Exhibit 10.1


 


SENESCO TECHNOLOGIES, INC.


 


2008 INCENTIVE
COMPENSATION PLAN


 


ARTICLE ONE


 


GENERAL PROVISIONS


I.             PURPOSE OF THE PLAN


 


This 2008 Incentive
Compensation Plan (the “Plan”) is intended to promote the interests of Senesco
Technologies, Inc., a Delaware corporation, by providing eligible persons
in the Corporation’s service with the opportunity to participate in one or more
cash or equity incentive compensation programs designed to encourage them to
continue their service relationship with the Corporation.


 


The Plan shall serve as the
successor to the Corporation’s 1998 Stock Incentive Plan (the “Predecessor Plan”),
and no further awards shall be granted under the Predecessor Plan after the
Plan Effective Date. All awards outstanding under the Predecessor Plan on the
Plan Effective Date shall continue to be governed solely by the terms of the
documents evidencing such award, and no provision of the Plan shall be deemed
to affect or otherwise modify the rights or obligations of the holders of such
transferred awards.


 


Capitalized terms shall have
the meanings assigned to such terms in the attached Appendix.


 


II.            TYPES OF AWARDS


 


Awards may be made under the
Plan in the form of (i) options, (ii) stock appreciation rights, (iii) stock
awards, (iv) restricted stock units, (v) cash awards, (vi) performance
units, and (vii) dividend equivalent rights.


 


III.          ADMINISTRATION OF THE PLAN


 


A.           The Compensation Committee shall have
sole and exclusive authority to administer the Plan with respect to Section 16
Insiders. Administration of the Plan with respect to all other persons eligible
to participate in the Plan may, at the Board’s discretion, be vested in the
Compensation Committee or a Secondary Board Committee, or the Board may retain
the power to administer those programs with respect to such persons.


 


B.            Members of the Compensation Committee or
any Secondary Board Committee shall serve for such period of time as the Board
may determine and may be removed by the Board at any time. The Board may also
at any time terminate the functions of any Secondary Board Committee and
reassume all powers and authority previously delegated to such committee.


 

















 


C.            To the extent permitted by and consistent
with applicable law, the Board may delegate to one or more executive officers
the power to grant awards to employees other than Section 16 Insiders.


 


D.           Each Plan Administrator shall, within the
scope of its administrative functions under the Plan, have full power and
authority (subject to the provisions of the Plan) to establish such rules and
regulations as it may deem appropriate for proper administration of the Plan
and to make such determinations under, and issue such interpretations of, the
provisions of the Plan and any outstanding Awards thereunder as it may deem
necessary or advisable. Decisions of the Plan Administrator within the scope of
its administrative functions under the Plan shall be final and binding on all
parties who have an interest in the Plan under its jurisdiction or any Award
thereunder.


 


E.            Service as a Plan Administrator by the
members of the Compensation Committee or the Secondary Board Committee shall
constitute service as Board members, and the 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 Compensation
Committee or the Secondary Board Committee shall be liable for any act or
omission made in good faith with respect to the Plan or any Award thereunder.


 


IV.          ELIGIBILITY


 


A.           The persons eligible to participate in
the Plan are as follows:


 


(i)            Employees,


 


(ii)           non-employee members of the Board or the
board of directors of any Parent or Subsidiary, and


 


(iii)          consultants
and other independent advisors who provide services to the Corporation (or any
Parent or Subsidiary).


 


B.            The Plan Administrator shall have full
authority to determine which eligible persons are to receive Awards under the
Plan, the time or times when those Awards are to be made, the number of shares
to be covered by each such Award, the time or times when the Award is to become
exercisable, the status of an option for federal tax purposes, the maximum term
for which an option or stock appreciation right is to remain outstanding, the
vesting and issuance schedules applicable to the shares which are the subject
of the Award, the cash consideration (if any) payable for those shares and the
form (cash or shares of Common Stock) in which the Award is to be settled and,
with respect to performance–based Awards, the performance objectives for each
such Award, the amounts payable at designated levels of attained performance,
any applicable service vesting requirements, and the payout schedule for each
such Award.


 


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V.            STOCK SUBJECT TO THE PLAN


 


A.           The stock issuable under the Plan shall
be shares of authorized but unissued or reacquired Common Stock, including
shares repurchased by the Corporation on the open market. The number of shares
of Common Stock initially reserved for issuance over the term of the Plan shall
be limited to five million one hundred and thirty seven thousand and two
hundred (5,137,200) shares.  Such reserve
shall consist of (i) the number of shares of Common Stock estimated to
remain available for issuance, as of the Plan Effective Date, under the
Predecessor Plan as last approved by the Corporation’s stockholders (excluding
shares subject to outstanding awards under the Predecessor Plan), plus (ii) an
additional increase of four million (4,000,000) shares. To the extent any
options or restricted stock units outstanding under the Predecessor Plan on the
Plan Effective Date expire or terminate unexercised or without the issuance of
shares thereunder, the number of shares of Common Stock subject to those expired
or terminated options and restricted stock units at the time of expiration or
termination shall be added to the share reserve under this Plan and shall
accordingly be available for issuance hereunder, up to a maximum of an
additional one million (1,000,000) shares.


 


B.            Each person participating in the Plan
shall be subject the following limitations:


 


(i)            for Awards denominated in shares of
Common Stock (whether payable in Common Stock, cash or a combination of both),
the maximum number of shares of Common Stock for which such Awards may be made
to such person in any calendar year shall not exceed one million (1,000,000)
shares of Common Stock in the aggregate, and


 


(ii)           for Awards denominated in dollars
(whether payable in cash, Common Stock or a combination of both), the maximum
dollar amount for which such Awards may be made in the aggregate to such person
shall not exceed one million Dollars ($1,000,000) per calendar year within the
applicable service or performance measurement period.


 


C.            Shares of Common Stock subject to
outstanding Awards made under the Plan (including Awards transferred to this
Plan from the Predecessor Plan) shall be available for subsequent issuance
under the Plan to the extent those Awards expire or terminate for any reason prior
to the issuance of the shares of Common Stock subject to those Awards. Unvested
shares issued under the Plan and subsequently forfeited or repurchased by the
Corporation, at a price per share not greater than the original issue price
paid per share, pursuant to the Corporation’s repurchase rights under the Plan
shall be added back to the number of shares of Common Stock reserved for
issuance under the Plan and shall accordingly be available for subsequent
reissuance. Should the exercise price of an option under the Plan be paid with
shares of Common Stock, then the authorized reserve of Common Stock under the
Plan shall be reduced only by the net number of shares issued under the
exercised stock option and not by the gross number of shares for which that option
is exercised. Upon the exercise of any stock appreciation right under the Plan,
the share reserve shall be reduced only by the net number of shares actually
issued by the Corporation upon such exercise and not by the gross number of
shares as to which such right is exercised. If shares of Common Stock otherwise
issuable under the Plan are withheld by the Corporation in satisfaction of the
withholding taxes incurred in connection with the exercise, vesting or
settlement of an Award, then the number of shares of Common Stock available for



 


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issuance under the Plan shall be reduced by the net
number of shares issued after such share withholding.


 


D.            Should any change be made to the Common
Stock by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares, spin-off transaction or other change
affecting the outstanding Common Stock as a class without the Corporation’s
receipt of consideration, or should the value of outstanding shares of Common
Stock be substantially reduced as a result of a spin-off transaction or an
extraordinary dividend or distribution, or should there occur any merger,
consolidation or other reorganization, then equitable adjustments shall be made
by the Plan Administrator to (i) the maximum number and/or class of
securities issuable under the Plan, (ii) the maximum number and/or class
of securities by which the share reserve under the Plan may increase by reason
of the expiration or termination of options or restricted stock units under the
Predecessor Plan, (iii) the maximum number and/or class of securities for
which any one person may be granted Common Stock-denominated Awards under the
Plan per calendar year, (iv) the number and/or class of securities and the
exercise or base price per share in effect under each outstanding award under
the Plan and the cash consideration (if any) payable per share, and (v) the
number and/or class of securities subject to the Corporation’s outstanding
repurchase rights under the Plan and the repurchase price payable per share.
The adjustments shall be made in such manner as the Plan Administrator deems
appropriate in order to prevent the dilution or enlargement of benefits under
the Plan and the outstanding Awards thereunder, and such adjustments shall be
final, binding and conclusive. In the event of a Change in Control, however,
the adjustments (if any) shall be made solely in accordance with the applicable
provisions of the Plan governing Change in Control transactions.


 


E.             Outstanding Awards granted pursuant to
the Plan shall in no way affect the right of the Corporation 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.


 


ARTICLE TWO


 


AWARDS


 


I.             OPTIONS


 


A.            Authority. The Plan Administrator shall have full
power and authority, exercisable in its sole discretion, to grant Incentive
Options and Nonstatutory Options evidenced by one or more Award Agreements in
the form approved by the Plan Administrator; provided, however, that each such
agreement shall comply with the terms specified below. Each agreement
evidencing an Incentive Option shall, in addition, be subject to the provisions
of Section H below.


 


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B.            Exercise Price.


 


(i)            The exercise price per share shall be
fixed by the Plan Administrator; provided, however, that such exercise price
shall not be less than one hundred percent (100%) of the Fair Market Value per
share of Common Stock on the grant date.


 


(ii)           The exercise price shall become
immediately due upon exercise of the option and shall, subject to the
provisions of the documents evidencing the option, be payable in one or more of
the forms specified below:


 


(1)           cash or check made payable to the
Corporation,


 


(2)           shares of Common Stock (whether delivered
in the form of actual stock certificates or through attestation of ownership)
held for the requisite period (if any) necessary to avoid any resulting charge
to the Corporation’s earnings for financial reporting purposes and valued at
Fair Market Value on the Exercise Date, or


 


(3)           to the extent the option is exercised for
vested shares of Common Stock, through a special sale and remittance procedure
pursuant to which the Participant shall concurrently provide instructions to (a) a
brokerage firm (reasonably satisfactory to the Corporation for purposes of
administering such procedure in compliance with the Corporation’s
pre-clearance/pre-notification policies) to effect the immediate sale of the
purchased shares and remit to the Corporation, out of the sale proceeds
available on the settlement date, sufficient funds to cover the aggregate
exercise price payable for the purchased shares plus all applicable income and
employment taxes required to be withheld by the Corporation by reason of such
exercise and (b) the Corporation to deliver the certificates for the
purchased shares directly to such brokerage firm on such settlement date
in order to complete the sale.


 


Except to the extent such
sale and remittance procedure is utilized, payment of the exercise price for
the purchased shares must be made on the Exercise Date.


 


C.            Exercise and Term of
Options.
Each option 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 Award Agreements evidencing the option. However, no option
shall have a term in excess of ten (10) years measured from the option
grant date.


 


D.           Effect of Termination of
Service.


 


(i)            The following provisions shall govern the
exercise of any options that are outstanding at the time of the Participant’s
cessation of Service or death:


 


(1)           Any option outstanding at the time of the
Participant’s cessation of Service for any reason shall remain exercisable for
such period of time thereafter as shall be determined by the Plan Administrator
and set forth in the documents evidencing the option, but no such option shall
be exercisable after the expiration of the option term.


 


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(2)           Any option held by the Participant at the
time of the Participant’s death and exercisable in whole or in part at that
time may be subsequently exercised by the personal representative of the
Participant’s estate or by the person or persons to whom the option is
transferred pursuant to the Participant’s will or the laws of inheritance or by
the Participant’s designated beneficiary or beneficiaries of that option.


 


(3)           Should the Participant’s Service be
terminated for Misconduct or should the Participant otherwise engage in
Misconduct while holding one or more outstanding options granted under this Article Two,
then all of those options shall terminate immediately and cease to be
outstanding.


 


(4)           During the applicable post-Service
exercise period, the option may not be exercised for more than the number of
vested shares for which the option is at the time exercisable; provided, however,
that one or more options may be structured so that those options continue to
vest in whole or part during the applicable post-Service exercise period. Upon
the expiration of the applicable exercise period or (if earlier) upon the
expiration of the option term, the option shall terminate and cease to be
outstanding for any shares for which the option has not been exercised.


 


(ii)           The Plan Administrator shall have
complete discretion, exercisable either at the time an option is granted or at
any time while the option remains outstanding, to:


 


(1)           extend the period of time for which the
option is to remain exercisable following the Participant’s cessation of
Service from the limited exercise period otherwise in effect for that option to
such greater period of time as the Plan Administrator shall deem appropriate,
but in no event beyond the expiration of the option term;


 


(2)           include an automatic extension provision
whereby the specified post-Service exercise period in effect for any option
shall automatically be extended by an additional period of time equal in
duration to any interval within the specified post-Service exercise period
during which the exercise of that option or the immediate sale of the shares
acquired under such option could not be effected in compliance with applicable
federal and state securities laws, but in no event shall such an extension
result in the continuation of such option beyond the expiration date of the
term of that option; and/or


 


(3)           permit the option to be exercised, during
the applicable post-Service exercise period, not only with respect to the
number of vested shares of Common Stock for which such option is exercisable at
the time of the Participant’s cessation of Service but also with respect to one
or more additional installments in which the Participant would have vested had
the Participant continued in Service.


 


E.            Stockholder Rights. The holder of an option shall have no
stockholder rights with respect to the shares subject to the option until such
person shall have exercised the option, paid the exercise price and become a
holder of record of the purchased shares.


 


F.            Repurchase Rights. The Plan Administrator shall have the
discretion to grant options which are exercisable for unvested shares of Common
Stock. Should the 


 


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Participant cease Service while such shares are
unvested, the Corporation shall have the right to repurchase any or all of
those unvested shares at a price per share equal to the lower of (i) the
exercise price paid per share or (ii) the Fair Market Value per share of
Common Stock at the time of repurchase. The terms 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 document evidencing such
repurchase right.


 


G.            Transferability of
Options. The
transferability of options granted under the Plan shall be governed by the
following provisions:


 


(i)             Incentive Options: During the lifetime of the Participant,
Incentive Options shall be exercisable only by the Participant and shall not be
assignable or transferable other than by will or the laws of inheritance
following the Participant’s death.


 


(ii)            Non-Statutory Options. Non-Statutory Options shall be subject
to the same limitation on transfer as Incentive Options, except that the Plan
Administrator may structure one or more Non-Statutory Options so that the
option may be assigned in whole or in part during the Participant’s lifetime.
The assigned portion may only be exercised by the person or persons who acquire
a proprietary interest in the option pursuant to the assignment. The terms
applicable to the assigned portion shall be the same as those in effect for the
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.


 


(iii)           Beneficiary Designation. Notwithstanding the foregoing, the Participant
may designate one or more persons as the beneficiary or beneficiaries of his or
her outstanding options, and those options shall, in accordance with such
designation, automatically be transferred to such beneficiary or beneficiaries
upon the Participant’s death while holding those options. Such beneficiary or
beneficiaries shall take the transferred options subject to all the terms and
conditions of the applicable agreement evidencing each such transferred option,
including (without limitation) the limited time period during which the option
may be exercised following the Participant’s death.


 


H.           Incentive Options. The terms specified below shall be
applicable to all Incentive Options.


 


(i)             Eligibility. Incentive Options may only be granted to
Employees.


 


(ii)            Dollar Limitation. The aggregate Fair Market Value of the
shares of Common Stock (determined as of the respective date or dates of grant)
for which one or more options granted to any Employee under the Plan (or any
other option plan of the Corporation or any Parent or Subsidiary) may for the
first time become exercisable as Incentive Options during any one calendar year
shall not exceed the sum of One Hundred Thousand Dollars ($100,000).


 


To the extent the Employee
holds two (2) or more such options which become exercisable for the first
time in the same calendar year, then for purposes of the foregoing limitations
on the exercisability of those options as Incentive Options, such options 


 


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shall be deemed to become
first exercisable in that calendar year on the basis of the chronological order
in which they were granted, except to the extent otherwise provided under
applicable law or regulation.


 


(iii)           10% Stockholder. If any Employee to whom an Incentive
Option is granted is a 10% Stockholder, then the exercise price per share shall
not be less than one hundred ten percent (110%) of the Fair Market Value per
share of Common Stock on the option grant date, and the option term shall not
exceed five (5) years measured from the option grant date.


 


II.            STOCK APPRECIATION RIGHTS


 


A.           Authority. The Plan Administrator shall have full
power and authority, exercisable in its sole discretion, to grant stock
appreciation rights evidenced by one or more Award Agreements in the form
approved by the Plan Administrator which complies with the terms specified
below.


 


B.            Types. Two types of stock appreciation rights
shall be authorized for issuance under this Section II: (i) tandem
stock appreciation rights (“Tandem Rights”) and (ii) stand-alone stock
appreciation rights (“Stand-alone Rights”).


 


C.            Tandem Rights. The following terms and conditions
shall govern the grant and exercise of Tandem Rights.


 


(i)             One or more Participants may be granted a Tandem
Right, exercisable upon such terms and conditions as the Plan Administrator may
establish, to elect between the exercise of the underlying option for shares of
Common Stock or the surrender of that option in exchange for a distribution
from the Corporation 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 Participant is at the time vested under the surrendered option (or
surrendered portion thereof) over (ii) the aggregate exercise price payable
for such vested shares.


 


(ii)            Any distribution to which the Participant becomes
entitled upon the exercise of a Tandem Right may be made in (i) shares of
Common Stock valued at Fair Market Value on the option surrender date, (ii) cash
or (iii) a combination of cash and shares of Common Stock, as specified in
the applicable Award agreement.


 


D.           Stand-Alone Rights. The following terms and conditions
shall govern the grant and exercise of Stand-alone Rights:


 


(i)             One or more Participants may be granted a Stand-alone
Right not tied to any underlying option. The Stand-alone Right shall relate to
a specified number of shares of Common Stock and shall be exercisable upon such
terms and conditions as the Plan Administrator may establish. In no event,
however, may the Stand-alone Right have a maximum term in excess of ten (10) years
measured from the grant date.


 


(ii)            Upon exercise of the Stand-alone Right, the holder
shall be entitled to receive a distribution from the Corporation in an amount
equal to the excess of (i) the 


 


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aggregate Fair Market Value (on the exercise date) of
the shares of Common Stock underlying the exercised right over (ii) the
aggregate base price in effect for those shares.


 


(iii)           The number of shares of Common Stock underlying each
Stand-alone Right and the base price in effect for those shares shall be
determined by the Plan Administrator in its sole discretion at the time the
Stand-alone Right is granted. In no event, however, may the base price per
share be less than the Fair Market Value per underlying share of Common Stock
on the grant date.


 


(iv)           Stand-alone Rights shall be subject to the same
transferability restrictions applicable to Non-Statutory Options and may not be
transferred during the holder’s lifetime, except to the extent otherwise
provided in the applicable Award Agreement. In addition, one or more
beneficiaries may be designated for an outstanding Stand-alone Right in
accordance with substantially the same terms and provisions as set forth in Section I.F
of this Article Two.


 


(v)            The distribution with respect to an exercised
Stand-alone Right may be made in (i) shares of Common Stock valued at Fair
Market Value on the exercise date, (ii) cash or (iii) a combination
of cash and shares of Common Stock, as specified in the applicable Award
agreement.


 


(vi)           The holder of a Stand-alone Right shall have no
stockholder rights with respect to the shares subject to the Stand-alone Right
unless and until such person shall have exercised the Stand-alone Right and
become a holder of record of the shares of Common Stock issued upon the
exercise of such Stand-alone Right.


 


E.            Post-Service Exercise. The provisions governing the exercise
of Tandem and Stand-alone Rights following the cessation of the Participant’s
Service shall be substantially the same as those set forth in Section I.C.
of this Article Two for the options granted under the Plan, and the Plan
Administrator’s discretionary authority under Section I.C.(ii) of
this Article Two shall also extend to any outstanding Tandem or
Stand-alone Appreciation Rights.


 


III.          STOCK AWARDS


 


A.           Authority. The Plan Administrator shall have full
power and authority, exercisable in its sole discretion, to grant stock awards
either as vested or unvested shares of Common Stock, through direct and
immediate issuances.  Each stock award
shall be evidenced by one or more Award Agreements in the form approved by the
Plan Administrator; provided, however, that each such agreement shall comply
with the terms specified below.


 


B.            Issue Price/Consideration.


 


(i)             Shares of Common Stock may be issued under a stock
award for a price per share fixed by the Plan Administrator at the time of the
Award, but in no event shall such issue price be less than one hundred percent
(100%) of the Fair Market Value per share of Common Stock on the Award date.


 


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(ii)            Shares of Common Stock may be issued under a stock
award for any of the following items of consideration which the Plan
Administrator may deem appropriate in each individual instance:


 


(1)           cash;


 


(2)           past services rendered or to be rendered
the Corporation (or any Parent or Subsidiary); or


 


(3)           any other valid consideration under the
State in which the Corporation is at the time incorporated.


 


C.            Vesting Provisions.


 


(i)            Stock awards may, in the discretion of the Plan
Administrator, be fully and immediately vested upon issuance as a bonus for
Service rendered or may vest in one or more installments over the Participant’s
period of Service and/or upon the attainment of specified performance
objectives. The elements of the vesting schedule applicable to any stock award
shall be determined by the Plan Administrator and incorporated into the Award
Agreement.


 


(ii)           The Plan Administrator shall also have
the discretionary authority, consistent with Code Section 162(m), to
structure one or more stock awards so that the shares of Common Stock subject
to those Awards shall vest upon the achievement of pre-established performance
objectives based on one or more Performance Goals and measured over the
performance period specified by the Plan Administrator at the time of the grant
of the Award.


 


(iii)          Should the Participant cease to remain in
Service while holding one or more unvested shares of Common Stock issued under
a stock award 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 Corporation 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 or cash equivalent, the Corporation
shall repay to the Participant the lower of (i) the cash consideration paid
for the surrendered shares or (ii) the Fair Market Value of those shares
at the time of cancellation.


 


(iv)          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. Any 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. However, no vesting
requirements tied to the attainment of performance objectives may be waived
with respect to shares which were intended at the time of issuance to qualify
as performance-based compensation under Code Section 162(m), except in the
event of the Participant’s Involuntary 


 


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Termination with respect to Awards made prior to January 1,
2009 or as otherwise provided in Section VIII of this Article Two.


 


(v)           Any new, substituted or additional
securities or other property (including money paid other than as a regular cash
dividend) which the Participant may have the right to receive with respect to
the Participant’s unvested shares of Common Stock by reason of any stock
dividend, stock split, recapitalization, combination of shares, exchange of
shares, spin-off transaction, extraordinary dividend or distribution  or other change affecting the outstanding Common Stock as a
class without the Corporation’s receipt of consideration shall be issued
subject to (i) the same vesting requirements applicable to the Participant’s
unvested shares of Common Stock and (ii) such escrow arrangements as the
Plan Administrator shall deem appropriate, unless and to the extent the Plan
Administrator determines at the time to vest and distribute such securities or
other property. Equitable adjustments to reflect each such transaction shall
also be made by the Plan Administrator to the repurchase price payable per
share by the Corporation for any unvested securities subject to its existing
repurchase rights under the Plan; provided the aggregate repurchase price shall
in each instance remain the same.


 


D.           Stockholder Rights. The Participant shall have full
stockholder rights with respect to any shares of Common Stock issued to the
Participant under a stock award, 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 dividends paid on such shares, subject to any
applicable vesting requirements.


 


IV.          RESTRICTED STOCK UNITS


 


A.           Authority. The Plan Administrator shall have the
full power and authority, exercisable in its sole discretion, to grant
restricted stock units which entitle the Participants to receive the shares
underlying those Awards upon vesting or upon the expiration of a designated
time period following the vesting of those Awards.  Each award of restricted stock units shall be
evidenced by one or more Award Agreements in the form approved by the Plan
Administrator; provided, however, that each such agreement shall comply with
the terms specified below.


 


B.            Vesting Provisions.


 


(i)            Restricted stock units may, in the
discretion of the Plan Administrator, vest in one or more installments over the
Participant’s period of Service or upon the attainment of specified performance
objectives.


 


(ii)           The Plan Administrator shall also have
the discretionary authority, consistent with Code Section 162(m), to
structure one or more restricted stock unit awards so that the shares of Common
Stock subject to those Awards shall vest (or vest and become issuable) upon the
achievement of pre-established performance objectives based on one or more
Performance Goals and measured over the performance period specified by the Plan
Administrator at the time of the grant of the Award.


 


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(iii)           Outstanding restricted stock units shall automatically
terminate, and no shares of Common Stock shall actually be issued in
satisfaction of those Awards, if the performance goals or Service requirements
established for those Awards are not attained or satisfied. The Plan
Administrator, however, shall have the discretionary authority to issue vested
shares of Common Stock under one or more outstanding Awards of restricted stock
units as to which the designated performance goals or Service requirements have
not been attained or satisfied. However, no vesting requirements tied to the
attainment of performance goals may be waived with respect to Awards which were
intended, at the time those Awards were granted, to qualify as
performance-based compensation under Code Section 162(m), except in the
event of the Participant’s Involuntary Termination with respect to Awards made
prior to January 1, 2009 or as otherwise provided in Section VIII of
this Article Two.


 


C.            Stockholder Rights. The Participant shall not have any
stockholder rights with respect to the shares of Common Stock subject to a
restricted stock unit award until that award vests and the shares of Common
Stock are actually issued thereunder. However, dividend-equivalent units may be
paid or credited, either in cash or in actual or phantom shares of Common
Stock, on outstanding restricted stock unit awards, subject to such terms and
conditions as the Plan Administrator may deem appropriate.


 


V.           CASH AWARDS


 


A.           Authority. The Plan Administrator shall have the
full power and authority, exercisable in its sole discretion, to make cash
incentive awards which are to vest in one or more installments over the
Participant’s continued Service with the Corporation or upon the attainment of
specified performance goals. Each such cash award shall be evidenced by one or
more Award Agreements in the form approved by the Plan Administrator; provided however,
that each such agreement shall comply with the terms specified below.


 


B.            Vesting Provisions.


 


(i)             The elements of the vesting schedule applicable to
each cash award shall be determined by the Plan Administrator and incorporated
into the Award Agreement.


 


(ii)            The Plan Administrator shall also have the
discretionary authority, consistent with Code Section 162(m), to structure
one or more cash awards so that those Awards shall vest upon the achievement of
pre-established corporate performance objectives based upon one or more
Performance Goals and measured over the performance period specified by the
Plan Administrator at the time of grant of the Award.


 


(iii)           Outstanding cash awards shall automatically terminate,
and no cash payment or other consideration shall be due the holders of those
Awards, if the performance goals or Service requirements established for the Awards
are not attained or satisfied. The Plan Administrator may, however, in its
discretion waive the termination of one or more unvested cash awards which
would otherwise occur upon the cessation of the Participant’s Service or the
non-attainment of the performance objectives applicable to those Awards. Any
such waiver shall result in the immediate vesting of the Participant’s interest
in the cash award as to which the waiver applies. Such wavier may be effected
at any time, whether before or after the 


 


12

















 


Participant’s cessation of Service or the attainment
or non-attainment of the applicable performance objectives. However, no vesting
requirements tied to the attainment of performance goals may be waived with
respect to awards which were intended, at the time those awards were granted,
to qualify as performance-based compensation under Code Section 162(m),
except in the event of the Participant’s Involuntary Termination with respect
to Awards made prior to January 1, 2009 or as otherwise provided in Section VIII
of this Article Two.


 


C.            Payment. Cash awards which become due and
payable following the attainment of the applicable performance goals or
satisfaction of the applicable Service requirement (or the waiver of such goals
or Service requirement) may be paid in (i) cash, (ii) shares of
Common Stock valued at Fair Market Value on the payment date or (iii) a
combination of cash and shares of Common Stock as the Plan Administrator shall
determine.


 


VI.          PERFORMANCE UNIT AWARDS


 


A.           Authority. The Plan Administrator shall have full
power and authority, exercisable in its sole discretion, to grant performance
unit awards in accordance with the terms of this Section VI. Each
performance unit award shall be evidenced by one or more Award Agreements in
the form approved by the Plan Administrator; provided however, that each such
agreement shall comply with the terms specified below.


 


B.            Bonus Pool. A performance unit shall represent a
participating interest in a special bonus pool tied to the attainment of
pre-established performance objectives based on one or more Performance Goals.
The amount of the bonus pool may vary with the level at which the applicable
performance objectives are attained, and the value of each Performance Unit
which becomes due and payable upon the attained level of performance shall be
determined by dividing the amount of the resulting bonus pool (if any) by the
total number of Performance Units issued and outstanding at the completion of the
applicable performance period.


 


C.            Service Requirement. Performance units may also be
structured to include a Service requirement which the Participant must satisfy
following the completion of the performance period in order to vest in the
performance units awarded with respect to that performance period.


 


D.           Payment. Performance units which become due and
payable following the attainment of the applicable performance objectives and
the satisfaction of any applicable Service requirement may be paid in (i) cash,
(ii) shares of Common Stock valued at Fair Market Value on the payment
date or (iii) a combination of cash and shares of Common Stock, as
determined by the Plan Administrator in its sole discretion and set forth in
the Award Agreement.


 


VII.         DIVIDEND EQUIVALENT RIGHTS


 


A.           Authority. The Plan Administrator shall have the
discretionary authority to grant dividend equivalent rights in accordance with
the terms of this Section VII. Each such Award shall be evidenced by one
or more Award Agreements in the form approved by the Plan 


 


13

















 


Administrator; provided however, that each such
agreement shall comply with the terms specified below.


 


B.            Terms. The dividend equivalent rights may be
granted as stand-alone awards or in tandem with other Awards made under the
Plan. The term of each dividend equivalent right award shall be established by
the Plan Administrator at the time of grant, but no such Award shall have a
term in excess of ten (10) years.


 


C.            Entitlement. 
Each dividend equivalent right shall represent the right to receive the
economic equivalent of each dividend or distribution, whether in cash,
securities or other property (other than shares of Common Stock), which is made
per issued and outstanding share of Common Stock during the term the dividend
equivalent right remains outstanding.  A
special account on the books of the Corporation shall be maintained for each
Participant to whom a dividend equivalent right is granted, and that account
shall be credited per dividend equivalent right with each such dividend or
distribution made per issued and outstanding share of Common Stock during the
term of that dividend equivalent right remains outstanding.


 


D.           Timing of Payment. 
Payment of the amounts credited to such book account may be made to the
Participant either concurrently with the actual dividend or distribution made
per issued and outstanding share of Common Stock or may be deferred for a
period specified by the Plan Administrator at the time the dividend equivalent
right is initially granted or (to the extent permitted by the Plan
Administrator) designated by the Participant pursuant to a timely deferral
election made in accordance with the requirements of Code Section 409A.


 


E.            Form of Payment. 
Payment of the amounts due with respect to dividend equivalent rights
may be made in (i) cash, (ii) shares of Common Stock or (iii) a
combination of cash and shares of Common Stock, as determined by the Plan
Administrator in its sole discretion and set forth in the Award Agreement.  If payment is to be made in the form of
Common Stock, the number of shares of Common Stock into which the cash dividend
or distribution amounts are to be converted for purposes of the Participant’s
book account may be based on the Fair Market Value per share of Common Stock on
the date of conversion, a prior date or an average of the Fair Market Value per
share of Common Stock over a designated period, as determined by the Plan
Administrator in its sole discretion.


 


VIII.       EFFECT OF CHANGE IN CONTROL


 


A.           In the event of an actual Change in
Control transaction, each option, stock appreciation right and restricted stock
unit award outstanding at that time under the Plan but not otherwise fully
vested shall automatically accelerate, immediately prior to the effective date
of that Change in Control, as to all the shares of Common Stock at the time
subject to such Award, unless (i) such Award is to be assumed or
substituted with an equivalent award by the successor corporation (or parent thereof)
or is otherwise to continue in full force and effect pursuant to the terms of
the Change in Control transaction or (ii) such Award is replaced with a
cash retention program of the successor corporation that preserves the spread
existing at the time of the Change 


 


14

















 


in Control on the shares of Common Stock as to which
the Award is not otherwise at that time vested and exercisable and provides for
the subsequent vesting and payout of that spread in accordance with the same
exercise/vesting schedule applicable to those shares, or (iii) the
acceleration of such Award is subject to other limitations imposed by the Plan
Administrator.


 


B.            All outstanding repurchase rights shall
automatically terminate, and the shares of Common Stock subject to those
terminated rights shall vest in full, immediately prior to the effective date
of an actual Change in Control transaction, except to the extent (i) those
repurchase rights are to be assigned to the successor corporation (or parent
thereof) or are otherwise to continue in full force and effect pursuant to the
terms of the Change in Control transaction or (ii) such accelerated
vesting is precluded by other limitations imposed by the Plan Administrator.


 


C.            Immediately following the consummation of
the Change in Control, all outstanding options, stock appreciation rights and
restricted stock unit awards shall terminate and cease to be outstanding,
except to the extent assumed by the successor corporation (or parent thereof)
or otherwise continued in full force and effect pursuant to the terms of the
Change in Control transaction.


 


D.           Each Award denominated in shares of
Common Stock which is assumed in connection with a Change in Control or
otherwise continued in effect shall be appropriately adjusted, immediately
after such Change in Control, to apply to the number and class of securities
into which the shares of Common Stock subject to that Award would have been
converted in consummation of such Change in Control had those shares actually
been outstanding at that time. Appropriate adjustments to reflect such Change
in Control shall also be made to (i) the exercise or base price or cash
consideration payable per share in effect under each outstanding Award, provided
the aggregate exercise or base price or cash consideration in effect for such
securities shall remain the same, (ii) the maximum number and/or class of
securities available for issuance over the remaining term of the Plan, (iii) the
maximum number and/or class of securities for which any one person may be
granted Common Stock-denominated Awards under the Plan per calendar year and (iv) the
number and/or class of securities subject to the Corporation’s outstanding
repurchase rights under the Plan and the repurchase price payable per share. To
the extent the actual holders of the Corporation’s outstanding Common Stock
receive cash consideration for their Common Stock in consummation of the Change
in Control, the successor corporation may, in connection with the assumption or
continuation of the outstanding Awards under the Plan and subject to the Plan
Administrator’s approval, substitute, for the securities underlying those
assumed Awards, one or more shares of its own common stock with a fair market
value equivalent to the cash consideration paid per share of Common Stock in
such Change in Control transaction, provided such common stock is readily
traded on an established U.S. securities exchange or market.


 


E.            The Plan Administrator shall have the
discretionary authority to structure one or more outstanding Awards so that
those Awards shall, immediately prior to the effective date of an actual Change
in Control transaction, vest as to all the shares of Common Stock at the time
subject to those Awards, whether or not those Awards are to be assumed in the
Change in Control transaction or otherwise continued in effect. In addition,
the Plan Administrator shall 


 


15

















 


have the discretionary authority to structure one or
more of the Corporation’s repurchase rights so that those rights shall
terminate immediately prior to the effective date of an actual Change in
Control transaction, and the shares subject to those terminated rights shall
thereupon vest in full.


 


F.            The Plan Administrator shall have full
power and authority to structure one or more outstanding Awards so that those
Awards shall vest as to all the shares of Common Stock at the time subject to
those Awards in the event the Participant’s Service is subsequently terminated
by reason of an Involuntary Termination within a designated period following
the effective date of any Change in Control transaction in which those Awards
do not otherwise vest on an accelerated basis. In addition, the Plan
Administrator may structure one or more of the Corporation’s repurchase rights
so that those rights shall immediately terminate with respect to any shares
held by the Participant at the time of such Involuntary Termination, and the
shares subject to those terminated repurchase rights shall accordingly vest in
full at that time.


 


G.            The portion of any Incentive Option
accelerated in connection with a Change in Control shall remain exercisable as
an Incentive Option only to the extent the applicable One Hundred Thousand
Dollar ($100,000) limitation 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.


 


H.           The Plan Administrator shall have the
discretionary authority to structure one or more cash, performance unit and
dividend equivalent right awards so that such Awards shall automatically vest
in whole or in part immediately prior to the effective date of an actual Change
in Control transaction or upon the subsequent termination of the Participant’s
Service by reason of an Involuntary Termination within a designated period
following the effective date of such Change in Control.


 


I.             The Plan Administrator’s authority under
Paragraphs E, F and H of this Section VIII shall also extend to any Awards
intended to qualify as performance-based compensation under Code Section 162(m),
even though the automatic vesting of those Awards pursuant to Paragraphs E, F
and H of this Section VIII may result in their loss of performance-based
status under Code Section 162(m).


 


ARTICLE THREE 


 


MISCELLANEOUS


 


I.             DEFERRED COMPENSATION


 


A.           The Plan Administrator may, in its sole
discretion, structure one or more Awards (other than options and stock
appreciation rights) so that the Participants may be provided with an election
to defer the compensation associated with those Awards for federal income tax
purposes. Any such deferral opportunity shall comply with all applicable
requirements of Code Section 409A.


 


B.            To the extent the Corporation maintains
one or more separate non-qualified deferred compensation arrangements which
allow the participants the opportunity to 


 


16

















 


make notional investments of their deferred account
balances in shares of Common Stock, the Plan Administrator may authorize the
share reserve under the Plan to serve as the source of any shares of Common
Stock that become payable under those deferred compensation arrangements. In
such event, the share reserve under the Plan shall be reduced on a
share-for-one share basis for each share of Common Stock issued under the Plan
in settlement of the deferred compensation owed under those separate
arrangements.


 


II.            TAX WITHHOLDING


 


A.           The Corporation’s obligation to deliver
shares of Common Stock upon the exercise, issuance or vesting of an Award under
the Plan shall be subject to the satisfaction of all applicable income and
employment tax withholding requirements.


 


B.            The Plan Administrator may, in its
discretion, provide Participants to whom Awards are made under the Plan with
the right to use shares of Common Stock in satisfaction of all or part of the
Withholding Taxes to which such holders may become subject in connection with
the exercise, issuance or vesting of those Awards or the issuance of shares of
Common Stock thereunder. Such right may be provided to any such holder in
either or both of the following formats:


 


(i)             Stock Withholding: The election to have the Corporation
withhold, from the shares of Common Stock otherwise issuable upon the issuance,
exercise or vesting of such Award or the issuance of shares of Common Stock
thereunder, a portion of those shares with an aggregate Fair Market Value equal
to the percentage of the Withholding Taxes (not to exceed one hundred percent
(100%)) designated by such individual. The shares of Common Stock so withheld
shall not reduce the number of shares of Common Stock authorized for issuance
under the Plan.


 


(ii)            Stock Delivery: The election to deliver to the Corporation, at the
time of the issuance, exercise or vesting of such Award or the issuance of
shares of Common Stock thereunder, one or more shares of Common Stock
previously acquired by such individual (other than in connection with the
exercise, share issuance or share vesting triggering the Withholding Taxes)
with an aggregate Fair Market Value equal to the percentage of the Withholding
Taxes (not to exceed one hundred percent (100%)) designated by the individual.
The shares of Common Stock so delivered shall neither reduce the number of
shares of Common Stock authorized for issuance under the Plan nor be added to
the number of shares of Common Stock authorized for issuance under the Plan.


 


III.          SHARE ESCROW/LEGENDS


 


Unvested shares may, in the
Plan Administrator’s discretion, be held in escrow by the Corporation 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.


 


IV.          EFFECTIVE DATE AND TERM OF THE
PLAN


 


A.            The Plan shall become effective on the
Plan Effective Date.


 


17

















 


B.            The Plan shall terminate upon the earliest to occur of (i) September 21,
2018, (ii) the date on which all shares available for issuance under the
Plan shall have been issued as fully vested shares or (iii) the
termination of all outstanding Awards in connection with a Change in Control.
Should the Plan terminate on September 21, 2018, then all Awards
outstanding at that time shall continue to have force and effect in accordance
with the provisions of the documents evidencing those Awards.


 


V.           AMENDMENT OF THE PLAN


 


A.            The Board shall have complete and
exclusive power and authority to amend or modify the Plan in any or all
respects, subject to stockholder approval to the extent required under
applicable law or regulation or pursuant to the listing standards of the Stock
Exchange on which the Common Stock is at the time primarily traded. However, no
such amendment or modification shall adversely affect the rights and
obligations with respect to Awards at the time outstanding under the Plan
unless the Participant consents to such amendment or modification.


 


B.            The Compensation Committee shall have the
discretionary authority to adopt and implement from time to time such addenda
or subplans to the Plan as it may deem necessary in order to bring the Plan
into compliance with applicable laws and regulations of any foreign
jurisdictions in which Awards are to be made under the Plan and/or to obtain favorable
tax treatment in those foreign jurisdictions for the individuals to whom the
Awards are made.


 


C.            Awards may be made under the Plan that
involve shares of Common Stock in excess of the number of shares then available
for issuance under the Plan, provided no shares shall actually be issued
pursuant to those Awards until the number of shares of Common Stock available
for issuance under the Plan is sufficiently increased by stockholder approval
of an amendment of the Plan authorizing such increase. If such stockholder
approval is not obtained within twelve (12) months after the date the
first excess Award is made, then all Awards granted on the basis of such excess
shares shall terminate and cease to be outstanding.


 


VI.          USE OF PROCEEDS


 


Any cash proceeds received
by the Corporation from the sale of shares of Common Stock under the Plan shall
be used for general corporate purposes.


 


VII.         REGULATORY APPROVALS


 


A.            The implementation of the Plan, the
granting of any Award under the Plan and the issuance of any shares of Common
Stock in connection with the issuance, exercise or vesting of any Award under
the Plan shall be subject to the Corporation’s procurement of all approvals and
permits required by regulatory authorities having jurisdiction over the Plan,
the Awards made under the Plan and the shares of Common Stock issuable pursuant
to those Awards.


 


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 


 


18

















 


of applicable securities laws, including 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 on which Common Stock is then listed for trading.


 


VIII.       NO EMPLOYMENT/SERVICE RIGHTS


 


Nothing in the Plan shall
confer upon the Participant any right to continue in Service for any period of
specific duration or interfere with or otherwise restrict in any way the rights
of the Corporation (or any Parent or Subsidiary employing or retaining such
person) or of the Participant, which rights are hereby expressly reserved by
each, to terminate such person’s Service at any time for any reason, with or
without cause.


 


19

















 


APPENDIX


 


The following definitions
shall be in effect under the Plan:


 


A.           Award shall mean any of the following awards
authorized for issuance or grant under the Plan: options, stock appreciation
rights, stock awards, restricted stock units, performance units, dividend
equivalent rights and cash incentive awards.


 


B.            Award Agreement shall mean the written agreement(s) between
the Corporation and the Participant evidencing a particular Award made to that
individual under the Plan, as such agreement(s) may be in effect from time
to time.


 


C.            Board shall mean the Corporation’s Board of
Directors.


 


D.           Change in Control shall, with respect to each Award made
under the Plan, be defined in accordance with the following provisions:


 


(i)            Change in Control shall have the meaning assigned to
such term in the Award Agreement for the particular Award or in any other
agreement incorporated by reference into the Award Agreement for purposes of
defining such term.


 


(ii)           In the absence of any other Change in Control
definition in the Award Agreement (or in any other agreement incorporated by
reference into the Award Agreement), Change in Control shall mean a change in
ownership or control of the Corporation effected through any of the following
transactions:


 


a.             a merger, consolidation or other
reorganization approved by the Corporation’s stockholders, unless
securities representing more than fifty percent (50%) of the total combined
voting power of the voting securities of the successor corporation are
immediately thereafter beneficially owned, directly or indirectly and in
substantially the same proportion, by the persons who beneficially owned the
Corporation’s outstanding voting securities immediately prior to such
transaction,


 


b.             a sale, transfer or other disposition of
all or substantially all of the Corporation’s assets, or


 


c.             the closing of any transaction or series
of related transactions pursuant to which any person or any group of persons
comprising a “group” within the meaning of Rule 13d-5(b)(1) of the
1934 Act (other than the Corporation or a person that, prior to such
transaction or series of related transactions, directly or indirectly controls,
is controlled by or is under common control with, the Corporation) becomes
directly or indirectly (whether as a result of a single acquisition or by
reason of one or more acquisitions within the twelve (12)-month period ending
with the most recent acquisition) the beneficial owner (within the meaning of Rule 13d-3
of the 1934 Act) of securities possessing (or convertible into or exercisable
for securities possessing) fifty percent (50%) or more of the total combined
voting power of the Corporation’s securities (as measured in terms of the power
to vote with respect to 


 


A-1

















 


the
election of Board members) outstanding immediately after the consummation of
such transaction or series of related transactions, whether such transaction
involves a direct issuance from the Corporation or the acquisition of
outstanding securities held by one or more of the Corporation’s existing
stockholders.


 


d.             a change in the composition of the Board
over a period of twelve (12) consecutive months or less such that a majority of
the Board members 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 a majority of the Board members described in clause (A) who were
still in office at the time the Board approved such election or nomination.


 


E.             Code shall mean the Internal Revenue Code of
1986, as amended.


 


F.             Common Stock shall mean the Corporation’s Common
Stock.


 


G.            Compensation Committee shall mean the Compensation Committee of
the Board comprised of two (2) or more non-employee Board members.


 


H.            Corporation shall mean Senesco Technologies, Inc.,
a Delaware corporation, and any corporate successor to all or substantially all
of the assets or voting stock of Senesco Technologies, Inc. which has by
appropriate action assumed the Plan.


 


I.              Employee shall mean an individual who is in the
employ of the Corporation (or any Parent or Subsidiary, whether now existing or
subsequently established), subject to the control and direction of the employer
entity as to both the work to be performed and the manner and method of performance.


 


J.             Exercise Date shall mean the date on which the
Corporation shall have received written notice of the option exercise.


 


K.            Fair Market Value per share of Common Stock on any
relevant date shall be the closing selling price per share of Common Stock at
the close of regular hours trading (i.e., before after-hours trading begins) on
date on question on the Stock Exchange serving as the primary market for the
Common Stock, as such price is reported by the National Association of
Securities Dealers (if primarily traded on the Nasdaq Global or Global Select
Market) or as officially quoted in the composite tape of transactions on any
other Stock Exchange on which the Common Stock is then primarily traded. If
there is no closing selling price for the Common Stock on the date in question,
then the Fair Market Value shall be the closing selling price on the last
preceding date for which such quotation exists.


 


A-2

















 


L.             Good Reason shall, with respect to each Award made
under the Plan, be defined in accordance with the following provisions:


 


(i)            Good Reason shall have the meaning
assigned to such term in the Award Agreement for the particular Award or in any
other agreement incorporated by reference into the Award Agreement for purposes
of defining such term.


 


(ii)           In the absence of any other Good Reason
definition in the Award Agreement (or in any other agreement incorporated by
reference into the Award Agreement), Good Reason shall mean an individual’s
voluntary resignation following (A) a change in his or her position with
the Corporation (or any Parent or Subsidiary) which materially reduces his or
her duties, responsibilities or authority, (B) a material diminution in
the duties, responsibilities or authority of the person to whom such individual
reports, (C) a material reduction in such individual’s level of base
compensation, with a reduction of more than fifteen percent (15%) to be deemed
material for such purpose, or (D) a material relocation of such individual’s
place of employment, with a relocation of more than fifty (50) miles to be
deemed material for such purpose, provided, however, that a resignation for
Good Reason may be effected only after (i) the individual provides written
notice to the Corporation of the event or transaction constituting grounds for
such resignation within sixty (60) days after the occurrence of that event
or transaction and (ii) the Corporation fails to take the requisite
remedial action with respect to such event or transaction within thirty
(30) days after receipt of such notice.


 


M.          Incentive Option shall mean an option which satisfies the
requirements of Code Section 422.


 


N.           Involuntary Termination shall, with respect to each Award made
under the Plan, be defined in accordance with the following provisions:


 


(i)            Involuntary Termination shall have the
meaning assigned to such term in the Award Agreement for the particular Award
or in any other agreement incorporated by reference into the Award Agreement
for purposes of defining such term.


 


(ii)           In the absence of any other Involuntary
Termination definition in the Award Agreement (or in any other agreement
incorporated by reference into the Award Agreement), Involuntary Termination
shall mean such individual’s involuntary dismissal or discharge by the
Corporation (or any Parent or Subsidiary) for reasons other than Misconduct, or
such individual’s voluntary resignation for Good Reason.


 


O.           Misconduct shall, with respect to each Award made
under the Plan, be defined in accordance with the following provisions:


 


(i)            Misconduct shall have the meaning
assigned to such term in the Award Agreement for the particular Award or in any
other agreement incorporated by reference into the Award Agreement for purposes
of defining such term.


 


A-3
















 


(ii)           In
the absence of any other Misconduct definition in the Award Agreement for a
particular Award (or in any other agreement incorporated by reference into the
Award Agreement), Misconduct shall mean the commission of any act of fraud,
embezzlement or dishonesty by the Participant, any unauthorized use or
disclosure by such person of confidential information or trade secrets of the
Corporation (or any Parent or Subsidiary), or any other intentional misconduct
by such person adversely affecting the business or affairs of the Corporation
(or any Parent or Subsidiary) in a material manner. The foregoing definition
shall not in any way preclude or restrict the right of the Corporation (or any
Parent or Subsidiary) to discharge or dismiss any Participant or other person
in the Service of the Corporation (or any Parent or Subsidiary) for any other
acts or omissions, but such other acts or omissions shall not be deemed, for
purposes of the Plan, to constitute grounds for termination for Misconduct.


 


P.             1934 Act shall mean the Securities
Exchange Act of 1934, as amended.


 


Q.            Non-Statutory Option shall mean an
option not intended to satisfy the requirements of Code Section 422.


 


R.            Parent shall mean any corporation
(other than the Corporation) in an unbroken chain of corporations ending with
the Corporation, provided each corporation in the unbroken chain (other than
the Corporation) 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.


 


S.             Participant shall mean any person who
is granted an Award under the Plan.


 


T.            Performance
Goals  shall mean any of the following performance criteria upon
which the vesting of one or more Awards under the Plan may be based: (i) pre-tax
or after-tax earnings, profit or net income, (ii) revenue or revenue
growth, (iii) earnings per share, (iv) return on assets, capital or
stockholder equity, (v) total stockholder return, (vi) gross or net profit
margin, (vii) cash flow, (viii) earnings or operating income before
interest, taxes, depreciation, amortization and/or charges for stock-based
compensation, (ix) market share, (x) increases in customer base,
(xi) operating income, net operating income or net operating income after
recorded tax expense; (xii) operating profit, net operating profit or net
operating profit after recorded tax expense, (xiii) operating margin,
(xiv) cost reductions or other expense control objectives, (xv) market
price of the Common Stock, whether measured in absolute terms or in
relationship to earnings or operating income, (xvi) budget objectives and
research and development milestones, (xvii) working capital,
(xviii) mergers, acquisitions or divestitures or (xix) measures of
customer satisfaction. Each performance criteria may be based upon the
attainment of specified levels of the Corporation’s performance under one or
more of the measures described above relative to the performance of other
entities and may also be based on the performance of any of the Corporation’s
business units or divisions or any Parent or Subsidiary. Each applicable
Performance Goal may include a minimum threshold level of performance below
which no Award will be earned, levels of performance at which specified
portions of an Award will be earned and a maximum level of performance at which
an Award 


 


A-4

















 


will be fully earned. Each applicable Performance Goal
may be structured at the time of the Award to provide for appropriate
adjustment for one or more of the following items: (A) asset
impairments or write-downs; (B) litigation judgments or claim settlements;
(C) the effect of changes in tax law, accounting principles or other such
laws or provisions affecting reported results; (D) accruals for
reorganization and restructuring programs; (E) any extraordinary
nonrecurring items as described in Accounting Principles Board Opinion No. 30
and/or in management’s discussion and analysis of financial condition and
results of operations appearing in the Corporation’s annual report to
shareholders for the applicable year; (F) the operations of any business
acquired by the Corporation or any Parent or Subsidiary or of any joint venture
in which the Corporation or any Parent or Subsidiary participates; (G) the
divestiture of one or more business operations or the assets thereof; or (H) the
costs incurred in connection with such acquisitions or divestitures.


 


U.            Permanent Disability
or Permanently Disabled shall, with respect to each Award made
under the Plan, be defined in accordance with the following provisions:


 


(i)            Permanent
Disability or Permanently Disabled shall have the meaning assigned to such term
in the Award Agreement for the particular Award or in any other agreement
incorporated by reference into the Award Agreement for purposes of defining
such term.


 


(ii)           In
the absence of any other definition of Permanent Disability or Permanently
Disabled in the Award Agreement for a particular Award (or in any other
agreement incorporated by reference into the Award Agreement), Permanent
Disability or Permanently Disabled shall mean the inability of the Participant
to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment expected to result in death or to be
of continuous duration of twelve (12) months or more.


 


V.            Plan shall mean the Corporation’s 2008
Incentive Compensation Plan, as set forth in this document.


 


W.           Plan Administrator shall mean the
particular entity or individual, whether the Compensation Committee (or
subcommittee thereof), the Board, the Secondary Board Committee or executive
officer authorized to administer the Plan with respect to one or more classes
of eligible persons, to the extent such entity or individual is carrying out
its administrative functions under the Plan with respect to the persons under
the jurisdiction of such entity or individual.


 


X.            Plan Effective Date shall mean the date
upon which the Plan shall be approved by the Corporation’s stockholders.


 


Y.            Predecessor Plan shall mean the
Corporation’s 1998 Stock Incentive Plan in effect immediately prior to the Plan
Effective Date hereunder.


 


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Z.            Secondary Board Committee shall mean a
committee of one or more Board members appointed by the Board to administer the
Plan with respect to eligible persons other than Section 16 Insiders.


 


AA.        Section 16 Insider shall mean an
officer or director of the Corporation subject to the short-swing profit
liabilities of Section 16 of the 1934 Act.


 


BB.          Service
shall, with respect to each Award made under the Plan, be defined in accordance
with the following provisions:


 


(i)            Service
shall have the meaning assigned to such term in the Award Agreement for the
particular Award or in any other agreement incorporated by reference into the
Award Agreement for purposes of defining such term.


 


(ii)           In
the absence of any other definition of Service in the Award Agreement for a
particular Award (or in any other agreement incorporated by reference into the
Award Agreement), Service shall mean the performance of services for the
Corporation (or any Parent or Subsidiary, whether now existing or subsequently
established) by a person in the capacity of an Employee, a non-employee member
of the board of directors or a consultant or independent advisor, except to the
extent otherwise specifically provided in the documents evidencing the option
grant or stock issuance. For purposes of this particular definition of Service,
a Participant shall be deemed to cease Service immediately upon the occurrence
of the either of the following events: (i) the Participant no longer
performs services in any of the foregoing capacities for the Corporation or any
Parent or Subsidiary or (ii) the entity for which the Participant is
performing such services ceases to remain a Parent or Subsidiary of the
Corporation, even though the Participant may subsequently continue to perform
services for that entity.


 


(iii)          Service
shall not be deemed to cease during a period of military leave, sick leave or
other personal leave approved by the Corporation; provided, however, that should such
leave of absence exceed three (3) months, then for purposes of determining
the period within which an Incentive Option may be exercised as such under the
federal tax laws, the Participant’s Service shall be deemed to cease on the
first day immediately following the expiration of such three (3)-month period,
unless Participant is provided with the right to return to Service following
such leave either by statute or by written contract. Except to the extent
otherwise required by law or expressly authorized by the Plan Administrator or
by the Corporation’s written policy on leaves of absence, no Service credit shall
be given for vesting purposes for any period the Participant is on a leave of
absence.


 


CC.          Stock Exchange shall mean the American
Stock Exchange, the Nasdaq Global or Global Select Market or the New York Stock
Exchange.


 


DD.         Subsidiary shall mean any corporation
(other than the Corporation) in an unbroken chain of corporations beginning
with the Corporation, provided each corporation (other than the last
corporation) in the unbroken chain owns, at the time of the determination,
stock 


 


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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.


 


EE.          10% Stockholder shall mean the owner of
stock (as determined under Code Section 424(d)) possessing more than ten
percent (10%) of the total combined voting power of all classes of stock of the
Corporation (or any Parent or Subsidiary).


 


FF.          Withholding Taxes shall mean the
applicable federal, state and foreign income and employment withholding taxes
and other payments to which the holder of an Award under the Plan may become
subject in connection with the issuance, exercise or vesting of that Award or
the issuance of shares of Common Stock thereunder.


 


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