THE COMPANY,
IN THE EVENT OF ANY CHANGE IN THE STOCK EFFECTED WITHOUT RECEIPT OF
CONSIDERATION BY THE COMPANY, WHETHER THROUGH MERGER, CONSOLIDATION,
REORGANIZATION, REINCORPORATION, RECAPITALIZATION, RECLASSIFICATION, STOCK
DIVIDEND, STOCK SPLIT, REVERSE STOCK SPLIT, SPLIT-UP, SPLIT-OFF, SPIN-OFF,
COMBINATION OF SHARES, EXCHANGE OF SHARES, OR SIMILAR CHANGE IN THE CAPITAL
STRUCTURE OF THE COMPANY, OR IN THE EVENT OF PAYMENT OF A DIVIDEND OR
DISTRIBUTION TO THE SHAREHOLDERS OF THE COMPANY IN A FORM OTHER THAN STOCK
(EXCEPTING NORMAL CASH DIVIDENDS) THAT HAS A MATERIAL EFFECT ON THE FAIR MARKET
VALUE OF SHARES OF STOCK, APPROPRIATE ADJUSTMENTS SHALL BE MADE IN THE NUMBER
AND KIND OF SHARES SUBJECT TO THE PLAN AND TO ANY OUTSTANDING AWARDS, IN THE
AWARD LIMITS SET FORTH IN SECTION 5.4 AND IN THE EXERCISE OR PURCHASE PRICE PER
SHARE UNDER ANY OUTSTANDING AWARD IN ORDER TO PREVENT DILUTION OR ENLARGEMENT OF
PARTICIPANTS' RIGHTS UNDER THE PLAN.
FOR PURPOSES OF THE FOREGOING, CONVERSION
OF ANY CONVERTIBLE SECURITIES OF THE COMPANY SHALL NOT BE TREATED AS "EFFECTED
WITHOUT RECEIPT OF CONSIDERATION BY THE COMPANY."
ANY FRACTIONAL SHARE
RESULTING FROM AN ADJUSTMENT PURSUANT TO THIS SECTION 4.2 SHALL BE ROUNDED DOWN
TO THE NEAREST WHOLE NUMBER.
THE COMMITTEE IN ITS SOLE DISCRETION, MAY ALSO
MAKE SUCH ADJUSTMENTS IN THE TERMS OF ANY AWARD TO REFLECT, OR RELATED TO, SUCH
CHANGES IN THE CAPITAL STRUCTURE OF THE COMPANY OR DISTRIBUTIONS AS IT DEEMS
APPROPRIATE, INCLUDING MODIFICATION OF PERFORMANCE GOALS, PERFORMANCE AWARD
FORMULAS AND PERFORMANCE PERIODS.
THE ADJUSTMENTS DETERMINED BY THE COMMITTEE
PURSUANT TO THIS SECTION 4.2 SHALL BE FINAL, BINDING AND CONCLUSIVE.
5.
ELIGIBILITY AND AWARD LIMITATIONS.
5.1
PERSONS ELIGIBLE FOR AWARDS.
AWARDS MAY BE
GRANTED ONLY TO EMPLOYEES, CONSULTANTS AND NON-EMPLOYEE DIRECTORS.
FOR PURPOSES
OF THE FOREGOING SENTENCE, "EMPLOYEES," "CONSULTANTS"AND "NON-EMPLOYEE
DIRECTORS" SHALL INCLUDE PROSPECTIVE
10
EMPLOYEES, PROSPECTIVE CONSULTANTS AND PROSPECTIVE NON-EMPLOYEE DIRECTORS TO
WHOM AWARDS ARE GRANTED IN CONNECTION WITH WRITTEN OFFERS OF AN EMPLOYMENT OR
OTHER SERVICE RELATIONSHIP WITH THE PARTICIPATING COMPANY GROUP; PROVIDED,
HOWEVER, THAT NO STOCK SUBJECT TO ANY SUCH AWARD SHALL VEST, BECOME EXERCISABLE
OR BE ISSUED PRIOR TO THE DATE ON WHICH SUCH PERSON COMMENCES SERVICE.
5.2
PARTICIPATION.
AWARDS ARE GRANTED SOLELY AT
THE DISCRETION OF THE COMMITTEE.
ELIGIBLE PERSONS MAY BE GRANTED MORE THAN ONE
AWARD.
HOWEVER, ELIGIBILITY IN ACCORDANCE WITH THIS SECTION SHALL NOT ENTITLE
ANY PERSON TO BE GRANTED AN AWARD, OR, HAVING BEEN GRANTED AN AWARD, TO BE
GRANTED AN ADDITIONAL AWARD.
5.3
INCENTIVE STOCK OPTION LIMITATIONS.
(A)
PERSONS ELIGIBLE.
AN INCENTIVE STOCK
OPTION MAY BE GRANTED ONLY TO A PERSON WHO, ON THE EFFECTIVE DATE OF GRANT, IS
AN EMPLOYEE OF THE COMPANY, A PARENT CORPORATION OR A SUBSIDIARY CORPORATION
(EACH BEING AN "ISO-QUALIFYING CORPORATION").
ANY PERSON WHO IS NOT AN EMPLOYEE
OF AN ISO-QUALIFYING CORPORATION ON THE EFFECTIVE DATE OF THE GRANT OF AN OPTION
TO SUCH PERSON MAY BE GRANTED ONLY A NONSTATUTORY STOCK OPTION.
AN INCENTIVE
STOCK OPTION GRANTED TO A PROSPECTIVE EMPLOYEE UPON THE CONDITION THAT SUCH
PERSON BECOME AN EMPLOYEE OF AN