**Exhibit 10.1**

**GAIAM, INC.**

# **1999 LONG-TERM INCENTIVE PLAN**RESTATED AS OF JUNE 22, 2006

### **Section 1.  *Purpose***.  The purpose ofthis Plan is to advance the interests of Gaiam and its shareholders byproviding incentives to certain Eligible Persons (as defined below) whocontribute significantly to the strategic and long-term performance objectivesand growth of the Company.

### **Section 2.  *Definitions***.  Thedefinitions applicable to this Plan are provided in Appendix A.

### **Section 3.  *Administration*.**  TheCommittee shall administer this Plan and shall have all the powers vested in itby the terms of this Plan, such powers to include exclusive authority to selectthe Eligible Persons to be granted Awards under this Plan, to determine thetype, size and terms of the Award to be made to each Eligible Person selected,to modify the terms of any Award that has been granted, to determine the timewhen Awards will be granted, to establish performance objectives, to make anyadjustments necessary or desirable as a result of the granting of Awards toEligible Persons located outside the United States and to prescribe the form ofthe agreements evidencing Awards made under this Plan. The Committee isauthorized to interpret this Plan and the Awards granted under this Plan, toestablish, amend and rescind any rules and regulations relating to this Plan,and to make any other determinations that it deems necessary or desirable forthe administration of this Plan. The Committee may correct any defect or supplyany omission or reconcile any inconsistency in this Plan or in any Award in themanner and to the extent the Committee deems necessary or desirable to carry itinto effect. Any decision of the Committee in the interpretation andadministration of this Plan, as described this Plan, shall lie within its soleand absolute discretion and shall be final, conclusive and binding on allparties concerned. The Committee may act onlyby a majority of its members in office, *except* that themembers thereof may authorize any one or more of their members or any officerof the Company to execute and deliver documents or to take any otherministerial action on behalf of the Committee with respect to Awards made or tobe made to Participants.Notwithstanding the foregoing or any other provision of this Plan, theCommittee shall not have the authority to accelerate the time or schedule ofany payment in a manner which is not permitted under Code Section 409A, or togrant or amend any Award in any manner which would result in an inclusion ofany amount in gross income under Code Section 409A(a)(1).

### No member ofthe Committee and no officer of the Company shall be liable for anything doneor omitted to be done by him, by any other member of the Committee or by anyofficer of the Company in connection with the performance of duties under thisPlan, *except* for his own willful misconduct oras expressly provided by statute. In addition to all other rights ofindemnification and reimbursement to which a member of the Committee and anofficer of the Company may be entitled, the Company shall indemnify and holdharmless each such member or officer who was or is a party or is threatened tobe made a party to any threatened, pending or completed proceeding or suit inconnection with the performance of duties under this Plan against expenses(including reasonable attorneys’ fees), judgments, fines, liabilities, lossesand amounts paid in settlement actually and reasonably incurred by him inconnection with such proceeding or suit, *except* for hisown willful misconduct or as expressly provided otherwise by statute. Expenses(including reasonable attorneys’ fees) incurred by a such a member or officerin defending any such proceeding or suit shall be paid by the Company inadvance of the final disposition of such proceeding or suit upon receipt of awritten affirmation by such member or officer of his good faith belief that hehas met the standard of conduct necessary for indemnification and a writtenundertaking by or on behalf of such member or officer to repay such amount ifit shall ultimately be determined that he is not entitled to be indemnified bythe Company as authorized in this Section.

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### **Section 4.  *Participation*.**  Consistentwith the purposes of this Plan, the Committee shall have exclusive power toselect the Eligible Persons who may participate in this Plan and be grantedAwards under this Plan. Eligible Persons may be selected individually or bygroups or categories, as determined by the Committee in its discretion.

### **Section 5.  *Awards under this Plan*.**

### **(a)**           *Types of Awards*.  Awardsunder this Plan may include, but need not be limited to, one or more of thefollowing types, either alone or in any combination thereof:  (i) Stock Options, (ii) Stock AppreciationRights, (iii) Restricted Stock, (iv) Performance Grants and (v) any other typeof Award deemed by the Committee in its discretion to be consistent with thepurposes of this Plan (including, but not limited to, Awards of or options orsimilar rights granted with respect to unbundled stock units or components thereof,and Awards to be made to Participants who are foreign nationals or are employedor performing services outside the United States).

###### **(b)**           *Maximum Number of Sharesthat May be Issued*.  There may be issued under this Plan(as Restricted Stock, in payment of Performance Grants, pursuant to theexercise of Stock Options or Stock Appreciation Rights or in payment of orpursuant to the exercise of such other Awards as the Committee, in itsdiscretion, may determine) an aggregate of not more than 3,000,000 CommonShares, subject to adjustment as provided in Section 15. No EligiblePerson may receive Awards under this Plan for more than 400,000 Common Sharesin any one fiscal year of Gaiam, subject to adjustment as provided inSection 15. Common Shares issued pursuant to this Plan may be eitherauthorized but unissued shares, treasury shares, reacquired shares or anycombination thereof. If any Common Shares issued as Restricted Stock orotherwise subject to repurchase or forfeiture rights are reacquired by theCompany pursuant to such rights or, if any Award is canceled, terminates orexpires unexercised, any Common Shares that would otherwise have been issuablepursuant thereto will be available for issuance under new Awards.

###### **(c)**           *Rights with Respect toCommon Shares and Other Securities*. Except as provided in subsection 8(c) with respect to Awards ofRestricted Stock and unless otherwise determined by the Committee in itsdiscretion, a Participant to whom an Award is made (and any person succeedingto such a Participant’s rights pursuant to this Plan) shall have no rights as ashareholder with respect to any Common Shares or as a holder with respect toother securities, if any, issuable pursuant to any such Award until the date ofthe issuance of a stock certificate to him for such Common Shares or otherinstrument of ownership, if any. Except as provided in Section 15, noadjustment shall be made for dividends, distributions or other rights (whetherordinary or extraordinary, and whether in cash, securities, other property orother forms of consideration, or any combination thereof) for which the recorddate is prior to the date such stock certificate or other instrument ofownership, if any, is required to be issued based upon the date any Award wasexercised. In all events, a Participant with whom an Award agreement is made toissue Common Shares in the future, shall have no rights as a shareholder withrespect to Common Shares related to such agreement until issuance to him of astock certificate representing such shares.

### **Section 6.  *Stock Options*.**  TheCommittee may sell Purchased Options or grant other Stock Options either alone,or in conjunction with Associated Awards, either at the time of grant or byamendment thereafter; *provided* thatan Incentive Stock Option may be granted only to Eligible Persons who areemployees of the Company and who have Associated Awards only to the extent thatsuch Associated Awards do not disqualify the Incentive Stock Option’s status assuch under the Code. Each Stock Option granted or sold under this Plan shall beevidenced by an agreement in such form as the 

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Committee shall prescribefrom time to time in accordance with this Plan and shall comply with theapplicable terms and conditions of this Section and this Plan, and with suchother terms and conditions, including, but not limited to, restrictions uponthe Stock Option or the Common Shares issuable upon exercise thereof, as theCommittee, in its discretion, shall establish.

###### **(a)**           The exercise price of a Stock Optionmay be equal to or greater than the Fair Market Value of the Common Sharessubject to such Stock Option at the time the Stock Option is granted, asdetermined by the Committee; *provided, however*,that in the case of an Incentive Stock Option granted to an employee of theCompany, the exercise price shall not be less than the Fair Market Value of theCommon Shares subject to such Stock Option at the time the Stock Option isgranted, or if granted to a Ten Percent Employee, such exercise price shall notbe less than 110% of such Fair Market Value at the time the Stock Option isgranted. In no event, however, will the exercise price per share of a StockOption be less than the par value per share of a Common Share.

###### **(b)**           The Committee shall determine thenumber of Common Shares to be subject to each Stock Option. In the case of aStock Option awarded in conjunction with an Associated Award, the number ofCommon Shares subject to an outstanding Stock Option may be reduced on anappropriate basis to the extent that the Associated Award has been exercised,paid to or otherwise received by the Participant, as determined by theCommittee.

###### **(c)**           Any Stock Option may be exercisedduring its term only at such time or times and in such installments as theCommittee may establish.

###### **(d)**           A Stock Option shall not beexercisable:

###### **(i)**            in the case of any Incentive StockOption granted to a Ten Percent Employee, after the expiration of five yearsfrom the date it is granted, and, in the case of any other Stock Option, afterthe expiration of ten years from the date it is granted; and

###### **(ii)**           unless payment in full is made forthe shares being acquired thereunder at the time of exercise as provided insubsection 6(i).

###### **(e)**           The Committee shall determine in itsdiscretion and specify in each agreement evidencing a Stock Option the effect,if any, the termination of the Participant’s employment with or performance ofservices for the Company shall have on the exercisability of the Stock Option; *provided, however*, that an Incentive Stock Option shall notbe exercisable at a time that is beyond the time an Incentive Stock Option maybe exercised in order to qualify as such under the Code.

###### **(f)**            In the case of an Incentive StockOption, the amount of the aggregate Fair Market Value of Common Shares(determined at the time of grant of the Stock Option) with respect to whichincentive stock options are exercisable for the first time by an employee ofthe Company during any calendar year (under all such plans of his employercorporation and its parent and subsidiary corporations) shall not exceed$100,000 or such other amount as is specified in the Code.

###### **(g)**           It is the intent of Gaiam thatNonqualified Stock Options granted under this Plan not be classified asIncentive Stock Options, that the Incentive Stock Options granted under thisPlan be consistent with and contain or be deemed to contain all provisionsrequired under Section 422 and the other appropriate provisions of theCode and any implementing regulations 

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###### (and any successor provisions thereof), and that any ambiguities inconstruction shall be interpreted in order to effectuate such intent.

###### **(h)**           A Purchased Option may contain suchadditional terms not inconsistent with this Plan, including but not limited tothe circumstances under which the purchase price of such Purchased Option maybe returned to the holder of the Purchased Option, as the Committee maydetermine in its sole discretion.

###### **(i)**            For purposes of payments made toexercise Stock Options, such payment shall be made in such form (including, butnot limited to, cash, Common Shares, the surrender of another outstanding Awardunder this Plan or any combination thereof) as the Committee may determine inits discretion; *provided, however,* that, unlessthe Committee determines otherwise, forpurposes of making such payment in Common Shares, such shares shall be valuedat their Fair Market Value on the day of exercise and shall have been held bythe Participant for a period of at least six (6) months.

### **Section 7.  *Stock Appreciation Rights*.**  TheCommittee may grant Stock Appreciation Rights either alone, or in conjunctionwith Associated Awards, either at the time of grant or by amendment thereafter.Each Award of Stock Appreciation Rights granted under this Plan shall beevidenced by an agreement in such form as the Committee shall prescribe fromtime to time in accordance with this Plan and shall comply with the applicableterms and conditions of this Section and this Plan, and with such other termsand conditions, including, but not limited to, restrictions upon the Award ofStock Appreciation Rights or the Common Shares issuable upon exercise thereof,as the Committee, in its discretion, shall establish.

###### **(a)**           The Committee shall determine thenumber of Common Shares to be subject to each Award of Stock AppreciationRights. In the case of an Award of Stock Appreciation Rights awarded inconjunction with an Associated Award, the number of Common Shares subject to anoutstanding Award of Stock Appreciation Rights may be reduced on an appropriatebasis to the extent that the Associated Award has been exercised, paid to orotherwise received by the Participant, as determined by the Committee.

###### **(b)**           The Award of Stock AppreciationRights shall not be exercisable:

###### **(i)**            unless the Associated Award, if any,is at the time exercisable;

###### **(ii)**           if the Associated Award is a StockOption and the Fair Market Value per share of the Common Shares on the exercisedate does not exceed the exercise price per share of such Stock Option; and

###### **(iii)**         if the Associated Award is an IncentiveStock Option and the exercise of the Award of Stock Appreciation Rights woulddisqualify the Incentive Stock Option as such under the Code.

###### **(c)**           The Committee shall determine in itsdiscretion and specify in each agreement evidencing an Award of Stock AppreciationRights the effect, if any, the termination of the Participant’s employment withor performance of services for the Company shall have on the exercisability ofthe Award of Stock Appreciation Rights.

###### **(d)**           An Award of Stock Appreciation Rightsshall entitle the holder to exercise such Award or to surrender unexercised anAssociated 

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###### Award (or any portion of such Associated Award) to Gaiam and to receivefrom Gaiam in exchange thereof, without payment to Gaiam, that number of CommonShares having an aggregate value equal to (or, in the discretion of theCommittee, less than) the excess of the Fair Market Value of one share, at thetime of such exercise, over the exercise price, times the number of sharessubject to the Award or the Associated Award, or portion thereof, that is soexercised or surrendered, as the case may be. The Committee shall be entitledin its discretion to elect to settle the obligation arising out of the exerciseof a Stock Appreciation Right by the payment of cash or Other Gaiam Securitiesor property, or other forms of payment or any combination thereof, asdetermined by the Committee, equal to the aggregate value of the Common Sharesit would otherwise be obligated to deliver. Any such election by the Committeeshall be made as soon as practicable after the receipt by the Committee ofwritten notice of the exercise of the Stock Appreciation Right.

###### **(e)**           A Stock Appreciation Right mayprovide that it shall be deemed to have been exercised at the close of businesson the business day preceding the expiration date of the Stock AppreciationRight or of the related Stock Option (or other Award), or such other date asspecified by the Committee, if at such time such Stock Appreciation Right has apositive value. Such deemed exercise shall be settled or paid in the samemanner as a regular exercise thereof as provided in subsection 7(d) ofthis Agreement.

### **Section 8.  *Restricted Stock***.  TheCommittee may grant Awards of Restricted Stock either alone, or in conjunctionwith Associated Awards, either at the time of grant or by amendment thereafter.Each Award of Restricted Stock under this Plan shall be evidenced by anagreement in such form as the Committee shall prescribe from time to time inaccordance with this Plan and shall comply with the applicable terms andconditions of this Section and this Plan, and with such other terms andconditions as the Committee, in its discretion, shall establish.

###### **(a)**           The Committee shall determine thenumber of Common Shares to be issued to a Participant pursuant to the Award ofRestricted Stock, and the extent, if any, to which they shall be issued inexchange for cash, other consideration, or both.

###### **(b)**           Until the expiration of such periodas the Committee shall determine from the date on which the Award is grantedand subject to such other terms and conditions as the Committee in itsdiscretion shall establish (the “***RestrictedPeriod***”), a Participant to whom an Award of Restricted Stock ismade shall be issued, but shall not be entitled to the delivery of, a stockcertificate representing the Common Shares subject to such Award.

###### **(c)**           Unless otherwise determined by theCommittee in its discretion, a Participant to whom an Award of Restricted Stockhas been made (and any person succeeding to such a participant’s rightspursuant to this Plan) shall have, after issuance of a certificate for thenumber of Common Shares awarded and prior to the expiration of the RestrictedPeriod, ownership of such Common Shares, including the right to vote suchCommon Shares and to receive dividends or other distributions made or paid withrespect to such Common Shares (*provided* thatsuch Common Shares, and any new, additional or different shares, or Other GaiamSecurities or property, or other forms of consideration that the Participantmay be entitled to receive with respect to such Common Shares as a result of astock split, stock dividend or any other change in the corporation or capitalstructure of Gaiam, shall be subject to the restrictions set forth in this Planas determined by the Committee in its discretion), subject, however, to theoptions, restrictions and limitations imposed thereon pursuant to this Plan.

###### **(d)**           The Committee shall determine in itsdiscretion and specify in each agreement evidencing an Award of Restricted Stockthe effect, if any, the termination of the Participant’s 

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###### employment with or performance of services for the Company during theRestricted Period shall have on such Award of Restricted Stock.

### **Section 9.  *Performance Grants*.**  TheCommittee may grant Awards of Performance Grants either alone, or inconjunction with Associated Awards, either at the time of grant or by amendmentthereafter. The Award of a Performance Grant to a Participant will entitle himto receive a specified amount determined by the Committee (the “***Actual Value***”), if the termsand conditions specified in this Plan and in the Award are satisfied. EachAward of a Performance Grant shall be subject to the applicable terms andconditions of this Section and this Plan, and to such other terms andconditions, including but not limited to, restrictions upon any cash, CommonShares, Other Gaiam Securities or property, or other forms of payment, or anycombination thereof, issued with respect to the Performance Grant, as theCommittee, in its discretion, shall establish, and shall be embodied in anagreement in such form and substance as is determined by the Committee.

###### **(a)**           The Committee shall determine thevalue or range of values of a Performance Grant to be awarded to eachParticipant selected for an Award and whether or not such a Performance Grantis granted in conjunction with an Associated Award. As determined by theCommittee, the maximum value of each Performance Grant (the “***Maximum Value***”) shall be:(i) an amount fixed by the Committee at the time the Award is made oramended thereafter, (ii) an amount that varies from time to time based inwhole or in part on the then current value of the Common Shares, Other GaiamSecurities or property, or other securities or property, or any combination thereofor (iii) an amount that is determinable from criteria specified by theCommittee. Performance Grants may be issued in different classes or serieshaving different names, terms and conditions. In the case of a PerformanceGrant awarded in conjunction with an Associated Award, the Performance Grantmay be reduced on an appropriate basis to the extent that the Associated Awardhas been exercised, paid to or otherwise received by the Participant, asdetermined by the Committee.

###### **(b)**           The award period (“***Award Period***”) related to anyPerformance Grant shall be a period determined by the Committee. At the timeeach Award is made, the Committee shall establish performance objectives to beattained within the Award Period as the means of determining the Actual Valueof such a Performance Grant. The performance objectives shall be based on suchmeasure or measures of performance, which may include, but need not be limitedto, the performance of the Participant, the Company or one or more of itsdivisions or units, or any combination of the foregoing, as the Committee shalldetermine, and may be applied on an absolute basis or be relative to industryor other indices or any combination thereof. The Actual Value of a PerformanceGrant shall be equal to its Maximum Value only if the performance objectivesare attained in full, but the Committee shall specify the manner in which theActual Value of Performance Grants shall be determined if the performanceobjectives are met in part. Such performance measures, the Actual Value or theMaximum Value, or any combination thereof, may be adjusted in any manner by theCommittee in its discretion at any time and from time to time during or as soonas practicable after the Award Period, if it determines that such performance measures,the Actual Value or the Maximum Value, or any combination thereof, are notappropriate under the circumstances.

###### **(c)**           The Committee shall determine in itsdiscretion and specify in each agreement evidencing a Performance Grant theeffect, if any, the termination of the Participant’s employment with orperformance of services for the Company during the Award Period shall have onsuch Performance Grant.

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###### **(d)**           The Committee shall determine whetherthe conditions of a Performance Grant have been met and, if so, shall ascertainthe Actual Value of the Performance Grant. If the Performance Grant has noActual Value, the Award and such Performance Grant shall be deemed to have beencanceled and the Associated Award, if any, may be canceled or permitted to continuein effect in accordance with its terms. If the Performance Grant has any ActualValue and:

###### **(i)**            was not awarded in conjunction withan Associated Award, the Committee shall cause an amount equal to the ActualValue of the Performance Grant earned by the Participant to be paid to him orhis permitted assignee or Beneficiary; or

###### **(ii)**           was awarded in conjunction with anAssociated Award, the Committee shall determine, in accordance with criteriaspecified by the Committee (A) to cancel the Performance Grant, in whichevent no amount with respect thereto shall be paid to the Participant or hispermitted assignee or Beneficiary, and the Associated Award may be permitted tocontinue in effect in accordance with its terms, (B) to pay the ActualValue of the Performance Grant to the Participant or his permitted assignee orBeneficiary as provided below, in which event the Associated Award may becanceled or (C) to pay to the Participant or his Beneficiary, the ActualValue of only a portion of the Performance Grants, in which event all or aportion of the Associated Award may be permitted to continue in effect inaccordance with its terms or be canceled, as determined by the Committee.

###### Such determination by the Committee shall bemade as promptly as practicable following the end of the Award Period or uponthe earlier termination of employment or performance of services, or at suchother time or times as the Committee shall determine, and shall be madepursuant to criteria specified by the Committee.

###### **(e)**           Payment of any amount with respect tothe Performance Grants that the Committee determines to pay as provided aboveshall be made by Gaiam as promptly as practicable after the end of the AwardPeriod or at such other time or times as the Committee shall determine, and maybe made in cash, Common Shares, Other Gaiam Securities or property, or otherforms of payment, or any combination thereof or in such other manner, asdetermined by the Committee in its discretion. Notwithstanding anything in thisSection to the contrary, the Committee may, in its discretion, determine andpay out the Actual Value of the Performance Grants at any time during the AwardPeriod.

### **Section 10.  *Deferral of Compensation*.**  TheCommittee shall determine whether or not an Award shall be made in conjunctionwith the deferral of the Participant’s salary, bonus or other compensation, orany combination thereof, and whether or not such deferred amounts may be:

###### **(a)**           forfeited to the Company or to otherParticipants or any combination thereof, under certain circumstances (which mayinclude, but need not be limited to, certain types of termination of employmentor performance of services for the Company);

###### **(b)**           subject to increase or decrease invalue based upon the attainment of or failure to attain, respectively, certainperformance measures; and/or

###### **(c)**           credited with income equivalents(which may include, but need not be limited to, interest, dividends or otherrates of return) until the date or dates of payment of the Award, if any.

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### **Section 11.  *Deferred Payment of Awards*.**  TheCommittee may specify that the payment of all or any portion of cash, CommonShares, Other Gaiam Securities or property, or any other form of payment, orany combination thereof, under an Award shall be deferred until a later date. Deferralsshall be for such periods or until the occurrence of such events, and upon suchterms, as the Committee shall determine in its discretion, provided however, that any such deferral shall comply withthe requirements of Code Section 409A. Deferred payments of Awards maybe made by undertaking to make payment in the future based upon the performanceof certain investment equivalents (which may include, but need not be limitedto, government securities, Common Shares, other securities, property or consideration,or any combination thereof), together with such additional amounts of incomeequivalents (which may be compounded and may include, but need not be limitedto, interest, dividends or other rates of return or any combination thereof) asmay accrue thereon until the date or dates of payment, such investmentequivalents and such additional amounts of income equivalents to be determinedby the Committee in its discretion.

### **Section 12.  *Transferability of Awards*.**  AParticipant’s rights and interest under this Plan or any Award may not beassigned or transferred, hypothecated or encumbered in whole or in part eitherdirectly or by operation of law or otherwise, including, but not by way oflimitation, execution, levy, garnishment, attachment, pledge, bankruptcy or inany other manner; *provided, however,*the Committeemay permit such transfer to a Permitted Transferee; and *provided,further*, that, unless otherwise permitted by the Code, any IncentiveStock Option granted pursuant to this Plan shall not be transferable other thanby will, by the laws of descent and distribution, and shall be exercisableduring the Participant’s lifetime only by Participant or by such PermittedTransferee.

### **Section 13.  *Amendment or Substitution of Awards under this Plan*.**  Theterms of any outstanding Award under this Plan may be amended or modified fromtime to time by the Committee in its discretion in any manner that it deemsappropriate (including, but not limited to, acceleration of the date ofexercise of any Award and/or payments thereunder) if the Committee could grantsuch amended or modified Award under the terms of this Plan at the time of suchamendment or modification; *provided* thatno such amendment or modification shall adversely affect in a material mannerany right of a Participant under the Award without his written consent, unlessthe Committee determines in its discretion that there have occurred or areabout to occur significant changes in the Participant’s position, duties orresponsibilities, or significant changes in economic, legislative, regulatory,tax, accounting or cost/benefit conditions that are determined by the Committeein its discretion to have or to beexpected to have a substantial effect on the performance of the Company, or anyaffiliate, division or department thereof, on this Plan or on any Award underthis Plan and provided further that the Committee shall not have the authorityto accelerate the time or schedule of any payment in a manner which is notpermitted under Code Section 409A, or to grant or amend any Award in any mannerwhich would result in an inclusion of any amount in gross income under CodeSection 409A(a)(1). The Committee may, in its discretion, permit holders ofAwards under this Plan to surrender outstanding Awards in order to exercise orrealize the rights under other Awards, or in exchange for the grant ofnew Awards, or require holders of Awards to surrender outstanding Awards as acondition precedent to the grant of new Awards under this Plan.

### **Section 14.  *Termination of a Participant*.**  Forall purposes under this Plan, the Committee shall determine whether aParticipant has terminated employment with, or the performance of services for,the Company; *provided, however*, an absence or leave approved by the Company, to theextent permitted by applicable provisions of the Code, shall not be consideredan interruption of employment or performance of services for any purpose underthis Plan.

### **Section 15.  *Dilution and Other Adjustments*.**  Ifany change in the outstanding Common Shares of the Company occurs by reason ofany stock split of or stock dividend on the Common Shares, then, 

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except as otherwise determined by the Committee, theterms of any outstanding Awards shall be equitably adjusted. If any change inthe outstanding Common Shares occurs by reason of any split-up, split-off,spin-off, recapitalization, merger, consolidation, rights offering,reorganization, combination or exchange of shares, sale by the Company of allof its assets, distribution to shareholders (other than a stock dividend or anormal cash dividend on the Common Shares), or other extraordinary or unusualevent (other than a stock split of the Common Stock as provided above), thenthe Committee may determine, in its discretion, to terminate all outstandingAwards immediately prior to the consummation of any such event, or make anequitable adjustment in the terms of any outstanding Award and/or the number ofCommon Shares available for Awards. Any such termination or adjustment made bythe Committee and shall be final, conclusive and binding for all purposes ofthe Plan. Unless otherwise provided by the Committee, all outstanding Awardsshall terminate immediately prior to the consummation of any dissolution orliquidation of the Company.

### **Section 16.  *Designation of Beneficiary by Participant*.**  AParticipant may name a beneficiary to receive any payment to which he may beentitled with respect to any Award under this Plan in the event of his death,on a written form to be provided by and filed with the Committee, and in amanner determined by the Committee in its discretion (a “***Beneficiary***”). The Committeereserves the right to review and approve Beneficiary designations. AParticipant may change his Beneficiary from time to time in the same manner,unless such Participant has made an irrevocable designation. Any designation ofa Beneficiary under this Plan (to the extent it is valid and enforceable underapplicable law) shall be controlling over any other disposition, testamentaryor otherwise, as determined by the Committee in its discretion. If nodesignated Beneficiary survives the Participant and is living on the date onwhich any amount becomes payable to such a Participant’s Beneficiary, suchpayment will be made to the legal representatives of the Participant’s estate,and the term “***Beneficiary***”as used in this Plan shall be deemed to include such person or persons. Ifthere are any questions as to the legal right of any Beneficiary to receive adistribution under this Plan, the Committee in its discretion may determinethat the amount in question be paid to the legal representatives of the estateof the Participant, in which event the Company, the Board, the Committee, theDesignated Administrator (if any), and the members thereof, will have no furtherliability to anyone with respect to such amount.

### **Section 17.  *Financial Assistance*.**  Ifthe Committee determines that such action is advisable, the Company may assistany Participant in obtaining financing from the Company (or under any programof the Company approved pursuant to applicable law), or from a bank or otherthird party, on such terms as are determined by the Committee, and in suchamount as is required to accomplish the purposes of this Plan, including, butnot limited to, to permit the exercise of an Award, the participation therein,and/or the payment of any taxes with respect thereto. Such assistance may takeany form that the Committee deems appropriate, including, but not limited to, adirect loan from the Company, a guarantee of the obligation by the Company orthe maintenance by the Company of deposits with such bank or third party.

### **Section 18.  *Miscellaneous Provisions*.**

###### **(a)**           Any proceeds from Awards shallconstitute general funds of Gaiam.

###### **(b)**           No fractional shares may be deliveredunder an Award, but in lieu thereof a cash or other adjustment may be made asdetermined by the Committee in its discretion.

###### **(c)**           No Eligible Person or other personshall have any claim or right to be granted an Award under this Plan.Determinations made by the Committee under this Plan need not be uniform andmay be made selectively among Eligible Persons under this Plan, whether or notsuch Eligible Persons are similarly situated. Neither this Plan nor any actiontaken hereunder shall be construed as giving any Eligible Person any right tocontinue to be employed by or perform 

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###### services for the Company, and the right to terminate the employment ofor performance of services by Eligible Persons at any time and for any reasonis specifically reserved.

###### **(d)**           No Participant or other person shallhave any right with respect to this Plan, the Common Shares reserved forissuance under this Plan or in any Award, contingent or otherwise, untilwritten evidence of the Award shall have been delivered to the recipient andall the terms, conditions and provisions of this Plan and the Award applicableto such recipient (and each person claiming under or through him) have beenmet.

###### **(e)**           No Common Shares, Other GaiamSecurities or property, other securities or property or other forms of paymentshall be issued hereunder with respect to any Award unless counsel for Gaiamshall be satisfied that such issuance will be in compliance with applicable lawand any applicable rules of any stock exchange or other market quotation system on which Common Shares are listed.

###### **(f)**            It is the intent of Gaiam that thisPlan comply in all respects with Rule 16b-3 and Section 162(m) withrespect to Awards granted to executive officers of Gaiam, that any ambiguitiesor inconsistencies in construction of this Plan be interpreted to give effectto such intention and that if any provision of this Plan is found not to be incompliance with Rule 16b-3 or Section 162(m), such provision shall bedeemed null and void with respect to Awards granted to executive officers ofGaiam to the extent required to permit such Awards to comply with Rule 16b-3and Section 162(m). It is also the intent of Gaiam that this Plan comply in allrespects with the provisions of the Code providing favorable treatment toIncentive Stock Options, that any ambiguities or inconsistencies inconstruction of this Plan be interpreted to give effect to such intention andthat if any provision of this Plan is found not to be in compliance with theIncentive Stock Option provisions of the Code, such provision shall be deemednull and void with respect to Incentive Stock Options granted to employees ofthe Company to the extent required to permit such Incentive Stock Options toreceive favorable treatment under the Code.

### Itis the intent of Gaiam that this Plan comply in all respects with anyapplicable provisions of Code Section 409A with respect to Awards granted underthis plan and any amendment or revision of such Awards, that any ambiguities orinconsistencies in construction of this Plan be interpreted to give effect tosuch intention and that if any provision of this Plan is found not to be incompliance with any applicable provisions of Code Section 409A such Planprovision shall be deemed null and void to the extent required to permit suchAwards to comply with any applicable provisions of Code Section 409A.Specifically, the Committee shall not have the authority to accelerate the timeor schedule of any payment in a manner which is not permitted under Codesection 409A or the regulations issued thereunder, or to grant or amend anyAward in any manner which would result in an inclusion of any amount in grossincome under Code Section 409A(a)(1).

###### **(g)**           The Company shall have the right todeduct from any payment made under this Plan any federal, state, local orforeign income or other taxes required by law to be withheld with respect tosuch payment. It shall be a condition to the obligation of Gaiam to issueCommon Shares, Other Gaiam Securities or property, other securities orproperty, or other forms of payment, or any combination thereof, upon exercise,settlement or payment of any Award under this Plan, that the Participant (orany Beneficiary or person entitled to act) pay to Gaiam, upon its demand, suchamount as may be required by the Company for the purpose of satisfying anyliability to withhold federal, state, local or foreign income or other taxes.If the amount requested is not paid, Gaiam may refuse to issue Common Shares,Other Gaiam Securities or property, other securities or property, or otherforms of payment, or any combination thereof.

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###### Notwithstanding anything in this Plan to thecontrary, the Committee may, in its discretion, permit an Eligible Person (orany Beneficiary or person entitled to act) to elect to pay a portion or all ofthe amount requested by the Company for such taxes with respect to such Award,at such time and in such manner as the Committee shall deem to be appropriate(including, but not limited to, by authorizing Gaiam to withhold, or agreeingto surrender to Gaiam on or about the date such tax liability is determinable,Common Shares, Other Gaiam Securities or property, other securities orproperty, or other forms of payment, or any combination thereof, owned by suchperson or a portion of such forms of payment that would otherwise bedistributed, or have been distributed, as the case may be, pursuant to suchAward to such person, having a Fair Market Value equal to the amount of suchtaxes).

###### **(h)**           The expenses of this Plan shall beborne by the Company; *provided, however*,the Company may recover from a Participant or his Beneficiary, heirs or assignsany and all damages, fees, expenses and costs incurred by the Company arisingout of any actions taken by a Participant in breach of this Plan or anyagreement evidencing such Participant’s Award.

###### **(i)**            This Plan shall be unfunded. TheCompany shall not be required to establish any special or separate fund or tomake any other segregation of assets to assure the payment of any Award underthis Plan, and rights to the payment of Awards shall be no greater than therights of the Company’s general creditors.

###### **(j)**            By accepting any Award or otherbenefit under this Plan, each Participant and each person claiming under orthrough him shall be conclusively deemed to have indicated his acceptance andratification of, and consent to, any action taken under this Plan by theCompany, the Board, the Committee or the Designated Administrator (ifapplicable).

###### **(k)**           The appropriate officers of theCompany shall cause to be filed any reports, returns or other informationregarding Awards hereunder of any Common Shares issued pursuant hereto as maybe required by applicable law and any applicable rules of any stock exchange orother market quotation system onwhich Common Shares are listed.

###### **(l)**            The validity, construction,interpretation, administration and effect of this Plan, and of its rules andregulations, and rights relating to this Plan and to Awards granted under thisPlan, shall be governed by the substantive laws, but not the choice of lawrules, of the State of Colorado.

###### **(m)**          Records of the Company shall beconclusive for all purposes under this Plan or any Award, unless determined bythe Committee to be incorrect.

###### **(n)**           If any provision of this Plan or anyAward is held to be illegal or invalid for any reason, the illegality orinvalidity shall not affect the remaining provisions of this Plan or any Award,but such provision shall be fully severable, and this Plan or Award, asapplicable, shall be construed and enforced as if the illegal or invalidprovision had never been included in this Plan or Award, as applicable.

###### **(o)**           Theterms of this Plan shall govern all Awards under this Plan and in no eventshall the Committee have the power to grant any Award under this Plan that iscontrary to any of the provisions of this Plan.

###### **(p)**           For purposes of interpretation ofthis Plan, the masculine pronoun includes the feminine and the singularincludes the plural wherever appropriate.

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###### **Section 19.  *Plan Amendment or Suspension*.**  ThisPlan may be amended or suspended in whole or in part at any time from time totime by the Board. No amendment of this Plan shall adversely affect in amaterial manner any right of any Participant with respect to any Awardpreviously granted without such Participant’s written consent, except aspermitted under Section 13.

### **Section 20.  *Plan Termination*.**  ThisPlan shall terminate upon the earlier of the following dates or events tooccur:

###### **(a)**           upon the adoption of a resolution ofthe Board terminating this Plan; or

###### **(b)**           the tenth anniversary of theEffective Date; *provided, however*, that the Boardmay, prior to such date, extend the term of this Plan for an additional periodof up to five years for the grant of Awards other than Incentive Stock Options.No termination of this Plan shall materially alter or impair any of the rightsor obligations of any person, without his consent, under any Award previouslygranted under this Plan, *except* thatsubsequent to termination of this Plan, the Committee may make amendments ormodifications permitted under Section 13.

### **Section 21.  *Effective Date*.**  ThisPlan shall be effective, and Awards may be granted under this Plan, on or afterthe Effective Date.

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**APPENDIX A**

### The followingterms shall have the meaning indicated:

###### **(a)**           “***Actual Value***” has the meaning set forth in Section 9.

###### **(b)**           “***Associated Award***” shall mean an Award grantedconcurrently or subsequently in conjunction with another Award.

###### **(c)**           “***Award***” shall mean an award of rights to an EligiblePerson under this Plan.

###### **(d)**           “***Award Period***” has the meaning set forth in subsection9(b).

###### **(e)**           “***Beneficiary***” has the meaning set forth in Section 16.

###### **(f)**            “***Board***” shall mean the board of directors of Gaiam.

###### **(g)**           “***Code***” shall mean the Internal Revenue Code of 1986, asit now exists or may be amended from time to time, and the rules andregulations promulgated thereunder, as they may exist or may be amended fromtime to time.

###### **(h)**           “***Committee***” shall mean the person or persons responsiblefor administering the Plan. The Board shall constitute the Committee until theBoard appoints a Board Committee, after which time the Board Committee shallconstitute the Committee, provided, however, that at any time the Board maydesignate itself as the Committee or designate itself to administer certain ofthe Committee’s authority under the Plan, including administering certain Awardsunder the Plan. The Board or the Board Committee may designate a DesignatedAdministrator to constitute the Committee or to administer certain of theCommittee’s authority under the Plan, including administering certain Awardsunder the Plan, subject to the right of the Board or the Board Committee, asapplicable, to revoke its designation at any time and to make such designationon such terms and conditions as it may determine in its discretion. Forpurposes of this definition, the *“**Board Committee**”* shall mean acommittee of the Board designated by the Board to administer this Plan. Exceptas otherwise determined by the Board, the Board Committee (i) shall becomprised of not fewer than two directors, (ii) shall meet any applicablerequirements under Rule 16b-3, including any requirement that the BoardCommittee consist of “nonemployee directors” (as defined in Rule 16b-3), (iii)shall meet any applicable requirements under Section 162(m), including anyrequirement that the Board Committee consist of “outside directors” (as definedin Treasury Regulation §1.162-27(e)(3)(i) or any successor regulation), and(iv) shall meet any applicable requirements of any stock exchange or othermarket quotation system on which Common Shares are listed. For purposes of thisdefinition, the *“**DesignatedAdministrator**”*shall mean a person or person designatedby the Board or a Board Committee to act as a Designated Administrator pursuantto this Plan. Except as otherwise determined by the Board, a DesignatedAdministrator shall only be appointed if Rule 16b-3 permits suchappointment and the exercise of any authority without adversely affecting theability of Awards to officers of Gaiam to comply with the conditions for Rule16b-3 or Section 162(m).

###### **(i)**            “***Company***” shall mean Gaiam and any parent, subsidiary oraffiliate of Gaiam.

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###### **(j)**            “***Common Shares***” shall mean shares of Class A commonstock, par value $0.0001 per share, of Gaiam and stock of any other class intowhich such shares may thereafter be changed.

###### **(k)**           “***Effective Date***” shall June 1, 1999.

###### **(l)**            “***Eligible Person(s)***” shall mean those persons who arefull or part-time employees of the Company or other individuals who performservices for the Company, including, without limitation, directors who are notemployees of the Company and consultants and independent contractors whoperform services for the Company.

###### **(m)          “*Exchange Act”*** shall mean theSecurities Exchange Act of 1934, as it now exists or may be amended from timeto time, and the rules promulgated thereunder, as they may exist or may beamended from time to time.

###### **(n)**           “***Fair Market Value***” shall mean such value rounded up tothe nearest cent as determined by the Committee in accordance with applicablelaw.

###### **(o)**           “***Incentive Stock Option***” shall mean a Stock Option thatis an incentive stock option as defined in Section 422 of the Code. IncentiveStock Options are subject, in part, to the terms, conditions and restrictionsdescribed in Section 6.

###### **(p)**           “***Maximum Value***” has the meaning set forth in subsection9(a).

###### **(q)**           “***Gaiam***” shall mean Gaiam, Inc., a Colorado corporation.

###### **(r)**           “***Nonqualified Stock Option***” shall mean a Stock Optionthat is not an incentive stock option as defined in Section 422 of the Code.Nonqualified Stock Options are subject, in part, to the terms, conditions andrestrictions described in Section 6.

###### **(s)**           “***Other Gaiam Securities***” shall mean Gaiam securities(which may include, but need not be limited to, unbundled stock units orcomponents thereof, debentures, preferred stock, warrants, securitiesconvertible into Common Shares or other property) other than Common Shares.

###### **(t)**            “***Participant***” shall mean an Eligible Person to whom anAward has been granted under this Plan.

###### **(u)**           “***Performance Grant***” shall mean an Award subject, in part,to the terms, conditions and restrictions described in Section 9, pursuantto which the recipient may become entitled to receive cash, Common Shares,Other Gaiam Securities or property, or other forms of payment, or anycombination thereof, as determined by the Committee.

###### **(v)**            *“**Permitted Transferee**”*means (i)any person defined as an employee in the Instructions to Registration StatementForm S-8 promulgated by the Securities and Exchange Commission, as such Formmay be amended from time to time, which persons include, as of the date ofadoption of the Plan, (a) executors, administrators or beneficiaries of theestates of deceased Participants, guardians or members of a committee forincompetent former Participants, or similar persons duly authorized by law toadminister the estate or assets of former Participants, and (b) Participants’family members who acquire Awards from the Participant other than for value,through a gift or a domestic relations order and (ii) any trust established forthe benefit of 

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###### any persondescribed in clause (i). For purposes of this definition, “***family member***” includes anychild, stepchild, grandchild, parent, stepparent, grandparent, spouse, formerspouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law,daughter-in-law, brother-in-law, or sister-in-law, including adoptiverelationships, any person sharing the Participant’s household (other than atenant or employee), a trust in which these persons have more than fiftypercent of the beneficial interest, a foundation in which these persons (or theParticipant) control the management of assets, and any other entity in whichthese persons (or the Participant) own more than fifty percent of the votinginterests. For purposes of this definition, neither (i) a transfer under adomestic relations order in settlement of marital property rights; nor (ii) atransfer to an entity in which more than fifty percent of the voting interestsare owned by family members (or the Participant) in exchange for an interest inthat entity is considered a transfer for “***value***”.

###### **(w)**           “***Plan***” shall mean this Gaiam, Inc. 1999 Long-TermIncentive Plan.

###### **(x)**           “***Purchased Option***” shall mean a Stock Option that is soldto an Eligible Person at a price determined by the Committee. Purchased Optionsare subject, in part, to the terms, conditions and restrictions described inSection 6.

###### **(y)**           “***Restricted Period***” has the meaning set forth insubsection 8(b).

###### **(z)**           “***Restricted Stock***” shall mean an Award of Common Sharesthat are issued subject, in part, to the terms, conditions and restrictionsdescribed in Section 8.

###### **(aa)**         “***Rule16b-3***” shall mean Rule 16b-3 promulgated by the Securities andExchange Commission under the Exchange Act and any successor rule.

###### **(bb)**         “***Section162(m)***” shall mean §162(m) of the Code, any rules or regulationspromulgated thereunder, as they may exist or may be amended from time to time,or any successor to such section.

###### **(cc)        **“***Section 409A***” shall mean§409A of the Code, any rules or regulations promulgated thereunder, as they mayexist or may be amended from time to time, or any successor to such section.

###### **(dd)**         “***StockAppreciation Right***” shall mean an Award of a right to receive(without payment to Gaiam) cash, Common Shares, Other Gaiam Securities orproperty, or other forms of payment, or any combination thereof, as determinedby the Committee, based on the increase in the value of the number of CommonShares specified in the Stock Appreciation Right. Stock Appreciation Rights aresubject, in part, to the terms, conditions and restrictions described inSection 7.

###### **(ee)**         “***StockOption***” shall mean an Award of a right to purchase CommonShares. The term Stock Option shall include Nonqualified Stock Options,Incentive Stock Options and Purchased Options.

###### **(ff)**           “***Ten Percent Employee***” shall mean an employee of theCompany who owns stock representing more than ten percent of the voting powerof all classes of stock of Gaiam or any parent or subsidiary of Gaiam.

###### **(gg)**         “***TreasuryRegulation***” shall mean a final, proposed or temporary regulationof the Department of Treasury under the Code and any successor regulation.

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