof.


     2.27 Service Provider. “Service Provider” means a consultant or other
Person who provides services to the Company or an Affiliated Company and who
the Administrator authorizes to become a Participant in the Plan.


     2.28 Stock Purchase Agreement. “Stock Purchase Agreement” means a written
agreement entered into by the Company with the Offeree with respect to a Right
to Purchase offered under the Plan.


     2.29 10% Shareholder. “10% Shareholder” means a Person who, as of a
relevant date, owns or is deemed to own (by reason of the attribution rules
applicable under Section 424(d) of the Code) stock
possessing more than 10% of the total combined voting power of all classes
of stock of the Company or of an Affiliated Company.


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ARTICLE 3


ELIGIBILITY


     3.1 Incentive Options. Officers and other key employees of the Company or
of an Affiliated Company (including members of the Board if they are employees
of the Company or of an Affiliated Company) are eligible to receive Incentive
Options under the Plan.


     3.2 Nonqualified Options and Rights to Purchase. Officers and other key
employees of the Company or of an Affiliated Company, members of the Board
(whether or not employed by the Company or an Affiliated Company), and Service
Providers are eligible to receive Nonqualified Options or Rights to Purchase
under the Plan.


     3.3 Limitation on Shares. In no event shall any Participant be granted
Options or Rights to Purchase in any one calendar year pursuant to which the
aggregate number of shares of Common Stock that may be acquired thereunder
exceeds five hundred thousand shares (500,000) shares (which number shall be
subject to adjustment as provided in Section 4.2 hereof).


ARTICLE 4


PLAN SHARES


     4.1 Shares Subject to the Plan. A total of two million nine hundred
ninety-eight thousand five hundred seventy-five (2,998,575)* shares of Common
Stock may be issued under the Plan, subject to adjustment as to the number and
kind of shares pursuant to Section 4.2 hereof. For purposes of this
limitation, in the event that (a) all or any portion of any Option or Right to
Purchase granted or offered under the Plan can no longer under any
circumstances be exercised, or (b) any shares of Common Stock are reacquired by
the Company pursuant to an Incentive Option Agreement, Nonqualified Option
Agreement or Stock Purchase Agreement, the shares of Common Stock allocable to
the unexercised portion of such Option or such Right to Purchase, or the shares
so reacquired, shall again be available for grant or issuance under the Plan.


     4.2 Changes in Capital Structure. In the event that the outstanding
shares of Common Stock are hereafter increased or decreased or changed into or
exchanged for a different number or kind of shares or other securities of the
Company by reason of a recapitalization, stock split, combination of shares,
reclassification, stock dividend, or other change in the capital structure of
the Company, then appropriate adjustments shall be made by the Administrator to
the aggregate number and kind of shares subject to this Plan, and the number
and kind of shares and the price per share subject to outstanding Option
Agreements, Rights to Purchase and Stock Purchase Agreements in order to
preserve, as nearly as practical, but not to increase, the benefits to
Participants.


ARTICLE 5


OPTIONS


     5.1 Option Agreement. Each Option granted pursuant to this Plan shall be
evidenced by an Option Agreement which shall specify the number of shares
subject thereto, the Exercise Price per share, and whether the Option is an
Incentive Option or Nonqualified Option. As soon as is practical following the
grant of an Option, an Option Agreement shall be duly executed and delivered by
or on behalf of the Company to the Optionee to whom such Option was granted.
Each Option Agreement shall be in such form and contain such additional terms
and conditions, not inconsistent with the provisions of this Plan,






	*	 	As amended September 13, 2000.


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as the Administrator shall, from time to time, deem desirable, including,
without limitation, the imposition of any rights of first refusal and resale
obligations upon any shares of Common Stock acquired pursuant to an Option
Agreement. Each Option Agreement may be different from each other Option
Agreement.


     5.2 Exercise Price. The Exercise Price per share of Common Stock covered
by each Option shall be determined by the Administrator, subject to the
following:


          (a) the Exercise Price of an Incentive Option shall not be less
than 100% of Fair Market Value on the date the Incentive Option is granted,



          (b) the Exercise Price of a Nonqualified Option shall not be less than 85%
of Fair Market Value on the date the Nonqualified Option is granted, and (c) if
the Person to whom an Option is granted is a 10% Shareholder on the date of
grant, the Exercise Price shall not be less than 110% of Fair Market Value on
the date the Option is granted.



     5.3 Payment of Exercise Price. Payment of the Exercise Price shall be
made upon exercise of an Option and may be made in any of the following ways:


          (a) By cash or check; or,



          (b) If approved by the Administrator, then, subject to any legal
restrictions, by (i) the surrender of shares of Common Stock owned by the
Optionee that have been held by the Optionee for at least six (6) months, which
surrendered shares shall be valued at Fair Market Value as of the date of such
exercise; (ii) the delivery to the Company of Optionee’s promissory note in a
form and on terms acceptable to the Administrator; (iii) the cancellation of
indebtedness of the Company to the Optionee; (iv) the waiver of compensation
due or accrued to the Optionee for services rendered; or (v) any combination of
the foregoing; or



          (c) If a public market for the Common Stock exists, by (i) a “same day
sale” commitment from the Optionee and an NASD Dealer whereby the Optionee
irrevocably elects to exercise the Option and to sell a portion of the shares
so purchased to pay for the Exercise Price and whereby the NASD Dealer
irrevocably commits upon receipt of such shares to forward the Exercise Price
directly to the Company; or (ii) a “margin” commitment from the Optionee and an
NASD Dealer whereby the Optionee irrevocably elects to exercise the Option and
to pledge the shares so purchased to the NASD Dealer in a margin account as
security for a loan from the NASD Dealer in the amount of the Exercise Price,
and whereby the NASD Dealer irrevocably commits upon receipt of such shares to
forward the Exercise Price directly to the Company; or



          (d) Any combination of the foregoing methods of payment or any other
consideration or method of payment that has been approved by the Administrator
and is permitted by applicable corporate law.



     5.4 Term and Termination of Options. The term and provisions for
termination of each Option shall be as fixed by the Administrator, but no
Option may be exercisable more than ten (10) years after the date it is
granted. An Option granted to a Person who is a 10% Shareholder on the date of
grant shall not be exercisable more than five (5) years after the date it is
granted.


     5.5 Vesting and Exercise of Options. Each Option shall vest and become
exercisable in one or more installments at such time or times and subject to
such conditions, including without limitation the achievement of specified
performance goals or objectives, as shall be determined by the Administrator.


     5.6 Annual Limit on Incentive Options. To the extent required for
“incentive stock option” treatment under Section 422 of the Code, the aggregate
Fair Market Value (determined as of the time of grant) of the Common Stock
shall not, with respect to which Incentive Options granted under this Plan


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and any other plan of the Company or any Affiliated Company become
exercisable for the first time by an Optionee during any calendar year, exceed
$100,000. The excess, if any of the Fair Market Value of any incentive stock
option that becomes vested in any calendar year over this $100,000 limitation
shall be treated, for federal income tax purposes as a Nonqualified Option.


     5.7 Nontransferability of Options. No Option shall be assignable or
transferable except by will or the laws of descent and distribution, and during
the life of the Optionee shall be exercisable only by such Optionee; provided,
however, that, in the discretion of the Administrator, any Option may be
assigned or transferred in any manner which an “incentive stock option” is
permitted to be assigned or transferred under the Code.


     5.8 Rights as Shareholder. An Optionee or permitted transferee of an
Option shall have no rights or privileges as a shareholder with respect to any
shares covered by an Option until such Option has been duly exercised and
certificates representing shares purchased upon such exercise have been issued
to such Person.


ARTICLE 6


RIGHTS TO PURCHASE


     6.1 Nature of Right to Purchase. A Right to Purchase granted to an
Offeree entitles the Offeree to purchase, for a Purchase Price determined by
the Administrator, shares of Common Stock subject to such terms, restrictions
and conditions as the Administrator may determine at the time of grant
(“Restricted Stock”). Such conditions may include, but are not limited to,
continued employment or the achievement of specified performance goals or
objectives.


     6.2 Acceptance of Right to Purchase. An Offeree shall have no rights with
respect to the Restricted Stock subject to a Right to Purchase unless the
Offeree shall have accepted the Right to Purchase within ten (10) days (or such
longer or shorter period as the Administrator may specify) following the grant
of the Right to Purchase by making payment of the full Purchase Price to the
Company in the manner set forth in Section 6.3 hereof and by executing and
delivering to the Company a Stock Purchase Agreement. Each Stock Purchase
Agreement shall be in such form, and shall set forth the Purchase Price and
such other terms, conditions and restrictions of the Restricted Stock, not
inconsistent with the provisions of this Plan, as the Administrator shall, from
time to time, deem desirable. Each Stock Purchase Agreement may be different
from each other Stock Purchase Agreement.


     6.3 Payment of Purchase Price. Subject to any legal restrictions,
payment of the Purchase Price upon acceptance of a Right to Purchase Restricted
Stock may be made, by:


          (a) Cash or check; or



          (b) If approved by the Administrator, (i) the surrender of shares of
Common Stock owned by the Offeree that have been held by the Offeree for at
least six (6) months, which surrendered shares shall be valued at Fair Market
Value as of the date of such exercise; (ii) delivery of the Offeree’s
promissory note in a form and on terms acceptable to the Administrator; (iii)
the cancellation of indebtedness of the Company to the Offeree; (iv) the waiver
of compensation due or accrued to the Offeree for services rendered; or



          (c) any combination of the foregoing methods of payment or any other
consideration or method of payment as shall be approved by the Administrator.



     6.4 Rights as a Shareholder. Upon complying with the provisions of
Section 6.2 hereof, an Offeree shall have the rights of a shareholder with
respect to the Restricted Stock purchased pursuant to


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the Right to Purchase, including voting and dividend rights, subject to
the terms, restrictions and conditions as are set forth in the Stock Purchase
Agreement. Unless the Administrator shall determine otherwise, certificates
evidencing shares of Restricted Stock shall remain in the possession of the
Company until such shares have vested in accordance with the terms of the Stock
Purchase Agreement.


     6.5 Restrictions. Shares of Restricted Stock may not be sold, assigned,
transferred, pledged or otherwise encumbered or disposed of except as
specifically provided in the Stock Purchase Agreement. In the event of
termination of a Participant’s employment, service as a director of the Company
or Service Provider status for any reason whatsoever (including death or
disability), the Stock Purchase Agreement may provide, in the discretion of the
Administrator, that the Company shall have the right, exercisable at the
discretion of the Administrator, to repurchase (i) at the original Purchase
Price, any shares of Restricted Stock which have not vested as of the date of
termination, and (ii) at Fair Market Value, any shares of Restricted Stock
which have vested as of such date, on such terms as may be provided in the
Stock Purchase Agreement.


     6.6 Vesting of Restricted Stock. The Stock Purchase Agreement shall
specify the date or dates, the performance goals or other objectives which must
be achieved, and any other conditions on which the Restricted Stock may vest.


     6.7 Dividends. If payment for shares of Restricted Stock is made by
promissory note, any cash dividends or other distributions of cash paid with
respect to the Restricted Stock may be applied, in the discretion of the
Administrator, to repayment of such note.


     6.8 Nonassignability of Rights. No Right to Purchase shall be assignable
or transferable except by will or the laws of descent and distribution or as
otherwise provided by the Administrator.


ARTICLE 7


ADMINISTRATION OF THE PLAN


     7.1 Administrator. Authority to control and manage the operation and
administration of the Plan shall be vested in the Board, which may delegate
such responsibilities in whole or in part to a committee consisting of two (2)
or more members of the Board (the “Committee”). Members of the Committee may
be appointed from time to time by, and shall serve at the pleasure of, the
Board. As used herein, the term “Administrator” means the Board or, with
respect to any matter as to which responsibility has been delegated to the
Committee, the term Administrator shall mean the Committee.


     7.2 Powers of the Administrator. In addition to any other powers or
authority conferred upon the Administrator elsewhere in the Plan or by law, the
Administrator shall have full power and authority to interpret the Plan, to
create, amend or rescind and to interpret rules and regulations relating to the
Plan and, without limiting the generality of the foregoing, to:


          (a) determine the Persons to whom, and the time or times at which,
Incentive Options or Nonqualified Options shall be granted and Rights to
Purchase shall be offered, the number of shares to be represented by each
Option and Right to Purchase and the consideration to be received by the
Company upon the exercise thereof;



          (b) determine the terms, conditions and restrictions contained in, and the
form of, Option Agreements and Stock Purchase Agreements;



          (c) determine the identity or capacity of any Persons who may be entitled
to exercise a Participant’s rights under any Option or Right to Purchase under
the Plan;



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          (d) correct any defect or supply any omission or reconcile any
inconsistency in the Plan or in any Option Agreement or Stock Purchase
Agreement;



          (e) accelerate the vesting of any Option or release or waive any
repurchase rights of the Company with respect to Restricted Stock;



          (f) extend the exercise date of any Option or acceptance date of any Right
to Purchase;



          (g) provide for rights of first refusal and/or repurchase rights;



          (h) amend outstanding Option Agreements and Stock Purchase Agreements to
provide for, among other things, any change or modification which the
Administrator could have provided for upon the grant of an Option or Right to
Purchase or in furtherance of the powers provided for herein; and



          (i) make all other determinations necessary or advisable for the
administration of the Plan, but only to the extent not contrary to the express
provisions of the Plan.



Any action, decision, interpretation or determination made in good faith by the
Administrator in the exercise of its authority conferred upon it under the Plan
shall be final and binding on the Company and all Participants.


     7.3 Limitation on Liability. No employee of the Company or member of the
Board or Committee shall be subject to any liability with respect to duties
under the Plan unless the Person acts fraudulently or in bad faith. To the
extent permitted by law, the Company shall indemnify each member of the Board
or Committee, and any employee of the Company with duties under the Plan, who
was or is a party, or is threatened to be made a party, to any threatened,
pending or completed proceeding, whether civil, criminal, administrative or
investigative, by reason of such Person’s conduct in the performance of duties
under the Plan.


ARTICLE 8


CHANGE IN CONTROL


     8.1 Change in Control. In order to preserve a Participant’s rights in the
event of a Change in Control of the Company, the Administrator shall take one
or more of the following actions with respect to outstanding Options (“Existing
Options”), Rights to Purchase (“Existing Purchase Rights”) and with respect to
Restricted Stock obtained under this Plan:


          (a) Obtain from the Acquiring Person in the Change of Control transaction
an agreement which requires it, concurrently with the consummation of the
Change of Control Transaction, to purchase or exchange each of the Existing
Options and each of the Existing Purchase Rights for cash, stock or other
property that is being paid or issued to Company’s stockholders in the Change
of Control Transaction in an amount equal to the difference, or spread, between
(i) the value of the cash, stock or other property that the Optionee or holder
of such Existing Purchase Right would have received pursuant to such Change in
Control transaction in exchange for all of the shares that would be issuable
upon exercise of such Existing Options or Purchase Rights, assuming that the
Existing Options and such Existing Purchase Rights had become fully exercisable
and had been exercised immediately prior to the consummation of such Change in
Control transaction, and (ii) the Exercise Price of such Existing Options or
Purchase Price of such Existing Purchase Rights (as the case may be);



          (b) Obtain from the Acquiring Person in the Change of Control transaction
an agreement that obligates the Acquiring Person to assume the Existing Options
or to grant, in substitution for the Existing Options, new options entitling
each Optionee to purchase a number of shares of voting

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stock of the Acquiring Person having a Fair Market Value that is equal to
the then Fair Market Value of the shares of Common Stock of the Company that
are subject to the Existing Options, with appropriate adjustments as to the
number and kind of shares and Exercise Prices, in which event the Plan and the
assumed Options, or the new options substituted therefor (the “Substituted
Options”), shall continue in the manner and under the terms so provided; or



          (c) Provide for the purchase or exchange of each Option or Right to
Purchase for an amount of cash or other property having a value equal to the
difference, or spread, between (i) the value of the cash or other property that
the Participant would have received pursuant to such Change in Control
transaction in exchange for the shares issuable upon exercise of the Option or
Right to Purchase had the Option or Right to Purchase been exercised
immediately prior to such Change in Control transaction and (ii) the Exercise
Price of such Option or the Purchase Price under such Right to Purchase;



          (d) adjust the terms of the Options and Rights to Purchase in a manner
determined by the Administrator to reflect the Change in Control;



          (e) cause the Options and Rights to Purchase to be assumed, or new rights
substituted therefor, by another Person, through the continuance of the Plan
and the assumption of outstanding Options and Rights to Purchase, or the
substitution for such Options and Rights to Purchase of new options and new
rights to purchase of comparable value covering shares of a successor
corporation, with appropriate adjustments as to the number and kind of shares
and Exercise Prices, in which event the Plan and such Options and Rights to
Purchase, or the new options and rights to purchase substituted therefor, shall
continue in the manner and under the terms so provided; or



          (f) make such other provision as the Administrator may consider equitable.



The Administrator shall cause written notice of any proposed Change of Control
transaction to be given to all Optionees not less than fifteen (15) days prior
to the anticipated effective date of the proposed Change of Control
transaction; provided, however, that any delay beyond such time period in the
giving of, or the failure to give, such notice shall not entitle any Person,
including any Optionee, to obtain a delay in the effective date or to
invalidate or adversely affect the validity of any such Change in Control
transaction.


     8.2 Effect of Change of Control Transaction.


          (a) If an agreement is obtained from the Acquiring Person which provides
either for (i) the payment or exchange of cash, stock or other consideration
equal to the Fair Market Value of the shares (whether or not vested) that are
subject to the Existing Options, as contemplated by Paragraph 8.1(a) above, or
(ii) the issuance of Substituted Options by the Acquiring Person, then, the
Existing Options shall terminate retroactive to the effective date of the
consummation of the Change of Control transaction. If, instead, an agreement
is obtained from the Acquiring Person which provides for the assumption of the
Existing Options and the continuance of this Plan by the Acquiring Person, the
Existing Options shall continue in full force and effect, subject to equitable
adjustments provided for in that agreement.



          (b) If the agreement contemplated by Paragraph 8.1(b) is obtained, or any
of the actions contemplated by Paragraph 7.1(c) is taken and, as a result, the
Optionees holding Existing Options immediately prior to the consummation of
such Change in Control either will continue to hold their Existing Options (as
adjusted in the manner set forth in Paragraph 8.1(b) or 8.1(c) above) or will
receive Substituted Options pursuant to Paragraph 8.1(b), but an Optionee’s
Continuous Service (as defined in the Optionee’s Option Agreement) is
terminated by the Company or the Acquiring Person for any reason during the
first eighteen (18) months following such Change in Control, then,
notwithstanding any provisions to the contrary contained in the Plan or any
Plan adopted in substitution of this Plan, all of the

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          shares of stock then subject or covered by such Existing Options or
Substitute Options, to the extent they are not already exercisable, shall
become vested and fully exercisable by the holder of such Existing Option or
Substitute Option, as the case may be, effective retroactively to the business
day immediately preceding the date of such termination of his or her Continuous
Service.



          (c) If, on the other hand, the Administrator is unable to obtain either of
the agreements contemplated by Paragraph 8.1(a) and Paragraph 8.1(b), and the
Change of Control transaction is nevertheless consummated, then, (i) all
Options that have not theretofore become fully vested and fully exercisable
shall become fully vested and exercisable, effective as of the business day
immediately preceding the date of consummation of the Change of Control
transaction; (ii) each holder of an Existing Option shall be entitled to
exercise such Option in whole or in part on or prior to the date on which the
Change of Control transaction is consummated, (iii) in the event of any such
exercise by an Optionee (which shall be deemed to have occurred immediately
prior to the consummation of the Change of Control transaction), the Optionee
shall, on such consummation, become entitled to receive the consideration such
Optionee would have received in such transaction had he owned the shares
acquired on such exercise immediately prior to such consummation, and (iv) any
Existing Option not exercised in full on or before the effective date of the
consummation of the Change of Control transaction shall terminate as to the
unexercised portion of such Option as of such effective date. In addition, if
an agreement is obtained as contemplated by Paragraph 8.1(a) or Paragraph
8.1(b) above in connection with any Change of Control transaction, then, on
consummation of the Change of Control transaction each Existing Option shall be
converted into the right to receive the consideration stated in such agreement
and the right to exercise any Existing Options to acquire shares of Common
Stock of the Company shall terminate.



If any of the actions set forth in Paragraphs 8.1(c), (d) or (e) is taken by
the Administrator and, as a result, the Participants holding such Options,
Rights to Purchase or Restricted Stock immediately prior to the consummation of
such Change in Control will hold Options, Rights to Purchase or Restricted
Stock, or options, rights to purchase or restricted stock issued in
substitution therefor, as contemplated in Paragraph 8.1(d) above, (collectively
“Substituted Rights”), and the Continuous Service of the holder of any such
Options, Rights to Purchase or Restricted Stock, or such Substituted Rights, as
the case may be, is terminated for any reason during the first eighteen (18)
months following such Change in Control; then, notwithstanding any provisions
to the contrary contained in the Plan, the time period relating to the exercise
or realization of such holder’s outstanding Options, Rights to Purchase or
Restricted Stock, or such Substituted Rights, as the case may be, shall
automatically accelerate on such termination of his or her Continuous Service.
If, on the other hand, the Administrator takes the action set forth in
Paragraph 8.1(a) above, all Options and Rights to Purchase shall terminate upon
the consummation of the Change in Control. The Administrator shall cause
written notice of the proposed transaction to be given to all Participants not
less than fifteen (15) days prior to the anticipated effective date of the
proposed transaction; provided, however, that any delay beyond such time period
in the giving of, or the failure to give, such notice shall not entitle any
Person, including any Optionee or Participant, to obtain a delay in the
effective date or to invalidate or adversely affect the validity of any such
Change in Control.


ARTICLE 9


AMENDMENT AND TERMINATION OF THE PLAN


     9.1 Amendments. The Board may from time to time alter, amend, suspend or
terminate the Plan in such respects as the Board may deem advisable. No such
alteration, amendment, suspension or termination shall be made which shall
substantially affect or impair the rights of any Participant under an
outstanding Option Agreement or Stock Purchase Agreement without such
Participant’s consent. The Board may alter or amend the Plan to comply with
requirements under the Code relating to Incentive Options or other types of
options which give Optionees more favorable tax treatment than that applicable


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to Options granted under this Plan as of the date of its adoption. Upon
any such alteration or amendment, any outstanding Option granted hereunder may,
if the Administrator so determines and if permitted by applicable law, be
subject to the more favorable tax treatment afforded to an Optionee pursuant to
such terms and conditions.


     9.2 Plan Termination. Unless the Plan shall theretofore have been
terminated, the Plan shall terminate on the tenth (10th) anniversary of the
Effective Date and no Options or Rights to Purchase may be granted under the
Plan thereafter, but Option Agreements, Stock Purchase Agreements and Rights to
Purchase then outstanding shall continue in effect in accordance with their
respective terms.


ARTICLE 10


TAX WITHHOLDING


     10.1 Withholding. The Company shall have the power to withhold, or
require a Participant to remit to the Company, an amount sufficient to satisfy
any applicable Federal, state, and local tax withholding requirements with
respect to any Options exercised or Restricted Stock issued under the Plan. To
the extent permissible under applicable tax, securities and other laws, the
Administrator may, in its sole discretion and upon such terms and conditions as
it may deem appropriate, permit a Participant to satisfy his or her obligation
to pay any such tax, in whole or in part, up to an amount determined on the
basis of the highest marginal tax rate applicable to such Participant, by (a)
directing the Company to apply shares of Common Stock to which the Participant
is entitled as a result of the exercise of an Option or as a result of the
purchase of or lapse of restrictions on Restricted Stock or (b) delivering to
the Company shares of Common Stock owned by the Participant. The shares of
Common Stock so applied or delivered in satisfaction of the Participant’s tax
withholding obligation shall be valued at their Fair Market Value as of the
date of measurement of the amount of income subject to withholding.


ARTICLE 11


MISCELLANEOUS


     11.1 Benefits Not Alienable. Other than as provided above, benefits under
the Plan may not be assigned or alienated, whether voluntarily or
involuntarily. Any unauthorized attempt at assignment, transfer, pledge or
other disposition shall be without effect.


     11.2 No Enlargement of Employee Rights. This Plan is strictly a voluntary
undertaking on the part of the Company and shall not be deemed to constitute a
contract between the Company and any Participant to be consideration for, or an
inducement to, or a condition of, the employment of any Participant. Nothing
contained in the Plan shall be deemed to give the right to any Participant to
be retained as an employee of the Company or any Affiliated Company or to limit
the right of the Company or any Affiliated Company to discharge any Participant
at any time.


     11.3 Application of Funds. The proceeds received by the Company from the
sale of Common Stock pursuant to Option Agreements and Stock Purchase
Agreements, except as otherwise provided herein, will be used for general
corporate purposes.






     This Plan, as amended on September 13, 2000, was approved by the
Stockholders of the Company on December 5, 2000, at it Annual Stockholders
Meeting held on that date.


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