Document:

EXHIBIT 4.6

                      NON-QUALIFIED STOCK OPTION AGREEMENT

      THIS NON-QUALIFIED STOCK OPTION AGREEMENT is entered into as of November
27, 2001 by and between MTR Gaming Group, Inc. a Delaware corporation (the
"Company"), and Michael E. Hager (the "Optionee"), an independent director of
the Company.

      In consideration of the mutual promises hereinafter set forth, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereby agree as follows:

      1. Option Grant. The Company and the Optionee hereby agree to be bound by
the terms of this Agreement with respect to the grant made by the Company's
Board of Directors effective on November 27, 2001 of an option to purchase an
aggregate of 25,000 shares of the common stock, $.00001 par value per share, of
the Company ("Common Stock") at an exercise price of $13.60 per share, being the
fair market value of such shares of Common Stock on the date of grant (the
"Option"). This Option is not intended to constitute an "incentive stock option"
(within the meaning of Section 422 of the Internal Revenue Code of 1986, as
amended). The Options will vest immediately.

      2. Term; Exercise. This Option will expire on November 26, 2011, subject
to earlier termination as provided herein (the "Termination Date"). This Option
is exercisable at anytime prior to the Termination Date except as otherwise
provided by the terms of this Option. In no event may a fraction of a share of
Common Stock be purchased under this Option.

      3. Notice of Exercise; Payment. This Option shall be exercisable by giving
written notice to the Company at its principal office, presently State Route 2
South, Chester, West Virginia, Attn.: Chief Financial Officer, stating that the
Optionee is exercising this Option, specifying the number of shares being
purchased and accompanied by payment in full of the aggregate purchase price
therefor: (a) in cash or by certified check; (b) with previously acquired shares
of Common Stock having an aggregate Fair Market Value on the date of exercise
equal to the aggregate exercise price of all Options being exercised; (c) with
any combination of cash, certified check or shares of Common Stock having such
value; or (d) any other form of legal consideration that may be acceptable to
the Board in its sole discretion.

      4. Representations and Warranties of Optionee. Notwithstanding the
foregoing, this Option shall not be exercisable by the Optionee unless: (a) a
Registration Statement under the Securities Act of 1933, as amended (the
"Securities Act") with respect to the shares of Common Stock to be received upon
the exercise of the Option shall be effective and current at the time of
exercise; or (b) there is an exemption from the registration requirements under
the Securities Act for the issuance of the shares of Common Stock upon exercise.
The Optionee hereby represents and warrants to the Company, that: (i) the shares
of Common Stock to be issued upon the exercise of this Option are being acquired
by the Optionee for the Optionee's own account, for investment only and not with
a view to the resale or distribution thereof; and (ii) any subsequent resale or
distribution of shares of Common Stock by the Optionee will be made only
pursuant to (x) a Registration Statement under the Securities Act which is
effective and current with respect
<PAGE>

to the shares of Common Stock being sold, or (y) a specific exemption from the
registration requirements of the Securities Act, but in claiming such exemption,
the Optionee shall, prior to any offer of sale or sale of such shares of Common
Stock, provide the Company with a favorable written opinion of counsel
satisfactory to the Company, in form, substance and scope satisfactory to the
Company, as to the applicability of such exemption to the proposed sale or
distribution. Such representation and warranties shall also be deemed to be made
by the Optionee upon each exercise of this Option. Nothing herein shall be
construed as requiring the Company to register the shares subject to this Option
under the Securities Act.

      5. Legends; Stop Transfer Instructions. The Company may affix appropriate
legends upon the certificates for shares of Common Stock issued upon exercise of
this Option and may issue such "stop transfer" instructions to its transfer
agent in respect of such shares as it determines, in its discretion, to be
necessary or appropriate to: (a) prevent a violation of, or to perfect an
exemption from, the registration requirements of the Securities Act and any
applicable state securities laws; or (b) implement the provisions of any
agreement between the Company and the Optionee with respect to such shares of
Common Stock.

      6. Taxes. The Company may withhold cash and/or shares of Common Stock to
be issued to the Optionee in the amount which the Company determines is
necessary to satisfy its obligation to withhold taxes or other amounts incurred
by reason of the grant or exercise of this Option, its disposition or the
disposition of the underlying shares of Common Stock. Alternatively, the Company
may require the Optionee to pay the Company such amount in cash promptly upon
demand.

      7. Compliance With Applicable Laws. The Optionee agrees to comply with all
applicable laws relating to the grant and exercise of the Option and the
disposition of the shares of Common Stock acquired upon exercise of the Option,
including without limitation, federal and state securities and "blue sky" laws,
and applicable prospectus delivery requirements.

      8. Transferability. The Option is not transferable otherwise than by will
or the laws of descent and distribution and may be exercised, during the
lifetime of the Optionee, only by the Optionee, or the Optionee's legal
representatives, provided, however, that the Option may be exercised and the
underlying securities resold by any family member of the Optionee who has
acquired the Option from the Optionee through a gift or a domestic relations
order. For purposes of this Option, "family member" includes any child,
stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse,
sibling, niece, nephew, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law, including adoptive
relationships, any person sharing the Optionee's household (other than a tenant
or employee), a trust in which these persons have more than fifty percent of the
beneficial interest, a foundation in which these persons (or the Optionee)
control the management of assets, and any other entity in which these persons
(or the Optionee) own more than fifty percent of the voting interests.

      9. Successors and Assigns. This Agreement shall be binding upon and inure
to the benefit of the parties hereto, any successor or assign of the Company and
to any Legal Representative of the Optionee, or any family member as defined in
this Agreement acquiring the Option as a result of a gift or pursuant to a
domestic relations order.

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<PAGE>

      10. Governing Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of Delaware, without regard
to the conflicts of law rules thereof.

      11. Validity. The invalidity, illegality or unenforceability of any
provision herein shall not affect the validity, legality or enforceability of
any other provision, all or which shall be valid, legal and enforceable to the
fullest extent permitted by applicable law.

      12. Adjustments Upon Changes in Common Stock. Notwithstanding any other
provision of this Agreement, in the event of a stock dividend, recapitalization,
merger in which the Company is the surviving corporation, spin-off, split-up,
combination or exchange of shares or the like which results in a change in the
number or kind of shares of Common Stock which is outstanding immediately prior
to such event, the aggregate number and kind of shares subject to the Agreement,
the aggregate number and kind of shares subject to each outstanding award of
options, the exercise price of each option, any contingencies and restrictions
based on the number or kind of shares, shall be appropriately adjusted by the
Board of Directors, whose determination shall be conclusive and binding on all
parties. Such adjustment may provide for the elimination of fractional shares
without payment therefor. In the event of (a) the liquidation or dissolution of
the Company, (b) a merger in which the Company is not the surviving corporation
or a consolidation, or (c) any transaction (or series of related transactions)
in which (i) more than 50% of the outstanding Common Stock is transferred or
exchanged for other consideration, or (ii) shares of Common Stock in excess of
the number of shares of Common Stock outstanding immediately preceding the
transaction are issued (other than to stockholders of the Company with respect
to their shares of stock in the Company), any outstanding options, unvested
stock shall terminate upon the earliest of any such event, unless other
provision is made therefor in the transaction. The Company and the Optionee
agree that the terms of this Section 13 shall apply to and be deemed to be
incorporated in all option agreements executed by and between the Company and
the Optionee prior to the date of this Agreement.

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<PAGE>

      IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.

                                        MTR GAMING GROUP, INC.

                                        By: \s\ Edson R. Arneault
                                           -------------------------------------
                                        Name: EDSON R. ARNEAULT
                                             -----------------------------------
                                        Its:  PRESIDENT
                                            ------------------------------------

                                        OPTIONEE

                                        By: /s/ Michael E. Hager
                                           -------------------------------------
                                              Michael E. Hager
                                              (Name of Optionee)

                                       4EXHIBIT 10.1

                            2001 STOCK INCENTIVE PLAN
                                       OF
                             MTR GAMING GROUP, INC.

      1. PURPOSES OF THE PLAN. This stock incentive plan (the "Plan") is
designed to provide an incentive to key employees (including directors and
officers who are key employees) and to consultants and directors who are not
employees of MTR GAMING GROUP, INC., a Delaware corporation (the "Company"), or
any of its Subsidiaries (as defined in Paragraph 17), and to offer an additional
inducement in obtaining the services of such persons. The Plan provides for the
grant of nonqualified stock options ("NQSOs") which do not qualify as incentive
stock options within the meaning of Section 422 of the Internal Revenue Code of
1986, as amended (the "Code"), and stock of the Company which may be subject to
contingencies or restrictions (collectively, "Awards"). The Plan does not
provide for the granting of any "incentive stock option" under the Code.

      2. STOCK SUBJECT TO THE PLAN. Subject to the provisions of Paragraph 10,
the aggregate number of shares of Common Stock, $.0001 par value per share, of
the Company ("Common Stock") for which Awards may be granted under the Plan
shall not exceed 490,000 shares, provided, however, that not more than 49% of
such shares may be issued to Directors and Executive Officers of the Company.
Such shares of Common Stock may, in the discretion of the Board of Directors of
the Company (the "Board of Directors"), consist either in whole or in part of
authorized but unissued shares of Common Stock or shares of Common Stock held in
the treasury of the Company. Subject to the provisions of Paragraph 11, any
shares of Common Stock subject to an option which for any reason expires, is
canceled or is terminated unexercised or which ceases for any reason to be
exercisable or a restricted stock Award which for any reason is forfeited, shall
again become available for the granting of Awards under the Plan. The Company
shall at all times during the term of the Plan reserve and keep available such
number of shares of Common Stock as will be sufficient to satisfy the
requirements of the Plan.

      3. ADMINISTRATION OF THE PLAN. The Plan shall be administered by the Board
of Directors or a committee of the Board of Directors consisting of not less
than two directors, each of whom shall be a "non-employee director" within the
meaning of Rule 16b-3 (as defined in Paragraph 17) (collectively, the
"Committee"). Unless otherwise provided in the By-laws of the Company or by
resolution of the Board of Directors, a majority of the members of the Committee
shall constitute a quorum, and the acts of a majority of the members present at
any meeting at which a quorum is present, and any acts approved in writing by
all members without a meeting, shall be the acts of the Committee. Subject to
the express provisions of the Plan, the Committee shall have the authority, in
its sole discretion, to determine: the key employees, consultants and directors
who shall be granted Awards; the type of Award to be granted; the times when an
Award shall be granted; the number of shares of Common Stock to be subject to
each Award; the term of each option; the date each option shall become
exercisable; whether an option shall be exercisable in whole or in installments
and, if in installments, the number of shares of Common Stock to be subject to
each installment, whether the installments shall be cumulative, the date each
installment shall become exercisable and the term of each installment; whether
to accelerate the date of exercise of any option or installment thereof; whether
shares of Common Stock may be issued upon the exercise of an option as partly
paid and, if so, the dates when future installments of the exercise price shall
become due and the amounts of such installments; the exercise price of each
option; the price, if any, to be paid for a share Award; the form of payment of
the exercise price of an option; whether to restrict the sale or other
disposition of a stock Award or the shares of Common Stock acquired upon the
exercise of an option and, if so, to determine whether such contingencies and
restrictions have been met and whether and under what conditions to waive any
such contingency or restriction; whether and under what conditions to subject
all or a portion of the grant or exercise of an option, the vesting of a stock
Award or the shares acquired pursuant to the exercise of an option to the
fulfillment of certain contingencies or restrictions as specified in the
contract referred to in Paragraph 9 hereof (the "Contract"),
<PAGE>

including without limitation, contingencies or restrictions relating to entering
into a covenant not to compete with the Company, any of its Subsidiaries or a
Parent (as defined in Paragraph 17), to financial objectives for the Company,
any of its Subsidiaries or a Parent, a division of any of the foregoing, a
product line or other category, and/or to the period of continued employment of
the Award holder with the Company, any of its Subsidiaries or a Parent, and to
determine whether such contingencies or restrictions have been met; whether an
Award holder is Disabled (as defined in Paragraph 17); the amount, if any,
necessary to satisfy the obligation of the Company, a Subsidiary or Parent to
withhold taxes or other amounts; the Fair Market Value (as defined in Paragraph
17) of a share of Common Stock; to construe the respective Contracts and the
Plan; with the consent of the Award holder, to cancel or modify an Award,
PROVIDED, that the modified provision is permitted to be included in an Award
granted under the Plan on the date of the modification; to prescribe, amend and
rescind rules and regulations relating to the Plan; to approve any provision
which under Rule 16b-3 requires the approval of the Board of Directors, a
committee of non-employee directors or the stockholders to be exempt (unless
otherwise specifically provided herein); and to make all other determinations
necessary or advisable for administering the Plan. Any controversy or claim
arising out of or relating to the Plan, any Award granted under the Plan or any
Contract shall be determined unilaterally by the Committee in its sole
discretion. The determinations of the Committee on the matters referred to in
this Paragraph 3 shall be conclusive and binding on the parties. No member or
former member of the Committee shall be liable for any action, failure to act or
determination made in good faith with respect to the Plan or any Award or
Contract hereunder. Prior to the creation and designation of the Committee by
the Board of Directors, all powers and authority allocated hereby to the
Committee shall be allocated to the Board of Directors and all references to the
Committee shall be deemed to be references to the Board of Directors.
Notwithstanding any provision in the Plan to the contrary, an Award granted to a
consultant or director who is not an employee of the Company shall be based upon
a formula or other criteria established by the Committee at least ninety (90)
days prior to the grant of such Award.

      4. OPTIONS

            (a) GRANT. The Committee may from time to time, consistent with the
purposes of the Plan, grant options to such key employees (including officers
and directors who are key employees) of, and consultants to, the Company or any
of its Subsidiaries, and such Outside Directors, as the Committee may determine,
in its sole discretion. Such options granted shall cover such number of shares
of Common Stock as the Committee may determine, in its sole discretion, as set
forth in the applicable Contract; PROVIDED, HOWEVER, THAT THE MAXIMUM NUMBER OF
SHARES SUBJECT TO OPTIONS THAT MAY BE GRANTED TO ANY EMPLOYEE DURING ANY
CALENDAR YEAR UNDER THE PLAN (THE "162(M) MAXIMUM") SHALL BE 350,000 SHARES.

            (b) EXERCISE PRICE. The exercise price of the shares of Common Stock
under each option shall be determined by the Committee, in its sole discretion,
as set forth in the applicable Contract. Notwithstanding any provision in this
Plan to the contrary, the exercise price per share of a NQSO shall not be less
than the Fair Market Value of a share of Common Stock on the date that the NQSO
was granted or, if the NQSO was repriced pursuant to Paragraph 4(f), the date
that the NQSO was repriced.

            (c) TERM. The term of each option granted pursuant to the Plan shall
be determined by the Committee, in its sole discretion, and set forth in the
applicable Contract. Options shall be subject to earlier termination as
hereunder provided.

            (d) EXERCISE. An option (or any part or installment thereof), to the
extent then exercisable, shall be exercised by giving written notice to the
Company at its then principal office stating which option is being exercised,
specifying the number of shares of Common Stock as to which such option is being
exercised and accompanied by payment in full of the aggregate exercise price
therefor (or the amount due upon exercise if the Contract permits installment
payments) (a) in cash or by certified check or (b) if the applicable Contract
permits, with previously acquired shares of Common Stock having an aggregate
Fair Market Value on the date of exercise equal to the aggregate exercise price
of all options

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<PAGE>

being exercised, or with any combination of cash, certified check or shares of
Common Stock having such value. The Company shall not be required to issue any
shares of Common Stock pursuant to any such option until all required payments,
including any required withholding, have been made.

                  The Committee may, in its sole discretion, permit payment of
all or a portion of the exercise price of an option by delivery by the optionee
of a properly executed notice, together with a copy of his irrevocable
instructions to a broker acceptable to the Committee to deliver promptly to the
Company the amount of sale or loan proceeds sufficient to pay such exercise
price. In connection therewith, the Company may enter into agreements for
coordinated procedures with one or more brokerage firms.

                  An optionee entitled to receive Common Stock upon the exercise
of an option shall not have the rights of a stockholder with respect to such
shares of Common Stock until the date of issuance of a stock certificate for
such shares or, in the case of uncertificated shares, until an entry is made on
the books of the Company's transfer agent representing such shares; PROVIDED,
HOWEVER, that until such stock certificate is issued or book entry is made, any
optionee using previously acquired shares of Common Stock in payment of an
option exercise price shall continue to have the rights of a stockholder with
respect to such previously acquired shares.

                  In no case may an option be exercised with respect to a
fraction of a share of Common Stock. In no case may a fraction of a share of
Common Stock be purchased or issued under the Plan.

            (e) RELOAD OPTIONS. An optionee who, at a time when he is eligible
to be granted options under the Plan, uses previously acquired shares of Common
Stock to exercise an option granted under the Plan (the "prior option"), shall,
upon such exercise, be automatically granted an option (the "reload option") to
purchase the same number of shares of Common Stock so used (or if there is not a
sufficient number of shares available for grant under the Plan remaining, such
number of shares as are then available). Such reload options shall be of the
same type and have the same terms as the prior option (except to the extent
inconsistent with the terms of the Plan); PROVIDED, HOWEVER, that the exercise
price per share of the reload option shall be equal to the Fair Market Value of
a share of Common Stock on the date of grant of the reload option.

            (f) REPRICING. In the event that the Committee determines that it
would be in the best interest of the Company and consistent with the purposes of
the Plan, the Committee may reduce the exercise price of previously granted
NQSOs; provided, however, that such repricing by the Committee pursuant to this
Paragraph 4(f) shall be limited to not more than ten percent (10%) of the number
of options then outstanding under the Plan.

      5. RESTRICTED STOCK. The Committee may from time to time, consistent with
the purposes of the Plan, grant shares of Common Stock to such key employees
(including officers and directors who are key employees) of, or consultants to,
the Company or any of its Subsidiaries, as the Committee may determine, in its
sole discretion. The grant may cover such number of shares as the Committee may
determine, in its sole discretion, and require the Award holder to pay such
price per share therefor, if any, as the Committee may determine, in its sole
discretion. Such shares may be subject to such contingencies and restrictions as
the Committee may determine, as set forth in the Contract. Upon the issuance of
the stock certificate for a share Award, or in the case of uncertificated
shares, the entry on the books of the Company's transfer agent representing such
shares, notwithstanding any contingencies or restrictions to which the shares
are subject, the Award holder shall be considered to be the record owner of the
shares, and subject to the contingencies and restrictions set forth in the
Award, shall have all rights of a stockholder of record with respect to such
shares, including the right to vote and to receive distributions. Upon the
occurrence of any such contingency or restriction, the Award holder may be
required to forfeit all or a portion of such shares back to the Company. The
shares shall vest in the Award holder when all of the restrictions and
contingencies lapse. Accordingly, the Committee may require that such shares be
held by the Company, together with a stock power duly endorsed in blank by the
Award

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<PAGE>

holder, until the shares vest in the Award holder. Contracts with respect to the
grant of shares of Common Stock shall require that the Award holder agree not to
transfer the Common Stock for (a) one year following the grant in the case of
Awards based on performance and (b) three years following the grant in the case
of Awards based on the passage of time. The Contracts may provide for the waiver
of this restriction in the event of death, disability, retirement, change of
control or other similar circumstances specified by the Committee.

      6. TERMINATION OF RELATIONSHIP. Except as may otherwise be expressly
provided in the applicable Contract, if an Award holder's relationship with the
Company, its Subsidiaries and Parent as an employee or a consultant has
terminated for any reason (other than as a result of his death or Disability),
the Award holder may exercise the options granted to him as an employee of, or
consultant to, the Company or any of its Subsidiaries, to the extent exercisable
on the date of such termination, at any time within three months after the date
of termination, but not thereafter and in no event after the date the Award
would otherwise have expired; PROVIDED, HOWEVER, that if such relationship is
terminated either (a) for Cause (as defined in Paragraph 17), or (b) without the
consent of the Company, such option shall terminate immediately; and PROVIDED
FURTHER that in the event an employee's employment is terminated in connection
with a change in control of the Company, then the employee will have the right
to exercise the option until the date the award otherwise would have expired.

            For the purposes of the Plan, an employment relationship shall be
deemed to exist between an individual and the Company, any of its Subsidiaries
or a Parent if, at the time of the determination, the individual was an employee
of such corporation for purposes of Section 422(a) of the Code. As a result, an
individual on military, sick leave or other bona fide leave of absence shall
continue to be considered an employee for purposes of the Plan during such leave
if the period of the leave does not exceed 90 days, or, if longer, so long as
the individual's right to reemployment with the Company, any of its Subsidiaries
or a Parent is guaranteed either by statute or by contract. If the period of
leave exceeds 90 days and the individual's right to reemployment is not
guaranteed by statute or by contract, the employment relationship shall be
deemed to have terminated on the 91st day of such leave.

            Except as may otherwise be expressly provided in the applicable
Contract, options granted under the Plan shall not be affected by any change in
the status of the Award holder so long as he continues to be an employee of, or
a consultant to, the Company, or any of its Subsidiaries or a Parent (regardless
of having changed from one to the other or having been transferred from one
corporation to another).

            Except as may otherwise be expressly provided in the applicable
Contract, if an Award holder's relationship with the Company as an Outside
Director ceases for any reason (other than as a result of his death or
Disability) then options granted to such holder as an Outside Director may be
exercised, to the extent exercisable on the date of such termination, at any
time within three months after the date of termination, but not thereafter and
in no event after the date the Award would otherwise have expired; PROVIDED,
HOWEVER, that if such relationship is terminated for Cause, such Award shall
terminate immediately. An Award granted to an Outside Director, however, shall
not be affected by the Award holder becoming an employee of, or consultant to,
the Company, any of its Subsidiaries or a Parent.

            Except as may otherwise be expressly provided in the Contract, upon
the termination of the relationship of an Award holder as an employee of, or
consultant to, the Company, and its Subsidiaries and Parent, or as an Outside
Director, for any reason (including his death or Disability), the share Award
shall cease any further vesting and the unvested portion of such Award as of the
date of such termination shall be forfeited to the Company for no consideration.

            Nothing in the Plan or in any Award granted under the Plan shall
confer on any Award holder any right to continue in the employ of, or as a
consultant to, the Company, any of its Subsidiaries or a Parent, or as a
director of the Company, or interfere in any way with any right of the Company,
any of its Subsidiaries or a Parent to terminate the Award holder's relationship
at any time for any reason

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<PAGE>

whatsoever without liability to the Company, any of its Subsidiaries or a
Parent.

      7. DEATH OR DISABILITY. Except as may otherwise be expressly provided in
the applicable Contract, if an Award holder dies (a) while he is an employee of,
or consultant to, the Company, any of its Subsidiaries or a Parent, (b) within
three months after the termination of such relationship (unless such termination
was for Cause or without the consent of the Company), or (c) within one year
following the termination of such relationship by reason of his Disability, the
options that were granted to him as an employee of, or consultant to, the
Company or any of its Subsidiaries, may be exercised, to the extent exercisable
on the date of his death, by his Legal Representative (as defined in Paragraph
17) at any time within one year after death, but not thereafter and in no event
after the date the option would otherwise have expired.

            Except as may otherwise be expressly provided in the applicable
Contract, if an Award holder's relationship as an employee of, or consultant to,
the Company, any of its Subsidiaries or a Parent has terminated by reason of his
Disability, the options that were granted to him as an employee of, or
consultant to the Company or any of its Subsidiaries may be exercised, to the
extent exercisable upon the effective date of such termination, at any time
within one year after such date, but not thereafter and in no event after the
date the option would otherwise have expired.

            Except as may otherwise be expressly provided in the applicable
Contract, if an Award holder's relationship as an Outside Director terminates as
a result of his death or Disability, the options granted to him as an Outside
Director may be exercised, to the extent exercisable on the date of such
termination, at any time within one year after the date of termination, but not
thereafter and in no event after the date the Award would otherwise have
expired. In the case of the death of the Award holder, the Award may be
exercised by his Legal Representative.

      8. COMPLIANCE WITH SECURITIES LAWS. It is a condition to the issuance of
any share Award and exercise of any option that either (a) a Registration
Statement under the Securities Act of 1933, as amended (the "Securities Act"),
with respect to the shares of Common Stock to be issued upon such grant or
exercise shall be effective and current at the time of exercise, or (b) there is
an exemption from registration under the Securities Act for the issuance of the
shares of Common Stock upon such exercise. Nothing herein shall be construed as
requiring the Company to register shares subject to any Award under the
Securities Act or to keep any Registration Statement effective or current.

            The Committee may require, in its sole discretion, as a condition to
the receipt of an Award or the exercise of any option that the Award holder
execute and deliver to the Company his representations and warranties, in form,
substance and scope satisfactory to the Committee, which the Committee
determines are necessary or convenient to facilitate the perfection of an
exemption from the registration requirements of the Securities Act, applicable
state securities laws or other legal requirement, including, without limitation,
that (a) the shares of Common Stock to be received under the Award or issued
upon the exercise of the option are being acquired by the Award holder for his
own account, for investment only and not with a view to the resale or
distribution thereof, and (b) any subsequent resale or distribution of shares of
Common Stock by such Award holder will be made only pursuant to (i) a
Registration Statement under the Securities Act which is effective and current
with respect to the shares of Common Stock being sold, or (ii) a specific
exemption from the registration requirements of the Securities Act, but in
claiming such exemption, the Award holder shall prior to any offer of sale or
sale of such shares of Common Stock provide the Company with a favorable written
opinion of counsel satisfactory to the Company, in form, substance and scope
satisfactory to the Company, as to the applicability of such exemption to the
proposed sale or distribution.

            In addition, if at any time the Committee shall determine, in its
sole discretion, that the listing or qualification of the shares of Common Stock
subject to any Award or option on any securities exchange, Nasdaq or under any
applicable law, or the consent or approval of any governmental agency or
regulatory body, is necessary or desirable as a condition to, or in connection
with, the granting of an Award or the issuing of shares of Common Stock
thereunder, such Award may not be granted and such

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<PAGE>

option may not be exercised in whole or in part unless such listing,
qualification, consent or approval shall have been effected or obtained free of
any conditions not acceptable to the Committee.

      9. AWARD CONTRACTS. Each Award shall be evidenced by an appropriate
Contract which shall be duly executed by the Company and the Award holder, and
shall contain such terms, provisions and conditions not inconsistent herewith as
may be determined by the Committee. The terms of each Award and Contract need
not be identical.

      10. ADJUSTMENTS UPON CHANGES IN COMMON STOCK. Notwithstanding any other
provision of the Plan, in the event of a stock dividend, recapitalization,
merger in which the Company is the surviving corporation, spin-off, split-up,
combination or exchange of shares or the like which results in a change in the
number or kind of shares of Common Stock which is outstanding immediately prior
to such event, the aggregate number and kind of shares subject to the Plan, the
aggregate number and kind of shares subject to each outstanding Award, the
exercise price of each option, any contingencies and restrictions based on the
number or kind of shares, and the 162(m) Maximum shall be appropriately adjusted
by the Board of Directors, whose determination shall be conclusive and binding
on all parties. Such adjustment may provide for the elimination of fractional
shares which might otherwise be subject to Awards without payment therefor.

            In the event of (a) the liquidation or dissolution of the Company,
(b) a merger in which the Company is not the surviving corporation or a
consolidation, or (c) any transaction (or series of related transactions) in
which (i) more than 50% of the outstanding Common Stock is transferred or
exchanged for other consideration, or (ii) shares of Common Stock in excess of
the number of shares of Common Stock outstanding immediately preceding the
transaction are issued (other than to stockholders of the Company with respect
to their shares of stock in the Company), any outstanding options and unvested
stock shall terminate upon the earliest of any such event, unless other
provision is made therefor in the transaction.

      11. AMENDMENTS AND TERMINATION OF THE PLAN. The Plan was adopted by the
Board of Directors on May 1, 2001. The Board of Directors may at any time
suspend or terminate the Plan, in whole or in part, or amend it from time to
time in such respects as it may deem advisable, including, without limitation,
in order to comply with the provisions of Rule 16b-3, Section 162(m) of the
Code, or any change in applicable law, regulations, rulings or interpretations
of any governmental agency or regulatory body. No termination, suspension or
amendment of the Plan shall adversely affect the rights of any Award holder
under an Award without his prior consent. The power of the Committee to construe
and administer any Awards granted under the Plan prior to the termination or
suspension of the Plan nevertheless shall continue after such termination or
during such suspension.

      12. NON-TRANSFERABILITY. No option granted under the Plan shall be
transferable otherwise than by will or the laws of descent and distribution, and
options may be exercised, during the lifetime of the Award holder, only by him
or his Legal Representatives. Except as may otherwise be expressly provided in
the Contract, a stock Award, to the extent not vested, shall not be transferable
otherwise than by will or the laws of descent and distribution. Except to the
extent provided above, Awards may not be assigned, transferred, pledged,
hypothecated or disposed of in any way (whether by operation of law or
otherwise) and shall not be subject to execution, attachment or similar process,
and any such attempted assignment, transfer, pledge, hypothecation or
disposition shall be null and void AB INITIO and of no force or effect;
PROVIDED, HOWEVER, that a contract may provide that non-qualified Awards may be
donated to charity or assigned to a family trust or similar estate planning
vehicle.

      13. WITHHOLDING TAXES. The Company, a Subsidiary or Parent may withhold
(a) cash, or (b) with the consent of the Committee, shares of Common Stock to be
issued under a stock Award or upon exercise of an option having an aggregate
Fair Market Value on the relevant date, or a combination of cash and shares
having such value, in an amount equal to the amount which the Committee
determines is necessary to satisfy the obligation of the Company, any of its
Subsidiaries or a Parent to withhold

                                       6
<PAGE>

federal, state and local taxes or other amounts incurred by reason of the grant,
vesting, exercise or disposition of an Award, or the disposition of the
underlying shares of Common Stock. Alternatively, the Company may require the
holder to pay to the Company such amount, in cash, promptly upon demand.

      14. LEGENDS; PAYMENT OF EXPENSES. The Company may endorse such legend or
legends upon the certificates for shares of Common Stock issued under a stock
Award or upon exercise of an option under the Plan and may issue such "stop
transfer" instructions to its transfer agent in respect of such shares as it
determines, in its discretion, to be necessary or appropriate to (a) prevent a
violation of, or to perfect an exemption from, the registration requirements of
the Securities Act and any applicable state securities laws, or (b) implement
the provisions of the Plan or any agreement between the Company and the Award
holder with respect to such shares of Common Stock.

            The Company shall pay all issuance taxes with respect to the
issuance of shares of Common Stock under a stock Award or upon the exercise of
an option granted under the Plan, as well as all fees and expenses incurred by
the Company in connection with such issuance.

      15. USE OF PROCEEDS. The cash proceeds received upon the exercise of an
option, or grant of a stock Award under the Plan shall be added to the general
funds of the Company and used for such corporate purposes as the Board of
Directors may determine.

      16. SUBSTITUTIONS AND ASSUMPTIONS OF AWARDS OF CERTAIN CONSTITUENT
CORPORATIONS. Anything in this Plan to the contrary notwithstanding, the Board
of Directors may, without further approval by the stockholders, substitute new
Awards for prior options, or restricted stock of a Constituent Corporation (as
defined in Paragraph 17) or assume the prior options or restricted stock of such
Constituent Corporation.

      17. DEFINITIONS. For purposes of the Plan, the following terms shall be
defined as set forth below:

            (a) "Cause" shall mean: (i) in the case of an employee or
consultant, if there is a written employment or consulting agreement between the
Award holder and the Company, any of its Subsidiaries or a Parent which defines
termination of such relationship for cause, cause as defined in such agreement,
and (ii) in all other cases, cause as defined by applicable state law.

            (b) "Constituent Corporation" shall mean any corporation which
engages with the Company, any of its Subsidiaries or a Parent in a transaction
to which Section 424(a) of the Code applies, or any Subsidiary or Parent of such
corporation.

            (c) "Disability" shall mean a permanent and total disability within
the meaning of Section 22(e)(3) of the Code.

            (d) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

            (e) "Fair Market Value" of a share of Common Stock on any day shall
mean: (i) if the principal market for the Common Stock is a national securities
exchange, the average of the highest and lowest sales prices per share of Common
Stock on such day as reported by such exchange or on a composite tape reflecting
transactions on such exchange, (ii) if the principal market for the Common Stock
is not a national securities exchange and the Common Stock is quoted on Nasdaq,
and (A) if actual sales price information is available with respect to the
Common Stock, the average of the highest and lowest sales prices per share of
Common Stock on such day on Nasdaq, or (B) if such information is not available,
the average of the highest bid and lowest asked prices per share of Common Stock
on such day on Nasdaq, or (iii) if the principal market for the Common Stock is
not a national securities exchange and the Common Stock is not quoted on Nasdaq,
the average of the highest bid and lowest asked prices per share of Common Stock
on such day as reported on the OTC Bulletin Board Service or by National
Quotation Bureau, Incorporated or a comparable service; PROVIDED, HOWEVER, that
if clauses (i), (ii)

                                       7
<PAGE>

and (iii) of this subparagraph are all inapplicable, or if no trades have been
made or no quotes are available for such day, the Fair Market Value of a share
of Common Stock shall be determined by the Board of Directors by any method
consistent with applicable regulations adopted by the Treasury Department
relating to stock options.

            (f) "Legal Representative" shall mean the executor, administrator or
other person who at the time is entitled by law to exercise the rights of a
deceased or incapacitated optionee with respect to an option granted under the
Plan.

            (g) "Nasdaq" shall mean the Nasdaq Stock Market.

            (h) "Outside Director" shall mean a person who is a director of the
Company, but on the date of grant is not an employee of, or consultant to, the
Company, any of its Subsidiaries or a Parent.

            (i) "Parent" shall have the same definition as "parent corporation"
in Section 424(e) of the Code.

            (j) "Rule 16b-3" shall mean Rule 16b-3 promulgated under the
Exchange Act, as the same may be in effect and interpreted from time to time.

            (k) "Subsidiary" shall have the same definition as "subsidiary
corporation" in Section 424(f) of the Code.

      18. GOVERNING LAW; CONSTRUCTION. The Plan, the Awards and Contracts
hereunder and all related matters shall be governed by, and construed in
accordance with, the laws of the State of Delaware, without regard to conflict
of law provisions that would defer to the substantive laws of another
jurisdiction.

            Neither the Plan nor any Contract shall be construed or interpreted
with any presumption against the Company by reason of the Company causing the
Plan or Contract to be drafted. Whenever from the context it appears
appropriate, any term stated in either the singular or plural shall include the
singular and plural, and any term stated in the masculine, feminine or neuter
gender shall include the masculine, feminine and neuter.

      19. PARTIAL INVALIDITY. The invalidity, illegality or unenforceability of
any provision in the Plan, any Award or Contract shall not affect the validity,
legality or enforceability of any other provision, all of which shall be valid,
legal and enforceable to the fullest extent permitted by applicable law.

                                       8

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