senorx_10k-ex1003.htm


    Exhibit
10.3


     

    SENORX,
INC.

     

    2006
EQUITY INCENTIVE PLAN

     

    (as
amended and restated February 26, 2009)

     

    1.           Purposes of the
Plan.  The purposes of this Plan are:

     

    
      	
               
      

            	
              ·

            	
              to
      attract and retain the best available personnel for positions of
      substantial responsibility,

            


    

     

    
      	
               
      

            	
              ·

            	
              to
      provide additional incentive to Employees, Directors and Consultants,
      and

            


    

     

    
      	
               
      

            	
              ·

            	
              to
      promote the success of the Company’s
business.

            


    

     

    The Plan
permits the grant of Incentive Stock Options, Nonstatutory Stock Options,
Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Performance
Units and Performance Shares.

     

    2.           Definitions.  As
used herein, the following definitions will apply:

     

    (a)           “Administrator” means
the Board or any of its Committees as will be administering the Plan, in
accordance with Section 4 of the Plan.

     

    (b)           “Applicable Laws”
means the requirements relating to the administration of equity-based awards
under U.S. state corporate laws, U.S. federal and state securities laws, the
Code, any stock exchange or quotation system on which the Common Stock is listed
or quoted and the applicable laws of any foreign country or jurisdiction where
Awards are, or will be, granted under the Plan.

     

    (c)           “Award” means,
individually or collectively, a grant under the Plan of Options, SARs,
Restricted Stock, Restricted Stock Units, Performance Units or Performance
Shares.

     

    (d)           “Award Agreement”
means the written or electronic agreement setting forth the terms and provisions
applicable to each Award granted under the Plan.  The Award Agreement
is subject to the terms and conditions of the Plan.

     

    (e)           “Board” means the
Board of Directors of the Company.

     

    (f)           “Change in Control”
means the occurrence of any of the following events:

     

    (i)                 Any
“person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act)
becomes the “beneficial owner” (as defined in Rule 13d-3 of the Exchange Act),
directly or indirectly, of securities of the Company representing fifty percent
(50%) or more of the total voting power represented by the Company’s then
outstanding voting securities; or


    
      
         


      

      
        
        

        
          

        

      

      
         


      

    


     

    (ii)                 The
consummation of the sale or disposition by the Company of all or substantially
all of the Company’s assets;

     

    (iii)                 A
change in the composition of the Board occurring within a two-year period, as a
result of which fewer than a majority of the directors are Incumbent
Directors.  “Incumbent Directors” means directors who either
(A) are Directors as of the effective date of the Plan, or (B) are
elected, or nominated for election, to the Board with the affirmative votes of
at least a majority of the Incumbent Directors at the time of such election or
nomination (but will not include an individual whose election or nomination is
in connection with an actual or threatened proxy contest relating to the
election of directors to the Company); or

     

    (iv)                 The
consummation of a merger or consolidation of the Company with any other
corporation, other than a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or its parent) at least fifty
percent (50%) of the total voting power represented by the voting securities of
the Company or such surviving entity or its parent outstanding immediately after
such merger or consolidation.

     

    (g)           “Code” means the
Internal Revenue Code of 1986, as amended.  Any reference to a section
of the Code herein will be a reference to any successor or amended section of
the Code.

     

    (h)           “Committee” means a
committee of Directors or of other individuals satisfying Applicable Laws
appointed by the Board in accordance with Section 4 hereof.

     

    (i)           “Common Stock” means
the common stock of the Company.

     

    (j)           “Company” means
SenoRx, Inc., a Delaware corporation, or any successor thereto.

     

    (k)           “Consultant” means any
person, including an advisor, engaged by the Company or a Parent or Subsidiary
to render services to such entity.

     

    (l)           “Director” means a
member of the Board.

     

    (m)           “Disability” means
total and permanent disability as defined in Section 22(e)(3) of the Code,
provided that in the case of Awards other than Incentive Stock Options, the
Administrator in its discretion may determine whether a permanent and total
disability exists in accordance with uniform and non-discriminatory standards
adopted by the Administrator from time to time.

     

    (n)           “Employee” means any
person, including Officers and Directors, employed by the Company or any Parent
or Subsidiary of the Company.  Neither service as a Director nor
payment of a director’s fee by the Company will be sufficient to constitute
“employment” by the Company.

     

    (o)           “Exchange Act” means
the Securities Exchange Act of 1934, as amended.


    
      
         


      

      
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    (p)           “Exchange Program”
means a program under which (i) outstanding Awards are surrendered or cancelled
in exchange for Awards of the same type (which may have lower exercise prices
and different terms), Awards of a different type, and/or cash, (ii) Participants
would have the opportunity to transfer any outstanding Awards to a financial
institution or other person or entity selected by the Administrator, and/or
(iii) the exercise price of an outstanding Award is reduced.  The
Administrator will determine the terms and conditions of any Exchange Program in
its sole discretion.

     

    (q)           “Fair Market Value”
means, as of any date, the value of Common Stock deter­mined as
follows:

     

    (i)              
   If the Common Stock is listed on any estab­lished stock
exchange or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its
Fair Market Value will be the closing sales price for such stock (or the closing
bid, if no sales were reported) as quoted on such exchange or system on the day
of determination, as reported in The Wall Street Journal or
such other source as the Administrator deems reliable;

     

    (ii)              
  If the Common Stock is regularly quoted by a recognized securities
dealer but selling prices are not reported, the Fair Market Value of a Share
will be the mean between the high bid and low asked prices for the Common Stock
on the day of determination, as reported in The Wall Street Journal or
such other source as the Administrator deems reliable;

     

    (iii)            
   For purposes of any Awards granted on the Registration Date,
the Fair Market Value will be the initial price to the public as set forth in
the final prospectus included within the registration statement in Form S-1
filed with the Securities and Exchange Commission for the initial public
offering of the Company’s Common Stock; or

     

    (iv)                In
the absence of an established market for the Common Stock, the Fair Market Value
will be determined in good faith by the Administrator.

     

    (r)       
    “Fiscal Year” means
the fiscal year of the Company.

     

    (s)           “Incentive Stock
Option” means an Option intended to qualify as an incentive stock option
within the meaning of Section 422 of the Code and the regulations
promulgated thereunder.

     

    (t)           “Inside Director”
means a Director who is an Employee.

     

    (u)           “Nonstatutory Stock
Option” means an Option that by its terms does not qualify or is not
intended to qualify as an Incentive Stock Option.

     

    (v)           “Officer” means a
person who is an officer of the Company within the meaning of Section 16 of
the Exchange Act and the rules and regulations promulgated
thereunder.

     

    (w)          “Option” means a stock
option granted pursuant to the Plan.

     

    (x)           “Optioned Stock” means
the Common Stock subject to an Award.


    
      
         


      

      
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    (y)           “Outside Director”
means a Director who is not an Employee.

     

    (z)           “Parent” means a
“parent corporation,” whether now or hereafter existing, as defined in
Section 424(e) of the Code.

     

    (aa)         “Participant” means
the holder of an outstanding Award.

     

    (bb)         “Performance Share”
means an Award denominated in Shares which may be earned in whole or in part
upon attainment of performance goals or other vesting criteria as the
Administrator may determine pursuant to Section 10.

     

    (cc)         “Performance Unit”
means an Award which may be earned in whole or in part upon attainment of
performance goals or other vesting criteria as the Administrator may determine
and which may be settled for cash, Shares or other securities or a combination
of the foregoing  pursuant to Section 10.

     

    (dd)         “Period of
Restriction” means the period during which the transfer of Shares of
Restricted Stock are subject to restrictions and therefore, the Shares are
subject to a substantial risk of forfeiture.  Such restrictions may be
based on the passage of time, the achievement of target levels of performance,
or the occurrence of other events as determined by the
Administrator.

     

    (ee)         “Plan” means this 2006
Equity Incentive Plan.

     

    (ff)          “Registration Date”
means the effective date of the first registration statement that is filed by
the Company and declared effective pursuant to Section 12(g) of the Exchange
Act, with respect to any class of the Company’s securities.

     

    (gg)         “Restricted Stock”
means Shares issued pursuant to a Restricted Stock award under Section 7 of
the Plan, or issued pursuant to the early exercise of an Option.

     

    (hh)         “Restricted Stock
Unit” means a bookkeeping entry representing an amount equal to the Fair
Market Value of one Share, granted pursuant to Section 8.  Each
Restricted Stock Unit represents an unfunded and unsecured obligation of the
Company.

     

    (ii)           “Rule 16b-3” means
Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3, as in effect when
discretion is being exercised with respect to the Plan.

     

    (jj)           “Section 16(b)”  means
Section 16(b) of the Exchange Act.

     

    (kk)         “Service Provider”
means an Employee, Director or Consultant.

     

    (ll)        
  “Share” means a share
of the Common Stock, as adjusted in accordance with Section 14 of the
Plan.

     

    (mm)       “Stock Appreciation
Right” or “SAR” means an Award,
granted alone or in connection with an Option, that pursuant to Section 9
is designated as a SAR.


    
      
         


      

      
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    (nn)         “Subsidiary” means a
“subsidiary corporation”, whether now or hereafter exist­ing, as defined in
Section 424(f) of the Code.

     

    3.           Stock Subject to the Plan.

     

    (a)           Stock Subject to the
Plan.  Subject to the provisions of Section 14 of the
Plan, the maximum aggregate number of Shares that may be issued under the Plan
is 10,369,190 (prior to any adjustment to reflect any stock split which may be
completed by the Company prior to the initial registration by the Company of its
Shares under Section 12 of the Exchange Act), which includes (i) a new number of
Shares reserved for issuance, plus (ii) the number of Shares which have been
reserved but not issued under the Company’s 1998 Stock Option Plan (the “1998
Plan”) as of the Registration Date, up to a maximum of 326,273 Shares (prior to
any adjustment to reflect any stock split which may be completed by the Company
prior to the initial registration by the Company of its Shares under Section 12
of the Exchange Act), and (iii) any Shares which may be returned to the 1998
Plan as a result of termination of options or repurchase of Shares issued under
the 1998 Plan, up to a maximum of 1,919,190 Shares (prior to any adjustment to
reflect any stock split which may be completed by the Company prior to the
initial registration by the Company of its Shares under Section 12 of the
Exchange Act).  The Shares may be authorized, but unissued, or
reacquired Common Stock.

     

    (b)           Automatic Share Reserve
Increase.  The number of Shares available for issuance under
the Plan shall be increased on the first day of each Fiscal Year beginning with
the 2007 Fiscal Year, in an amount equal to the lesser of (A) 630,000
Shares, (B) 3.5% of the outstanding Shares on the last day of the immediately
preceding Fiscal Year or (C) such lesser number of Shares determined by the
Board.

     

    (c)           Lapsed
Awards.  If an Award expires or becomes unexercisable without
having been exercised in full, is surrendered pursuant to an Exchange Program,
or, with respect to Restricted Stock, Restricted Stock Units, Performance Units
or Performance Shares, is forfeited to or repurchased by the Company due to
failure to vest, the unpurchased Shares (or for Awards other than Options or
SARs the forfeited or repurchased Shares) which were subject thereto will become
available for future grant or sale under the Plan (unless the Plan has
terminated).  With respect to SARs, only Shares actually issued
pursuant to an SAR will cease to be available under the Plan; all remaining
Shares under SARs will remain available for future grant or sale under the Plan
(unless the Plan has terminated).  Shares that have actually been
issued under the Plan under any Award will not be returned to the Plan and will
not become available for future distribution under the Plan; provided, however,
that if Shares issued pursuant to Awards of Restricted Stock, Performance Units
or Performance Shares are repurchased by the Company or are forfeited to the
Company, such Shares will become available for future grant under the
Plan.  Shares used to pay the exercise price of an Award or to satisfy
the minimum statutory withholding obligations related to an Award will become
available for future grant or sale under the Plan.  Notwithstanding
the foregoing and, subject to adjustment as provided in Section 14, the
maximum number of Shares that may be issued upon the exercise of Incentive Stock
Options shall equal the aggregate Share number stated in Section 3(a),
plus, an additional number of Shares equal to that portion of each automatic
increase specified in Section 3(b) that does not exceed 630,000
Shares.


    
      
         


      

      
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    (d)           Share
Reserve.  The Company, during the term of this Plan, will at
all times reserve and keep available such number of Shares as will be sufficient
to satisfy the requirements of the Plan.

     

    4.           Administration of the
Plan.

     

    (a)           Procedure.

     

    (i)                 Multiple Administrative
Bodies.  Different Committees with respect to different groups
of Service Providers may administer the Plan.

     

    (ii)                 Section 162(m).  To
the extent that the Administrator determines it to be desirable to qualify
Options granted hereunder as “performance-based compensation” within the meaning
of Section 162(m) of the Code, the Plan will be administered by a Committee
of two or more “outside directors” within the meaning of Section 162(m) of
the Code.

     

    (iii)                 Rule
16b-3.  To the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder
will be structured to satisfy the requirements for exemption under Rule
16b-3.

     

    (iv)                 Other
Administration.  Other than as provided above, the Plan will be
administered by (A) the Board or (B) a Committee, which committee will
be constituted to satisfy Applicable Laws.

     

    (b)           Powers of the
Administrator.  Subject to the provisions of the Plan, and in
the case of a Committee, subject to the specific duties delegated by the Board
to such Committee, the Administrator will have the authority, in its
discre­tion:

     

    (i)              
   to determine the Fair Market Value;

     

    (ii)                 to
select the Service Providers to whom Awards may be granted
hereunder;

     

    (iii)                to
determine the number of Shares to be covered by each Award granted
hereunder;

     

    (iv)                to
approve forms of Award Agreements for use under the Plan;

     

    (v)                 to
determine the terms and conditions, not inconsistent with the terms of the Plan,
of any Award granted hereunder.  Such terms and conditions include,
but are not limited to, the exercise price, the time or times when Awards may be
exercised (which may be based on performance criteria), any vesting acceleration
or waiver of forfeiture restrictions, and any restriction or limitation
regarding any Award or the Shares relating thereto, based in each case on such
factors as the Administrator will determine;

     

    (vi)                to
determine the terms and conditions of any, and to institute any Exchange
Program;


    
      
         


      

      
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    (vii)               to
construe and interpret the terms of the Plan and Awards granted pursuant to the
Plan;

     

    (viii)              to
prescribe, amend and rescind rules and regulations relating to the Plan,
including rules and regulations relating to sub-plans established for the
purpose of satisfying applicable foreign laws;

     

    (ix)                 to
modify or amend each Award (subject to Section 19(c) of the Plan),
including the discretionary authority to extend the post-termination
exercisability period of Awards;

     

    (x)           
      to allow Participants to satisfy withholding
tax obligations in such manner as prescribed in Section 15;

     

    (xi)                 to
authorize any person to execute on behalf of the Company any instrument required
to effect the grant of an Award previously granted by the
Administrator;

     

    (xii)                to
allow a Participant to defer the receipt of the payment of cash or the delivery
of Shares that would otherwise be due to such Participant under an
Award

     

    (xiii)               to
make all other determinations deemed necessary or advisable for administering
the Plan.

     

    (c)           Effect of
Administrator’s Decision.  The Administrator’s decisions,
determinations and interpretations will be final and binding on all Participants
and any other holders of Awards.

     

    5.           Eligibility.  Nonstatutory
Stock Options, Restricted Stock, Restricted Stock Units, SARs, Performance Units
and Performance Shares may be granted to Service Providers.  Incentive
Stock Options may be granted only to Employees.

     

    6.           Stock
Options.

     

    (a)           Limitations.  Each
Option will be designated in the Award Agreement as either an Incentive Stock
Option or a Nonstatutory Stock Option.  However, notwithstanding such
designa­tion, to the extent that the aggregate Fair Market Value of the
Shares with respect to which Incentive Stock Options are exercisable for the
first time by the Participant during any calendar year (under all plans of the
Company and any Parent or Subsidiary) exceeds $100,000, such Options will be
treated as Nonstatutory Stock Options.  For purposes of this
Section 6(a), Incentive Stock Options will be taken into account in the
order in which they were granted.  The Fair Market Value of the Shares
will be determined as of the time the Option with respect to such Shares is
granted.

     

    (b)           Term of
Option.  The term of each Option will be stated in the Award
Agreement.  In the case of an Incentive Stock Option, the term will be
ten (10) years from the date of grant or such shorter term as may be provided in
the Award Agreement.  Moreover, in the case of an Incentive Stock
Option granted to a Participant who, at the time the Incentive Stock Option is
granted, owns stock representing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or any Parent or
Subsidiary, the term of the Incentive Stock Option will be five (5) years from
the date of grant or such shorter term as may be provided in the Award
Agreement.


    
      
         


      

      
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    (c)           Option Exercise Price and
Consideration.

     

    (i)                 Exercise
Price.  The per share exercise price for the Shares to be
issued pursuant to exercise of an Option will be determined by the
Administrator, subject to the following:

     

    (1)           In
the case of an Incentive Stock Option

     

    a)           granted
to an Employee who, at the time the Incentive Stock Option is granted, owns
stock representing more than ten percent (10%) of the voting power of all
classes of stock of the Company or any Parent or Subsidiary, the per Share
exercise price will be no less than 110% of the Fair Market Value per Share on
the date of grant.

     

    b)           granted
to any Employee other than an Employee described in paragraph (A) immediately
above, the per Share exercise price will be no less than 100% of the Fair Market
Value per Share on the date of grant.

     

    c)           Notwithstanding
the foregoing, Incentive Stock Options may be granted with a per Share exercise
price of less than 100% of the Fair Market Value per Share on the date of grant
pursuant to a transaction described in, and in a manner consistent with,
Section 424(a) of the Code.

     

    (2)           In
the case of a Nonstatutory Stock Option, the per Share exercise price will be no
less than 100% of the Fair Market Value per Share on the date of
grant.

     

    (ii)                 Waiting Period and Exercise
Dates.  At the time an Option is granted, the Administrator
will fix the period within which the Option may be exercised and will determine
any conditions that must be satisfied before the Option may be
exercised.

     

    (iii)                 Form of
Consideration.  The Administrator will determine the acceptable
form of consideration for exercising an Option, including the method of
payment.  In the case of an Incentive Stock Option, the Administrator
will determine the acceptable form of consideration at the time of
grant.  Such consideration may consist entirely of: (1) cash; (2)
check; (3) other Shares, provided Shares acquired directly or indirectly from
the Company, (A) have been owned by the Participant and not subject to
substantial risk of forfeiture for more than six months on the date of
surrender, and (B) have a Fair Market Value on the date of surrender equal
to the aggregate exercise price of the Shares as to which said Option will be
exercised; (4) consideration received by the Company under a broker-assisted
cashless exercise program; (5) any combination of the foregoing methods of
payment; or (6) such other consideration and method of payment for the issuance
of Shares to the extent permitted by Applicable Laws.

     

    (d)           Exercise of
Option.

     

    (i)                 Procedure for Exercise;
Rights as a Stockholder.  Any Option granted hereunder will be
exercisable according to the terms of the Plan and at such times and under such
conditions as determined by the Administrator and set forth in the Award
Agreement.  An Option may not be exercised for a fraction of a
Share.


    
      
         


      

      
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    An Option
will be deemed exercised when the Company receives: (i) notice of exercise
(in such form as the Administrator specify from time to time) from the person
entitled to exercise the Option, and (ii) full payment for the Shares with
respect to which the Option is exercised (together with an applicable
withholding taxes).  Full payment may consist of any consideration and
method of payment authorized by the Administrator and permitted by the Award
Agreement and the Plan.  Shares issued upon exercise of an Option will
be issued in the name of the Participant or, if requested by the Participant, in
the name of the Participant and his or her spouse.  Until the Shares
are issued (as evidenced by the appropriate entry on the books of the Company or
of a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a stockholder will exist with respect to the
Optioned Stock, notwithstanding the exercise of the Option.  The
Company will issue (or cause to be issued) such Shares promptly after the Option
is exercised.  No adjustment will be made for a dividend or other
right for which the record date is prior to the date the Shares are issued,
except as provided in Section 14 of the
Plan.

     

    Exercising
an Option in any manner will decrease the number of Shares thereafter available,
both for purposes of the Plan and for sale under the Option, by the number of
Shares as to which the Option is exercised.

     

    (ii)                 Termination of Relationship
as a Service Provider.  If a Participant ceases to be a Service
Provider, other than upon the Participant’s death or Disability, the Participant
may exercise his or her Option within such period of time as is specified in the
Award Agreement to the extent that the Option is vested on the date of
termination (but in no event later than the expiration of the term of such
Option as set forth in the Award Agreement).  In the absence of a
specified time in the Award Agreement, the Option will remain exercisable for
three (3) months following the Participant’s termination.  Unless
otherwise provided by the Administrator, if on the date of termination the
Participant is not vested as to his or her entire Option, the Shares covered by
the unvested portion of the Option will revert to the Plan.  If after
termination the Participant does not exercise his or her Option within the time
specified by the Administrator, the Option will terminate, and the Shares
covered by such Option will revert to the Plan.

     

    (iii)                 Disability of
Participant.  If a Participant ceases to be a Service Provider
as a result of the Participant’s Disability, the Participant may exercise his or
her Option within such period of time as is specified in the Award Agreement to
the extent the Option is vested on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Award
Agreement).  In the absence of a specified time in the Award
Agreement, the Option will remain exercisable for twelve (12) months following
the Participant’s termination.  Unless otherwise provided by the
Administrator, if on the date of termination the Participant is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option will revert to the Plan.  If after termination the Participant
does not exercise his or her Option within the time specified herein, the Option
will terminate, and the Shares covered by such Option will revert to the
Plan.


    
      
         


      

      
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    (iv)                 Death of
Participant.  If a Participant dies while a Service Provider,
the Option may be exercised following the Participant’s death within such period
of time as is specified in the Award Agreement to the extent that the Option is
vested on the date of death (but in no event may the option be exercised later
than the expiration of the term of such Option as set forth in the Award
Agreement), by the Participant’s designated beneficiary, provided such
beneficiary has been designated prior to Participant’s death in a form
acceptable to the Administrator.  If no such beneficiary has been
designated by the Participant, then such Option may be exercised by the personal
representative of the Participant’s estate or by the person(s) to whom the
Option is transferred pursuant to the Participant’s will or in accordance with
the laws of descent and distribution.  In the absence of a specified
time in the Award Agreement, the Option will remain exercisable for twelve (12)
months following Participant’s death.  Unless otherwise provided by
the Administrator, if at the time of death Participant is not vested as to his
or her entire Option, the Shares covered by the unvested portion of the Option
will immediately revert to the Plan.  If the Option is not so
exercised within the time specified herein, the Option will terminate, and the
Shares covered by such Option will revert to the Plan.

     

    7.           Restricted
Stock.

     

    (a)           Grant of Restricted
Stock.  Subject to the terms and provisions of the Plan, the
Administrator, at any time and from time to time, may grant Shares of Restricted
Stock to Service Providers in such amounts as the Administrator, in its sole
discretion, will determine.

     

    (b)           Restricted Stock
Agreement.  Each Award of Restricted Stock will be evidenced by
an Award Agreement that will specify the Period of Restriction, the number of
Shares granted, and such other terms and conditions as the Administrator, in its
sole discretion, will determine.  Unless the Administrator determines
otherwise, the Company as escrow agent will hold Shares of Restricted Stock
until the restrictions on such Shares have lapsed.

     

    (c)           Transferability.  Except
as provided in this Section 7, Shares of Restricted Stock may not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated until the
end of the applicable Period of Restriction.

     

    (d)           Other
Restrictions.  The Administrator, in its sole discretion, may
impose such other restrictions on Shares of Restricted Stock as it may deem
advisable or appropriate.

     

    (e)           Removal of
Restrictions.  Except as otherwise provided in this Section 7,
Shares of Restricted Stock covered by each Restricted Stock grant made under the
Plan will be released from escrow as soon as practicable after the last day of
the Period of Restriction or at such other time as the Administrator may
determine.  The Administrator, in its discretion, may accelerate the
time at which any restrictions will lapse or be removed.

     

    (f)           Voting
Rights.  During the Period of Restriction, Service Providers
holding Shares of Restricted Stock granted hereunder may exercise full voting
rights with respect to those Shares, unless the Administrator determines
otherwise.

     

    (g)           Dividends and Other
Distributions.  During the Period of Restriction, Service
Providers holding Shares of Restricted Stock will be entitled to receive all
dividends and other distributions paid with respect to such Shares unless
otherwise provided in the Award Agreement.  If any such dividends or
distributions are paid in Shares, the Shares will be subject to the same
restrictions on transferability and forfeitability as the Shares of Restricted
Stock with respect to which they were paid.


    
      
         


      

      
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    (h)           Return of Restricted Stock
to Company.  On the date set forth in the Award Agreement, the
Restricted Stock for which restrictions have not lapsed will revert to the
Company and again will become available for grant under the Plan.

     

    8.           Restricted Stock
Units.

     

    (a)           Grant.  Restricted
Stock Units may be granted at any time and from time to time as determined by
the Administrator.  After the Administrator determines that it will
grant Restricted Stock Units under the Plan, it shall advise the Participant in
an Award Agreement of the terms, conditions, and restrictions related to the
grant, including the number of Restricted Stock Units.

     

    (b)           Vesting Criteria and Other
Terms.  The Administrator shall set vesting criteria in its
discretion, which, depending on the extent to which the criteria are met, will
determine the number of Restricted Stock Units that will be paid out to the
Participant.  The Administrator may set vesting criteria based upon
the achievement of Company-wide, business unit, or individual goals (including,
but not limited to, continued employment), or any other basis determined by the
Administrator in its discretion.

     

    (c)           Earning Restricted Stock
Units.  Upon meeting the applicable vesting criteria, the
Participant shall be entitled to receive a payout as specified in the Restricted
Stock Unit Award Agreement.  Notwithstanding the foregoing, at any
time after the grant of Restricted Stock Units, the Administrator, in its sole
discretion, may reduce or waive any vesting criteria that must be met to receive
a payout.

     

    (d)           Form and Timing of
Payment.  Payment of earned Restricted Stock Units shall be
made as soon as practicable after the date(s) set forth in the Restricted Stock
Unit Award Agreement.  The Administrator may only settle earned
Restricted Stock Units in Shares.

     

    (e)           Cancellation.  On
the date set forth in the Restricted Stock Unit Award Agreement, all unearned
Restricted Stock Units shall be forfeited to the Company.

     

    9.           Stock Appreciation
Rights.

     

    (a)           Grant of
SARs.  Subject to the terms and conditions of the Plan, a SAR
may be granted to Service Providers at any time and from time to time as will be
determined by the Administrator, in its sole discretion.

     

    (b)           Number of
Shares.  The Administrator will have complete discretion to
determine the number of SARs granted to any Service Provider.

     

    (c)           Exercise Price and Other
Terms.  The per share exercise price for the Shares to be
issued pursuant to exercise of an SAR shall be determined by the Administrator
and shall be no less than 100% of the Fair Market Value per share on the date of
grant.  Otherwise, subject to Section 6(a) of the Plan, the
Administrator, subject to the provisions of the Plan, shall have complete
discretion to determine the terms and conditions of SARs granted under the Plan;
provided, however, that no SAR may have a term of more than ten (10) years from
the date of grant.


    
      
         


      

      
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    (d)           SAR
Agreement.  Each SAR grant will be evidenced by an Award
Agreement that will specify the exercise price, the term of the SAR, the
conditions of exercise, and such other terms and conditions as the
Administrator, in its sole discretion, will determine.

     

    (e)           Expiration of
SARs.  An SAR granted under the Plan will expire upon the date
determined by the Administrator, in its sole discretion, and set forth in the
Award Agreement.  Notwithstanding the foregoing, the rules of
Section 6(d) also will apply to SARs.

     

    (f)           Payment of SAR
Amount.  Upon exercise of an SAR, a Participant will be
entitled to receive payment from the Company in an amount determined by
multiplying:

     

    (i)                 The
difference between the Fair Market Value of a Share on the date of exercise over
the exercise price; times

     

    (ii)                 The
number of Shares with respect to which the SAR is exercised.

     

    The
payment upon SAR exercise may only be in Shares of equivalent value (rounded
down to the nearest whole Share).

     

    10.           
Performance Units and
Performance Shares.

     

    (a)           Grant of Performance
Units/Shares.  Performance Units and Performance Shares may be
granted to Service Providers at any time and from time to time, as will be
determined by the Administrator, in its sole discretion.  The
Administrator will have complete discretion in determining the number of
Performance Units and Performance Shares granted to each
Participant.

     

    (b)           Value of Performance
Units/Shares.  Each Performance Unit will have an initial value
that is established by the Administrator on or before the date of
grant.  Each Performance Share will have an initial value equal to the
Fair Market Value of a Share on the date of grant.

     

    (c)           Performance Objectives and
Other Terms.  The Administrator will set performance objectives
or other vesting provisions (including, without limitation, continued status as
a Service Provider) in its discretion which, depending on the extent to which
they are met, will determine the number or value of Performance Units/Shares
that will be paid out to the Service Providers.  The time period
during which the performance objectives or other vesting provisions must be met
will be called the “Performance Period.”  Each Award of Performance
Units/Shares will be evidenced by an Award Agreement that will specify the
Performance Period, and such other terms and conditions as the Administrator, in
its sole discretion, will determine.  The Administrator may set
performance objectives based upon the achievement of Company-wide, divisional,
or individual goals, applicable federal or state securities laws, or any other
basis determined by the Administrator in its discretion.

     

    (d)           Earning of Performance
Units/Shares.  After the applicable Performance Period has
ended, the holder of Performance Units/Shares will be entitled to receive a
payout of the number of Performance Units/Shares earned by the Participant over
the Performance Period, to be determined as a function of the extent to which
the corresponding performance objectives or other vesting provisions have been
achieved.  After the grant of a Performance Unit/Share, the
Administrator, in its sole discretion, may reduce or waive any performance
objectives or other vesting provisions for such Performance
Unit/Share.


    
      
         


      

      
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    (e)           Form and Timing of Payment
of Performance Units/Shares.  Payment of earned Performance
Units/Shares will be made as soon as practicable after the expiration of the
applicable Performance Period.  The Administrator, in its sole
discretion, may pay earned Performance Units/Shares in the form of cash, in
Shares (which have an aggregate Fair Market Value equal to the value of the
earned Performance Units/Shares at the close of the applicable Performance
Period) or in a combination thereof.

     

    (f)           Cancellation of Performance
Units/Shares.  On the date set forth in the Award Agreement,
all unearned or unvested Performance Units/Shares will be forfeited to the
Company, and again will be available for grant under the Plan.

     

    11.           Formula Awards to Outside
Directors.

     

    (a)           General.  Outside
Directors will be entitled to receive all types of Awards (except Incentive
Stock Options) under this Plan, including discretionary Awards not covered under
this Section 11.  All grants of Awards to Outside Directors pursuant
to this Section will be automatic and nondiscretionary, except as otherwise
provided herein, and will be made in accordance with the following
provisions:

     

    (b)           Type of
Option.  If Options are granted pursuant to this Section they
will be Nonstatutory Stock Options and, except as otherwise provided herein,
will be subject to the other terms and conditions of the Plan.

     

    (c)           No
Discretion.  No person will have any discretion to select which
Outside Directors will be granted Awards under this Section or to determine the
number of Shares to be covered by such Awards (except as provided in
Sections 11(h) and 14).

     

    (d)           Initial
Award.  When each person first becomes an Outside Director,
they will be automatically granted both an Option for 15,000 Shares and 6,522
Restricted Stock Units (collectively the “Initial Award”) on or about the date
on which such person first becomes an Outside Director, whether through election
by the stockholders of the Company or appointment by the Board to fill a
vacancy; provided, however, that an Inside Director who ceases to be an Inside
Director, but who remains a Director, will not receive an Initial
Award.

     

    (e)           Annual
Award.  On each date of the first open trading window of each
fiscal year beginning in 2009, each Outside Director will be automatically
granted both an Option for 12,000 Shares and 1,305 Restricted Stock Units
(collectively the “Annual Award”), if as of such date, he or she will have
served on the Board for at least the preceding six (6) months.

     

    (f)           Options.  The
terms of each Option granted pursuant to this Section will be as
follows:


    
      
         


      

      
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    (i)                 The
term of the Option will be ten (10) years.

     

    (ii)                 The
exercise price for Shares subject to Options will be 100% of the Fair Market
Value on the grant date.

     

    (iii)                Subject
to Section 14, the portion of the Initial Award granted as an Option, if
applicable, will vest and become exercisable as to one thirty-sixth (1/36) of
the Shares per month, so as to be 100% vested on the third anniversary of the
grant date, provided that the Participant continues to serve as a Director
through each such date.

     

    (iv)                Subject
to Section 14, the portion of the Annual Award granted as an Option, if
applicable, will vest and become exercisable as to one thirty-sixth (1/36) of
the Shares per month, so as to be 100% vested on the third anniversary of the
grant date, provided that the Participant continues to serve as a Director
through such date.

     

    (g)           Restricted Stock
Units.  The terms of each Restricted Stock Unit granted
pursuant to this Section will be as follows:

     

    (i)              
   Restricted Stock Units shall be settled in Shares, on a one
unit for one Share basis.

     

    (ii)                 Subject
to Section 14, the portion of the Initial Award granted as Restricted Stock
Units, if applicable, will vest and become exercisable as to fifty percent (50%)
of the Restricted Stock Units on the first anniversary of the grant date and as
to fifty percent (50%) of the Restricted Stock Units on the second anniversary
of the grant date, so as to be 100% vested on the second anniversary of the
grant date, provided that the Participant continues to serve as a Director
through each such date.

     

    (iii)                 Subject
to Section 14, the portion of the Annual Award granted as Restricted Stock
Units, if applicable, will vest and become exercisable as to fifty percent (50%)
of the Restricted Stock Units on the first anniversary of the grant date and as
to fifty percent (50%) of the Restricted Stock Units on the second anniversary
of the grant date, so as to be 100% vested on the second anniversary of the
grant date, provided that the Participant continues to serve as a Director
through each such date.

     

    (h)           Adjustments.  The
Administrator in its discretion may change and otherwise revise the terms of
Awards granted under this Section 11, including, without limitation, the number
of Shares and exercise prices thereof, for Awards granted on or after the date
the Administrator determines to make any such change or revision.

     

    12.           Leaves of
Absence.  Unless the Administrator provides otherwise, vesting
of Awards granted hereunder will be suspended during any unpaid leave of
absence.  A Service Provider will not cease to be an Employee in the
case of (i) any leave of absence approved by the Company or
(ii) transfers between locations of the Company or between the Company, its
Parent, or any Subsidiary.  For purposes of Incentive Stock Options,
no such leave may exceed ninety (90) days, unless reemployment upon expiration
of such leave is guaranteed by statute or contract.  If reemployment
upon expiration of a leave of absence approved by the Company is not so
guaranteed, then three (3) months following the 91st day of such leave any
Incentive Stock Option held by the Participant will cease to be treated as an
Incentive Stock Option and will be treated for tax purposes as a Nonstatutory
Stock Option.


    
      
         


      

      
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    13.           Transferability of
Awards.  Unless determined otherwise by the Administrator, an
Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed
of in any manner other than by will or by the laws of descent or distribution
and may be exercised, during the lifetime of the Participant, only by the
Participant.  If the Administrator makes an Award transferable, such
Award will contain such additional terms and conditions as the Administrator
deems appropriate.

     

    14.           Adjustments; Dissolution or
Liquidation; Merger or Change in Control.

     

    (a)           Adjustments.  In
the event that any dividend or other distribution (whether in the form of cash,
Shares, other securities, or other property), recapitalization, stock split,
reverse stock split, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase, or exchange of Shares or other securities of the
Company, or other change in the corporate structure of the Company affecting the
Shares occurs, the Administrator, in order to prevent diminution or enlargement
of the benefits or potential benefits intended to be made available under the
Plan, may (in its sole discretion) adjust the number and class of Shares that
may be delivered under the Plan and/or the number, class, and price of Shares
covered by each outstanding Award, the numerical Share limits in Section 3
of the Plan and the number of Shares issuable pursuant to Awards to be granted
under Section 11.

     

    (b)           Dissolution or
Liquidation.  In the event of the proposed dissolution or
liquida­tion of the Company, the Administrator will notify each Participant
as soon as practicable prior to the effective date of such proposed
transaction.  To the extent it has not been previously exercised, an
Award will terminate immediately prior to the consummation of such proposed
action.

     

    (c)           Change in
Control.  In the event of a merger or Change in Control, each
outstanding Award will be treated as the Administrator determines, including,
without limitation, that each Award be assumed or an equivalent option or right
substituted by the successor corporation or a Parent or Subsidiary of the
successor corporation.  The Administrator shall not be required to
treat all Awards similarly in the transaction.

     

    In the
event that the successor corporation does not assume or substitute for the
Award, the Participant will fully vest in and have the right to exercise all of
his or her outstanding Options and SARs, including Shares as to which such
Awards would not otherwise be vested or exercisable, all restrictions on
Restricted Stock and Restricted Stock Units will lapse, and, with respect to
Awards with performance-based vesting, all performance goals or other vesting
criteria will be deemed achieved at 100% on-target levels and all other terms
and conditions met.  In addition, if an Option or SAR is not assumed
or substituted in the event of a Change in Control, the Administrator will
notify the Participant in writing or electronically that the Option or SAR will
be exercisable for a period of time determined by the Administrator in its sole
discretion, and the Option or SAR will terminate upon the expiration of such
period.

     

    For the
purposes of this subsection (c), an Award will be considered assumed if,
following the Change in Control, the Award confers the right to purchase or
receive, for each Share subject to the Award immediately prior to the Change in
Control, the consideration (whether stock, cash, or other securities or
property) received in the Change in Control by holders of Common Stock for each
Share held on the effective date of the transaction (and if holders were offered
a choice of consideration, the type of consideration chosen by the holders of a
majority of the outstanding Shares); provided, however, that if such
consideration received in the Change in Control is not solely common stock of
the successor corporation or its Parent, the Administrator may, with the consent
of the successor corporation, provide for the consideration to be received upon
the exercise of an Option or SAR or upon the payout of a Restricted Stock Unit,
Performance Unit or Performance Share, for each Share subject to such Award, to
be solely common stock of the successor corporation or its Parent equal in fair
market value to the per share consideration received by holders of Common Stock
in the Change in Control.


    
      
         


      

      
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    Notwithstanding
anything in this Section 14(c) to the contrary, an Award that vests, is earned
or paid-out upon the satisfaction of one or more performance goals will not be
considered assumed if the Company or its successor modifies any of such
performance goals without the Participant’s consent; provided, however, a
modification to such performance goals only to reflect the successor
corporation’s post-Change in Control corporate structure will not be deemed to
invalidate an otherwise valid Award assumption.

     

    (d)           Outside Director
Awards.  With respect to Awards granted to an Outside Director
that are assumed or substituted for, if on the date of or following such
assumption or substitution the Participant’s status as a Director or a director
of the successor corporation, as applicable, is terminated other than upon a
voluntary resignation by the Participant (unless such resignation is at the
request of the acquirer), then the Participant will fully vest in and have the
right to exercise Options and/or SARs as to all of the Shares underlying such
Award, including those Shares which would not otherwise be vested or
exercisable, all restrictions on Restricted Stock and Restricted Stock Units
will lapse, and, with respect to Performance Units and Performance Shares, all
performance goals or other vesting criteria will be deemed achieved at 100%
on-target levels and all other terms and conditions met.

     

    15.           Tax
Withholding.

     

    (a)           Withholding
Requirements.  Prior to the delivery of any Shares or cash
pursuant to an Award (or exercise thereof), the Company will have the power and
the right to deduct or withhold, or require a Participant to remit to the
Company, an amount sufficient to satisfy federal, state, local, foreign or other
taxes (including the Participant’s FICA obligation) required to be withheld with
respect to such Award (or exercise thereof).

     

    (b)           Withholding
Arrangements.  The Administrator, in its sole discretion and
pursuant to such procedures as it may specify from time to time, may permit a
Participant to satisfy such tax withholding obligation, in whole or in part by
(a) paying cash, (b) electing to have the Company withhold otherwise deliverable
cash or Shares having a Fair Market Value equal to the minimum statutory amount
required to be withheld, or (c) delivering to the Company already-owned Shares
having a Fair Market Value equal to the minimum statutory amount required to be
withheld.  The Fair Market Value of the Shares to be withheld or
delivered will be determined as of the date that the taxes are required to be
withheld.


    
      
         


      

      
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    16.           No Effect on Employment or
Service.  Neither the Plan nor any Award will confer upon a
Participant any right with respect to continuing the Participant’s relationship
as a Service Provider with the Company, nor will they interfere in any way with
the Participant’s right or the Company’s right to terminate such relationship at
any time, with or without cause, to the extent permitted by Applicable
Laws.

     

    17.           Date of
Grant.  The date of grant of an Award will be, for all
purposes, the date on which the Administrator makes the determination granting
such Award, or such other later date as is determined by the
Administrator.  Notice of the determination will be provided to each
Participant within a reasonable time after the date of such grant.

     

    18.           Term of
Plan.  Subject to Section 22 of the Plan, the Plan
will become effective upon its adoption by the Board.  It will
continue in effect for a term of ten (10) years from the date adopted by the
Board unless terminated earlier under Section 19 of the
Plan.

     

    19.           Amendment and Termination of
the Plan.

     

    (a)           Amendment and
Termination.  The Board may at any time amend, alter, suspend
or terminate the Plan.

     

    (b)           Stockholder
Approval.  The Company will obtain stockholder approval of any
Plan amendment to the extent necessary and desirable to comply with Applicable
Laws.

     

    (c)           Effect of Amendment or
Termination.  No amendment, alteration, suspension or
termination of the Plan will impair the rights of any Participant, unless
mutually agreed otherwise between the Participant and the Administrator, which
agreement must be in writing and signed by the Participant and the
Company.  Termination of the Plan will not affect the Administrator’s
ability to exercise the powers granted to it hereunder with respect to Awards
granted under the Plan prior to the date of such termination.

     

    20.           Conditions Upon Issuance of
Shares.

     

    (a)           Legal
Compliance.  Shares will not be issued pursuant to the exercise
of an Award unless the exercise of such Award and the issuance and delivery of
such Shares will comply with Applicable Laws and will be further subject to the
approval of counsel for the Company with respect to such
compliance.

     

    (b)           Investment
Representations.  As a condition to the exercise of an Award,
the Company may require the person exercising such Award to represent and
warrant at the time of any such exercise that the Shares are being purchased
only for investment and without any present intention to sell or distribute such
Shares if, in the opinion of counsel for the Company, such a representation is
required.

     

    21.           Inability to Obtain
Authority.  The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the
Company’s counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, will relieve the Company of any liability in respect of the failure
to issue or sell such Shares as to which such requisite authority will not have
been obtained.


    
      
         


      

      
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    22.           Stockholder
Approval.  The Plan will be subject to approval by the
stockholders of the Company within twelve (12) months after the date the Plan is
adopted by the Board.  Such stockholder approval will be obtained in
the manner and to the degree required under Applicable Laws.

     

     

     

     

     

     

     

     

     

     

     

     

    -18-