exv10w1








 




    Exhibit
10.1



 




    BIOCRYST
    PHARMACEUTICALS, INC.

    STOCK INCENTIVE PLAN



 




    (AS
    AMENDED AND RESTATED MARCH 31, 2010)



 




    ARTICLE ONE



 




    GENERAL
    PROVISIONS



 


		
	
    I.  
	
    PURPOSES
    OF THE PLAN




 



    A. This Stock Incentive Plan (the “Plan”),
    formerly the “BioCryst Pharmaceuticals, Inc. 1991 Stock
    Option Plan,” is intended to promote the interests of
    BioCryst Pharmaceuticals, Inc., a Delaware corporation (the
    “Company”), by providing a method whereby (i) key
    employees (including officers and directors) of the Company (or
    its parent or subsidiary corporations) who are responsible for
    the management, growth and financial success of the Company (or
    any parent or subsidiary corporations), (ii) non-employee
    members of the board of directors of the Company (the
    “Board”) (or of any parent or subsidiary corporations)
    and (iii) consultants and other independent contractors who
    provide valuable services to the Company (or any parent or
    subsidiary corporations) may be offered the opportunity to
    acquire a proprietary interest, or otherwise increase their
    proprietary interest, in the Company as an incentive for them to
    remain in the service of the Company (or any parent or
    subsidiary corporations).



 



    B. For purposes of the Plan, the following provisions shall
    be applicable in determining the parent and subsidiary
    corporations of the Company:



 



    (i) Any corporation (other than the Company) in an unbroken
    chain of corporations ending with the Company shall be
    considered to be a parent corporation of the Company,
    provided each such corporation in the unbroken chain (other than
    the Company) owns, at the time of the determination, stock
    possessing fifty percent (50%) or more of the total combined
    voting power of all classes of stock in one of the other
    corporations in such chain.



 



    (ii) Each corporation (other than the Company) in an
    unbroken chain of corporations beginning with the Company shall
    be considered to be a subsidiary of the Company, provided
    each such corporation (other than the last corporation) in the
    unbroken chain owns, at the time of the determination, stock
    possessing fifty percent (50%) or more of the total combined
    voting power of all classes of stock in one of the other
    corporations in such chain.



 



    C. The Plan, as hereby amended and restated, was approved
    and adopted by the Board on March 31, 2010 in order to
    increase by 1,300,000 the number of shares of the Company’s
    common stock, par value $0.01 per share (the “Common
    Stock”), that may be issued pursuant to the Plan. The
    Board’s adoption of the share increase is subject to
    approval by the Company’s stockholders at the
    Company’s 2010 Annual Stockholders Meeting.



 


		
	
    II.  
	
    STRUCTURE
    OF THE PLAN




 



    A. The Plan shall be divided into three separate equity
    programs:



 



    (i) the Discretionary Option Grant Program specified in
    Article Two, pursuant to which eligible persons may, at the
    discretion of the Plan Administrator, be granted options to
    purchase shares of Common Stock,



 



    (ii) the Stock Issuance Program specified in
    Article Three, pursuant to which eligible persons may, at
    the discretion of the Plan Administrator, be issued shares of
    Common Stock directly, either through immediate purchase of such
    shares or as compensation for services rendered to the Company
    (or any parent or subsidiary), and





    










 







    (iii) the Automatic Option Grant Program specified in
    Article Four, pursuant to which non-employee members of the
    Board will automatically receive option grants to purchase
    shares of Common Stock.



 



    B. Unless the context clearly indicates otherwise, the
    provisions of Articles One and Five of the Plan shall apply
    to all equity programs under the Plan and shall accordingly
    govern the interests of all individuals under the Plan.



 


		
	
    III.  
	
    ADMINISTRATION
    OF THE PLAN




 



    A. A committee of two (2) or more non-employee Board
    members appointed by the Board (the “Primary
    Committee”) shall have sole and exclusive authority to
    administer the Discretionary Option Grant and Stock Issuance
    Programs with respect to Section 16 Insiders. For purposes
    of this Section, a Section 16 Insider shall mean an officer
    or director of the Company subject to the short-swing profit
    liabilities of Section 16 of the Securities Exchange Act of
    1934 (the “1934 Act”).



 



    B. Administration of the Discretionary Option Grant and
    Stock Issuance Programs with respect to all other persons
    eligible to participate in the programs may, at the Board’s
    discretion, be vested in the Primary Committee, another
    committee of one (1) or more Board members appointed by the
    Board (the “Secondary Committee”), or the Board may
    retain the power to administer those programs with respect to
    all such persons.



 



    C. Members of the Primary Committee and any Secondary
    Committee shall serve for such period of time as the Board may
    determine and shall be subject to removal by the Board at any
    time.



 



    D. Each Plan Administrator (whether the Primary Committee,
    the Board or the Secondary Committee) shall, within the scope of
    its administrative functions under the Plan, have full power and
    authority (subject to the express provisions of the Plan) to
    establish such rules and regulations as it may deem appropriate
    for the proper administration of the Discretionary Option Grant
    and Stock Issuance Programs and to make such determinations
    under, and issue interpretations of, the provisions of such
    programs and any outstanding options or stock issuances
    thereunder as it may deem necessary or advisable. Decisions of
    the Plan Administrator within the scope of its administrative
    authority under the Plan shall be final and binding on all
    parties.



 



    E. Service on the Primary Committee or the Secondary
    Committee shall constitute service as a Board member, and
    members of each such committee shall accordingly be entitled to
    full indemnification and reimbursement as Board members for
    their service on such committee. No member of the Primary
    Committee or Secondary Committee shall be liable for any act of
    omission made in good faith with respect to the Plan or any
    option grants or stock issuances under the Plan.



 



    F. Administration of the Automatic Option Grant Program
    shall be self-executing in accordance with the express terms and
    conditions of Article Four, and no Plan Administrator shall
    exercise any discretionary functions under that program.



 


		
	
    IV.  
	
    ELIGIBILITY




 



    A. The persons eligible to participate in the Discretionary
    Option Grant and Stock Issuance Programs shall be limited to the
    following:



 



    (i) officers and other key employees of the Company (or its
    parent or subsidiary corporations) who render services which
    contribute to the management, growth and financial success of
    the Company (or its parent or subsidiary corporations);



 



    (ii) individuals who are consultants or independent
    advisors and who provide valuable services to the Company (or
    its parent or subsidiary corporations); and



 



    (iii) non-employee members of the Board (or of the board of
    directors of parent or subsidiary corporations).





    










 







    B. Only Board members who are not employees of the Company
    (or any parent or subsidiary) shall be eligible to receive
    automatic option grants pursuant to the Automatic Option Grant
    Program specified in Article Four.



 



    C. The Plan Administrator shall, within the scope of its
    administrative jurisdiction under the Plan, have full power and
    authority to determine (i) whether to grant options in
    accordance with the Discretionary Option Grant Program or to
    effect stock issuances in accordance with the Stock Issuance
    Program, (ii) which eligible persons are to receive option
    grants under the Discretionary Option Grant Program, the time or
    times when such option grants are to be made, the number of
    shares to be covered by each such grant, the status of the
    granted option as either an incentive stock option
    (“Incentive Option”) which satisfies the requirements
    of Section 422 of the Internal Revenue Code of 1986, as
    amended (the “Code”) or a non-statutory option not
    intended to meet such requirements, the time or times when each
    such option is to become exercisable, the vesting schedule (if
    any) applicable to the option shares and the maximum term for
    which such option is to remain outstanding, and (iii) which
    eligible persons are to receive stock issuances under the Stock
    Issuance Program, the time or times when such issuances are to
    be made, the number of shares to be issued to each participant,
    the vesting schedule (if any) applicable to the shares and the
    consideration for such shares.



 


		
	
    V.  
	
    STOCK
    SUBJECT TO THE PLAN




 



    A. Shares of the Company’s Common Stock shall be
    available for issuance under the Plan and shall be drawn from
    either the Company’s authorized but unissued shares of
    Common Stock or from reacquired shares of Common Stock,
    including shares repurchased by the Company on the open market.
    The maximum number of shares of Common Stock which may be issued
    over the term of the Plan, as amended and restated, shall not
    exceed 12,340,000 shares, subject to adjustment from time
    to time in accordance with the provisions of this
    Section V. The total number of shares available under the
    Plan as of March 18, 2010 is 8,829,930. This amount
    includes: 7,052,614 shares reserved for awards already
    issued; 477,316 shares of Common Stock available for future
    issuance under the Plan; and the increase of
    1,300,000 shares of Common Stock authorized by the Board
    subject to shareholder approval at the 2010 Annual Stockholders
    Meeting.



 



    B. In no event shall the number of shares of Common Stock
    for which any one individual participating in the Plan may
    receive options, separately exercisable stock appreciation
    rights and direct stock issuances exceed 1,500,000 shares
    of Common Stock in the aggregate. For purposes of such
    limitation, however, no stock options granted prior to the date
    the Common Stock was first registered under Section 12 of
    the 1934 Act (the “Section 12(g) Registration
    Date”) shall be taken into account.



 



    C. Should an outstanding option under this Plan expire or
    terminate for any reason prior to exercise in full, the shares
    subject to the portion of the option not so exercised shall be
    available for subsequent option grant or direct stock issuances
    under the Plan. Unvested shares issued under the Plan and
    subsequently repurchased by the Corporation, at the original
    issue price paid per share, pursuant to the Corporation’s
    repurchase rights under the Plan, or shares underlying
    terminated share right awards, shall be added back to the number
    of shares of Common Stock reserved for issuance under the Plan
    and shall accordingly be available for reissuance through one or
    more subsequent option grants or direct stock issuances under
    the Plan. However, should the exercise price of an outstanding
    option under the Plan be paid with shares of Common Stock or
    should shares of Common Stock otherwise issuable under the Plan
    be withheld by the Company in satisfaction of the withholding
    taxes incurred in connection with the exercise of an outstanding
    option or the vesting of a direct stock issuance under the Plan,
    then the number of shares of Common Stock available for issuance
    under the Plan shall be reduced by the gross number of shares
    for which the option is exercised or which vest under the direct
    stock issuance, and not by the net number of shares of Common
    Stock actually issued to the holder of such option or stock
    issuance. Shares of Common Stock subject to any option
    surrendered for an appreciation distribution under
    Section IV of Article Two or Section III of
    Article Four shall not be available for subsequent issuance
    under the Plan.



 



    D. In the event any change is made to the Common Stock
    issuable under the Plan by reason of any stock split, stock
    dividend, recapitalization, combination of shares, exchange of
    shares or other change affecting the outstanding Common Stock as
    a class without receipt of consideration, then appropriate
    adjustments shall be






    










 







    made to (i) the maximum number
    and/or class
    of securities issuable under the Plan, (ii) the maximum
    number
    and/or class
    of securities for which any one individual participating in the
    Plan may be granted stock options, separately exercisable stock
    appreciation rights, and direct stock issuances under the Plan
    from and after the Section 12(g) Registration Date,
    (iii) the number
    and/or class
    of securities and price per share in effect under each
    outstanding option under the Plan, (iv) the number
    and/or class
    of securities in effect under each outstanding direct stock
    issuance under the Plan, and (v) the number
    and/or class
    of securities for which automatic option grants are subsequently
    to be made per non-employee Board member under the Automatic
    Option Grant Program. The purpose of such adjustments shall be
    to preclude the enlargement or dilution of rights and benefits
    under the Plan.



 



    E. The fair market value per share of Common Stock on any
    relevant date under the Plan shall be determined in accordance
    with the following provisions:



 



    (i) If the Common Stock is not at the time listed or
    admitted to trading on any national securities exchange but is
    traded in the
    over-the-counter
    market, the fair market value shall be the mean between the
    highest bid and lowest asked prices (or, if such information is
    available, the closing selling price) per share of Common Stock
    on the date in question in the
    over-the-counter
    market, as such prices are reported by the National Association
    of Securities Dealers through the Nasdaq National Market or any
    successor system. If there are no reported bid and asked prices
    (or closing selling price) for the Common Stock on the date in
    question, then the mean between the highest bid price and lowest
    asked price (or the closing selling price) on the last preceding
    date for which such quotations exist shall be determinative of
    fair market value.



 



    (ii) If the Common Stock is at the time listed or admitted
    to trading on any national securities exchange, then the fair
    market value shall be the closing selling price per share of
    Common Stock on the date in question on the securities exchange
    determined by the Plan Administrator to be the primary market
    for the Common Stock, as such price is officially quoted in the
    composite tape of transactions on such exchange. If there is no
    reported sale of Common Stock on the exchange on the date in
    question, then the fair market value shall be the closing
    selling price on the exchange on the last preceding date for
    which such quotation exists.



 



    (iii) If the Common Stock is at the time neither listed nor
    admitted to trading on any securities exchange nor traded in the
    over-the-counter
    market, then the fair market value shall be determined by the
    Plan Administrator after taking into account such factors as the
    Plan Administrator shall deem appropriate.



 




    ARTICLE TWO

    



 




    DISCRETIONARY
    OPTION GRANT PROGRAM



 


		
	
    I.  
	
    TERMS AND
    CONDITIONS OF OPTIONS




 



    Options granted pursuant to this Article Two shall be
    authorized by action of the Plan Administrator and may, at the
    Plan Administrator’s discretion, be either Incentive
    Options or non-statutory options. Individuals who are not
    Employees may only be granted non-statutory options under this
    Article Two. Each option granted shall be evidenced by one
    or more instruments in the form approved by the Plan
    Administrator. Each such instrument shall, however, comply with
    the terms and conditions specified below, and each instrument
    evidencing an Incentive Option shall, in addition, be subject to
    the applicable provisions of Section II of this
    Article Two.



 



    A. Option Price.



 



    1. The option price per share shall be fixed by the Plan
    Administrator. In no event, however, shall the option price per
    share be less than one hundred percent (100%) of the fair market
    value per share of Common Stock on the date of the option grant.





    










 







    2. The option price shall become immediately due upon
    exercise of the option and shall, subject to the provisions of
    Section V of this Article Two and the instrument
    evidencing the grant, be payable as follows:



 



    (i) full payment in cash or check drawn to the
    Company’s order;



 



    (ii) full payment in shares of Common Stock held by the
    optionee for the requisite period necessary to avoid a charge to
    the Company’s earnings for financial reporting purposes and
    valued at fair market value on the Exercise Date (as such term
    is defined below);



 



    (iii) full payment through a combination of shares of
    Common Stock held by the optionee for the requisite period
    necessary to avoid a charge to the Company’s earnings for
    financial reporting purposes and valued at fair market value on
    the Exercise Date and cash or cash equivalent; or



 



    (iv) full payment through a broker-dealer sale and
    remittance procedure pursuant to which the optionee
    (I) shall provide irrevocable written instructions to a
    designated brokerage firm to effect the immediate sale of the
    purchased shares and remit to the Company, out of the sale
    proceeds available on the settlement date, sufficient funds to
    cover the aggregate option price payable for the purchased
    shares plus all applicable Federal and State income and
    employment taxes required to be withheld by the Company in
    connection with such purchase and (II) shall provide
    written directives to the Company to deliver the certificates
    for the purchased shares directly to such brokerage firm in
    order to complete the sale transaction.



 



    For purposes of this subparagraph 2, the Exercise Date shall be
    the date on which written notice of the option exercise is
    delivered to the Corporation. Except to the extent the sale and
    remittance procedure is utilized in connection with the exercise
    of the option, payment of the option price for the purchased
    shares must accompany such notice.



 



    B. Term and Exercise of Options.



 



    Each option granted under this Article Two shall be
    exercisable at such time or times, during such period, and for
    such number of shares as shall be determined by the Plan
    Administrator and set forth in the instrument evidencing the
    option grant. No such option, however, shall have a maximum term
    in excess of ten (10) years from the grant date. During the
    lifetime of the optionee, the option, together with any stock
    appreciation rights pertaining to such option, shall be
    exercisable only by the optionee and shall not be assignable or
    transferable by the optionee except for a transfer of the option
    by will or by the laws of descent and distribution following the
    optionee’s death. However, the Plan Administrator shall
    have the discretion to provide that a non-statutory option may,
    in connection with the optionee’s estate plan, be assigned
    in whole or in part during the optionee’s lifetime either
    as (i) as a gift to one or more members of optionee’s
    immediate family, to a trust in which optionee
    and/or one
    or more such family members hold more than fifty percent (50%)
    of the beneficial interest or an entity in which more than fifty
    percent (50%) of the voting interests are owned by optionee
    and/or one
    or more such family members, or (ii) pursuant to a domestic
    relations order. The assigned portion shall be exercisable only
    by the person or persons who acquire a proprietary interest in
    the option pursuant to such assignment. The terms applicable to
    the assigned portion shall be the same as those in effect for
    this option immediately prior to such assignment and shall be
    set forth in such documents issued to the assignee as the Plan
    Administrator may deem appropriate.



 



    C. Termination of Service.



 



    1. Except to the extent otherwise provided pursuant to
    Section V of this Article Two, the following
    provisions shall govern the exercise period applicable to any
    options held by the optionee at the time of cessation of Service
    or death.



 



    (i) Should the optionee cease to remain in Service for any
    reason other than death or permanent disability, then the period
    for which each outstanding option held by such optionee is to
    remain exercisable shall be limited to the three (3)-month
    period following the date of such cessation of Service. However,
    should optionee die during the three (3)-month period following
    his or her cessation of service, the personal representative of
    the optionee’s estate or the person or persons to whom the
    option is






    










 







    transferred pursuant to the optionee’s will or in
    accordance with the laws of descent and distribution shall have
    a twelve (12)-month period following the date of the
    optionee’s death during which to exercise such option.



 



    (ii) In the event such Service terminates by reason of
    permanent disability (as defined in Section 22(e)(3) of the
    Internal Revenue Code), then the period for which each
    outstanding option held by the optionee is to remain exercisable
    shall be limited to the twelve (12)-month period following the
    date of such cessation of Service.



 



    (iii) Should the optionee, after completing five
    (5) full years of service, die while in Service, then the
    exercisability of each of his or her outstanding options shall
    automatically accelerate so that each such option shall become
    fully exercisable with respect to the total number of shares of
    Common Stock at the time subject to such option and may be
    exercised for all or any portion of such shares. The personal
    representative of the optionee’s estate or the person or
    persons to whom the option is transferred pursuant to the
    optionee’s will or in accordance with the laws of descent
    and distribution shall have a twelve (12)-month period following
    the date of the optionee’s death during which to exercise
    such option.



 



    (iv) In the event such service terminates by reason of
    death prior to the optionee obtaining five (5) full years
    of service, then the period for which each outstanding vested
    option held by the optionee at the time of death shall be
    exercisable by the optionee’s estate or the person or
    persons to whom the option is transferred pursuant to the
    optionee’s will shall be limited to the twelve (12)-month
    period following the date of the optionee’s death.



 



    (v) Under no circumstances, however, shall any such option
    be exercisable after the specified expiration date of the option
    term.



 



    (vi) Each such option shall, during such limited exercise
    period, be exercisable for any or all of the shares for which
    the option is exercisable on the date of the optionee’s
    cessation of Service. Upon the expiration of such limited
    exercise period or (if earlier) upon the expiration of the
    option term, the option shall terminate and cease to be
    exercisable. However, each outstanding option shall immediately
    terminate and cease to remain outstanding, at the time of the
    optionee’s cessation of Service, with respect to any shares
    for which the option is not otherwise at that time exercisable
    or in which the optionee is not otherwise vested.



 



    (vii) Should (i) the optionee’s Service be
    terminated for misconduct (including, but not limited to, any
    act of dishonesty, willful misconduct, fraud or embezzlement) or
    (ii) the optionee make any unauthorized use or disclosure
    of confidential information or trade secrets of the Company or
    its parent or subsidiary corporations, then in any such event
    all outstanding options held by the optionee under this
    Article Two shall terminate immediately and cease to be
    exercisable.



 



    2. The Plan Administrator shall have complete discretion,
    exercisable either at the time the option is granted or at any
    time while the option remains outstanding, to permit one or more
    options held by the optionee under this Article Two to be
    exercised, during the limited period of exercisability provided
    under subparagraph 1 above, not only with respect to the number
    of shares for which each such option is exercisable at the time
    of the optionee’s cessation of Service but also with
    respect to one or more subsequent installments of purchasable
    shares for which the option would otherwise have become
    exercisable had such cessation of Service not occurred.



 



    3. For purposes of the foregoing provisions of this
    Section I.C (and for all other purposes under the Plan):



 



    (i) The optionee shall be deemed to remain in the
    Service of the Company for so long as such individual
    renders services on a periodic basis to the Company (or any
    parent or subsidiary corporation) in the capacity of an
    Employee, a non-employee member of the board of directors or an
    independent consultant or advisor, unless the agreement
    evidencing the applicable option grant specifically states
    otherwise.





    










 







    (ii) The optionee shall be considered to be an Employee
    for so long as such individual remains in the employ of the
    Company or one or more of its parent or subsidiary corporations,
    subject to the control and direction of the employer entity not
    only as to the work to be performed but also as to the manner
    and method of performance.



 



    D. Stockholder Rights.



 



    An optionee shall have no stockholder rights with respect to any
    shares covered by the option until such individual shall have
    exercised the option and paid the option price for the purchased
    shares.



 



    E. Repurchase Rights.



 



    The shares of Common Stock acquired upon the exercise of options
    granted under this Article Two may be subject to repurchase
    by the Company in accordance with the following provisions:



 



    1. The Plan Administrator shall have the discretion to
    grant options which are exercisable for unvested shares of
    Common Stock under this Article Two. Should the optionee
    cease Service while holding such unvested shares, the Company
    shall have the right to repurchase any or all those unvested
    shares at the option price paid per share. The terms and
    conditions upon which such repurchase right shall be exercisable
    (including the period and procedure for exercise and the
    appropriate vesting schedule for the purchased shares) shall be
    established by the Plan Administrator and set forth in the
    instrument evidencing such repurchase right.



 



    2. All of the Company’s outstanding repurchase rights
    shall automatically terminate, and all shares subject to such
    terminated rights shall immediately vest in full, upon the
    occurrence of any Corporate Transaction under Section III
    of this Article Two, except to the extent: (i) any
    such repurchase right is expressly assigned to the successor
    corporation (or parent thereof) in connection with the Corporate
    Transaction or (ii) such termination is precluded by other
    limitations imposed by the Plan Administrator at the time the
    repurchase right is issued.



 



    3. The Plan Administrator shall have the discretionary
    authority, exercisable either before or after the
    optionee’s cessation of Service, to cancel the
    Corporation’s outstanding repurchase rights with respect to
    one or more shares purchased or purchasable by the optionee
    under this Discretionary Option Grant Program and thereby
    accelerate the vesting of such shares in whole or in part at any
    time.



 


		
	
    II.  
	
    INCENTIVE
    OPTIONS




 



    The terms and conditions specified below shall be applicable to
    all Incentive Options granted under this Article Two.
    Incentive Options may only be granted to individuals who are
    Employees of the Company. Options which are specifically
    designated as “non-statutory” options when issued
    under the Plan shall not be subject to such terms and conditions.



 



    A. Dollar Limitation. The aggregate fair
    market value (determined as of the respective date or dates of
    grant) of the Common Stock for which one or more options granted
    to any Employee under this Plan (or any other option plan of the
    Company or its parent or subsidiary corporations) may for the
    first time become exercisable as incentive stock options under
    the Federal tax laws during any one calendar year shall not
    exceed the sum of One Hundred Thousand Dollars ($100,000). To
    the extent the Employee holds two or more such options which
    become exercisable for the first time in the same calendar year,
    the foregoing limitation on the exercisability of such options
    as incentive stock options under the Federal tax laws shall be
    applied on the basis of the order in which such options are
    granted. Should the number of shares of Common Stock for which
    any Incentive Option first becomes exercisable in any calendar
    year exceed the applicable One Hundred Thousand Dollar
    ($100,000) limitation, then that option may nevertheless be
    exercised in such calendar year for the excess number of shares
    as a non-statutory option under the Federal tax laws.



 



    B. 10% Stockholder. If any individual to whom
    an Incentive Option is granted is the owner of stock (as
    determined under Section 424(d) of the Internal Revenue
    Code) possessing 10% or more of the total combined voting power
    of all classes of stock of the Company or any one of its parent
    or subsidiary corporations, then the option price per share
    shall not be less than one hundred and ten percent (110%) of the
    fair market value






    










 







    per share of Common Stock on the grant date, and the option term
    shall not exceed five (5) years, measured from the grant
    date.



 



    C. Termination of Employment. Any portion of
    an Incentive Option that remains outstanding (by reason of the
    optionee remaining in the Service of the Company, pursuant to
    the Plan Administrator’s exercise of discretion under
    Section V of this Article Two, or otherwise) more than
    3 months following the date an optionee ceases to be an
    Employee of the Company shall thereafter be exercisable as a
    non-statutory option under federal tax laws.



 



    Except as modified by the preceding provisions of this
    Section II, the provisions of Articles One, Two and
    Five of the Plan shall apply to all Incentive Options granted
    hereunder.



 


		
	
    III.  
	
    CORPORATE
    TRANSACTIONS/CHANGES IN CONTROL




 



    A. In the event of any of the following
    stockholder-approved transactions (a “Corporate
    Transaction”):



 



    (1) a merger or consolidation in which the Company is not
    the surviving entity, except for a transaction the principal
    purpose of which is to change the State of the Company’s
    incorporation,



 



    (2) the sale, transfer or other disposition of all or
    substantially all of the assets of the Company in liquidation or
    dissolution of the Company, or



 



    (3) any 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 the
    Company’s outstanding securities are transferred to a
    person or persons different from the persons holding those
    securities immediately prior to such merger,



 



    then the exercisability of each option outstanding under this
    Article Two shall automatically accelerate so that each
    such option shall, immediately prior to the specified effective
    date for the Corporate Transaction, become fully exercisable
    with respect to the total number of shares of Common Stock at
    the time subject to such option and may be exercised for all or
    any portion of such shares. However, an outstanding option under
    this Article Two shall not so accelerate if and to
    the extent the acceleration of such option is subject to other
    limitations imposed by the Plan Administrator at the time of
    grant, unless the Plan Administrator, in its discretion, later
    determines to waive such limitations.



 



    B. Immediately after the consummation of the Corporate
    Transaction, all outstanding options under this Article Two
    shall terminate and cease to be outstanding, except to the
    extent assumed by the successor corporation or its parent
    company. The Plan Administrator shall have complete discretion
    to provide, on such terms and conditions as it sees fit, for a
    cash payment to be made to any optionee on account of any option
    terminated in accordance with this paragraph, in an amount equal
    to the excess (if any) of (A) the fair market value of the
    shares subject to the option as of the date of the Corporate
    Transaction, over (B) the aggregate exercise price of the
    option.



 



    C. Each outstanding option under this Article Two
    which is assumed in connection with the Corporate Transaction or
    is otherwise to continue in effect shall be appropriately
    adjusted, immediately after such Corporate Transaction, to apply
    and pertain to the number and class of securities which would
    have been issued to the option holder, in consummation of such
    Corporate Transaction, had such person exercised the option
    immediately prior to such Corporate Transaction. Appropriate
    adjustments shall also be made to the option price payable per
    share, provided the aggregate option price payable for
    such securities shall remain the same. In addition, the class
    and number of securities available for issuance under the Plan
    following the consummation of the Corporate Transaction shall be
    appropriately adjusted.



 



    D. The grant of options under this Article Two shall
    in no way affect the right of the Company to adjust, reclassify,
    reorganize or otherwise change its capital or business structure
    or to merge, consolidate, dissolve, liquidate or sell or
    transfer all or any part of its business or assets.





    










 







    E. The exercisability of each outstanding option under this
    Article Two shall automatically accelerate, and the
    Company’s outstanding repurchase rights under this
    Article Two shall immediately terminate upon the occurrence
    of a Change in Control.



 



    F. For purposes of this Section III (and for all other
    purposes under the Plan), a Change in Control shall be deemed to
    occur in the event:



 



    (1) any person or related group of persons (other than the
    Company or a person that directly or indirectly controls, is
    controlled by, or is under common control with, the Company)
    directly or indirectly acquires beneficial ownership (within the
    meaning of
    Rule 13d-3
    of the 1934 Act) of securities possessing more than fifty
    percent (50%) of the total combined voting power of the
    Company’s outstanding securities pursuant to a tender or
    exchange offer made directly to the Company’s
    stockholders; or



 



    (2) there is a change in the composition of the Board over
    a period of twenty-four (24) consecutive months or less
    such that a majority of the Board members (rounded up to the
    next whole number) ceases, by reason of one or more contested
    elections for Board membership, to be comprised of individuals
    who either (A) have been Board members continuously since
    the beginning of such period or (B) have been elected or
    nominated for election as Board members during such period by at
    least two-thirds of the Board members described in
    clause (A) who were still in office at the time such
    election or nomination was approved by the Board.



 



    G. All options accelerated in connection with the Change in
    Control shall remain fully exercisable until the expiration or
    sooner termination of the option term.



 



    H. The portion of any Incentive Option accelerated under
    this Section III in connection with a Corporate Transaction
    or Change in Control shall remain exercisable as an incentive
    stock option under the Federal tax laws only to the extent the
    dollar limitation of Section II of this Article Two is
    not exceeded. To the extent such dollar limitation is exceeded,
    the accelerated portion of such option shall be exercisable as a
    non-statutory option under the Federal tax laws.



 


		
	
    IV.  
	
    STOCK
    APPRECIATION RIGHTS




 



    A. Provided and only if the Plan Administrator determines
    in its discretion to implement the stock appreciation right
    provisions of this Section IV, one or more optionees may be
    granted the right, exercisable upon such terms and conditions as
    the Plan Administrator may establish, to surrender all or part
    of an unexercised option granted under this Article Two in
    exchange for a distribution from the Company in an amount equal
    to the excess of (i) the fair market value (on the option
    surrender date) of the number of shares in which the optionee is
    at the time vested under the surrendered option (or surrendered
    portion thereof) over (ii) the aggregate option price
    payable for such vested shares. The distribution may be made in
    shares of Common Stock valued at fair market value on the option
    surrender date, in cash, or partly in shares and partly in cash,
    as the Plan Administrator shall determine in its sole discretion.



 



    B. The shares of Common Stock subject to any option
    surrendered for an appreciation distribution pursuant to this
    Section IV shall not be available for subsequent
    option grant under the Plan.



 


		
	
    V.  
	
    EXTENSION
    OF EXERCISE PERIOD




 



    The Plan Administrator shall have full power and authority,
    exercisable either at the time the option is granted or at any
    time while the option remains outstanding, to extend the period
    of time for which any option granted under this Article Two
    is to remain exercisable following the optionee’s cessation
    of Service or death from the limited period in effect under
    Section I.C.1 of Article Two to such greater period of
    time as the Plan Administrator shall deem appropriate;
    provided, however, that in no event shall such option be
    exercisable after the specified expiration date of the option
    term.





    










 








    ARTICLE THREE

    



 




    STOCK
    ISSUANCE PROGRAM



 


		
	
    I.  
	
    STOCK
    ISSUANCE TERMS




 



    Shares of Common Stock may be issued under the Stock Issuance
    Program through direct and immediate issuances without any
    intervening option grants. Each such stock issuance shall be
    evidenced by a Stock Issuance Agreement which complies with the
    terms specified below. Shares of Common Stock may also be issued
    under the Stock Issuance Program pursuant to share right awards
    which entitle the recipients to receive shares upon the
    attainment of designated Service
    and/or
    performance goals.



 



    A. Purchase Price.



 



    1. The purchase price per share shall be fixed by the Plan
    Administrator, but shall not be less than one hundred percent
    (100%) of the fair market value per share of Common Stock on the
    issuance date.



 



    2. Shares of Common Stock may be issued under the Stock
    Issuance Program for any of the following items of consideration
    which the Plan Administrator may deem appropriate in each
    individual instance:



 



    (i) cash or check made payable to the Company, or



 



    (ii) services rendered to the Company (or any parent or
    subsidiary).



 



    B. Vesting Provisions.



 



    1. The Plan Administrator may issue shares of Common Stock
    under the Stock Issuance Program which are fully and immediately
    vested upon issuance or which are to vest in one or more
    installments over the participant’s period of Service or
    upon attainment of specified performance objectives.
    Alternatively, the Plan Administrator may issue share right
    awards under the Stock Issuance Program which shall entitle the
    recipient to receive a specified number of shares of Common
    Stock upon the attainment of one or more Service
    and/or
    performance goals established by the Plan Administrator. Upon
    the attainment of such Service
    and/or
    performance goals, fully-vested shares of Common Stock shall be
    issued in satisfaction of those share right awards.



 



    2. Any new, substituted or additional securities or other
    property (including money paid other than as a regular cash
    dividend) issued by reason of any stock dividend, stock split,
    recapitalization, combination of shares, exchange of shares or
    other change affecting the outstanding Common Stock as a class
    without the Company’s receipt of consideration, shall be
    issued or set aside with respect to the shares of unvested
    Common Stock granted to a participant or subject to a
    participant’s share right award, subject to (i) the
    same vesting requirements applicable to the participant’s
    unvested shares of Common Stock or share rights award, and
    (ii) such escrow arrangements as the Plan Administrator
    shall deem appropriate.



 



    3. The participant shall have full stockholder rights with
    respect to any shares of Common Stock issued to the participant
    under the Stock Issuance Program, whether or not the
    participant’s interest in those shares is vested.
    Accordingly, the participant shall have the right to vote such
    shares and to receive any regular cash dividends paid on such
    shares.



 



    4. The participant shall not have any stockholders rights
    with respect to any shares of Common Stock subject to a share
    right award. However, the Plan Administrator may provide for a
    participant to receive one or more dividend equivalents with
    respect to such shares, entitling the participant to all regular
    cash dividends payable on the shares of Common Stock underlying
    the share right award, which amounts shall be (i) subject
    to the same vesting requirements applicable to the shares of
    Common Stock underlying the share rights award, and
    (ii) payable upon issuance of the shares to which such
    dividend equivalents relate.





    










 







    5. Should the participant cease to remain in Service while
    holding one or more unvested shares of Common Stock issued under
    the Stock Issuance Program or should the performance objectives
    not be attained with respect to one or more such unvested shares
    of Common Stock, then those shares shall be immediately
    surrendered to the Company for cancellation, and the participant
    shall have no further stockholder rights with respect to those
    shares. To the extent the surrendered shares were previously
    issued to the participant for consideration paid in cash, the
    Company shall repay to the participant the cash consideration
    paid for the surrendered shares.



 



    6. The Plan Administrator may in its discretion waive the
    surrender and cancellation of one or more unvested shares of
    Common Stock which would otherwise occur upon the cessation of
    the Participant’s Service or the non-attainment of the
    performance objectives applicable to those shares. Such waiver
    shall result in the immediate vesting of the participant’s
    interest in the shares of Common Stock as to which the waiver
    applies. Such waiver may be effected at any time, whether before
    or after the participant’s cessation of Service or the
    attainment or non-attainment of the applicable performance
    objectives.



 



    7. Outstanding share right awards under the Stock Issuance
    Program shall automatically terminate, and no shares of Common
    Stock shall actually be issued in satisfaction of those awards,
    if the Service
    and/or
    performance goals established for such awards are not attained.
    The Plan Administrator, however, shall have the discretionary
    authority to issue shares of Common Stock in satisfaction of one
    or more outstanding share right awards as to which the
    designated Service
    and/or
    performance goals are not attained. Such authority may be
    exercised at any time, whether before or after the
    participant’s cessation of Service or the attainment or
    non-attainment of the applicable performance objectives.



 


		
	
    II.  
	
    CORPORATE
    TRANSACTION/CHANGE IN CONTROL




 



    A. All of the Company’s outstanding repurchase rights
    under the Stock Issuance Program shall terminate automatically,
    and all the shares of Common Stock subject to those terminated
    rights shall immediately vest in full, in the event of any
    Corporate Transaction, except to the extent (i) those
    repurchase rights are to be assigned to the successor
    corporation (or parent thereof) in connection with the such
    Corporate Transaction, or (ii) such accelerated vesting is
    precluded by other limitations imposed in the Stock Issuance
    Agreement, unless the Plan Administrator determines to waive
    such limitations.



 



    B. Each repurchase right which is assigned in connection
    with (or is otherwise to continue in effect after) a Corporate
    Transaction shall be appropriately adjusted such that it shall
    apply and pertain to the number and class of securities issued
    to the participant in consummation of the Corporate Transaction
    with respect to the shares granted to participant under this
    Article III.



 



    C. All of the Company’s outstanding repurchase rights
    under the Stock Issuance Program shall automatically terminate,
    and all shares of Common Stock subject to those terminated
    rights shall immediately vest, in the event of any Change in
    Control.



 



    D. All shares of Common Stock underlying outstanding share
    right awards issued under the Stock Issuance Program shall vest,
    and all of the shares of Common Stock subject to such share
    right awards shall be issued to participants, immediately prior
    to the consummation of any Corporate Transaction or Change in
    Control.



 


		
	
    III.  
	
    SHARE
    ESCROW / LEGENDS




 



    Unvested shares may, in the Plan Administrator’s
    discretion, be held in escrow by the Company until the
    participant’s interest in such shares vests or may be
    issued directly to the participant with restrictive legends on
    the certificates evidencing those unvested shares.





    










 








    ARTICLE FOUR

    



 




    AUTOMATIC
    OPTION GRANT PROGRAM



 




    I. ELIGIBILITY.



 



    The individuals eligible to receive automatic option grants
    pursuant to the provisions of this Article Four shall be
    (i) those individuals who, after the effective date of this
    amendment and restatement, first become non-employee Board
    members, whether through appointment by the Board, election by
    the Company’s stockholders, or by continuing to serve as a
    Board member after ceasing to be employed by the Company, and
    (ii) those individuals already serving as non-employee
    Board members on the effective date of this amendment and
    restatement. As used herein, a “non-employee” Board
    member is any Board member who is not employed by the Company on
    the date in question.



 


		
	
    II.  
	
    TERMS AND
    CONDITIONS OF AUTOMATIC OPTION GRANTS




 



    A. Grants. Option grants shall be made under
    this Article Three as follows:



 



    1. Each individual who first becomes a non-employee Board
    member on or after the effective date of this amendment and
    restatement shall automatically be granted at such time a
    non-statutory stock option under the terms and conditions of
    this Article Four, to purchase a number shares of Common
    Stock equal to the product of (i) 20,000, and (ii) a
    fraction, the numerator of which is the number of months
    (rounded to the nearest whole number) remaining between the date
    such Board member first became a non-employee Board member and
    the Company’s next scheduled Annual Stockholders Meeting,
    and the denominator of which is 12.



 



    2. Immediately following each Annual Stockholders Meeting
    of the Company, each individual who is then serving as a
    non-employee Board member (except for those individuals first
    elected to serve as non-employee Board members at such meeting),
    shall automatically be granted a non-statutory stock option
    under this Article Four to acquire 15,000 shares of
    Common Stock.



 



    B. Exercise Price. The exercise price per
    share of each automatic option grant made under this
    Article Four shall be equal to one hundred percent (100%)
    of the fair market value per share of Common Stock on the
    automatic grant date.



 



    C. Payment. The exercise price shall be
    payable in one of the alternative forms specified below:



 



    (1) payment in cash or check made payable to the
    Company’s order; or



 



    (2) full payment in shares of Common Stock held for the
    requisite period necessary to avoid a charge to the
    Company’s reported earnings and valued at fair market value
    on the Exercise Date (as such term is defined below); or



 



    (3) full payment in a combination of shares of Common Stock
    held for the requisite period necessary to avoid a charge to the
    Company’s reported earnings and valued at fair market value
    on the Exercise Date and cash or check payable to the
    Company’s order; or



 



    (4) full payment through a sale and remittance procedure
    pursuant to which the non-employee Board member (I) shall
    provide irrevocable written instructions to a designated
    brokerage firm to effect the immediate sale of the purchased
    shares and remit to the Company, out of the sale proceeds
    available on the settlement date, sufficient funds to cover the
    aggregate exercise price payable for the purchased shares and
    shall (II) concurrently provide written directives to the
    Company to deliver the certificates for the purchased shares
    directly to such brokerage firm in order to complete the sale
    transaction.



 



    For purposes of this subparagraph C, the Exercise Date shall be
    the date on which written notice of the option exercise is
    delivered to the Company. Except to the extent the sale and
    remittance procedure specified above is utilized for the
    exercise of the option, payment of the option price for the
    purchased shares must accompany the exercise notice.





    










 







    D. Option Term. Each automatic grant under
    this Article Four shall have a term of ten (10) years
    measured from the automatic grant date.



 



    E.  Exercisability.



 



    1. Each initial automatic grant made pursuant to
    Section II.A.1 of this Article Four shall vest and
    become exercisable over the period extending from the date of
    grant to the scheduled date of the next Annual Stockholders
    Meeting following the grant. A pro rata portion of such
    automatic grant shall vest on the last day of each calendar
    month following the date of grant, with the final portion
    vesting on the scheduled date of such Annual Stockholders
    Meeting.



 



    2. Each 15,000 share automatic grant made pursuant to
    Section II.A.2 of this Article Four shall vest and
    become exercisable for 1/12th of the option shares upon the
    optionee’s completion of each month of Board service over
    the twelve (12)-month period measured from the automatic grant
    date.



 



    F. Non-Transferability. During the lifetime
    of the optionee, each automatic option, together with the
    limited stock appreciation right pertaining to such option,
    shall be exercisable only by the optionee, except to the extent
    such option or the limited stock appreciation right is assigned
    or transferred (i) by will or by the laws of descent and
    distribution following the optionee’s death, or
    (ii) during optionee’s lifetime either (A) as a
    gift in connection with the optionee’s estate plan to one
    or more members of optionee’s immediate family, to a trust
    in which optionee
    and/or one
    or more such family members hold more than fifty percent (50%)
    of the beneficial interest or to an entity in which more than
    fifty percent (50%) of the voting interests are owned by
    optionee
    and/or one
    or more such family members, or (B) pursuant to a domestic
    relations order. The portion of any option assigned or
    transferred during optionee’s lifetime shall be exercisable
    only by the person or persons who acquire a proprietary interest
    in the option pursuant to such assignment. The terms applicable
    to the assigned portion shall be the same as those in effect for
    this option immediately prior to such assignment and shall be
    set forth in such documents issued to the assignee as the Plan
    Administrator may deem appropriate.



 



    G. Cessation of Board Service.



 



    1. Should the optionee cease to serve as a Board member for
    any reason while holding one or more automatic option grants
    under this Article Four, then such optionee shall have the
    remainder of the ten (10) year term of each such option in
    which to exercise each such option for any or all of the shares
    of Common Stock for which the option is exercisable at the time
    of such cessation of Board service. Each such option shall
    immediately terminate and cease to be outstanding, at the time
    of such cessation of Board service, with respect to any shares
    for which the option is not otherwise at that time exercisable.
    Upon the expiration of the ten (10)-year option term, the
    automatic grant shall terminate and cease to be outstanding in
    its entirety. Upon the death of the optionee, whether before or
    after cessation of Board service, any option held by optionee at
    the time of optionee’s death may be exercised, for any or
    all of the shares of Common Stock for which the option was
    exercisable at the time of cessation of Board service by the
    optionee and which have not been theretofore exercised by the
    optionee, by the personal representative of the optionee’s
    estate or by the person or persons to whom the option is
    transferred pursuant to the optionee’s will or in
    accordance with the laws of descent and distribution. Any such
    exercise must occur during the reminder of the ten
    (10) year term of such option.



 



    H. Stockholder Rights. The holder of an
    automatic option grant under this Article Four shall have
    none of the rights of a stockholder with respect to any shares
    subject to such option until such individual shall have
    exercised the option and paid the exercise price for the
    purchased shares.



 


		
	
    III.  
	
    CORPORATE
    TRANSACTIONS/CHANGES IN CONTROL




 



    A. In the event of a Corporate Transaction, the
    exercisability of each option outstanding under this
    Article Four shall automatically accelerate so that each
    such option shall, immediately prior to the specified effective
    date for the Corporate Transaction, become fully exercisable
    with respect to the total number of shares of Common Stock at
    the time subject to such option and may be exercised for all or
    any portion of such shares.





    










 







    B. Immediately after the consummation of the Corporate
    Transaction, all outstanding options under this
    Article Four shall terminate and cease to be outstanding,
    except to the extent assumed by the successor corporation or its
    parent company. If so provided by the terms of the Corporate
    Transaction, the optionee shall receive a cash payment on
    account of any option terminated in accordance with this
    paragraph, in an amount equal to the excess (if any) of
    (A) the fair market value of the shares subject to the
    option as valued pursuant to the Corporate Transaction over
    (B) the aggregate exercise price of the option.



 



    C. Each outstanding option under this Article Four
    which is assumed in connection with the Corporate Transaction or
    is otherwise to continue in effect shall be appropriately
    adjusted, immediately after such Corporate Transaction, to apply
    and pertain to the number and class of securities which would
    have been issued to the option holder, in consummation of such
    Corporate Transaction, had such person exercised the option
    immediately prior to such Corporate Transaction. Appropriate
    adjustments shall also be made to the option price payable per
    share, provided the aggregate option price payable for
    such securities shall remain the same.



 



    D. In connection with any Change in Control, the
    exercisability of each option grant outstanding at the time
    under this Article Four shall automatically accelerate so
    that each such option shall, immediately prior to the specified
    effective date for the Change in Control, become fully
    exercisable with respect to the total number of shares of Common
    Stock at the time subject to such option and may be exercised
    for all or any portion of such shares.



 



    E. The automatic grant of options under this
    Article Four shall in no way affect the right of the
    Company to adjust, reclassify, reorganize or otherwise change
    its capital or business structure or to merge, consolidate,
    dissolve, liquidate or sell or transfer all or any part of its
    business or assets.



 


		
	
    IV.  
	
    STOCK
    APPRECIATION RIGHTS




 



    A. With respect to options granted under the Automatic
    Option Grant Program prior to March 7, 2006:



 



    1. Upon the occurrence of a Hostile Take-Over, the optionee
    shall have a thirty (30)-day period in which to surrender to the
    Company each option held by him or her under this Article Four.
    The optionee shall in return be entitled to a cash distribution
    from the Company in an amount equal to the excess of
    (i) the Take-Over Price of the shares of Common Stock at
    the time subject to each surrendered option (whether or not the
    option is then exercisable for those shares) over (ii) the
    aggregate exercise price payable for such shares. The cash
    distribution shall be made within five (5) days following
    the date the option is surrendered to the Company, and neither
    the approval of the Plan Administrator nor the consent of the
    Board shall be required in connection with the option surrender
    and cash distribution. Any unsurrendered portion of the option
    shall continue to remain outstanding and become exercisable in
    accordance with the terms of the instrument evidencing such
    grant. This limited stock appreciation right shall in all events
    terminate upon the expiration or sooner termination of the
    option term and may not be assigned or transferred by the
    optionee.



 



    2. For purposes of Article Four, the following
    definitions shall be in effect:



 



    (i) A Hostile Take-Over shall be deemed to occur in
    the event any person or related group of persons (other than the
    Company or a person that directly or indirectly controls, is
    controlled by, or is under common control with, the Company)
    directly or indirectly acquires beneficial ownership (within the
    meaning of
    Rule 13d-3
    of the 1934 Act, as amended) of securities possessing more
    than fifty percent (50%) of the total combined voting power of
    the Company’s outstanding securities pursuant to a tender
    or exchange offer made directly to the Company’s
    stockholders which the Board does not recommend such
    stockholders to accept.



 



    (ii) The Take-Over Price per share shall be deemed
    to be equal to the fair market value per share on the option
    surrender date.



 



    B. With respect to each option granted under the Automatic
    Option Grant Program on and after March 7, 2006, each
    optionee shall have the right to surrender all or part of the
    option (to the extent not then exercised)






    










 







    in exchange for a distribution from the Company in an amount
    equal to the excess of (i) the fair market value (on the
    option surrender date) of the number of shares in which the
    optionee is at the time vested under the surrendered option (or
    surrendered portion thereof) over (ii) the aggregate option
    price payable for such vested shares. The distribution shall be
    made in shares of Common Stock valued at fair market value on
    the option surrender date.



 



    C. The shares of Common Stock subject to any option
    surrendered for an appreciation distribution pursuant to this
    Section IV shall not be available for subsequent
    option grant under the Plan.



 




    ARTICLE FIVE

    



 




    MISCELLANEOUS



 


		
	
    I.  
	
    AMENDMENT
    OF THE PLAN




 



    The Board shall have complete and exclusive power and authority
    to amend or modify the Plan in any or all respects whatsoever.
    However, no such amendment or modification shall, without the
    consent of the holders, adversely affect rights and obligations
    with respect to options at the time outstanding under the Plan.
    In addition, certain amendments may require stockholder approval
    pursuant to applicable laws or regulations.



 


		
	
    II.  
	
    TAX
    WITHHOLDING




 



    A. The Company’s obligation to deliver shares or cash
    upon the exercise of stock options or stock appreciation rights
    or upon the grant or vesting of direct stock issuances under the
    Plan shall be subject to the satisfaction of all applicable
    Federal, State and local income and employment tax withholding
    requirements.



 



    B. The Plan Administrator may, in its discretion and upon
    such terms and conditions as it may deem appropriate, provide
    any or all holders of outstanding options or stock issuances
    under the Plan (other than the automatic option grants under
    Article Four) with the election to have the Company
    withhold, from the shares of Common Stock otherwise issuable
    upon the exercise or vesting of such awards, a whole number of
    such shares with an aggregate fair market value equal to the
    minimum amount necessary to satisfy the Federal, State and local
    income and employment tax withholdings (the “Taxes”)
    incurred in connection with the acquisition or vesting of such
    shares. In lieu of such direct withholding, one or more
    participants may also be granted the right to deliver whole
    shares of Common Stock to the Company in satisfaction of such
    Taxes. Any withheld or delivered shares shall be valued at their
    fair market value on the applicable determination date for such
    Taxes.



 


		
	
    III.  
	
    EFFECTIVE
    DATE AND TERM OF PLAN




 



    A. The Plan, as amended and restated, shall be effective on
    the date specified in the Board of Directors resolution adopting
    the Plan. Except as provided below, each option issued and
    outstanding under the Plan immediately prior to such effective
    date shall continue to be governed solely by the terms and
    conditions of the agreement evidencing such grant, and nothing
    in this restatement of the Plan shall be deemed to affect or
    otherwise modify the rights or obligations of the holders of
    such options with respect to their acquisition of shares of
    Common Stock thereunder. The Plan Administrator shall, however,
    have full power and authority, under such circumstances as the
    Plan Administrator may deem appropriate (but in accordance with
    Article I of this Section Five), to extend one or more
    features of this amendment and restatement to any options
    outstanding on the effective date.



 



    B. Unless sooner terminated in accordance with the other
    provisions of this Plan, the Plan shall terminate upon the
    earlier of (i) March 6, 2016 or (ii) the
    date on which all shares available for issuance under the Plan
    shall have been issued or cancelled pursuant to the exercise,
    surrender or cash-out of the options granted hereunder. If the
    date of termination is determined under clause (i) above,
    then any options or stock issuances outstanding on such date
    shall continue to have force and effect in accordance with the
    provisions of the agreements evidencing those awards.





    










 







    C. Options may be granted with respect to a number of
    shares of Common Stock in excess of the number of shares at the
    time available for issuance under the Plan, provided each
    granted option is not to become exercisable, in whole or in
    part, at any time prior to stockholder approval of an amendment
    authorizing a sufficient increase in the number of shares
    issuable under the Plan.



 


		
	
    IV.  
	
    USE OF
    PROCEEDS




 



    Any cash proceeds received by the Company from the sale of
    shares pursuant to options or stock issuances granted under the
    Plan shall be used for general corporate purposes.



 


		
	
    V.  
	
    REGULATORY
    APPROVALS




 



    A. The implementation of the Plan, the granting of any
    option hereunder, and the issuance of stock (i) upon the
    exercise or surrender of any option or (ii) under the Stock
    Issuance Program shall be subject to the procurement by the
    Company of all approvals and permits required by regulatory
    authorities having jurisdiction over the Plan, the options
    granted under it and the stock issued pursuant to it.



 



    B. No shares of Common Stock or other assets shall be
    issued or delivered under the Plan unless and until there shall
    have been compliance with all applicable requirements of Federal
    and state securities laws, including (to the extent required)
    the filing and effectiveness of the
    Form S-8
    registration statement for the shares of Common Stock issuable
    under the Plan, and all applicable listing requirements of any
    stock exchange (or the Nasdaq National Market, if applicable) on
    which Common Stock is then trading.



 


		
	
    VI.  
	
    NO
    EMPLOYMENT/SERVICE RIGHTS




 



    Neither the action of the Company in establishing or restating
    the Plan, nor any action taken by the Plan Administrator
    hereunder, nor any provision of the Plan shall be construed so
    as to grant any individual the right to remain in the employ or
    service of the Company (or any parent or subsidiary corporation)
    for any period of specific duration, and the Company (or any
    parent or subsidiary corporation retaining the services of such
    individual) may terminate such individual’s employment or
    service at any time and for any reason, with or without cause.



 


		
	
    VII.  
	
    MISCELLANEOUS
    PROVISIONS




 



    A. Except to the extent otherwise expressly provided in the
    Plan, the right to acquire Common Stock or other assets under
    the Plan may not be assigned, encumbered or otherwise
    transferred by any participant.



 



    B. The provisions of the Plan relating to the exercise of
    options and the issuance
    and/or
    vesting of shares shall be governed by the laws of the State of
    Alabama without resort to that state’s
    conflict-of-laws
    provisions, as such laws are applied to contracts entered into
    and performed in such State.