Document:

CABLE SYSTEM ACQUISITION AGREEMENT

      THIS CABLE SYSTEM ACQUISITION AGREEMENT (the "Agreement") is made and
entered into as of the ____ day of March 2005 by and between Multiband
Corporation a Minnesota corporation (the "Buyer"), and Ultravision, Inc. a New
Jersey corporation (the "Seller").

                                   WITNESSETH

      WHEREAS, the Seller owns, operates and maintains cable television systems
serving residents of the apartment complexes identified on the attached Exhibit
A (the "Properties"); and

      WHEREAS, the Seller entered into Rights of Entry Agreements identified on
the attached Exhibit B with the owners of the Properties (the "Cable
Agreements"). Exhibit B shall also contain the terms of said Cable Agreements.

      WHEREAS, the Seller has agreed to sell, and the Buyer has agreed to
purchase (a) all of Seller's equipment used in the operation of the cable
television system located at the Properties, specifically including any and all
cable home wiring, the headend (including all satellite dishes and antennas),
all components and all internal and underground portions of the distribution
systems (the "Distribution System") located on the Properties as identified on
Exhibit C (the "Cable Systems") and (b) all of Seller's right, title and
interest in and to the Cable Agreements and related subscribers, upon the terms
and conditions hereafter set forth.

      NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto, intending to be
legally bound, covenant and agree as follows:

      1. Sale and Purchase of Cable Agreements and Cable Systems.

            At Closing (as defined below) the Seller shall sell, assign,
transfer, deliver and convey to the Buyer, and the Buyer shall purchase and
acquire from the Seller, the Cable Agreements and Cable Systems for a total
purchase price of two hundred fifty thousand dollars ($275,000) as adjusted in
Paragraph 10 below ("Purchase Price"). This sum shall be payable as follows:
$25,000 down payment, previously paid, $250,000 cash at closing, plus or minus
the adjustment, if any, set forth in Paragraph 10 below, as applicable. The
Purchase Price at Buyer's sole election can be paid to Seller or to the extent
Seller's has any outstanding liens directly to the lienholders to the extent
necessary to satisfy said liens, with the balance to the Seller. The purchase of
the Cable Agreements and Cable Systems shall include all right, title and
interest Seller owns in the subscribers and related cash flows generated as a
result of said Cable Agreements. Seller warrants that the Cable Systems shall be
in normal working condition as of the Closing Date (as defined herein). Buyer
shall have the opportunity to inspect the Cable Systems prior to the Closing
Date. Seller shall cooperate with all reasonable requests made by Buyer in
connection with the performance of such inspection.

            Seller agrees to provide Buyer with Bills of Sale in the Form of
Exhibit D, attached hereto, simultaneously with Buyer's respective purchases of
the Cable Agreements and Cable Systems.

      2. Termination of Rights. On the Closing Date (as defined herein), Seller
shall sell, transfer, assign and convey all of Seller's rights, title and
interest in and to (a) the Cable Systems and (b) the Cable Agreements to Buyer.

      3. No assumption of liabilities: Buyer shall not assume any liabilities of
Seller pursuant to this Agreement other than those obligations to perform the
Seller's obligations and services under the Cable Agreements that arise
subsequent to the Closing Date.

      4. Representations, Warranties and Covenants of the Seller. The Seller
represents and warrants to Buyer as follows:

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            a. The Seller is validly existing and in good standing under the
laws of the State of New Jersey and has all requisite power and authority to own
the Cable Systems.

            b. The execution, delivery and performance of this Agreement by the
Seller have been duly and validly authorized. When duly and validly executed and
delivered by Seller, this Agreement shall constitute the valid and binding
agreement of the Seller, enforceable against Seller in accordance with its
terms.

            c. The Seller owns the Cable Agreement and Cable Systems and has the
full right, power and authority to sell, transfer, assign and convey the Cable
Agreements and Cable Systems to the Buyer. The Cable Systems are in good working
order and do not require any modification, upgrade or repair by Buyer to provide
video services as they are currently being provided to Seller's subscribers.

            d. Seller shall deliver the Cable Agreements and Cable Systems to
Buyer free and clear of any liens or encumbrances at time of transfer, including
any tax liens.

            e. There is no litigation, action, suit or proceeding pending or, to
the best of Seller's knowledge, threatened against or relating to the Cable
Systems.

            f. Exhibit "C" contains a true and complete list of the equipment
and other tangible property included in the Cable Systems.

            g. The Cable Agreements are in full force and effect and Seller is
not in breach or default of any terms or conditions thereunder, and no event has
occurred that if notice was delivered, would constitute a breach or default
under the terms of the Cable Agreement, including any payments of commissions or
revenue shares to Landlords.

            h. Seller is aware of no facts and has not received any notice or
other communication from any person stating or alleging that Seller is not in
compliance in any material respect with all requirements of (i) the FCC rules
and regulations of the Cable Act, (ii) any Authorization, or that any
Authorization has been revoked, suspended, has expired, or is otherwise not in
full force and effect or (iii) any other applicable Legal Requirement.

            i. Exhibit E contains a true and complete list of the live
      subscribers and current monthly cash flows related to the Cable
      Agreements.

      5. Representations and Warranties of the Buyer: The Buyer represents and
warrants to the Seller as follows:

            a. The Buyer is validly existing and in good standing under the laws
of Minnesota.

            b. The execution, delivery and performance of this Agreement by the
Buyer have been duly and validly authorized. When duly and validly executed and
delivered by the Buyer, this Agreement shall constitute the valid and binding
agreement of the Buyer, enforceable against Buyer in accordance with its terms.

      6. Conditions Precedent to Obligations of Buyer. The obligation of the
Buyer to be performed at or prior to the Closing shall be subject to the
fulfillment on or prior to the Closing Date of all the conditions set forth
below:

            a. Each of the representations and warranties of the Seller
contained in this Agreement shall have been true when made and at all times
after the date when made, to and including the Closing Date.

                                       2
<PAGE>

            b. The Seller shall have performed all of its obligations under this
Agreement to the extent such obligations were required to have been performed on
or prior to the Closing Date.

      7. Deliveries to the Buyer on the Closing Date.

            The Seller shall deliver or cause to be delivered to the Buyer on
the Closing Date the following:

            a. A completed copy of Exhibit "C", which contains a list of all
equipment and other tangible property being purchased by Buyer hereunder.

            b. An executed Bill of Sale in the form attached hereto as Exhibit
"D" for the Cable Agreements and the Cable Systems.

      8. Indemnification. The Seller shall indemnify, hold harmless and defend
the Buyer from and against any and all damages, costs and expenses (including
reasonable attorneys' fees) arising from any misrepresentation, breach of
warranty or non-fulfillment of any agreement, covenant, term or condition under
this Agreement by the Seller. The Buyer shall indemnify, hold harmless and
defend the Seller from and against any and all damages, costs and expenses
(including reasonable attorneys' fees) arising from any misrepresentation,
breach of warranty or nonfulfillment of any agreement, covenant, term or
condition under this Agreement by the Buyer.

      9. Closing. Closing of this Agreement (the "Closing") shall take place on
or before March 15, 2005 (the "Closing Date") or as soon thereafter as feasible.
The effective date of this Agreement shall be April 1, 2005. Seller shall run
all operations in the ordinary course of business between the Effective Date and
Closing Date and shall not sell or otherwise dispose of any assets in the
interim.

      10. Seller's Additional Warranties; Adjustments to Selling Price. Seller
warrants that the Cable Systems, collectively, shall include 5,685 homes passed
by the systems as of the Closing Date. Seller also warrants that the Cable
Systems shall have 500 subscribers, plus or minus 50 subscribers, as of the
Closing Date. In the event that the number of subscribers to the Cable Systems
is equal to or less than 450 subscribers as of the Closing Date, the Selling
Price due at the Closing Date shall be reduced by $25,000. In the event that the
number of subscribers to the Cable Systems is equal to or more than 550
subscribers as of the Closing Date, the Selling Price due at the Closing Date
shall be increased by $25,000.

      11. Additional Documents. Seller shall, at the request of the Buyer,
whether before or after the Closing, execute and deliver such other instruments
and do and perform such other acts and things as may be reasonably necessary for
effecting completely the consummation of this Agreement and the transactions
herein contemplated.

      12. Termination. Unless such date is extended mutually in writing by the
parties, this Agreement shall terminate if the Closing does not take place on or
before March 30, 2005. Upon such a termination, the parties shall have no
further liability to each other under this Agreement.

      13. Entire Agreement and Modifications. No representation, promise,
inducement, or statement of intention has been made by the Seller or Buyer which
is not embodied in this Agreement or in the exhibits or other documents
delivered pursuant hereto or in connection with the transaction contemplated
hereby, and neither Seller nor Buyer shall be bound by or liable for any alleged
representation, promise, inducement, or statement of intention not so set forth.
This Agreement may be modified or amended only by written instrument signed by
each of the parties hereto.

                                       3
<PAGE>

      14. Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective successors and
assigns.

      15. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota. The Agreement shall be
deemed to have been made in Minnesota.

      16. Notices. All notices, demands and other communications to be given or
delivered under or by reason of the provisions of this Agreement will be in
writing and will be deemed to have been given when personally delivered or three
business days after being mailed by first class U.S. mail, return receipt
requested, or when receipt is acknowledged, if sent by facsimile, telecopy or
other electronic transmission device. Notices, demands and communications to
Buyer or Seller will, unless another address is specified in writing, be sent to
the address indicated below:

Notices to Seller:                          with a copy to:

UltraVision,Inc.                            David G. Uffelman, Esq.
212 Old Forge Road                          165 Washington Street
Monroe Township, NJ 08831                   Morristown, NJ 07960
Telecopy: 732-521-0298                      Telecopy: 973-889-0002

Notices to Buyer:                           with a copy to:

Jim Mandel                                  Steven Bell
Multiband Corporation                       Multiband Corporation.
9449 Science Center Drive                   9449 Science Center Drive
New Hope, Minnesota  55428                  New Hope, Minnesota  55428
Telecopy: 763-504-3060                      Telecopy:  763-504-3060

IN WITNESS WHEREOF, the Seller and Buyer have caused this Agreement to be
executed by their duly authorized representatives as of the date first written
above.

                                        Seller

                                        By: ____________________________
                                        Print Name: ____________________
                                        Title: _________________________

                                        Multiband Corporation

                                        By: ____________________________
                                        Print Name: ____________________
                                        Title: _________________________

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                                    EXHIBIT A

                            Description of Properties

                                       5
<PAGE>

                                    EXHIBIT B

                         Description of Cable Agreements

                                       6
<PAGE>

                                    EXHIBIT C

                          Description of Cable Systems

                                       7
<PAGE>

                                    EXHIBIT D

                                  Bill of Sale

      KNOW ALL MEN BY THESE PRESENTS, that (the "Seller"), for good and valuable
consideration paid by Multiband Corporation, a Minnesota corporation (the
"Buyer") pursuant to a Cable System Acquisition Agreement dated as of March ,
2005 (the "Acquisition Agreement") inter alia, has, as of the close of business
this day, sold, conveyed transferred and assigned and by these presents does, as
of the close of business this day, hereby sell, convey transfer and assign to
the Buyer all of its right, title and interests in, to and under all of the
personal property included in the Cable Systems and Cable Agreements (as such
term is defined in the Acquisition Agreement and as such personal property is
set forth in Exhibit A attached thereto) located on the Properties (as defined
in the Acquisition Agreement). Such personal property is being sold, conveyed,
transferred and assigned pursuant hereto subject to the representations and
warranties contained in the Acquisition Agreement.

      TO HAVE AND TO HOLD, the entire right, title and interest in and to the
personal property herby sold, conveyed, transferred and assigned to the Buyer
for its own use, benefit and behalf forever.

      IN WITNESS WHEREOF, the Seller has executed and delivered this Bill of
Sale on the ____ day of March 2005

                                     SELLER

                                     By:______________________________
                                     Print Name: _____________________
                                     Title: __________________________

                                       8EXHIBIT
10.1

 

ACURA
PHARMACEUTICALS, INC.

1998
STOCK OPTION PLAN (1)

 

1.
Purposes. The Plan
described herein, as amended and restated, shall be known as the "Acura
Pharmaceuticals, Inc. 1998 Stock Option Plan" (the "Plan"). The purposes of the
Plan are to attract and retain the best available personnel for positions of
substantial responsibility, to provide additional incentive to Employees,
Directors and Consultants of the Company or its Subsidiaries (as defined in
Section 2 below) to whom Option's may be granted under this Plan, and to promote
the success of the Company's business.

 

Options
granted hereunder may be either "incentive stock options," as defined in Section
422 of the Internal Revenue Code of 1986, as amended, or "Non-ISO's," at the
discretion of the Board and as reflected in the terms of the written option
agreement.

 

The Plan
is not intended as an agreement or promise of employment. Neither the Plan, nor
any Option granted pursuant to the Plan, shall confer on any person any right to
continue in the employ of the Company. The right of the Company to terminate an
Employee is not limited by the Plan, nor by any Option granted pursuant to the
Plan, unless such right is specifically described by the terms of any such
Option.

 

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

 

(a)
"Board" shall
mean the Committee, if one has been appointed, or the Board of Directors of the
Company, if no Committee is appointed.

 

(b)
"Code" shall
mean the Internal Revenue Code of 1986, as amended.

 

(c)
"Committee" shall
mean the Committee appointed under Section 4(a) hereof.

 

(d)
"Common
Stock" shall
mean the Common Stock, $.01 par value, of the Company.

 

1     Amended by the Board of Directors on April
15, 1999 to increase the number of shares available for grant under the Plan
from 2,600,000 shares to 3,600,000 shares. Ratified by the Company's
shareholders on August 19, 1999. Amended further by the Board of Directors on
April 20, 2001 to increase the number of shares available for grant under the
Plan from 3,600,000 shares to 8,100,000 shares. Ratified by the Company's
shareholders on June 14, 2001. Amended further by the Board of Directors on
August 26, 2003 to (i) increase the number of shares available for grant under
the Plan from 8,100,000 shares to 12,000,000 shares, (ii) permit the grant of
Non-ISO's at a per share price less than the fair market value of the Company's
Common Stock on the date of grant, and (iii) provide a maximum limit on options
granted to any individual during any calendar year of 5,500,000 shares. Amended
further by the Board of Directors on May 5, 2004 to (i) further increase the
number of shares available for grant under the Plan from 12,000,000 to
20,000,000 shares, and (ii) increase the maximum limit on options granted to any
individual during any calendar year to 8,750,000 shares. Ratified by the
Company's shareholders on August 12, 2004.
 

(e)
"Company" shall
mean Acura Pharmaceuticals, Inc., a New York corporation.

 

(f)
"Continuous
Service or Continuous Status as an Employee" shall
mean the absence of any interruption or termination of service as an Employee.
Continuous Status as an Employee shall not be considered interrupted in the case
of sick leave, military leave, or any other leave of absence approved by the
Board.

 

(g)
"Director" shall
mean any person serving on the Board of Directors.

 

(h)
"Employee" shall
mean any person, including officers, employed by the Company or any Parent or
Subsidiary of the Company. The payment of a Director's fee by the Company shall
not be sufficient to constitute "employment" by the Company.

 

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

 

(j)
"Fair
Market Value" shall
mean (i) the closing price for a share of the Common Stock on the exchange or
quotation system which reports or quotes the closing prices for a share of the
Common Stock, as accurately reported for any date (or, if no shares of Common
Stock are traded on such date, for the immediately preceding date on which
shares of Common Stock were traded) in The Wall Street Journal (or if The Wall
Street Journal no longer reports such price, in a newspaper or trade journal
selected by the Committee) or (ii) if no such price quotation is available, the
price which the Committee acting in good faith determines through any reasonable
valuation method that a share of Common Stock might change hands between a
willing buyer and a willing seller, neither being under any compulsion to buy or
to sell and both having reasonable knowledge of the relevant facts.

 

(k)
"Incentive
Stock Option" shall
mean an Option intended to qualify as an incentive stock option within the
meaning of Section 422 of the Code.

 

(l)
"Non-ISO" shall
mean an Option to purchase stock which is not intended by the Committee to
satisfy the requirements of Section 422 of the Code.

 

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

 

(n)
"Optioned
Stock" shall
mean the Common Stock subject to an Option.

 

(o)
"Optionee" shall
mean an Employee, Director or Consultant who receives an Option.

 

(p)
"Parent" shall
mean a "parent corporation," whether now or hereafter existing, as defined in
Section 424(e) of the Code.

 

(q)
"Plan" shall
mean this Acura Pharmaceuticals, Inc. 1998 Stock Option Plan, as amended from
time to time.

 

(r)
"Rule
16b-3" shall
mean Rule 16b-3 of the General Rules and Regulations under the Exchange
Act.

 

(s)
"Share" shall
mean a share of the Common Stock, as adjusted in accordance with Section 11 of
the Plan.

 

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

 

(u)
"Ten
Percent Shareholder" shall
mean a person who owns (after taking into account the attribution rules 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 a
Subsidiary.

 

3. Stock
Authorized. 

 

Subject
to the provisions of Section 11 of the Plan, the maximum aggregate number of
shares which may be Optioned and sold under the Plan is Twenty Million
(20,000,000) shares of authorized, but unissued, or reacquired Common Stock. The
maximum number of shares which may be subject to an Option granted in any
calendar year shall not exceed 8,750,000 shares
(subject to adjustment under Section 11 hereof consistent with Section 162(m) of
the Code). If the shares that would be issued or transferred pursuant to any
Options are not issued or transferred and ceased to be issuable or transferable
for any reason, the number of shares subject to such Option will no longer be
charged against a limitation provided for herein and may again be subject to
Options. Notwithstanding the proceeding sentence, with respect to any Option
granted to any individual who is a "covered employee" within the meaning of
Section 162(m) of the Code that is cancelled, the number of shares subject to
such Option shall continue to count against the maximum number of shares which
may be the subject of Options granted to such individual. For purposes of the
preceding sentence if, after grant, the exercise price of an Option is reduced,
such reduction shall be treated as a cancellation of such Option and the grant
of a new Option, and both the cancellation of the Option and the new Option
shall reduce the maximum number of shares for which Options may be granted to
the holder of such Option in a calendar year.

 

If an
Option should expire or become unexercisable for any reason without having been
exercised in full, the unpurchased Shares which were subject thereto shall,
unless the Plan shall have been terminated, become available for further grant
under the Plan.

 

4. Administration.

 

(a)
Procedure. The
Company's Board of Directors may appoint a Committee to administer the Plan
which shall be constituted so as to permit the Plan to continue to comply with
Rule 16b-3, as currently in effect or as hereafter modified or amended. The
Committee appointed by the Board of Directors shall consist of not less than two
members of the Board of Directors, to administer the Plan on behalf of the Board
of Directors, subject to such terms and conditions as the Board of Directors may
prescribe. Once appointed, the Committee shall continue to serve until otherwise
directed by the Board of Directors. From time to time, the Board of Directors
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, or remove all members of the Committee
and thereafter directly administer the Plan; provided, however, that at no time
shall a Committee of less than two members administer the Plan. Subject to the
provisions of the Plan, the Committee shall be authorized to interpret the Plan,
to establish, amend and rescind any rules and regulations relating to the Plan
and to make all other determinations necessary or advisable for the
administration of the Plan. Notwithstanding anything to the contrary contained
herein, no member of the Committee shall serve as such under this Plan unless
such person is a "Non-Employee Director" within the meaning of Rule
16b-3(b)(3)(i) of the Exchange Act. A majority vote of the members of the
Committee shall be required for all of its actions.

 

A
majority of the entire Committee shall constitute a quorum, and the action of
the majority of the Committee members present at any meeting at which a quorum
is present shall be the action of the Committee. All decisions, determinations,
and interpretations of the Committee shall be final and conclusive on all
persons affected thereby and shall, as to Incentive Stock Options, be consistent
with Section 422 of the Code. The Committee shall have all of the powers and
duties set forth herein, as well as such additional powers and duties as the
Board of Directors may delegate to it; provided, however, that the Board of
Directors expressly retains the right in its sole discretion (i) to elect and to
replace the members of the Committee, and (ii) to terminate or amend this Plan
in any manner consistent with applicable law.

 

(b)
Powers
of the Committee. Subject
to the provisions of the Plan, the Committee shall have the authority, in its
discretion: (i) to grant Incentive Stock Options, in accordance with Section 422
of the Code, or to grant Non-ISO's; (ii) to determine the Fair Market Value of
the Common Stock; (iii) to determine the exercise price per share of Options to
be granted which exercise price shall be determined in accordance with Section 8
of the Plan; (iv) to determine the persons to whom (including, without
limitation, members of the Committee) and the time or times at which, Options
shall be granted and the number of Shares to be represented by each Option; (v)
to interpret the Plan; (vi) to prescribe, amend and rescind rules and
regulations relating to the Plan; (vii) to determine the terms and provisions of
each Option granted (which need not be identical) and, with the consent of the
holder thereof, modify or amend each Option; (viii) to accelerate or defer (with
the consent of the Optionee) the exercise date of any Option; (ix) 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 Board; and (x) to
make all other determinations deemed necessary or advisable for the
administration of the Plan.

 

(c)
Subject to the provisions of this Plan and compliance with Rule 16b-3 of the
Exchange Act, the Committee may grant options under this Plan to members of the
Company's Board of Directors, including members of the Committee, and in such
regard may determine:

 

(i) the
time at which any such Option shall be granted; 

 

(ii) the
number of Shares covered by any such Option; 

 

(iii) the
time or times at which, or the period during which, any such Option may be
exercised or whether it may be exercised in whole or in
installments;

 

(iv) the
provisions of the agreement relating to any such Option; and

 

(v) the
Option Price of Shares subject to an Option granted such Board
member.

 

(d)
Effect
of the Committee's Decision. All
decisions, determinations and interpretations of the Committee shall be final
and binding on all Optionees and any other holders of any Options granted under
the Plan.

 

5.
Eligibility.
Incentive Stock Options may be granted only to Employees. Non-ISO's may be
granted to Employees as well as non-employee Directors and Consultants of the
Company as determined by the Board or any Committee. Any person who has been
granted an Option may, if he is otherwise eligible, be granted an additional
Option or Options.

 

Each
grant of an Option shall be evidenced by an Option Agreement, and each Option
Agreement shall (1) specify whether the Option is an Incentive Stock Option or a
Non-ISO and (2) incorporate such other terms and conditions as the Committee
acting in its absolute discretion deems consistent with the terms of this Plan,
including, without limitation, a restriction on the number of shares of stock
subject to the Option which first become exercisable during any calendar
year.

 

To the
extent that the aggregate Fair Market Value of the stock of the Company subject
to Incentive Stock Options granted (determined as of the date such an Incentive
Stock Option is granted) which first become exercisable in any calendar year
exceeds $100,000, such Options shall be treated as Non-ISO's. This $100,000
limitation shall be administered in accordance with the rules under Section
422(d) of the Code.

 

6.
Effective
Date and Term of Plan. The
effective date of this Plan ("Effective Date") shall be the date it is adopted
by the Board, provided the shareholders of the Company (acting at a duly called
meeting of such shareholders or by the written consent of shareholders) approve
this Plan within twelve (12) months after such Effective Date. The effectiveness
of Options granted under this Plan prior to the date such shareholder approval
is obtained shall be contingent on such shareholder approval.

 

Subject
to the provisions of Section 13 hereof, no Option shall be granted under this
Plan on or after the earlier of

 

(1) the
tenth anniversary of the Effective Date of this Plan in which event the Plan
otherwise thereafter shall continue in effect until all outstanding Options
shall have been surrendered or exercised in full or no longer are exercisable,
or

 

(2) the
date on which all of the Common Stock reserved for issuance under Section 3 of
this Plan has (as a result of the exercise or expiration of Options granted
under this Plan) been issued or no longer is available for use under this Plan,
in which event the Plan also shall terminate on such date.

 

7.
Term
of Option. An
Option shall expire on the date specified in such Option, which date shall not
be later than the tenth anniversary of the date on which the Option was granted,
except that, if any Employee, at any time an Incentive Stock Option is granted
to him or her, owns stock representing more than ten percent (10%) of the total
combined voting power of all classes of Common Stock (or, under Section 424(d)
of the Code is deemed to own stock representing more than ten percent (10%) of
the total combined voting power of all such classes of Common Stock, by reason
of the ownership of such classes of stock, directly or indirectly, by or for any
brother, sister, spouse, ancestor or lineal descendant of such Employee, or by
or for any corporation, partnership, state or trust of which such Employee is a
shareholder, partner or beneficiary), the Incentive Stock Option granted him or
her shall not be exercisable after the expiration of five (5) years from the
date of grant or such earlier expiration as provided in the particular Option
agreement.

 

8. Exercise
Price and Consideration. 

 

(a) The
per Share exercise price for the Shares to be issued pursuant to exercise of an
Option shall be such price as is determined by the Board, but shall be subject
to the following:

 

(i) In
the case of an Incentive Stock Option 

 

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

 

(B)
granted to any Employee, the per share exercise price shall be no less than 100%
of the Fair Market Value per Share on the date of grant.

 

(ii) In
the case of a Non-ISO, the per Share exercise price shall be determined by the
Board on the date of grant.

 

(b) The
consideration to be paid for the Shares to be issued upon exercise of an Option,
including the method of payment, shall be determined by the Board and may
consist entirely of 

 

(i)
cash;

 

(ii)
check;

 

(iii)
promissory note, provided such promissory note shall be full recourse as to
principal and interest and shall bear interest at the market rate, which market
rate shall be equal to the rate of interest available to the Optionee in a third
party arms-length loan transaction of similar nature and amount;

 

(iv)
Shares of Common Stock having been held by the Optionee for at least six (6)
months prior to being surrendered as consideration for the Shares to be issued
upon exercise of an Option and having a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised, or any combination of such methods of payment;
or

 

(v) such
other consideration and method of payment for the issuance of Shares to the
extent permitted under New York law.

 

The
Company shall be permitted to withhold shares to be issued under the Option to
pay related income tax withholding requirements. The amount of such tax
withholding shall be no greater than the applicable statutory withholding
amount.

 

9. Exercise
of Option. 

 

(a)
Procedure
for Exercise; Rights as a Shareholder. Any
Option granted hereunder shall be exercisable at such times and under such
conditions as determined by the Committee, including performance criteria with
respect to the Company and/or the Optionee, and as shall be permissible under
the terms of the Plan.

 

An Option
may not be exercised for a fraction of a Share. 

 

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. Full payment
may, as authorized by the Board, consist of any consideration and method of
payment allowable under Section 8(b) of the Plan. Until the issuance, which in
no event will be delayed more than thirty (30) days from the date of the
exercise of the Option, (as evidenced by the appropriate entry on the books of
the Company or of a duly authorized transfer agent of the Company) of the stock
certificate evidencing such Shares, no right to vote or receive dividends or any
other rights as a shareholder shall exist with respect to the Optioned Stock,
notwithstanding the exercise of the Option. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the stock
certificate is issued, except as provided in the Plan.

 

Exercise
of an Option in any manner shall result in a decrease in the number of Shares
which thereafter may be available, both for purposes of the Plan and for sale
under the Option, by the number of Shares as to which the Option is
exercised.

 

(b)
Termination
of Status as an Employee, or Director or Consultant with Respect to
Non-ISO's.
Non-ISO's granted pursuant to the Plan may be exercised notwithstanding the
termination of the Optionee's status as an employee, a non-employee Director or
a Consultant, except as provided in the Plan or as provided by the terms of the
Stock Option Agreement.

 

(c)
Termination
of Service as an Employee with Respect to Incentive Stock
Options. If the
Continuous Service of any Employee terminates, he or she may, but only within
thirty (30) days (or such other period of time not exceeding three (3) months as
is determined by the Committee) after the date he or she ceases to be an
Employee of the Company, exercise his or her Option to the extent that he or she
was entitled to exercise it as of the date of such termination. To the extent
that he or she was not entitled to exercise the Option at the date of such
termination, or if he or she does not exercise such Option (which he or she was
entitled to exercise) within the time specified herein, the Option shall
terminate.

 

(d)
Disability
of Optionee.
Notwithstanding the provisions of Section 9(c) above, in the event an Employee
is unable to continue his or her Continued Service with the Company as a result
of his or her total and permanent disability (within the meaning of Section
22(e)(3) of the Code), he or she may, but only within three (3) months (or such
other period of time not exceeding twelve (12) months as is determined by the
Committee) from the date of disability, exercise his or her Option to the extent
he or she was entitled to exercise it at the date of such disability. To the
extent that he or she was not entitled to exercise the Option at the date of
disability, or if he or she does not exercise such Option (which he or she was
entitled to exercise) within the time specified herein, the Option shall
terminate.

 

(e)
Death
of Optionee. In the
event of the death of an Optionee:

 

(i)
during the term of the Option who is at the time of his or her death an Employee
of the Company and who shall have been in Continuous Status as an Employee, a
Director or Consultant since the date of grant of the Option, the Option may be
exercised, at any time within twelve (12) months 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 right to
exercise that would have accrued had the Optionee continued living one (1) month
after the date of death; or

 

(ii)
within thirty (30) days (or such other period of time not exceeding three (3)
months as is determined by the Committee) after the termination of Continuous
Status as an Employee, a Director or Consultant, the Option may be exercised, at
any time within three (3) months 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 right to exercise that had accrued
at the date of termination.

 

10. Transferability
of Options. 

 

(a)
Incentive Stock Options may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the life time of the
Optionee only by the Optionee.

 

(b) The
Committee may, in its discretion, authorize all or a portion of the Non-ISOs to
be granted to an Optionee to be on terms which permit transfer by such Optionee
to (i) the spouse, children or grandchildren of the Optionee (the "Immediate
Family Members"), (ii) a trust or trusts for the exclusive benefit of such
Immediate Family Members, or (iii) a partnership in which such Immediate Family
Members are the only partners, provided that (x) there may be no consideration
for any such transfer, (y) the Non-ISO Stock Option Agreement pursuant to which
such options are granted must be approved by the Committee, and must expressly
provide for transferability in a manner consistent with this section, (z)
subsequent transfers of transferred Options shall be prohibited except those
made by will or by the laws of descent or distribution, and (zz) such transfer
is approved in advance by the Committee. Following transfer, any such Options
shall continue to be subject to the same terms and conditions as were applicable
immediately prior to transfer, provided that for purposes of determining the
rights of exercise under the Option, the term "Optionee" shall be deemed to
refer to the transferee. The termination of service as an employee, non-employee
director or consultant shall continue to be applied with respect to the original
Optionee, following which the options shall be exercisable by the transferee
only to the extent, and for the periods specified in Section 9 of the Plan and
in the Stock Option Agreement.

 

11.
Adjustments
Upon Changes in Capitalization or Merger. Subject
to any required action by the shareholders of the Company, the number of shares
of Common Stock covered by each outstanding Option, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option, as well as the price per share of
Common Stock covered by each such outstanding Option, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split or the payment of a stock dividend with
respect to the Common Stock or any other increase or decrease in the number of
issued 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 issuance 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 shall be made with respect to, the number or
exercise price of shares of Common Stock subject to an Option.

 

In the
event of the proposed dissolution or liquidation of the Company, or in the event
of a proposed sale of all or substantially all of the assets of the Company, or
the merger of the Company with or into another corporation, the Board may, in
the exercise of its sole discretion in such instances, accelerate the vesting of
all or any portion of Options then outstanding.

 

12.
Time
for Granting Options. The date
of grant of an Option shall, for all purposes, be the date on which the Board
makes the determination granting such Option. Notice of the determination shall
be given to each Employee, non-employee Director and Consultant to whom an
Option is so granted within a reasonable time after the date of such
grant.

 

13.
Amendment
and Termination of the Plan. (a) The
Board may amend or terminate the Plan from time to time in such respects as the
Board may deem advisable; provided that, the following revisions or amendments
shall require approval of the holders of a majority of the outstanding shares of
the Company entitled to vote:

 

(i) any
increase in the number of Shares subject to the Plan, other than in connection
with an adjustment under Section 11 of the Plan;

 

(ii) any
change in the class of Employees which are eligible participants for Options
under the Plan; or

 

(iii) if
shareholder approval of such amendment is required for continued compliance with
Rule 16b-3.

 

(b)
Shareholder
Approval. Any
amendment requiring shareholder approval under Section 13(a) of the Plan shall
be solicited as described in Section 17 of the Plan.

 

(c)
Effect
of Amendment or Termination. 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 this Plan had not
been amended or terminated, unless mutually agreed otherwise between the
Optionee and the Board, which agreement must be in writing and signed by the
Optionee and the Company.

 

14.
Conditions
Upon Issuance of Shares. Shares
shall not be issued pursuant to the exercise of 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 of 1933, as amended, 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. The
Company, during the term of this Plan, will at all times reserve and keep
available such number of Shares as shall be sufficient to satisfy the
requirements of the Plan.

 

16.
Option
Agreement. Options
shall be evidenced by written Option agreements in such form as the Committee
shall approve.

 

17.
Shareholder
Approval.
Continuance of the Plan shall be subject to approval by the shareholders of the
Company within twelve (12) months before or after the date the Plan is adopted.
If such shareholder approval is obtained at a duly held shareholders' meeting,
it may be obtained by the affirmative vote of the holders of a majority of the
outstanding shares of the Company present or represented and entitled to vote
thereon. The approval of such shareholders of the Company shall be (1) solicited
substantially in accordance with Section 14(a) of the Exchange Act and the rules
and regulations promulgated thereunder, or (2) solicited after the Company has
furnished in writing to the holders entitled to vote substantially the same
information concerning the Plan as that which would be required by the rules and
regulations in effect under Section 14(a) of the Exchange Act at the time such
information is furnished.

 

18.
Miscellaneous
Provisions. An
Optionee shall have no rights as a shareholder with respect to any Shares
covered by his Option until the date of the issuance of a stock certificate to
him for such shares.

 

19.
Other
Provisions. The
stock option agreement authorized under the Plan shall contain such other
provisions, including, without limitation, restrictions upon the exercise of the
Option, as the Committee shall deem advisable. Any such stock option agreement
shall contain such limitations and restrictions upon the exercise of the Option
as shall be necessary in order that such option will be an Incentive Stock
Option as defined in Section 422 of the Code if an Incentive Stock Option is
intended to be granted.

 

20.
Indemnification
of Committee. In
addition to such other rights of indemnification as they may have as Directors
or as members of the Committee, the members of the Committee shall be
indemnified by the Company against the reasonable expenses, including attorneys'
fees actually and necessarily incurred in connection with the defense of any
action, suit or proceeding, or in connection with any appeal therein, to which
they or any of them may be a party by reason of any action taken or failure to
act under or in connection with the Plan or any Option granted thereunder, and
against all amounts paid by them in settlement thereof (provided such settlement
is approved by independent legal counsel selected by the Company) or paid by
them in satisfaction of a judgment in any such action, suit or proceeding,
except in relation to matters as to which it shall be adjudged in such action,
suit or proceeding that such Board member is liable for negligence or misconduct
in the performance of his duties; provided that within sixty (60) days after
institution of any such action, suit or proceeding a Board member shall in
writing offer the Company the opportunity, at its own expense, to handle and
defend the same.

 

21.
Application
of Funds. The
proceeds received by the Company from the sale of Common Stock pursuant to
Options will be used for general corporate purposes.

 

22.
No
Obligation to Exercise Option. The
granting of an Option shall impose no obligation upon the Optionee to exercise
such Option.

 

23.
Other
Compensation Plans. The
adoption of the Plan shall not affect any other stock option or incentive or
other compensation plans in effect for the Company or any Subsidiary, nor shall
the Plan preclude the Company from establishing any other forms of incentive or
other compensation for employees and Directors of the Company or any
Subsidiary.

 

24.
Singular,
Plural; Gender. Whenever
used herein, nouns in the singular shall include the plural, and the masculine
pronoun shall include the feminine gender.

 

25.
Headings,
Etc., No Part of Plan. Headings
of Articles and Sections hereof are inserted for convenience and reference; they
constitute no part of the Plan.

 

26.
Governing
Law. The Plan
shall be governed by and construed in accordance with the laws of the State of
New York, except to the extent preempted by Federal law. The Plan is intended to
comply with Rule 16b-3. Any provisions inconsistent with Rule 16b-3 shall be
inoperative and shall not affect the validity of the Plan, unless the Board of
Directors shall expressly resolve that the Plan is no longer intended to comply
with Rule 16b-3.

 

Dated:
May 5, 2004

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