Document:

Exhibit 4.1

	
  COMMON
  STOCK

  	
  

  	
  COMMON
  STOCK

  
	
  NUMBER

  	
  SHARES

  
	
   

  	
   

  
	
   

  	
  ZORAN
  CORPORATION

  	
   

  
	
   

  	
   

  	
   

  
	
  INCORPORATED
  UNDER THE LAWS OF THE STATE OF

  DELAWARE

  	
   

  	
  SEE
  REVERSE FOR

  CERTAIN DEFINITIONS

  
	
   

  	
   

  	
  CUSIP 
  98975F 10 1

  
	
   

  	
   

  	
   

  
				

 

THIS CERTIFIES THAT

 

is the record holder of

FULLY PAID AND
NONASSESSABLE SHARES OF COMMON STOCK, PAR VALUE $0.001 PER SHARE, OF

ZORAN
CORPORATION

transferable on the books
of the Corporation by the holder hereof in person or by duly authorized
attorney upon surrender of this Certificate properly endorsed. This Certificate
is not valid unless countersigned and registered by the Transfer Agent and
Registrar.

WITNESS the facsimile seal of the Corporation and the facsimile
signatures of its duly authorized officers.

	
  

  SECRETARY

  	
  

  	
  

  PRESIDENT AND
  CHIEF EXECUTIVE OFFICER

  

 

	
  

  	
  COUNTERSIGNED AND REGISTERED:

  
	
   

  
	
  

  	
  AMERICAN STOCK TRANSFER & TRUST COMPANY

  
	
   

  
	
   

  	
  TRANSFER AGENT AND REGISTRAR

  
	
   

  
	
   

  	
  

  
	
   

  
	
   

  	
  AUTHORIZED SIGNATURE

  
						

 

The Corporation
shall furnish without charge to each stockholder who so requests a statement of
the powers, designations, preferences and relative, participating, optional or
other special rights of each class of stock of the Corporation or series
thereof and the qualifications, limitations or restrictions of such preferences
and/or rights.  Such requests shall be
made to the Corporation’s Secretary at the principal office of the Corporation.

The following
abbreviations, when used in the inscription on the face of this certificate,
shall be construed as though they were written out in full according to
applicable laws or regulations.

	
  TEN COM

  	
  —

  	
  as tenants in common

  	
  UNIF GIFT MIN ACT —

  	
   

  	
  Custodian

  	
   

  
	
  TEN ENT

  	
  —

  	
  as tenants by the entireties

  	
   

  	
  (Cust)

  	
   

  	
  (Minor)

  
	
  JT TEN 

  	
  —

  	
  as joint tenants with right of

  	
   

  	
  Under Uniform Gifts to Minors

  
	
   

  	
   

  	
  survivorship and not as tenants in

  	
   

  	
  Act

  	
   

  
	
   

  	
   

  	
  common

  	
   

  	
  (State)

  
	
   

  	
   

  	
   

  	
  UNIF TRF MIN ACT —

  	
   

  	
  Custodian (Until age

  	
   

  	
  )

  
	
   

  	
   

  	
   

  	
   

  	
  (Cust)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  Under Uniform Transfers

  
	
   

  	
   

  	
   

  	
   

  	
  (Minor)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  to Minors Act

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
  (State)

  
															

 

Additional abbreviations
may also be used though not in the above list.

 

FOR VALUE RECEIVED,
                                                     hereby sell, assign and transfer unto

 

	
  PLEASE INSERT SOCIAL
  SECURITY OR OTHER

  	
   

  
	
  IDENTIFYING
  NUMBER OF ASSIGNEE

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

 

(PLEASE PRINT OR
TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)

 

                                                                                                                                                                                                 Shares
of the common stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint

 

                                                                                                                                                                                               Attorney
to transfer the said stock on the books of the within named Corporation with
full power of substitution in the premises.

 

	
  Dated

  	
   

  	
   

  

 

 

 

	
  

  	
  X

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  X

  	
   

  
	
  NOTICE:   

  	
  THE SIGNATURE(S) TO THIS ASSIGNMENT MUST CORRESPOND
  WITH THE NAME(S) AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY
  PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.

  

 

Signature(s) Guaranteed

 

 

	
  By

  	
   

  	
   

  
	
  THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE
  GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND
  CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION
  PROGRAM, PURSUANT TO S.E.C. RULE 17Ad-15.Exhibit
10.17

ZORAN
CORPORATION

1993
STOCK OPTION PLAN

(As
Amended Through April 21, 2002)

1.                                      Purposes
of the Plan.  The purposes of
this Stock Option Plan are to attract and retain the best available personnel
for positions of substantial responsibility, to provide additional incentives
to Employees, Non-Employee Directors and Consultants of the Company and its
Subsidiaries, and to promote the success of the Company’s business.  Options granted hereunder may be either
Incentive Stock Options or Nonstatutory Stock Options at the discretion of the
Committee.

2.                                      Definitions.  As used herein, and in any Option granted hereunder,
the following definitions shall apply:

(a)                                  “Board”
shall mean the Board of Directors of the Company.

(b)                                 “Code”
shall mean the Internal Revenue Code of 1986, as amended, and any applicable
regulations promulgated thereunder.

(c)                                  “Common
Stock” shall mean the Common Stock of the Company.

(d)                                 “Company”
shall mean Zoran Corporation, a Delaware corporation.

(e)                                  “Committee”
shall mean the Committee appointed by the Board in accordance with paragraph
(a) of Section 4 of the Plan.  If the
Board does not appoint or ceases to maintain a Committee, the term “Committee”
shall refer to the Board.

(f)                                    “Consultant”
shall mean any independent contractor retained to perform services for the
Company.

(g)                                 “Continuous
Service” shall mean the absence of any interruption or termination of
service with the Company, a successor of the Company or any Parent or
Subsidiary, whether in the capacity of an Employee, a Non-Employee Director, or
a Consultant.  Continuous Service shall
not be considered interrupted (i) during any period of sick leave, military
leave or any other leave of absence approved by the Board, (ii) in the case of
transfers between locations of the Company or between the Company and any
Parent, Subsidiary or successor of the Company, or (iii) merely as a result of
a change in the capacity in which the Optionee renders such service provided
that no interruption or termination of the Optionee’s service occurs.

(h)                                 “Employee”
shall mean any person, including officers (whether or not they are directors),
employed by the Company or any Subsidiary.

(i)                                     “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.

(j)                                     “Incentive
Stock Option” shall mean any option granted under this Plan and any other
option granted to an Employee in accordance with the provisions of Section 422
of the Code, and the regulations promulgated thereunder.

(k)                                  “Non-Employee
Director” shall mean any director of the Company or any Subsidiary who is
not employed by the Company or such Subsidiary.

(l)                                     “Nonstatutory
Stock Option” shall mean an Option granted under the Plan that is subject
to the provisions of Section 1.83-7 of the Treasury Regulations promulgated
under Section 83 of the Code.

(m)                               “Option”
shall mean a stock option granted pursuant to the Plan.

(n)                                 “Option
Agreement” shall mean a written agreement between the Company and the
Optionee regarding the grant and exercise of Options to purchase Shares and the
terms and conditions thereof as determined by the Committee pursuant to the
Plan.

(o)                                 “Optioned
Shares” shall mean the Common Stock subject to an Option.

(p)                                 “Optionee”
shall mean an Employee, Non-Employee Director or Consultant who receives an
Option.

(q)                                 “Parent”
shall mean a “parent corporation,” whether now or hereafter existing, as
defined by Section 424(e) of the Code.

(r)                                    “Plan”
shall mean this 1993 Stock Option Plan.

(s)                                  “Registration
Date” shall mean the effective date of the first registration statement
filed by the Company pursuant to Section 12(g) of the Exchange Act with respect
to any class of the Company’s equity securities.

(t)                                    “Section
162(m)” means Section 162(m) of the Code.

(u)                                 “Securities
Act” shall mean the Securities Act of 1933, as amended.

(v)                                 “Share”
shall mean a share of the Common Stock subject to an Option, as adjusted in
accordance with Section 11 of the Plan.

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

3.                                      Stock
Subject to the Plan.  Subject to
the provisions of Section 11 of the Plan, the maximum aggregate number of Shares
which may be issued under the Plan shall be five million one hundred seventy
thousand (5,170,000).  If an Option expires
or becomes unexercisable for any reason without having been exercised in full,
the Shares which were subject to the Option but as to which the Option was not
exercised shall, unless the Plan shall have been terminated, become available
for other Option grants under the Plan.

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The Company intends that
as long as it is not subject to the reporting requirements of Section 13 or
15(d) of the Exchange Act and is not an investment company registered or
required to be registered under the Investment Company Act of 1940, all offers
and sales of Options and Shares issuable upon exercise of any Option shall be
exempt from registration under the provisions of Section 5 of the Securities
Act, and the Plan shall be administered in such a manner so as to preserve such
exemption.  The Company intends that the
Plan shall constitute a written compensatory benefit plan within the meaning of
Rule 701(b) of 17 CFR Section 230.701 promulgated by the Securities and
Exchange Commission pursuant to such Act. 
The Committee shall designate which Options granted under the Plan by
the Company are intended to be granted in reliance on Rule 701.

4.                                      Administration
of the Plan.

(a)                                  Procedure.  The Plan shall be administered by the Board.  The Board may appoint one or more Committees
to administer the Plan, subject to such terms and conditions as the Board may
prescribe.  Once appointed, the Committee
shall continue to serve until otherwise directed by the Board.  From time to time, the Board may increase the
size of the Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill
vacancies, however caused, and remove all members of the Committee and,
thereafter, directly administer the Plan.

Members of the Board or
Committee who are either eligible for Options or have been granted Options may
vote on any matters affecting the administration of the Plan or the grant of
options pursuant to the Plan, except that no such member shall act upon the
granting of an Option to himself, but any such member may be counted in
determining the existence of a quorum at any meeting of the Board or the
Committee during which action is taken with respect to the granting of an
Option to him or her.

The Committee shall meet
at such times and places and upon such notice as the chairperson determines.  A majority of the Committee shall constitute
a quorum.  Any acts by the Committee may
be taken at any meeting at which a quorum is present and shall be by majority
vote of those members entitled to vote.  Additionally,
any acts reduced to writing or approved in writing by all of the members of the
Committee shall be valid acts of the Committee.

(b)                                 Procedure After Registration Date.  Notwithstanding subsection (a) above, after
the date of registration of the Company’s Common Stock on a national securities
exchange or the Registration Date, the Board shall take all action necessary to
administer the Plan in accordance with the then effective provisions of Rule
16b-3 promulgated under the Exchange Act, provided that any amendment to the
Plan required for compliance with such provisions shall be made consistent with
the provisions of Section 13 of the Plan, and said regulations.

(c)                                  Powers of the Committee.  Subject to the provisions of the Plan, the
Committee shall have the authority:  (i)
to determine, upon review of relevant information, the fair market value of the
Common Stock; (ii) to determine the exercise price of Options to be granted,
the Employees, Directors or Consultants to whom and the time or times at which
Options shall be granted, and the number of Shares to be represented by each
Option; (iii) to interpret the Plan; (iv) to prescribe, amend and rescind rules
and regulations relating to the Plan; (v) to determine 

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the terms and provisions of each Option granted under
the Plan (which need not be identical) and, with the consent of the holder
thereof, to modify or amend any Option; (vi) to authorize any person to execute
on behalf of the Company any instrument required to effectuate the grant of an
Option previously granted by the Committee; (vii) to accelerate or (with the
consent of the Optionee) defer an exercise date of any Option, subject to the
provisions of Section 9(a) of the Plan; (viii) to determine whether Options
granted under the Plan will be Incentive Stock Options or Nonstatutory Stock
Options; (ix) to make all other determinations deemed necessary or advisable
for the administration of the Plan; and (x) to designate which options granted
under the Plan will be issued in reliance on Rule 701.

(d)                                 Effect of Committee’s Decision.  All decisions, determinations and
interpretations of the Committee shall be final and binding on all potential or
actual Optionees, any other holder of an Option or other equity security of the
Company and all other persons.

5.                                      Eligibility
and Option Limitations.

(a)                                  Persons Eligible for Options.  Options under the Plan may be granted only to
Employees, Non-Employee Directors or Consultants whom the Committee, in its
sole discretion, may designate from time to time.  For purposes of the foregoing sentence, “Employees,”
“Non-Employee Directors” and “Consultants” shall include prospective Employees,
prospective Non-Employee Directors and prospective Consultants to whom Options
are granted in connection with written offers of employment or other service
relationship.  Incentive Stock Options
may be granted only to Employees.  Any
person who is not an Employee on the effective date of grant of an Option to
such person may be granted only a Nonstatutory Stock Option.  An Employee who has been granted an Option,
if he or she is otherwise eligible, may be granted an additional Option or
Options.  However, the aggregate fair
market value (determined in accordance with the provisions of Section 8(a) of
the Plan) of the Shares subject to one or more Incentive Stock Options grants
that are exercisable for the first time by an Optionee during any calendar year
(under all stock option plans of the Company and its Parents and Subsidiaries)
shall not exceed $100,000 (determined as of the grant date).

(b)                                 Section 162(m) Grant Limit.  Subject to adjustment as provided in Section
11, no Employee shall be granted one or more Options within any fiscal year of
the Company which in the aggregate are for the purchase of more than five
hundred thousand (500,000) Shares (the “Section 162(m) Grant Limit”).  An Option which is canceled in the same
fiscal year of the Company in which it was granted shall continue to be counted
against the Section 162(m) Grant Limit for such period.

(c)                                  No Right to Continuing Employment.  Neither the establishment nor the operation
of the Plan shall confer upon any Optionee or any other person any right with
respect to continuation of employment or other service with the Company or any
Subsidiary, nor shall the Plan interfere in any way with the right of the
Optionee or the right of the Company (or any Parent or Subsidiary) to terminate
such employment or service at any time.

(d)                                 Option Repricing.  No Option shall be repriced without the
approval of a majority of the shares of Common Stock present or represented by
proxy and voting at a meeting 

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of the stockholders of the Company at which a quorum
representing a majority of all outstanding shares of Common Stock is present or
represented by proxy.

6.                                      Term
of Plan.  The Plan shall become
effective upon its adoption by the Board or its approval by vote of the holders
of the outstanding shares of the Company entitled to vote on the adoption of
the Plan (in accordance with the provisions of Section 18 hereof), whichever is
earlier.  It shall continue in effect for
a term of ten (10) years unless sooner terminated under Section 13 of the Plan.

7.                                      Term
of Option.  Unless the Committee
determines otherwise, the term of each Option granted under the Plan shall be
ten (10) years from the date of grant.  The
term of the Option shall be set forth in the Option Agreement.  No Incentive Stock Option shall be
exercisable after the expiration of ten (10) years from the date such Option is
granted, and no Incentive Stock Option granted to any Employee who, at the date
such Option is granted, owns (within the meaning of Section 424(d) of the Code)
more than ten percent (10%) of the total combined voting power of all classes
of stock of the Company or any Parent or subsidiary shall be exercisable after
the expiration of five (5) years from the date such Option is granted.

8.                                      Option
Price and Consideration.

(a)                                  Option Price.  Except as provided in subsection (b) below,
the option price for the Shares to be issued pursuant to any Option shall be
such price as is determined by the Committee, which shall in no event be less
than:  (i) in the case of Incentive Stock
Options, the fair market value of such Shares on the date the Option is
granted; or (ii) in the case of Nonstatutory Stock Options, 85% of such fair
market value.  Fair market value of the
Common Stock shall be determined by the Committee, using such criteria as it
deems relevant; provided, however, that if there is a public market for the
Common Stock, the fair market value per Share shall be the average of the last
reported bid and asked prices of the Common Stock on the date of grant, as
reported in The Wall Street Journal (or, if not so reported, as
otherwise reported by the NASDAQ System) or, in the event the Common Stock is
listed on a national securities exchange (within the meaning of Section 6 of
the Exchange Act) or on the NASDAQ National Market System (or any successor
national market system), the fair market value per Share shall be the closing
price on such exchange on the date of grant of the Option, as reported in The
Wall Street Journal.

(b)                                 Ten Percent Shareholders.  No Option shall be granted to any Employee
who, at the date such Option is granted, owns (within the meaning of Section
424(d) of the Code) more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company or any Parent or Subsidiary,
unless the option price for the Shares to be issued pursuant to such Option is
at least equal to 110% of the fair market value of such Shares on the grant
date determined by the Committee in the manner set forth in subsection (a)
above.

(c)                                  Consideration.  The consideration to be paid for the Optioned
Shares shall be payment in cash or by check unless payment in some other manner,
including other shares of the Company’s Common Stock or such other
consideration and method of payment for the issuance of Optioned Shares as may
be permitted under Section 152 of the Delaware General Corporation Law, is
authorized by the Committee at the time of the grant of the Option.  Any cash or other 

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property received by the Company from the sale of
Shares pursuant to the Plan shall constitute part of the general assets of the
Company.

9.                                      Exercise
of Option.

(a)                                  Voting Period.  Any Option granted hereunder shall be
exercisable at such times and under such conditions as determined by the
Committee and as shall be permissible under the terms of the Plan, which shall
be specified in the Option Agreement evidencing the Option.  Unless the Committee specifically determines
otherwise at the time of the grant of the option, each Option shall vest and
become exercisable, cumulatively, in four substantially equal installments on
each of the first four anniversaries of the date of the grant of the option, subject
to the Optionee’s Continuous Service.  However,
no Option granted to a prospective Employee, prospective Non-Employee Director
or prospective Consultant may become exercisable prior to the date on which
such person commences service.

(b)                                 Exercise Procedures.  An Option shall be deemed to be exercised
when written notice of such exercise has been given to the Company in
accordance with the terms of the Option by the person entitled to exercise the
Option, and full payment for the Shares with respect to which the Option is
exercised has been received by the Company. 
An Option may not be exercised for fractional shares or for less than
ten (10) Shares.  As soon as practicable
following the exercise of an Option in the manner set forth above, the Company
shall issue or cause its transfer agent to issue stock certificates
representing the Shares purchased.  Until
the issuance of such stock certificates (as evidenced by the appropriate entry
on the books of the Company or of a duly authorized transfer agent of the
Company), no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to the Optioned Shares notwithstanding the
exercise of the Option.  No adjustment
will be made for a dividend or other rights for which the record date is prior
to the date of the transfer by the Optionee of the consideration for the
purchase of the Shares, except as provided in Section 11 of the Plan.  After the Registration Date, the exercise of
an Option by any person subject to short-swing trading liability under Section
16(b) of the Exchange Act shall be subject to compliance with all applicable
requirements of Rule 16b-3(d) or (e) promulgated under the Exchange Act.

(c)                                  Death of Optionee.  In the event of the death during the Option
period of an Optionee who is at the time of his death, or was within the ninety
(90) day period immediately prior thereto, an Employee, Non-Employee Director
or Consultant, and who was in Continuous Service from the date of the grant of
the Option until the date of death or termination, the Option may be exercised,
at any time within one (1) year following the date of death, by the Optionee’s
estate or by a person who acquired the right to exercise the Option by bequest
or inheritance, but only to the extent of the accrued right to exercise at the
time of the termination or death, whichever comes first.

(d)                                 Disability of Optionee.  In the event of the permanent and total
disability during the Option period of an optionee who is at the time of such
disability, or was within the ninety (90) day period prior thereto, an
Employee, Non-Employee Director or Consultant, and who was in Continuous
Service from the date of the grant of the Option until the date of disability
or termination, the Option may be exercised at any time within one (1) year
following the date of disability, but only to the extent of the accrued right
to exercise at the time of the termination or 

 6
 

disability, whichever comes first, subject to the
condition that no option shall be exercised after the expiration of the Option
period.

(e)                                  Other Termination of Continuous Service.  If the Continuous Service of an Optionee
shall cease for any reason other than permanent and total disability or death,
he or she may, but only within ninety (90) days (or such other period of time
as is determined by the Committee) after the date his or her Continuous Service
ceases, exercise his or her Option to the extent that he or she was entitled to
exercise it at the date of such termination of Continuous Service, subject to
the condition that no Option shall be exercisable after the expiration of the
Option period.

(f)                                    Exercise of Option With Stock After Registration
Date.  After the
Registration Date, the Committee may permit an Optionee to exercise an Option
by delivering shares of the Company’s Common Stock.  If the Optionee is so permitted, the option
agreement covering such Option may include provisions authorizing the Optionee
to exercise the Option, in whole or in part, by:  (i) delivering whole shares of the Company’s
Common Stock previously owned by such Optionee (whether or not acquired through
the prior exercise of a stock option) having a fair market value equal to the
aggregate option price for the Optioned Shares issuable on exercise of the
Option; and/or (ii) directing the Company to withhold from the Shares that
would otherwise be issued upon exercise of the Option that number of whole
Shares having a fair market value equal to the aggregate option price for the
Optioned Shares issuable on exercise of the Option.  Shares of the Company’s Common Stock so
delivered or withheld shall be valued at their fair market value at the close
of the last business day immediately preceding the date of exercise of the
Option, as determined by the Committee, in accordance with the provisions of
Section 8(a) of the Plan.  Any balance of
the exercise price shall be paid in cash. 
Any shares delivered or withheld in accordance with this provision shall
not again become available for purposes of the Plan and for Options subsequently
granted thereunder.

(g)                                 Tax Withholding.  After the Registration Date, when an Optionee
is required to pay to the Company an amount with respect to tax withholding
obligations in connection with the exercise of an option granted under the
Plan, the optionee may elect prior to the date the amount of such withholding
tax is determined (the “Tax Date”) to make such payment, or such increased
payment as the Optionee elects to make up to the maximum federal, state and
local marginal tax rates, including any related FICA obligation, applicable to
the Optionee and the particular transaction, by:  (i) delivering cash; (ii) delivering part or
all of the payment in previously owned shares of Common Stock (whether or not
acquired through the prior exercise of an Option); and/or (iii) irrevocably
directing the Company to withhold from the Shares that would otherwise be
issued upon exercise of the Option that number of whole Shares having a fair
market value equal to the amount of tax required or elected to be withheld (a “Withholding
Election”).  If an Optionee’s Tax Date is
deferred beyond the date of exercise and the Optionee makes a Withholding
Election, the Optionee will initially receive the full amount of Optioned
Shares otherwise issuable upon exercise of the option, but will be
unconditionally obligated to surrender to the Company on the Tax Date the
number of Shares necessary to satisfy his or her minimum withholding
requirements, or such higher payment as he or she may have elected to make,
with adjustments to be made in cash after the Tax Date.

 7
 

Any withholding of
Optioned Shares with respect to taxes arising in connection with the exercise
of an Option by any person subject to short swing trading liability under
Section 16(b) of the Exchange Act shall satisfy the following conditions:

(i)                                     An
advance election to withhold Optioned Shares in settlement of a tax liability
must satisfy the requirements of Rule 16b-3(d)(1)(i), regarding
participant-directed transactions;

(ii)                                  Absent
such an election, the withholding of Optioned Shares to settle a tax liability
may occur only during the quarterly window period described in Rule 16b-3(e);

(iii)                               Absent
an advance election or window-period withholding, the Optionee may deliver
shares of Common Stock owned prior to the exercise of an Option to settle a tax
liability arising upon exercise of the Option, in accordance with Rule
16b-3(f); or

(iv)                              The
delivery of previously acquired shares of Common Stock (but not the withholding
of newly acquired Shares) will be allowed where an election under Section 83(b)
of the Code accelerates the Tax Date to a day that occurs less than six (6)
months after the advance election and is not within the quarterly window period
described in Rule 16b-3(e).

Any adverse consequences
incurred by an Optionee with respect to the use of shares of Common Stock to
pay any part of the option Price or of any tax in connection with the exercise
of an option, including without limitation any adverse tax consequences arising
as a result of a disqualifying disposition within the meaning of Section 422 of
the Code, shall be the sole responsibility of the Optionee.  Shares withheld in accordance with this
provision shall not again become available for purposes of the Plan and for
Options subsequently granted thereunder.

10.                               Non-Transferability
of Options.  An Option may not be
sold, pledged, assigned, hypothecated, transferred or disposed of in any manner
other than by will or by the laws of descent and distribution and may be
exercised, during the lifetime of the Optionee, only by the Optionee.

11.                               Adjustments
Upon Changes in Capitalization.  Subject
to any required action by the shareholders of the Company, the number of shares
subject to the Plan, the Section 162(m) Grant Limit set forth in Section 5(b),
the number of Optioned Shares covered by each outstanding Option, and the per
share exercise price of each such Option, shall be proportionately adjusted for
any increase or decrease in the number of issued shares of Common Stock
resulting from a stock split, reverse stock split, recapitalization,
combination, reclassification, the payment of a stock dividend on the Common
Stock or any other increase or decrease in the number of such shares of Common
Stock effected without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the Company shall not
be deemed to have been “effected without receipt of consideration.”  Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.  Except as expressly provided herein, no issue
by the Company of shares of stock of any class, or securities convertible into
shares of stock of any class, shall affect, and no adjustment by reason thereof

 8
 

shall be made with respect to, the number or price of
shares of Common Stock subject to an Option.

The Committee may, if it
so determines in the exercise of its sole discretion, also make provision for
adjusting the number or class of securities covered by any Option, as well as the
price to be paid therefor, in the event that the Company effects one or more
reorganizations, recapitalizations, rights offerings, or other increases or
reductions of shares of its outstanding Common Stock, and in the event of the
Company being consolidated with or merged into any other corporation.

Unless otherwise
determined by the Board, upon the dissolution or liquidation of the Company the
Options granted under the Plan shall terminate and thereupon become null and
void.

Upon any merger or
consolidation, if the Company is not the surviving corporation, the Options
granted under the Plan shall either be assumed by the new entity or shall
terminate in accordance with the provisions of the preceding paragraph.

12.                               Time
of Granting Options.  Unless
otherwise specified by the Committee, the date of grant of an Option under the
Plan shall be the date on which the Committee makes the determination granting
such Option.  Notice of the determination
shall be given to each Optionee to whom an Option is so granted within a
reasonable time after the date of such grant.

13.                               Amendment
and Termination of the Plan.  The
Board may amend or terminate the Plan from time to time in such respects as the
Board may deem advisable, except that, without approval of the shareholders of
the Company, no such revision or amendment shall change the number of Shares
subject to the Plan or change the designation of the class of employees eligible
to receive Options.  Any such amendment
or termination of the Plan shall not affect Options already granted, and such
Options shall remain in full force and effect as if the Plan had not been
amended or terminated.

14.                               Conditions
Upon Issuance of Shares.  Shares
shall not be issued with respect to an Option unless the exercise of such Option
and the issuance and delivery of such Shares pursuant thereto shall comply with
all relevant provisions of law, including, without limitation, the Securities
Act, the Exchange Act, the rules and regulations promulgated thereunder, and
the requirements of any stock exchange upon which the Shares may then be
listed, and shall be further subject to the approval of counsel for the Company
with respect to such compliance.  As a
condition to the exercise of an Option, the Company may require the person
exercising such Option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without
any present intention to sell or distribute such Shares if, in the opinion of counsel
for the Company, such a representation is required by any of the aforementioned
relevant provisions of law.

15.                               Reservation
of Shares.  During the term of
this Plan the Company will at all times reserve and keep available the number
of Shares as shall be sufficient to satisfy the requirements of the Plan.  Inability of the Company to obtain from any
regulatory body having jurisdiction and authority deemed by the Company’s
counsel to be necessary to the lawful issuance and sale of 

 9
 

any Shares hereunder shall relieve the Company of any
liability in respect of the nonissuance or sale of such Shares as to which such
requisite authority shall not have been obtained.

16.                               Information
to Optionee.  During the term of
any option granted under the Plan, the Company shall provide or otherwise make
available to each Optionee a copy of its financial statements at least
annually.

17.                               Option
Agreement.  Options granted under
the Plan shall be evidenced by Option Agreements.

18.                               Shareholder
Approval.  The Plan shall be
subject to approval by the shareholders of the Company within twelve (12)
months before or after the Plan is adopted. 
Any option granted before shareholder approval is obtained and any exercise
of such option must be rescinded if such shareholder approval is not obtained
within twelve (12) months after the Plan is adopted.  Shares issued upon the exercise of such options
shall not be counted in determining whether such approval is obtained.  Shareholder approval of the Plan and any
amendments thereto requiring shareholder approval shall be by the affirmative
vote of the holders of a majority of the capital stock of the Company present
or represented and entitled to vote at a duly held meeting or by the written
consent of the holders of a majority of the outstanding capital stock of the
Company entitled to vote.

 10

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