<PAGE>

                                                                    Exhibit 10.4


                           IDERA PHARMACEUTICALS, INC.
                           ---------------------------

                           2005 STOCK INCENTIVE PLAN*
                           --------------------------


1.     Purpose

       The purpose of this 2005 Stock Incentive Plan (the "Plan") of Idera
Pharmaceuticals, Inc., a Delaware corporation (the "Company"), is to advance the
interests of the Company's stockholders by enhancing the Company's ability to
attract, retain and motivate persons who are expected to make important
contributions to the Company and by providing such persons with equity ownership
opportunities and performance-based incentives that are intended to align their
interests with those of the Company's stockholders. Except where the context
otherwise requires, the term "Company" shall include any of the Company's
present or future parent or subsidiary corporations as defined in Sections
424(e) or (f) of the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder (the "Code") and any other business venture
(including, without limitation, joint venture or limited liability company) in
which the Company has a controlling interest, as determined by the Board of
Directors of the Company (the "Board").

2.     Eligibility

       All of the Company's employees, officers and directors and all of the
Company's consultants and advisors that are natural persons are eligible to
receive options, stock appreciation rights, restricted stock, restricted stock
units and other stock-based awards (each, an "Award") under the Plan. Each
person who receives an Award under the Plan is deemed a "Participant".

3.     Administration and Delegation

       (a)    Administration by Board of Directors. The Plan will be
administered by the Board. The Board shall have authority to grant Awards and to
adopt, amend and repeal such administrative rules, guidelines and practices
relating to the Plan as it shall deem advisable. The Board may correct any
defect, supply any omission or reconcile any inconsistency in the Plan or any
Award in the manner and to the extent it shall deem expedient to carry the Plan
into effect and it shall be the sole and final judge of such expediency. All
decisions by the Board shall be made in the Board's sole discretion and shall be
final and binding on all persons having or claiming any interest in the Plan or
in any Award. No director or person acting pursuant to the authority delegated
by the Board shall be liable for any action or determination relating to or
under the Plan made in good faith.













-----------
* Reflects amendment to Plan approved by the Company's stockholders on June 7,
2006 and the one-for-eight reverse stock split effected on June 29, 2006.


<PAGE>


       (b)    Appointment of Committees. To the extent permitted by applicable
law, the Board may delegate any or all of its powers under the Plan to one or
more committees or subcommittees of the Board (a "Committee"). All references in
the Plan to the "Board" shall mean the Board or a Committee of the Board or the
officers referred to in Section 3(c) to the extent that the Board's powers or
authority under the Plan have been delegated to such Committee or officers.

       (c)    Delegation to Officers. To the extent permitted by applicable law,
the Board may delegate to one or more officers of the Company the power to grant
Awards to employees or officers of the Company or any of its present or future
subsidiary corporations and to exercise such other powers under the Plan as the
Board may determine, provided that the Board shall fix the terms of the Awards
to be granted by such officers (including the exercise price of such Awards,
which may include a formula by which the exercise price will be determined) and
the maximum number of shares subject to Awards that the officers may grant; and
provided further, however, that no officer shall be authorized to grant Awards
to any "executive officer" of the Company (as defined by Rule 3b-7 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) or to any
"officer" of the Company (as defined by Rule 16a-1 under the Exchange Act).

4.     Stock Available for Awards

       (a)    Number of Shares. Subject to adjustment under Section 9, Awards
may be made under the Plan for up to 1,125,000 shares of common stock, $0.001
par value per share, of the Company (the "Common Stock"). If any Award expires
or is terminated, surrendered or canceled without having been fully exercised or
is forfeited in whole or in part (including as the result of shares of Common
Stock subject to such Award being repurchased by the Company at the original
issuance price pursuant to a contractual repurchase right) or results in any
Common Stock not being issued, the unused Common Stock covered by such Award
shall again be available for the grant of Awards under the Plan. However, in the
case of Incentive Stock Options (as hereinafter defined), the foregoing
provisions shall be subject to any limitations under the Code. Shares issued
under the Plan may consist in whole or in part of authorized but unissued shares
or treasury shares.

       (b)    Sub-limits. Subject to adjustment under Section 9, the following
sub-limits on the number of shares subject to Awards shall apply:

              (1)    Section 162(m) Per-Participant Limit. The maximum number of
shares of Common Stock with respect to which Awards may be granted to any
Participant under the Plan shall be 125,000 per calendar year. For purposes of
the foregoing limit, the combination of an Option in tandem with an SAR (as each
term is hereafter defined) shall be treated as a single Award. The
per-Participant limit described in this Section 4(b)(1) shall be construed and
applied consistently with Section 162(m) of the Code or any successor provision
thereto, and the regulations thereunder ("Section 162(m)").






                                      -2-
<PAGE>


              (2)    Limit on Awards that Vest Based Upon the Passage of Time
Alone. The maximum number of shares of Common Stock with respect to which
Restricted Stock Awards and Other Stock Unit Awards that either require no
purchase by the Participant or vest on the basis of the passage of time alone
may be granted shall be 62,500.

5.     Stock Options

       (a)    General. The Board may grant options to purchase Common Stock
(each, an "Option") and determine the number of shares of Common Stock to be
covered by each Option, the exercise price of each Option and the conditions and
limitations applicable to the exercise of each Option, including conditions
relating to applicable federal or state securities laws, as it considers
necessary or advisable. An Option which is not intended to be an Incentive Stock
Option (as hereinafter defined) shall be designated a "Nonstatutory Stock
Option".

       (b)    Incentive Stock Options. An Option that the Board intends to be an
"incentive stock option" as defined in Section 422 of the Code (an "Incentive
Stock Option") shall only be granted to employees of Hybridon, Inc., any of
Hybridon Inc.'s present or future parent or subsidiary corporations as defined
in Sections 424(e) or (f) of the Code, and any other entities the employees of
which are eligible to receive Incentive Stock Options under the Code, and shall
be subject to and shall be construed consistently with the requirements of
Section 422 of the Code. The Company shall have no liability to a Participant,
or any other party, if an Option (or any part thereof) that is intended to be an
Incentive Stock Option is not an Incentive Stock Option or for any action taken
by the Board pursuant to Section 10(f), including without limitation the
conversion of an Incentive Stock Option to a Nonstatutory Stock Option.

       (c)    Exercise Price. The Board shall establish the exercise price of
each Option and specify such exercise price in the applicable option agreement.

       (d)    Duration of Options. Each Option shall be exercisable at such
times and subject to such terms and conditions as the Board may specify in the
applicable option agreement; provided, however, that no Option will be granted
for a term in excess of 10 years.

       (e)    No Reload Rights. No Option granted under the Plan shall contain
any provision entitling the optionee to the automatic grant of additional
Options in connection with any exercise of the original Option.

       (f)    Exercise of Option. Options may be exercised by delivery to the
Company of a written notice of exercise signed by the proper person or by any
other form of notice (including electronic notice) approved by the Board
together with payment in full as specified in Section 5(g) for the number of
shares for which the Option is exercised. Shares of Common Stock subject to the
Option will be delivered by the Company following exercise either as soon as
practicable or, subject to such conditions as the Board shall specify, on a
deferred basis (with the Company's obligation to be evidenced by an instrument
providing for future delivery of the deferred shares at the time or times
specified by the Board).









                                      -3-
<PAGE>


       (g)    Payment Upon Exercise. Common Stock purchased upon the exercise of
an Option granted under the Plan shall be paid for as follows:

              (1)    in cash, by check or by wire transfer, payable to the order
of the Company;

              (2)    except as the Board may otherwise provide in an option
agreement, by (i) delivery of an irrevocable and unconditional undertaking by a
creditworthy broker to deliver promptly to the Company sufficient funds to pay
the exercise price and any required tax withholding or (ii) delivery by the
Participant to the Company of a copy of irrevocable and unconditional
instructions to a creditworthy broker to deliver promptly to the Company cash or
a check sufficient to pay the exercise price and any required tax withholding;

              (3)    for so long as the Common Stock is registered under the
Exchange Act, by delivery of shares of Common Stock owned by the Participant
valued at their fair market value as determined by (or in a manner approved by)
the Board ("Fair Market Value"), provided (i) such method of payment is then
permitted under applicable law, (ii) such Common Stock, if acquired directly
from the Company, was owned by the Participant for such minimum period of time,
if any, as may be established by the Board in its discretion and (iii) such
Common Stock is not subject to any repurchase, forfeiture, unfulfilled vesting
or other similar requirements;

              (4)    to the extent permitted by applicable law and by the Board,
by (i) delivery of a promissory note of the Participant to the Company on terms
determined by the Board, or (ii) payment of such other lawful consideration as
the Board may determine; or

              (5)    by any combination of the above permitted forms of payment.

       (h)    Substitute Options. In connection with a merger or consolidation
of an entity with the Company or the acquisition by the Company of property or
stock of an entity, the Board may grant Options in substitution for any options
or other stock or stock-based awards granted by such entity or an affiliate
thereof. Substitute Options may be granted on such terms as the Board deems
appropriate in the circumstances, notwithstanding any limitations on Options
contained in the other sections of this Section 5 or in Section 2. Substitute
Options shall not count against the overall share limit set forth in Section
4(a), except as may be required by reason of Section 422 and related provisions
of the Code.

6.     Stock Appreciation Rights.

       (a)    General. A Stock Appreciation Right, or SAR, is an Award entitling
the holder, upon exercise, to receive an amount in Common Stock determined by
reference to appreciation, from and after the date of grant, in the fair market
value of a share of Common Stock. The date as of which such appreciation or
other measure is determined shall be the exercise date.

       (b)    Grants. Stock Appreciation Rights may be granted in tandem with,
or independently of, Options granted under the Plan.




                                      -4-
<PAGE>

              (1)    Tandem Awards. When Stock Appreciation Rights are expressly
granted in tandem with Options, (i) the Stock Appreciation Right will be
exercisable only at such time or times, and to the extent, that the related
Option is exercisable (except to the extent designated by the Board in
connection with a Reorganization Event) and will be exercisable in accordance
with the procedure required for exercise of the related Option; (ii) the Stock
Appreciation Right will terminate and no longer be exercisable upon the
termination or exercise of the related Option, except to the extent designated
by the Board in connection with a Reorganization Event; provided that a Stock
Appreciation Right granted with respect to less than the full number of shares
covered by an Option will not be reduced until the number of shares as to which
the related Option has been exercised or has terminated is less than the number
of shares covered by the Stock Appreciation Right; (iii) the Option will
terminate and no longer be exercisable upon the exercise of the related Stock
Appreciation Right; and (iv) the Stock Appreciation Right will be transferable
only with the related Option.

              (2)    Independent SARs. A Stock Appreciation Right not expressly
granted in tandem with an Option will become exercisable at such time or times,
and on such conditions, as the Board may specify in the SAR Award.

       (c)    Exercise. Stock Appreciation Rights may be exercised by delivery
to the Company of a written notice of exercise signed by the proper person or by
any other form of notice (including electronic notice) approved by the Board,
together with any other documents required by the Board.

7.     Restricted Stock; Restricted Stock Units.

       (a)    General. The Board may grant Awards entitling recipients to
acquire shares of Common Stock ("Restricted Stock"), subject to the right of the
Company to repurchase all or part of such shares at their issue price or other
stated or formula price (or to require forfeiture of such shares if issued at no
cost) from the recipient in the event that conditions specified by the Board in
the applicable Award are not satisfied prior to the end of the applicable
restriction period or periods established by the Board for such Award. Instead
of granting Awards for Restricted Stock, the Board may grant Awards entitling
the recipient to receive shares of Common Stock to be delivered at the time such
shares of Common Stock vest ("Restricted Stock Units") (Restricted Stock and
Restricted Stock Units are each referred to herein as a "Restricted Stock
Award").

       (b)    Terms and Conditions. The Board shall determine the terms and
conditions of a Restricted Stock Award, including the conditions for repurchase
(or forfeiture) and the issue price, if any.

       (c)    Stock Certificates. Any stock certificates issued in respect of a
Restricted Stock Award shall be registered in the name of the Participant and,
unless otherwise determined by the Board, deposited by the Participant, together
with a stock power endorsed in blank, with the Company (or its designee). At the
expiration of the applicable restriction periods, the Company (or such designee)
shall deliver the certificates no longer subject to such restrictions to the







                                      -5-
<PAGE>


Participant or if the Participant has died, to the beneficiary designated, in a
manner determined by the Board, by a Participant to receive amounts due or
exercise rights of the Participant in the event of the Participant's death (the
"Designated Beneficiary"). In the absence of an effective designation by a
Participant, "Designated Beneficiary" shall mean the Participant's estate.

8.     Other Stock-Based Awards.

       Other Awards of shares of Common Stock, and other Awards that are valued
in whole or in part by reference to, or are otherwise based on, shares of Common
Stock or other property, may be granted hereunder to Participants ("Other Stock
Unit Awards"), including without limitation Awards entitling recipients to
receive shares of Common Stock to be delivered in the future. Such Other Stock
Unit Awards shall also be available as a form of payment in the settlement of
other Awards granted under the Plan or as payment in lieu of compensation to
which a Participant is otherwise entitled. Other Stock Unit Awards may be paid
in shares of Common Stock or cash, as the Board shall determine. Subject to the
provisions of the Plan, the Board shall determine the conditions of each Other
Stock Unit Awards, including any purchase price applicable thereto.

9.     Adjustments for Changes in Common Stock and Certain Other Events.

       (a)    Changes in Capitalization. In the event of any stock split,
reverse stock split, stock dividend, recapitalization, combination of shares,
reclassification of shares, spin-off or other similar change in capitalization
or event, or any distribution to holders of Common Stock other than an ordinary
cash dividend, (i) the number and class of securities available under this Plan,
(ii) the sub-limits set forth in Section 4(b), (iii) the number and class of
securities and exercise price per share of each outstanding Option, (iv) the
share- and per-share provisions of each Stock Appreciation Right, (v) the share-
and per-share provisions and the repurchase price per share subject to each
outstanding Restricted Stock Award and (vi) the share- and per-share-related
provisions of each outstanding Other Stock Unit Award, shall be appropriately
adjusted by the Company (or substituted Awards may be made, if applicable) to
the extent determined by the Board.

       (b)    Reorganization Events.

              (1)    Definition. A "Reorganization Event" shall mean: (a) any
merger or consolidation of the Company with or into another entity as a result
of which all of the Common Stock of the Company is converted into or exchanged
for the right to receive cash, securities or other property or is cancelled, (b)
any exchange of all of the Common Stock of the Company for cash, securities or
other property pursuant to a share exchange transaction or (c) any liquidation
or dissolution of the Company.

              (2)    Consequences of a Reorganization Event on Awards Other than
Restricted Stock Awards. In connection with a Reorganization Event, the Board
shall take any one or more of the following actions as to all or any outstanding
Awards on such terms as the Board determines: (i) provide that Awards shall be
assumed, or substantially equivalent Awards shall










                                      -6-
<PAGE>

be substituted, by the acquiring or succeeding corporation (or an affiliate
thereof), (ii) upon written notice to a Participant, provide that the
Participant's unexercised Options or other unexercised Awards shall become
exercisable in full and will terminate immediately prior to the consummation of
such Reorganization Event unless exercised by the Participant within a specified
period following the date of such notice, (iii) provide that outstanding Awards
shall become realizable or deliverable, or restrictions applicable to an Award
shall lapse, in whole or in part prior to or upon such Reorganization Event,
(iv) in the event of a Reorganization Event under the terms of which holders of
Common Stock will receive upon consummation thereof a cash payment for each
share surrendered in the Reorganization Event (the "Acquisition Price"), make or
provide for a cash payment to a Participant equal to (A) the Acquisition Price
times the number of shares of Common Stock subject to the Participant's Options
or other Awards (to the extent the exercise price does not exceed the
Acquisition Price) minus (B) the aggregate exercise price of all such
outstanding Options or other Awards, in exchange for the termination of such
Options or other Awards, (v) provide that, in connection with a liquidation or
dissolution of the Company, Awards shall convert into the right to receive
liquidation proceeds (if applicable, net of the exercise price thereof) and (vi)
any combination of the foregoing.

              For purposes of clause (i) above, an Option shall be considered
assumed if, following consummation of the Reorganization Event, the Option
confers the right to purchase, for each share of Common Stock subject to the
Option immediately prior to the consummation of the Reorganization Event, the
consideration (whether cash, securities or other property) received as a result
of the Reorganization Event by holders of Common Stock for each share of Common
Stock held immediately prior to the consummation of the Reorganization Event
(and if holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the outstanding shares of
Common Stock); provided, however, that if the consideration received as a result
of the Reorganization Event is not solely common stock of the acquiring or
succeeding corporation (or an affiliate thereof), the Company may, with the
consent of the acquiring or succeeding corporation, provide for the
consideration to be received upon the exercise of Options to consist solely of
common stock of the acquiring or succeeding corporation (or an affiliate
thereof) equivalent in value (as determined by the Board) to the per share
consideration received by holders of outstanding shares of Common Stock as a
result of the Reorganization Event.

              (3)    Consequences of a Reorganization Event on Restricted Stock
Awards. Upon the occurrence of a Reorganization Event other than a liquidation
or dissolution of the Company, the repurchase and other rights of the Company
under each outstanding Restricted Stock Award shall inure to the benefit of the
Company's successor and shall apply to the cash, securities or other property
which the Common Stock was converted into or exchanged for pursuant to such
Reorganization Event in the same manner and to the same extent as they applied
to the Common Stock subject to such Restricted Stock Award. Upon the occurrence
of a Reorganization Event involving the liquidation or dissolution of the
Company, except to the extent specifically provided to the contrary in the
instrument evidencing any Restricted Stock Award or any other agreement between
a Participant and the Company, all restrictions and









                                      -7-
<PAGE>

conditions on all Restricted Stock Awards then outstanding shall automatically
be deemed terminated or satisfied.

10.    General Provisions Applicable to Awards

       (a)    Transferability of Awards. Except as the Board may otherwise
determine or provide in an Award, Awards shall not be sold, assigned,
transferred, pledged or otherwise encumbered by the person to whom they are
granted, either voluntarily or by operation of law, except by will or the laws
of descent and distribution or, other than in the case of an Incentive Stock
Option, pursuant to a qualified domestic relations order, and, during the life
of the Participant, shall be exercisable only by the Participant. References to
a Participant, to the extent relevant in the context, shall include references
to authorized transferees.

       (b)    Documentation. Each Award shall be evidenced in such form
(written, electronic or otherwise) as the Board shall determine. Each Award may
contain terms and conditions in addition to those set forth in the Plan.

       (c)    Board Discretion. Except as otherwise provided by the Plan, each
Award may be made alone or in addition or in relation to any other Award. The
terms of each Award need not be identical, and the Board need not treat
Participants uniformly.

       (d)    Termination of Status. The Board shall determine the effect on an
Award of the disability, death, retirement, authorized leave of absence or other
change in the employment or other status of a Participant and the extent to
which, and the period during which, the Participant, or the Participant's legal
representative, conservator, guardian or Designated Beneficiary, may exercise
rights under the Award.

       (e)    Withholding. Each Participant shall pay to the Company, or make
provision satisfactory to the Company for payment of, any taxes required by law
to be withheld in connection with an Award to such Participant. Except as the
Board may otherwise provide in an Award, for so long as the Common Stock is
registered under the Exchange Act, Participants may satisfy such tax obligations
in whole or in part by delivery of shares of Common Stock, including shares
retained from the Award creating the tax obligation, valued at their Fair Market
Value; provided, however, except as otherwise provided by the Board, that the
total tax withholding where stock is being used to satisfy such tax obligations
cannot exceed the Company's minimum statutory withholding obligations (based on
minimum statutory withholding rates for federal and state tax purposes,
including payroll taxes, that are applicable to such supplemental taxable
income). Shares surrendered to satisfy tax withholding requirements cannot be
subject to any repurchase, forfeiture, unfulfilled vesting or other similar
requirements. The Company may, to the extent permitted by law, deduct any such
tax obligations from any payment of any kind otherwise due to a Participant.

       (f)    Amendment of Award. The Board may amend, modify or terminate any
outstanding Award, including but not limited to, substituting therefor another
Award of the same or a different type, changing the date of exercise or
realization, and converting an Incentive Stock











                                      -8-
<PAGE>

Option to a Nonstatutory Stock Option, provided that the Participant's consent
to such action shall be required unless the Board determines that the action,
taking into account any related action, would not materially and adversely
affect the Participant.

       (g)    Conditions on Delivery of Stock. The Company will not be obligated
to deliver any shares of Common Stock pursuant to the Plan or to remove
restrictions from shares previously delivered under the Plan until (i) all
conditions of the Award have been met or removed to the satisfaction of the
Company, (ii) in the opinion of the Company's counsel, all other legal matters
in connection with the issuance and delivery of such shares have been satisfied,
including any applicable securities laws and any applicable stock exchange or
stock market rules and regulations, and (iii) the Participant has executed and
delivered to the Company such representations or agreements as the Company may
consider appropriate to satisfy the requirements of any applicable laws, rules
or regulations.

       (h)    Acceleration. The Board may at any time provide that any Award
shall become immediately exercisable in full or in part, free of some or all
restrictions or conditions, or otherwise realizable in full or in part, as the
case may be.

       (i)    Performance Conditions.

              (1)    This Section 10(i) shall be administered by a Committee
approved by the Board, all of the members of which are "outside directors" as
defined by Section 162(m) (the "Section 162(m) Committee").

              (2)    Notwithstanding any other provision of the Plan, if the
Section 162(m) Committee determines, at the time a Restricted Stock Award or
Other Stock Unit Award is granted to a Participant, that such Participant is, or
may be as of the end of the tax year in which the Company would claim a tax
deduction in connection with such Award, a Covered Employee (as defined in
Section 162(m)), then the Section 162(m) Committee may provide that this Section
10(i) is applicable to such Award.

              (3)    If a Restricted Stock Award or Other Stock Unit Award is
subject to this Section 10(i), then the lapsing of restrictions thereon and the
distribution of cash or Shares pursuant thereto, as applicable, shall be subject
to the achievement of one or more objective performance goals established by the
Section 162(m) Committee, which shall be based on the relative or absolute
attainment of specified levels of one or any combination of the following: (a)
earnings per share, (b) return on average equity or average assets with respect
to a pre-determined peer group, (c) earnings, (d) earnings growth, (e) revenues,
(f) expenses, (g) stock price, (h) market share, (i) return on sales, assets,
equity or investment, (j) regulatory compliance, (k) achievement of balance
sheet or income statement objectives, (l) total shareholder return, (m) net
operating profit after tax, (n) pre-tax or after-tax income, (o) cash flow, (p)
achievement of research, development, clinical or regulatory milestones, (q)
product sales and (r) business development activities, and may be absolute in
their terms or measured against or in relationship to other companies
comparably, similarly or otherwise situated. Such performance goals may be
adjusted to exclude any one or more of (i) extraordinary items, (ii)









                                      -9-
<PAGE>

gains or losses on the dispositions of discontinued operations, (iii) the
cumulative effects of changes in accounting principles, (iv) the writedown of
any asset, and (v) charges for restructuring and rationalization programs. Such
performance goals: (i) may vary by Participant and may be different for
different Awards; (ii) may be particular to a Participant or the department,
branch, line of business, subsidiary or other unit in which the Participant
works and may cover such period as may be specified by the Section 162(m)
Committee; and (iii) shall be set by the Section 162(m) Committee within the
time period prescribed by, and shall otherwise comply with the requirements of,
Section 162(m).

              (4)    Notwithstanding any provision of the Plan, with respect to
any Restricted Stock Award or Other Stock Unit Award that is subject to this
Section 10(i), the Section 162(m) Committee may adjust downwards, but not
upwards, the cash or number of Shares payable pursuant to such Award, and the
Section 162(m) Committee may not waive the achievement of the applicable
performance goals except in the case of the death or disability of the
Participant.

              (5)    The Section 162(m) Committee shall have the power to impose
such other restrictions on Awards subject to this Section 10(i) as it may deem
necessary or appropriate to ensure that such Awards satisfy all requirements for
"performance-based compensation" within the meaning of Section 162(m)(4)(C) of
the Code, or any successor provision thereto.

11.    Miscellaneous

       (a)    No Right To Employment or Other Status. No person shall have any
claim or right to be granted an Award, and the grant of an Award shall not be
construed as giving a Participant the right to continued employment or any other
relationship with the Company. The Company expressly reserves the right at any
time to dismiss or otherwise terminate its relationship with a Participant free
from any liability or claim under the Plan, except as expressly provided in the
applicable Award.

       (b)    No Rights As Stockholder. Subject to the provisions of the
applicable Award, no Participant or Designated Beneficiary shall have any rights
as a stockholder with respect to any shares of Common Stock to be distributed
with respect to an Award until becoming the record holder of such shares.
Notwithstanding the foregoing, in the event the Company effects a split of the
Common Stock by means of a stock dividend and the exercise price of and the
number of shares subject to such Option are adjusted as of the date of the
distribution of the dividend (rather than as of the record date for such
dividend), then an optionee who exercises an Option between the record date and
the distribution date for such stock dividend shall be entitled to receive, on
the distribution date, the stock dividend with respect to the shares of Common
Stock acquired upon such Option exercise, notwithstanding the fact that such
shares were not outstanding as of the close of business on the record date for
such stock dividend.

       (c)    Effective Date and Term of Plan. The Plan shall become effective
on the date on which it is adopted by the Board, but no Award may be granted
unless and until the Plan has been approved by the Company's stockholders. No
Awards shall be granted under the Plan after the completion of 10 years from the
earlier of (i) the date on which the Plan was adopted by the








                                      -10-
<PAGE>


Board or (ii) the date the Plan was approved by the Company's stockholders, but
Awards previously granted may extend beyond that date.

       (d)    Amendment of Plan. The Board may amend, suspend or terminate the
Plan or any portion thereof at any time; provided that, to the extent determined
by the Board, no amendment requiring stockholder approval under any applicable
legal, regulatory or listing requirement shall become effective until such
stockholder approval is obtained. No Award shall be made that is conditioned
upon stockholder approval of any amendment to the Plan.

       (e)    Provisions for Foreign Participants. The Board may modify Awards
or Options granted to Participants who are foreign nationals or employed outside
the United States or establish subplans or procedures under the Plan to
recognize differences in laws, rules, regulations or customs of such foreign
jurisdictions with respect to tax, securities, currency, employee benefit or
other matters.

       (f)    Compliance With Code Section 409A. No Award shall provide for
deferral of compensation that does not comply with Section 409A of the Code,
unless the Board, at the time of grant, specifically provides that the Award is
not intended to comply with Section 409A of the Code.

       (g)    Governing Law. The provisions of the Plan and all Awards made
hereunder shall be governed by and interpreted in accordance with the laws of
the State of Delaware, excluding choice-of-law principles of the law of such
state that would require the application of the laws of a jurisdiction other
than such state.










                                      -11-