Document:

2002 Phantom Stock Option Plan

 Exhibit 10.4.2 
  
 

 
 Integris Metals, Inc. 
  
 PHANTOM STOCK OPTION PLAN 
  
 The Phantom Stock Option Plan (hereinafter called the “Plan”) is hereby established by Integris Metals, Inc., a
New York corporation (hereinafter called “Integris”), effective as of January 1, 2002. 
  
 Phantom Stock Options (“Awards”) may be granted to Employees under the Plan, from time to time, subject to adjustment as provided in Articles 11
and 12. Any shares subject to an Award that are forfeited, canceled, or expired may be awarded again under the Plan. 
  
 ARTICLE 1 
 PURPOSE 
  
 The purpose of the Plan is to attract and retain key management employees of
Integris and to provide such persons with a proprietary interest in the Company through the granting of Phantom Stock Options. 
  
 ARTICLE 2 
 DEFINITIONS

  
 For the purpose of the Plan, unless the context requires
otherwise, the following terms shall have the meanings indicated: 
  
 2.1 “Award” means a grant of Phantom Stock Options under the Plan. 
  
 2.2 “Award Agreement” means a written agreement pursuant to this Plan between a Participant and the Company which sets out the
terms of the Award. 
  
 2.3 “Board”
means the board of directors of the Company. 
  
 2.4 “Cause” means (i) serious, willful misconduct with respect to the Participant’s duties as an employee of the Company; (ii) engaging in any competitive behavior defined below; (iii) the Participant’s indictment for a
felony; (iv) the Participant’s commission of fraud, embezzlement, theft or other act involving dishonesty, or a crime constituting moral turpitude, in any case whether or not involving the Company, that, in the opinion of the Company, renders
the Participant’s continued employment harmful to the Company; (v) the voluntary resignation of the Participant without the prior consent of the Company; (vi) substance abuse on the part of the Participant; or (vii) the Participant acting in
bad faith relative to the Company’s business interests. 
  
 For purposes of the Plan, a Participant shall be deemed to engage in competitive behavior if he (a) directly or indirectly, without the consent of the Company, solicits or provides any services such as those provided by the Company for
anyone (i) who is a customer or client of the Company; or (ii) who is a prospective customer or client of the Company with whom the Company has discussed possible business relationships; (b) requests, induces or attempts to influence any distributor
or supplier of goods or services to the Company to curtail or cancel any business they may transact with the Company; (c) requests, induces or attempts to influence any client or customer of the Company that has done business with, or potential
client or customer which has been in contact with, the Company to curtail or cancel any business they may transact with the Company; or (d) requests, induces or attempts to influence any employee of the Company to terminate his or her employment
with the Company. 
  

 1 

 Integris Metals, Inc. 
  
 PHANTOM STOCK OPTION PLAN 
  

 2.5 “Change of Control” or “COC” means any change in the current
ownership structure in which the current shareholders cease to own at least 50% of the Company’s common stock. 
  
 2.6 “Code” means the Internal Revenue Code of 1986, as amended. 
  
 2.7 “Company” means Integris Metals, Inc., a New York corporation. 
  
 2.8 “Company Value” means the value of the Company
for purposes of this Plan, and shall be based on a fixed 6.5 times multiple of EBITDA for each fiscal year, computed as of the last day of the fiscal year. For purposes of the Plan, the EBITDA in any particular year shall not be less than $97.38
million. 
  
 2.9 “Date of Grant” means
the effective date on which an option Award is made to a Participant as set forth in the applicable Award Agreement. 
  
 2.10 “Disability” shall be defined as in the Integris Long-Term Disability Plan. 
  
 2.11 “EBITDA” shall mean earnings before interest,
taxes, depreciation and amortization of the Company for each fiscal year. 
  
 2.12 “Employee” shall mean any person who is employed the Company, is on the Company’s payroll, and whose wages are subject to withholding under the Federal Insurance Contributions Act, codified in Code
§ 3121. 
  
 2.13 “Exercise Period”
shall mean the time period subsequent to the end of a fiscal year, as determined by the Plan Administrator, during which a Participant may exercise a vested Award. 
  
 2.14 “Formula Value” of a share of Phantom Stock shall mean the Company Value per share computed
as of the last day of the fiscal year prior to an event requiring such determination. Formula Value is based on the Company Value divided by the number of issued and outstanding shares of Phantom Stock. For purposes of the Plan, the number of issues
and outstanding shares of Phantom Stock shall be 50,000,000. 
  
 2.15 “Good Reason” means (i) a reduction in the compensation paid to Participant, unless such reduction is comparable to an across-the-board reduction applicable to all senior management employees of the
Company due to adverse business circumstances, or (ii) a request of Participant to relocate his office to a distance of greater than fifty (50) miles from the present site of his office 
  
 2.16 “Grant Value” of a Participant’s Award means the Formula Value on the Date of Grant
multiplied by the number of awards granted to the Participant, and is based on a multiple of the Participant’s annual base salary in effect at the time of grant. 
  
 2.17 “Phantom Stock” means a hypothetical share of the Company for purposes of the Plan.

  
 2.18 “Initial Public Offering”
shall mean the Company’s first offering of common stock to the public that is registered under the Securities Act of 1933, as amended, with the Securities and Exchange Commission. 
  
 2.19 “Plan” means the Integris Metals, Inc. Phantom Stock Option Plan, as amended from time to
time. 
  

 2 

 Integris Metals, Inc. 
  
 PHANTOM STOCK OPTION PLAN 
  

 2.20 “Participant” shall mean an executive officer or key Employee of the
Company to whom an Award is granted under the Plan. 
  
 2.21 “Plan Administrator” means the executive committee appointed or designated by the Board, or Compensation Committee of the Board, to administer the Plan in accordance with Article 3 of the Plan. 
  
 2.22 “Retirement” of a Participant shall mean a
Participant’s Termination of Service which is designated by the Plan Administrator as a “retirement” for purposes of the Plan or, if applicable, a Participant’s date of termination after the normal retirement date specified in a
plan maintained by the Company under which the Participant is covered, and which is qualified under section 401(a) of the Code. 
  
 2.23 “ROCE” means return on capital employed, as determined by the fiscal year prior to an Exercise Period. 
  
 2.24 “Strike Price” of a Phantom Stock Option
shall mean the Formula Value of the Phantom Stock at Date of Grant. For purposes of the Plan, the strike price for any particular Award shall not be less than $12.66. 
  
 2.21 “Termination of Service” occurs when a Participant ceases to serve as an Employee of the
Company. 
  
 ARTICLE 3 
 ADMINISTRATION 
  
 The Plan shall be administered by the Board through the Board Compensation Committee; provided, however, that the Compensation Committee shall appoint a
Plan Administrator to administer the Plan. The Plan Administrator shall be an executive committee comprised of Company senior management. Hereafter, any reference to the Plan Administrator that relates to administration of the Plan shall be
considered to refer to the executive committee. The Board may, upon resolution, delegate some or all of its powers with respect to the administration of the Plan to the Plan Administrator. The Plan Administrator shall have only such powers as may be
so delegated. 
  
 If the Board delegates some or all of its power
to the Plan Administrator as provided hereunder, any member of the Plan Administrator (or all members in the event the Board elects to assume direct responsibility for administration of the Plan) may be removed at any time, with or without cause, by
resolution of the Board. Any vacancy occurring in the membership of the Plan Administrator may be filled by appointment by the Board. If a committee is acting as the Plan Administrator, such committee shall select one of its members to act as its
chairman and shall make such rules and regulations for its operation as it deems appropriate; and a majority of the committee shall constitute a quorum and the act of a majority of the members of such committee present at a meeting at which a quorum
is present shall be the act of the Plan Administrator. 
  
 The
Plan Administrator shall have discretion to (i) administer the Plan, and (ii) make such other determinations and take such other action as it deems necessary or advisable to administer the Plan. Without limiting the generality of the foregoing
sentence, the Plan Administrator may, in its sole discretion (but in a uniform and consistent manner), treat all or any portion of any period during which a holder is on military leave or on an approved leave of absence from the Company as a period
of employment of such holder by the Company for the purpose of determining his or her Exercise Period under Article 6. Any interpretation, determination, or other action made or taken by the Plan Administrator shall be final, binding, and conclusive
on all interested parties. 
  

 3 

 Integris Metals, Inc. 
  
 PHANTOM STOCK OPTION PLAN 
  

 ARTICLE 4 
 ELIGIBILITY 
  
 Executive officers and key Employees are eligible to receive Awards under the plan. The CEO, on behalf of the Plan Administrator, will recommend to the Compensation Committee of the Board (the “Compensation Committee”) those
executive officers and key Employees to participate in the plan, as well as the number of awards to be granted to each Participant. The Compensation Committee, upon recommendation from the CEO of the company, shall approve the eligible persons to
whom Awards will be granted. Awards may be granted at any time and from time to time to new Participants, or to then Participants, or to a greater or lesser number of Participants, and may include or exclude previous Participants, as the Plan
Administrator shall recommend. Except as required by the Plan, Awards granted at different times need not contain similar provisions. The Plan Administrator’s recommendations and the Compensation Committee’s determinations under the Plan
(including without limitation determinations of which persons, if any, are to receive Awards, the form, amount and timing of such Awards, the terms and provisions of such Awards and the agreements evidencing same) need not be uniform and may be made
by it selectively among persons who receive, or are eligible to receive, Awards under the Plan. 
  
 ARTICLE 5 
 GRANT OF AWARDS; DETERMINATION OF AWARD SIZE 
  
 5.1 Grant of Awards. The grant of an Award shall be evidenced by an
Award Agreement, in a form approved by the Plan Administrator, between the Company and the Participant. Each such Award Agreement shall set forth its Date of Grant, the number of options granted, the Strike Price of the options, the period during
which the options shall vest, and the period during which the options shall be exercisable. Each such Award Agreement shall be subject to the express terms and conditions of the Plan, and shall be subject to such other terms and conditions, which,
in the reasonable judgment of the Plan Administrator, are appropriate and not inconsistent with the Plan. Any Award pursuant to the Plan must be granted within ten (10) years of the Effective Date of the Plan. 
  
 5.2 Determination of Award Size. The number of Awards granted to a
Participant in any particular year is based on Grant Value as a multiple of the annual base salary of the Participant in effect at the time of grant. For purposes of the Plan, the Grant Value for any Participant in a particular year shall not exceed
six times the annual base salary in effect at time of grant. 
  
 ARTICLE 6 
 EXERCISE PERIOD; VESTING; CHANGE OF CONTROL; INITIAL PUBLIC OFFERING 
  
 6.1 Exercise Period. Subject to the other provisions of the Plan, an
Award Agreement shall set forth the period or periods during which Phantom Stock Options may be exercised, in whole or in part, and redeemed for payment of the Actual Exercise Value (as defined in Section 8.3) in accordance with Article 8 below;
such period during which an Award may be exercised is referred to as the Award’s “Exercise Period”. The Exercise Period for an Award may be reduced or terminated upon Termination of Service as defined in Article 7. No portion of any
Award may be exercised after the expiration of the Exercise Period immediately following the six (6) year anniversary from its Date of Grant. 
  
 6.2 Vesting. Unless determined otherwise by the Plan Administrator, the vesting of Awards granted is as follows: 
  

	 	•	50% vesting on the 2nd anniversary of the Date
of Grant 

  

	 	•	25% vesting on the 3rd anniversary of the Date
of Grant 

  

	 	•	25% vesting on the 4th anniversary of the Date
of Grant 

  

 4 

 Integris Metals, Inc. 
  
 PHANTOM STOCK OPTION PLAN 
  

 6.3 Initial Public Offering. In the event of an Initial Public Offering (“IPO”),
Participants are entitled to vest immediately in the 50% portion of their Awards that are scheduled to vest on the 2nd anniversary of the Date of Grant as stipulated in Section 6.2 above, but only to the extent that such 50% portion has not already
vested. Upon exercise of any vested Award upon an IPO, Participants are entitled to receive the difference between the IPO price and the Strike Price, and, at the discretion of the Participant, may be settled in cash or in stock of the publicly
traded company, or a combination of both. 
  
 All unvested
portions of Awards shall be converted into nonqualified stock options with similar value and vesting provisions to purchase shares of the publicly traded company. 
  
 6.4 Change of Control. In the event of a Change of Control (“COC”), Participants are entitled to receive
the difference between the COC price and the Strike Price upon exercise of vested Awards. For unvested Awards, Participants are entitled to receive replacement long-term incentive awards with similar value and vesting provisions in the resulting
company upon COC. In the event that Participants do not receive replacement long-term incentive awards with similar value and vesting provisions upon COC, all unvested Awards shall vest immediately and such Participants shall be entitled to receive
the difference between the COC price and the Strike Price upon exercise of such vested Awards. 
  
 In addition, if prior to the vesting of a replacement award, a Participant’s employment is terminated by the resulting company for any reason other than Cause subsequent to a COC, such unvested awards vest
immediately. 
  
 ARTICLE 7 
 TERMINATION OF SERVICE 
  
 In the event of Termination of Service of a Participant, vested and unvested Awards shall be treated as follows: 
  
 7.1 Death. Upon the Participant’s death, all of the
Participant’s Awards automatically vest and must be exercised by the Participant’s estate or personal representative during the next Exercise Period following the Participant’s death. Otherwise, all of the Participant’s Awards
shall be cancelled. However, if complying with the Exercise Period requirement above is deemed a hardship to the Participant’s estate or personal representative, the Plan Administrator may, at it’s discretion, extend the Exercise Period to
provide additional time for the Participant’s estate or personal representative to exercise the vested Awards. 
  
 7.2 Disability. Upon the Participant’s Disability, all of the Participant’s Awards automatically vest and must be exercised during the
next Exercise Period following the Participant’s Termination of Service due to Disability. Otherwise, all of the Participant’s Awards shall be cancelled. However, if complying with the Exercise Period requirement above is deemed a hardship
to the Participant, the Plan Administrator may, at it’s discretion, extend the Exercise Period to provide additional time for the Participant to exercise the vested Awards. 
  
 7.3 Retirement. Upon the Participant’s Retirement, the Participant vested Awards must be exercised during either
of the next two Exercise Periods to the extent such Awards are exercisable at the date of such Termination of Service. Otherwise, all of the Participants vested Awards shall be cancelled. All unvested options expire immediately. 
  
 7.4 Voluntary Termination with Good Reason or Termination Without
Cause. Upon the Participant’s voluntary termination with Good Reason or termination by the Company without Cause, the Participant shall have until the next Exercise Period to exercise any Award to the extent such Awards are exercisable at
the date of such Termination of Service. All unvested options expire immediately. 
  

 5 

 Integris Metals, Inc. 
  
 PHANTOM STOCK OPTION PLAN 
  

 7.5 Voluntary Termination without Good Reason or Termination With Cause. Upon the
Participant’s voluntary termination without Good Reason or Termination by the Company with Cause, all options, whether vested or unvested, expire immediately. 
  
 ARTICLE 8 
 EXERCISE OF PHANTOM STOCK; AWARD DEFERRAL 
  
 8.1 Exercise. Vested Awards that are exercisable in accordance with the Plan or applicable Award Agreement may be exercised by a Participant into cash only in accordance with this Article 8 and the terms and conditions of the
applicable Award Agreement. To exercise vested Awards, a Participant must deliver to the Plan Administrator a written notice of exercise stating the number of Awards to be exercised. Such exercise shall be effective on the date of receipt by the
Plan Administrator (the “Exercise Date”). 
  
 8.2
Timing. Awards may only be exercised during one pre-determined two-week Exercise Period each year. The Exercise Period, unless determined otherwise by the Board or Plan Administrator, shall commence on the first day following the first Board
meeting subsequent to the closing of the Company’s financial statements. 
  
 8.3 Amount Payable. Upon receipt by the Plan Administrator of a proper written notice of exercise by a Participant in accordance with the terms of the Plan and the individual Award Agreement, the Participant
shall be entitled to receive a cash payout equal to: (i) the aggregate Formula Value of the Phantom Stock on the Exercise Date, less (ii) the aggregate Strike Price of the options exercised (the result of which is hereinafter referred to as the
“Target Exercise Value”) multiplied by the previous 12 month’s Return on Common Equity (“ROCE”) performance-based rating, ranging from 10% to 160% (the result of which is hereinafter referred to as the “Actual Exercise
Value”). However, Participants are not entitled to any ROCE adjustment in the event of an IPO or a COC. 
  
 8.4 Payment. Subject to Section 6.1, when a Participant exercises an Award under the Plan, the Company shall settle the Actual Exercise Value
payable to the Participant in a lump sum within 30 days after the Exercise Date. 
  
 8.5 Compliance with Other Laws and Regulations. The Board may instruct the Plan Administrator to obtain such agreements or undertakings, if any, as the Board may deem necessary or advisable to assure compliance
with any law or regulation of any governmental authority. 
  
 8.6 Award Deferral. Participants may elect to defer the payment of Awards in cash under such rules and procedures as established by the Plan Administrator, and may also provide that deferred settlements include the crediting of
interest on the deferral amounts. 
  
 ARTICLE 9 

AMENDMENT OR DISCONTINUANCE 
  
 The Plan may be amended or discontinued by the Board at any time. However, no amendment may adversely affect an outstanding Phantom Stock Option Agreement
without the consent of the Participant. 
  

 6 

 Integris Metals, Inc. 
  
 PHANTOM STOCK OPTION PLAN 
  

 ARTICLE 10 
 TERM 
  
 The Plan
shall be effective as of January 1, 2002. Unless sooner terminated by action of the Board, the Plan will terminate on the tenth (10th) anniversary of the effective date, but Awards granted before that date will continue to be effective in accordance with their terms and conditions. 
  
 ARTICLE 11 
 CAPITAL ADJUSTMENTS 
  
 If at any time
while the Plan is in effect, or Phantom Stock Options are outstanding, there shall be (i) an Initial Public Offering, (ii) a Change of Control, or (iii) an increase or decrease in the number of issued and outstanding shares of common stock of the
Company resulting from (1) the declaration or payment of a stock dividend, (2) any recapitalization resulting in a stock split–up, combination, or exchange of shares of the Company’s common stock, or (3) other increase or decrease in such
shares effected without receipt of consideration by the Company, then and in such event: 
  
 (i) An appropriate adjustment shall be made in the Strike Price or the maximum number of Phantom Stock then subject to being awarded under
the Plan, to the extent that the same proportion of the Company’s value or issued and outstanding shares of Phantom Stock shall continue to be subject to being so awarded; and 
  
 (ii) Appropriate adjustments shall be made in the Strike Price or the number of Phantom Stock Options
outstanding under each Award Agreement, to the extent that the same proportion of the Company’s value or issued and outstanding shares of Phantom Stock in each such instance shall remain subject to redemption. 
  
 Upon the occurrence of each event requiring an adjustment with respect to any
Award, the Company shall mail to each affected Participant its computation of such adjustment that shall be conclusive and binding upon each such Participant. 
  

ARTICLE 12 
 RECAPITALIZATION,
MERGER AND CONSOLIDATION 
  
 The existence of the Plan and Awards granted
hereunder shall not affect in any way the right or power of the Company to make or authorize any or all adjustments, recapitalizations, reorganizations, or other changes in the Company’s capital structure and its business, or any merger or
consolidation of the Company, or any issue of bonds, debentures or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar
character or otherwise. 
  
 ARTICLE 13 
 MISCELLANEOUS PROVISIONS 
  
 13.1 No Right to Continued Employment. Neither the Plan nor any Award granted under the Plan shall confer upon any Participant any right with
respect to continuance of employment by the Company. 
  
 13.3
No Rights as a Shareholder. A Participant shall not have any rights as a shareholder with respect to any Award. 
  

 7 

 Integris Metals, Inc. 
  
 PHANTOM STOCK OPTION PLAN 
  

 13.4 Indemnification of Board and Plan Administrator. No member of the Board or the Plan
Administrator, nor any officer or Employee of the Company acting on behalf of the Board or the Plan Administrator, shall be personally liable for any action, determination, or interpretation taken or made in good faith with respect to the Plan, and
all members of the Board or the Plan Administrator and each and any officer or employee of the Company acting on their behalf shall, to the extent permitted by law, be fully indemnified and protected by the Company in respect of any such action,
determination, or interpretation. 
  
 13.5 Effect of the
Plan. No action of the Board or the Plan Administrator shall be deemed to give any person any right to be granted an Award or any other rights except as may be evidenced by an Award Agreement, or any amendment thereto, executed on behalf of the
Company, and then only to the extent and upon the terms and conditions expressly set forth therein. 
  
 13.6 Compliance With Other Laws and Regulations. The Plan, the grant and redemption of Awards hereunder shall be subject to all applicable federal
and state laws, rules and regulations and to such approvals by any government or regulatory agency as may be required. 
  
 13.7 Tax Requirements. The Company shall have the right to deduct from all Awards hereunder settled in cash or other form, any Federal, state, or
local taxes required by law to be withheld with respect to such payments 
  
 13.8 Non-Assignability. Awards granted to a Participant may not be transferred or assigned other than by will or by the laws of descent and distribution. If the Participant attempts to alienate, assign, pledge,
hypothecate, or otherwise dispose of his Award or any right thereunder, except as provided for in the Plan or the Award Agreement, or in the event of any levy, attachment, execution, or similar process upon the right or interest conferred by the
Plan or the Award Agreement, the Plan Administrator may terminate the Participant’s Award Agreement by notice to him, upon which the Awards become null and void. 
  
 IN WITNESS WHEREOF, the Company has caused this instrument to be executed as of 3 March, 2003, by its President and CEO
pursuant to prior action taken by the Board. 
  

			
	Integris Metals Incorporated
		
	By:	 	/s/    HARRY JONES
	 	 	Harry Jones~President and CEO

  

			
		
	Witnessed By:	 	/s/    JOHN R. SMITH
	 	 	John R. Smith~VPHR

  

 8Lifescape Solutions, Inc. 2001 Stock Plan and form of stock option agreement

 Exhibit 10.13 
  
 LIFESCAPE SOLUTIONS, INC. 
  
 2001 STOCK PLAN 
  
 1. Purposes of the Plan. The purposes of this 2001 Stock Plan are to attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentives to Employees, Directors and Consultants and to promote the success of the Company’s business. Options granted under the Plan may be Incentive Stock Options or Nonstatutory Stock Options, as
determined by the Administrator at the time of grant. Stock Purchase Rights may also be granted under the Plan. 
  
 2. Definitions. As used herein, the following definitions shall apply: 
  
 (a) “Administrator” means the Board or any of its Committees as shall be administering the Plan in
accordance with Section 4 hereof. 
  
 (b) “Applicable
Laws” means the requirements relating to the administration of stock option plans under U.S. state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed
or quoted and the applicable laws of any other country or jurisdiction where Options or Stock Purchase Rights are granted under the Plan. 
  
 (c) “Board” means the Board of Directors of the Company. 
  
 (d) “Code” means the Internal Revenue Code of 1986, as amended. 
  
 (e) “Committee” means a committee of Directors appointed by
the Board in accordance with Section 4 hereof. 
  
 (f)
“Common Stock” means the common stock, par value $0.001 per share, of the Company or any successor thereof. 
  
 (g) “Company” means Lifescape Solutions, Inc., a Delaware corporation. 
  
 (h) “Consultant” means any person who is engaged by the Company or any Parent or Subsidiary to render
consulting or advisory services to such entity. 
  
 (i)
“Director” means a member of the Board. 
  
 (j)
“Disability” means total and permanent disability as defined in Section 22(e)(3) of the Code. 
  
 (k) “Employee” means any person, including Officers and Directors, employed by the Company or any Parent or Subsidiary of the Company. A
Service Provider shall not cease to be an Employee in the case of (i) any leave of absence approved by the Company or (ii) transfers between 

 
locations of the Company or between the Company, its Parent, any Subsidiary, or any successor. For purposes of Incentive Stock Options, no such leave may
exceed ninety days, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of absence approved by the Company is not so guaranteed, on the 181st day of such leave any
Incentive Stock Option held by the Optionee shall cease to be treated as an Incentive Stock Option and shall be treated for tax purposes as a Nonstatutory Stock Option. Neither service as a Director nor payment of a director’s fee by the
Company shall be sufficient to constitute “employment” by the Company. 
  
 (l) “Exchange Act” means the Securities Exchange Act of 1934, as amended. 
  
 (m) “Fair Market Value” means, as of any date, the value of Common Stock determined as follows: 
  
 (i) If the Common Stock is listed on any established stock exchange or a
national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were
reported) as quoted on such exchange or system for the last market trading day prior to the time of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable; 
  
 (ii) If the Common Stock is regularly quoted by a recognized securities
dealer but selling prices are not reported, its Fair Market Value shall be the mean between the high bid and low asked prices for the Common Stock on the last market trading day prior to the day of determination; or 
  
 (iii) In the absence of an established market for the Common Stock, the Fair
Market Value thereof shall be determined in good faith by the Administrator. 
  
 (n) “Incentive Stock Option” means an Option intended to qualify as an incentive stock option within the meaning of Section 422 of the Code. 
  
 (o) “Nonstatutory Stock Option” means an Option not intended
to qualify as an Incentive Stock Option. 
  
 (p)
“Officer” means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder. 
  
 (q) “Option” means a stock option granted pursuant to the Plan. 
  
 (r) “Option Agreement” means a written or electronic
agreement between the Company and an Optionee evidencing the terms and conditions of an individual Option grant. The Option Agreement is subject to the terms and conditions of the Plan. 
  
 (s) “Option Exchange Program” means a program whereby outstanding Options are exchanged for Options with a
lower exercise price. 
  

 -2- 

 (t) “Optioned Stock” means the Common Stock subject to an Option or a Stock Purchase
Right. 
  
 (u) “Optionee” means the holder of an
outstanding Option or Stock Purchase Right granted under the Plan. 
  
 (v) “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e) of the Code. 
  
 (w) “Plan” means this 2001 Stock Plan. 
  
 (x) “Purchaser” means purchaser of Optioned Stock pursuant to a Stock Purchase Right. 
  
 (y) “Restricted Stock” means shares of Common Stock acquired
pursuant to a grant of a Stock Purchase Right under Section 11 below. 
  
 (z) “Restricted Stock Purchase Agreement” means a written or electronic agreement between the Company and an Optionee evidencing the terms and conditions of an individual Stock Purchase Right grant. The Restricted Stock
Purchase Agreement is subject to the terms and conditions of the Plan. 
  
 (aa) “Section 16(b) “ means Section 16(b) of the Exchange Act. 
  
 (bb) “Service Provider” means an Employee, Director or Consultant. 
  
 (cc) “Share” means a share of the Common Stock, as adjusted in accordance with Section 12 below. 
  
 (dd) “Stock Purchase Right” means a right to purchase Common
Stock pursuant to Section 11 below. 
  
 (ee)
“Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing, as defined in Section 424(f) of the Code. 
  
 3. Stock Subject to the Plan. Subject to the provisions of Section 12 of the Plan, the maximum aggregate number of Shares which may be subject to
Options and/or Stock Purchase Rights and sold under the Plan is 3,173,050 Shares. The Shares may be authorized but unissued, or reacquired Common Stock. 
  
 If an Option or Stock Purchase Right expires or becomes unexercisable without having been exercised in full, or is surrendered pursuant to an Option
Exchange Program, the unpurchased Shares which were subject thereto shall become available for future grant or sale under the Plan (unless the Plan has been terminated). However, Shares that have actually been issued under the Plan, upon exercise of
either an Option or Stock Purchase Right, shall not be returned to the Plan and shall not become available for future distribution under the Plan, except that if Shares of Restricted Stock are repurchased by the Company at their original purchase
price, such Shares shall become available for future grant under the Plan. 
  

 -3- 

 4. Administration of the Plan. 
  
 (a) Administrator. The Plan shall be administered by the Board or a Committee appointed by the Board, which Committee
shall be constituted to comply with Applicable Laws. 
  
 (b)
Powers of the Administrator. Subject to the provisions of the Plan and, in the case of a Committee, the specific duties delegated by the Board to such Committee, and subject to the approval of any relevant authorities, the Administrator shall
have the authority in its discretion: 
  
 (i) to determine the
Fair Market Value; 
  
 (ii) to select the Service Providers to
whom Options and Stock Purchase Rights may from time to time be granted hereunder; 
  
 (iii) to determine the number of Shares to be covered by each Option and Stock Purchase Right granted hereunder; 
  
 (iv) to approve forms of agreement for use under the Plan; 
  
 (v) to determine the terms and conditions of any Option or Stock Purchase Right granted hereunder. Such terms and conditions include, but are not limited
to, the exercise price, the time or times when Options or Stock Purchase Rights may be exercised (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation regarding
any Option or Stock Purchase Right or the Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine; 
  
 (vi) to determine whether and under what circumstances an Option may be settled in cash under subsection 9(e) instead of
Common Stock; 
  
 (vii) to reduce the exercise price of any
Option to the then current Fair Market Value if the Fair Market Value of the Common Stock covered by such Option has declined since the date the Option was granted; 
  
 (viii) to initiate an Option Exchange Program; 
  
 (ix) to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating
to sub-plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws; 
  
 (x) to allow Optionees to satisfy withholding tax obligations by electing to have the Company withhold from the Shares to be issued upon exercise of an
Option or Stock Purchase Right that number of Shares having a Fair Market Value equal to the amount required to be withheld. The Fair Market Value of the Shares to be withheld shall be determined on the date that 

  

 -4- 

 
the amount of tax to be withheld is to be determined. All elections by Optionees to have Shares withheld for this purpose shall be made in such form and
under such conditions as the Administrator may deem necessary or advisable; and 
  
 (xi) to construe and interpret the terms of the Plan and awards granted pursuant to the Plan. 
  
 (c) Effect of Administrator’s Decision. All decisions, determinations and interpretations of the Administrator shall be final and binding on
all Optionees. 
  
 5. Eligibility. 
  
 (a) Nonstatutory Stock Options and Stock Purchase Rights may be granted to
Service Providers. Incentive Stock Options may be granted only to Employees. 
  
 (b) Each Option shall be designated in the Option Agreement as either an Incentive Stock Option or a Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time by the Optionee during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000, the portion of such Options
in excess of $100,000 shall be treated as Nonstatutory Stock Options. For purposes of this Section 5(b), Incentive Stock Options shall be taken into account in the order in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted. 
  
 (c) Neither the Plan nor any Option or Stock Purchase Right shall confer upon any Optionee any right with respect to continuing the Optionee’s relationship as a Service Provider with the Company, nor shall it
interfere in any way with his or her right or the Company’s right to terminate such relationship at any time, with or without cause. 
  
 6. Term of Plan. The Plan shall become effective upon its adoption by the Board. It shall continue in effect for a term of ten (10) years unless
sooner terminated under Sections 12 or 14 of the Plan. 
  
 7.
Term of Option. The term of each Option shall be stated in the Option Agreement; provided, however, that the term shall be no more than ten (10) years from the date of grant thereof. In the case of an Incentive Stock Option granted to an
Optionee who, at the time the Option is granted, 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 term of such Option shall be five (5) years from the
date of grant or such shorter term as may be provided in the Option Agreement. 
  
 8. Option Exercise Price and Consideration. 
  
 (a) The per share exercise price for the Shares to be issued upon exercise of an Option shall be such price as is determined by the Administrator, but shall be subject to the following: 
  

 -5- 

 (i) In the case of an Incentive Stock Option 
  
 (A) granted to an Employee who, at the time of grant of such 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 exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant. 

 
 (B) granted to any other 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 Nonstatutory Stock Option 
  
 (A) granted to a Service Provider who, at the time of grant of such 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 exercise price shall be no less than 110% of the Fair Market Value per Share on the date of grant. 
  
 (B) granted to any other Service Provider, the per Share exercise price shall be no less than 85% of the Fair Market Value per Share on the date of
grant. 
  
 (iii) Notwithstanding the foregoing, Options may be
granted with a per Share exercise price other than as required above pursuant to a merger or other corporate transaction. 
  
 (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
Administrator (and, in the case of an Incentive Stock Option, shall be determined at the time of grant). Such consideration may consist of (1) cash, (2) check, (3) promissory note, (4) other Shares which (x) in the case of Shares acquired upon
exercise of an option, have been owned by the Optionee for more than six months on the date of surrender, and (y) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which such Option shall be
exercised, (5) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan, or (6) any combination of the foregoing methods of payment. In making its determination as to the type of
consideration to accept, the Administrator shall consider if acceptance of such consideration may be reasonably expected to benefit the Company. 
  
 9. Exercise of Option. 
  
 (a) Procedure for Exercise; Rights as a Stockholder. Any Option granted hereunder shall be exercisable according to the terms hereof at such times
and under such conditions as determined by the Administrator and set forth in the Option Agreement. Except in the case of Options granted to Officers, Directors and Consultants, Options shall become exercisable at a rate of no less than 20% per year
over five (5) years from the date the Options are granted. Unless the Administrator provides otherwise, vesting of Options granted hereunder shall be tolled during any unpaid leave of absence. An Option may not be exercised for a fraction of a
Share. 
  

 -6- 

 An Option shall be deemed exercised when the Company receives: (i) written or electronic notice of
exercise (in accordance with the Option Agreement) from the person entitled to exercise the Option, and (ii) full payment for the Shares with respect to which the Option is exercised. Full payment may consist of any consideration and method of
payment authorized by the Administrator and permitted by the Option Agreement and the Plan. Shares issued upon exercise of an Option shall be issued in the name of the Optionee or, if requested by the Optionee, in the name of the Optionee and his or
her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist
with respect to the Shares, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other right for which the record
date is prior to the date the Shares are issued, except as provided in Section 12 of the Plan. 
  
 Exercise of an Option in any manner shall result in a decrease in the number of Shares thereafter 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 Relationship as a Service
Provider. If an Optionee ceases to be a Service Provider other than as a result of Optionee’s death or Disability, such Optionee may exercise his or her Option within such period of time as is specified in the Option Agreement (of at least
thirty (30) days) to the extent that the Option is vested on the date of termination (but in no event later than the expiration of the term of the Option as set forth in the Option Agreement). In the absence of a specified time in the Option
Agreement, the Option shall remain exercisable for three (3) months following the Optionee’s termination. If, on the date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion of
the Option shall revert to the Plan. If, after termination, the Optionee does not exercise his or her Option within the time specified by the Administrator, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

  
 (c) Disability of Optionee. If an Optionee ceases to be
a Service Provider as a result of the Optionee’s Disability, the Optionee may exercise his or her Option within such period of time as is specified in the Option Agreement (of at least six (6) months) to the extent the Option is vested on the
date of termination (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement). In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for twelve (12) months
following the Optionee’s termination. If, on the date of termination, the Optionee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall revert to the Plan. If, after termination, the
Optionee does not exercise his or her Option within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan. 
  
 (d) Death of Optionee. If an Optionee dies while a Service Provider, the Option may be exercised within such period
of time as is specified in the Option Agreement (of at least six (6) months) to the extent that the Option is vested on the date of death (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement) by
the Optionee’s estate or by a person who acquires the right to exercise the Option by bequest or inheritance. In the 

  

 -7- 

 
absence of a specified time in the Option Agreement, the Option shall remain exercisable for twelve (12) months following the Optionee’s termination.
If, at the time of death, the Optionee is not vested as to the entire Option, the Shares covered by the unvested portion of the Option shall immediately revert to the Plan. If the Option is not so exercised within the time specified herein, the
Option shall terminate, and the Shares covered by such Option shall revert to the Plan. 
  
 (e) Buyout Provisions. The Administrator may at any time offer to buy out for a payment in cash or Shares, an Option previously granted, based on such terms and conditions as the Administrator shall establish
and communicate to the Optionee at the time that such offer is made. 
  
 10. Non-Transferability of Options and Stock Purchase Rights. Options and Stock Purchase Rights 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 lifetime of the Optionee, only by the Optionee. 
  
 11. Stock Purchase Rights. 
  
 (a) Rights to Purchase. Stock Purchase Rights may be issued either alone, in addition to, or in tandem with other Options, Stock Purchase Rights
and/or cash awards made outside of the Plan. After the Administrator determines that it will offer Stock Purchase Rights under the Plan, it shall advise the Optionee in writing or electronically of the terms, conditions and restrictions related to
the offer, including the number of Shares that such person shall be entitled to purchase, the price to be paid, and the time within which such person must accept such offer. The terms of the offer shall comply in all respects with Section 260.140.42
of Title 10 of the California Code of Regulations. The offer shall be accepted by execution of a Restricted Stock Purchase Agreement in the form determined by the Administrator. 
  
 (b) Repurchase Option. Unless the Administrator determines otherwise, the Restricted Stock Purchase Agreement shall
grant the Company a repurchase option exercisable upon the voluntary or involuntary termination of the Purchaser’s service with the Company for any reason (including death or Disability). The purchase price for Shares repurchased pursuant to
the Restricted Stock Purchase Agreement shall be the original price paid by the Purchaser and may be paid by cancellation of any indebtedness of the Purchaser to the Company. The repurchase option shall lapse at such rate as the Administrator may
determine. Except with respect to Shares purchased by Officers, Directors and Consultants, the repurchase option shall in no case lapse at a rate of less than 20% per year over five (5) years from the date of purchase. 
  
 (c) Other Provisions. The Restricted Stock Purchase Agreement shall
contain such other terms, provisions and conditions not inconsistent with the Plan as may be determined by the Administrator in its sole discretion. 
  
 (d) Rights as a Stockholder. Once the Stock Purchase Right is exercised, the Purchaser shall have rights equivalent to those of a stockholder and
shall be a stockholder when his or her purchase is entered upon the records of the duly authorized transfer agent of the Company. No adjustment shall be made for a dividend or other right for which the record date is prior to the date the Stock
Purchase Right is exercised, except as provided in Section 12 of the Plan. 
  

 -8- 

 12. Adjustments Upon Changes in Capitalization; Dissolution or Liquidation; Merger or Asset Sale.

  
 (a) Changes in Capitalization. Subject to any required
action by the stockholders of the Company, the number of shares of Common Stock covered by each outstanding Option or Stock Purchase Right, and the number of shares of Common Stock which have been authorized for issuance under the Plan but as to
which no Options or Stock Purchase Rights have yet been granted or which have been returned to the Plan upon cancellation or expiration of an Option or Stock Purchase Right, as well as the price per Share of Common Stock covered by each such
outstanding Option or Stock Purchase Right, shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock split, stock dividend, combination or
reclassification of 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. The 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 price of shares of Common Stock subject to an
Option or Stock Purchase Right. 
  
 (b) Dissolution or
Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Administrator shall notify each Optionee as soon as practicable prior to the effective date of such proposed transaction. The Administrator in its
discretion may provide for an Optionee to have the right to exercise his or her Option or Stock Purchase Right until fifteen (15) days prior to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which the Option
or Stock Purchase Right would not otherwise be exercisable. In addition, the Administrator may provide that any Company repurchase option applicable to any Shares purchased upon exercise of an Option or Stock Purchase Right shall lapse as to all
such Shares, provided the proposed dissolution or liquidation takes place at the time and in the manner contemplated. To the extent it has not been previously exercised, an Option or Stock Purchase Right will terminate immediately prior to the
consummation of such proposed action. Following the effective date of a dissolution or liquidation of the Company, the Plan shall terminate in full. 
  
 (c) Merger or Asset Sale. In the event of a merger of the Company with or into another corporation, or the sale of substantially all of the assets
of the Company, each outstanding Option and Stock Purchase Right shall be assumed or an equivalent option or right substituted by the successor corporation or a Parent or Subsidiary of the successor corporation. In the event that the successor
corporation refuses to assume or substitute for the Option or Stock Purchase Right, the Optionee shall fully vest in and have the right to exercise the Option or Stock Purchase Right as to all of the Optioned Stock, including Shares as to which it
would not otherwise be vested or exercisable, and following the effective date of such merger or sale of assets. If an Option or Stock Purchase Right becomes fully vested and exercisable in lieu of assumption or substitution in the event of a merger
or sale of assets, the Administrator shall notify the Optionee in writing or electronically that the Option or Stock Purchase Right shall be fully exercisable for a period of 

  

 -9- 

 
fifteen (15) days from the date of such notice, and following the expiration of such period, the Plan and any outstanding Options or Stock Purchase Rights
shall terminate. For the purposes of this paragraph, the Option or Stock Purchase Right shall be considered assumed if, following the merger or sale of assets, the option or right confers the right to purchase or receive, for each Share of Optioned
Stock subject to the Option or Stock Purchase Right immediately prior to the merger or sale of assets, the consideration (whether stock, cash, or other securities or property) received in the merger or sale of assets by holders of Common Stock for
each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration
received in the merger or sale of assets is not solely common stock of the successor corporation or its Parent, the Administrator may, with the consent of the successor corporation, provide for the consideration to be received upon the exercise of
the Option or Stock Purchase Right, for each Share of Optioned Stock subject to the Option or Stock Purchase Right, to be solely common stock of the successor corporation or its Parent equal in fair market value to the per share consideration
received by holders of Common Stock in the merger or sale of assets. 
  
 13. Time of Granting Options and Stock Purchase Rights. The date of grant of an Option or Stock Purchase Right shall, for all purposes, be the date on which the Administrator makes the determination granting such Option or Stock
Purchase Right, or such other date as is determined by the Administrator. Notice of the determination shall be given to each Service Provider to whom an Option or Stock Purchase Right is so granted within a reasonable time after the date of such
grant. 
  
 14. Amendment and Termination of the Plan.

  
 (a) Amendment and Termination. The Board may at any
time amend, alter, suspend or terminate the Plan. 
  
 (b)
Stockholder Approval. The Board shall obtain stockholder approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws. 
  
 (c) Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan shall impair
the rights of any Optionee, unless mutually agreed otherwise between the Optionee and the Administrator, which agreement must be in writing and signed by the Optionee and the Company. Termination of the Plan shall not affect the Administrator’s
ability to exercise the powers granted to it hereunder with respect to Options granted under the Plan prior to the date of such termination. 
  
 15. Conditions Upon Issuance of Shares. 
  
 (a) Legal Compliance. 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 shall comply with Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance. 
  
 (b) Investment Representations. As a condition to the exercise of an Option, the Administrator may require the person
exercising such Option to represent and warrant at the time of 

  

 -10- 

 
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. 
  
 16. Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained. 
  
 17. Reservation of Shares. The Company, during the term of this Plan,
shall at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan. 
  
 18. Stockholder Approval. The Plan shall be subject to approval by the stockholders of the Company within twelve (12) months after the date the
Plan is adopted. Such stockholder approval shall be obtained in the degree and manner required under Applicable Laws. 
  
 19. Information to Optionees and Purchasers. The Company shall provide to each Optionee and to each individual who acquires Shares pursuant to the
Plan, not less frequently than annually during the period such Optionee or purchaser has one or more Options or Stock Purchase Rights outstanding, and, in the case of an individual who acquires Shares pursuant to the Plan, during the period such
individual owns such Shares, copies of annual financial statements. The Company shall not be required to provide such statements to key Employees whose duties in connection with the Company assure their access to equivalent information. 

 

 -11- 

 PICASA, INC. 
 [LIFESCAPE SOLUTIONS, INC.] 
  
 2001 STOCK PLAN 
  
 STOCK OPTION AGREEMENT

  
 Unless otherwise defined herein, the terms defined in the
2001 Stock Plan (the “Plan”) shall have the same defined meanings in this Stock Option Agreement (the “Option Agreement”). 
  

	I.	NOTICE OF STOCK OPTION GRANT 

  
 [Name] 
 [Address] 
  
 The undersigned Optionee has been granted an Option to purchase Common Stock
of the Company, subject to the terms and conditions of the Plan and this Option Agreement, as follows: 
  

					
	 Grant Number
	 	 [Grant No.]
	  	 
			
	 Date of Grant
	 	 [Grant Date]
	  	 
			
	 Vesting Commencement Date
	 	 [Vest Date]
	  	 
			
	 Exercise Price per Share
	 	 [Per Share Price]
	  	 
			
	 Total Number of Shares Granted
	 	 [No. Shares]
	  	 
			
	 Total Exercise Price
	 	 [Aggregate Price]
	  	 
			
	 Type of Option:
	 	                      Incentive
Stock Option
	  	 
			
	 	 	                     
Nonstatutory Stock Option
	  	 
			
	 Term/Expiration Date:
	 	 Ten Years from Date of Grant
	  	 

  
 Vesting
Schedule: 
  
 This Option shall be exercisable, in whole or
in part, according to the following vesting schedule: 
  
 a. 20%
of the Shares subject to this Option shall vest upon the six (6) month anniversary of this Option’s Vesting Commencement Date, (provided, however, that vesting of such 20% of the Shares shall accelerate as if vested on the Vesting Commencement
Date if Optionee’s 

 
employment with the Company terminates before the six month anniversary of the Vesting Commencement Date, unless Optionee (i) voluntarily terminates, (ii) is
terminated for any act of personal dishonesty taken by Optionee in connection with his responsibilities to the Company, (iii) is convicted of or pleads guilty or nolo contendere to a felony, (iv) is terminated due to a willful act that constitutes
misconduct and is injurious to the Company or (v) is terminated due to a breach of Optionee’s employment agreement). 
  
 b. Subsequent to the six (6) month anniversary of this Option’s Vesting Commencement Date, 20% of the Shares subject to this Option shall vest on
each of the first, second, third and fourth anniversaries of the Optionee’s Vesting Commencement Date. 
  
 c. Except as otherwise provided above, all vesting is subject to the Optionee’s continuing to be a Service Provider on the above provided vesting
dates. 
  
 Termination Period: 
  
 This Option shall be exercisable for three (3) months after the Optionee
ceases to be a Service Provider; provided, that upon the Optionee’s death or Disability, this Option may be exercised for twelve (12) months after the Optionee ceases to be a Service Provider; provided, further, that in no event may the
Optionee exercise this Option after the Term/Expiration Date as provided above. 
  

	II.	AGREEMENT 

  
 1. Grant of Option. The Administrator hereby grants to the Optionee named in the Notice of Grant (the “Optionee”), an option (the
“Option”) to purchase the number of Shares set forth in the Notice of Grant, at the exercise price per Share set forth in the Notice of Grant (the “Exercise Price”), and subject to the terms and conditions of the Plan, which is
incorporated herein by reference. Subject to Section 14(c) of the Plan, in the event of a conflict between the terms and conditions of the Plan and this Option Agreement, the terms and conditions of the Plan shall prevail. 
  
 If designated in the Notice of Grant as an Incentive Stock Option
(“ISO”), this Option is intended to qualify as an Incentive Stock Option as defined in Section 422 of the Code. Nevertheless, to the extent that it exceeds the $100,000 rule of Code Section 422(d), the portion of this Option in excess of
$100,000 shall be treated as a Nonstatutory Stock Option (“NSO”). 
  
 2. Exercise of Option. 
  
 a. Right to Exercise. This Option shall be exercisable during its term in accordance with the Vesting Schedule set out in the Notice of Grant and with the applicable provisions of the Plan and this Option Agreement. 
  
 b. Method of Exercise. This Option shall be exercisable by delivery of
an exercise notice in the form attached as Exhibit A (the “Exercise Notice”) which shall state the election to exercise the Option, the number of Shares with respect to which the Option is being exercised, and such other
representations and agreements as may be required by the Company. The 

  

 -2- 

 
Exercise Notice shall be accompanied by payment of the aggregate Exercise Price for all Exercised Shares. The Option shall be deemed to be exercised upon
receipt by the Company of such fully executed Exercise Notice accompanied by the aggregate Exercise Price. 
  
 No Shares shall be issued pursuant to the exercise of an Option unless such issuance and such exercise complies with Applicable laws. Assuming such
compliance, for income tax purposes the Shares shall be considered transferred to the Optionee on the date on which the Option is exercised with respect to such Shares. 
  
 3. Optionee’s Representations. In the event the Shares have not been registered under the Securities Act of
1933, as amended, at the time this Option is exercised, the Optionee shall, if required by the Company, concurrently with the exercise of all or any portion of this Option, deliver to the Company his or her Investment Representation Statement in the
form attached hereto as Exhibit B. 
  
 4. Lock-Up
Period. The Optionee hereby agrees that, if so requested by the Company or any representative of the underwriters (the “Managing Underwriter”) in connection with any registration of the offering of any securities of the Company under
the Securities Act, the Optionee shall not sell or otherwise transfer any Shares or other securities of the Company during the 180-day period (or such other period as may be requested in writing by the Managing Underwriter and agreed to in writing
by the Company) (the “Market Standoff Period”) following the effective date of a registration statement of the Company filed under the Securities Act. Such restriction shall apply only to the first registration statement of the Company to
become effective under the Securities Act that includes securities to be sold on behalf of the Company to the public in an underwritten public offering under the Securities Act. The Company may impose stop-transfer instructions with respect to
securities subject to the foregoing restrictions until the end of such Market Standoff Period. 
  
 5. Method of Payment. Payment of the aggregate Exercise Price shall be by any of the following, or a combination thereof, at the election of the Optionee: 
  
 a. cash or check; 
  
 b. consideration received by the Company under a formal cashless exercise
program adopted by the Company in connection with the Plan; 
  
 c.
surrender of other Shares which, (i) in the case of Shares acquired upon exercise of an option, have been owned by the Optionee for more than six (6) months on the date of surrender, and (ii) have a Fair Market Value on the date of surrender equal
to the aggregate Exercise Price of the Exercised Shares; or 
  
 d.
with the consent of the Administrator, any other means of exercise authorized from time to time in the Plan and/or by the Board. 
  
 6. Restrictions on Exercise. This Option may not be exercised until such time as the Plan has been approved by the stockholders of the Company, or
if the issuance of such Shares upon such exercise or the method of payment of consideration for such shares would constitute a violation of any Applicable Law. 
  

 -3- 

 7. Non-Transferability of Option. This Option may not be transferred in any manner otherwise than
by will or by the laws of descent or distribution and may be exercised during the lifetime of the Optionee only by the Optionee. The terms of the Plan and this Option Agreement shall be binding upon the executors, administrators, heirs, successors
and assigns of the Optionee. 
  
 8. Term of Option. This
Option may be exercised only within the term set out in the Notice of Grant, and may be exercised during such term only in accordance with the Plan and the terms of this Option. 
  
 9. Tax Consequences. Set forth below is a brief summary as of the date of this Option of some of the federal tax
consequences of exercise of this Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR
DISPOSING OF THE SHARES. 
  
 a. Exercise of ISO. If this
Option qualifies as an ISO, there will be no regular federal income tax liability upon the exercise of the Option, although the excess, if any, of the Fair Market Value of the Shares being exercised on the date of exercise over the aggregate
Exercise Price of the Shares being exercised will be treated as an adjustment to the alternative minimum tax for federal tax purposes and may subject the Optionee to the alternative minimum tax in the year of exercise. 
  
 b. Exercise of Nonstatutory Stock Option. There may be a regular
federal income tax liability upon the exercise of an NSO. The Optionee will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares being exercised
on the date of exercise over the aggregate Exercise Price of the Shares being exercised. If the Optionee is an Employee or a former Employee, the Company will be required to withhold from the Optionee’s compensation or collect from the Optionee
and pay to the applicable taxing authorities an amount in cash equal to a percentage of this compensation income at the time of exercise, and may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered
at the time of exercise. 
  
 c. Disposition of Shares. In
the case of an NSO, if Shares are held for at least one year, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes. In the case of an ISO, if Shares transferred pursuant to the
Option are held for at least one year after exercise and for at least two years after the Date of Grant, any gain realized on disposition of the Shares will also be treated as long-term capital gain for federal income tax purposes. If Shares
purchased under an ISO are disposed of within one year after exercise or two years after the Date of Grant, any gain realized on such disposition will be treated as compensation income (taxable at ordinary income rates) to the extent of the
difference between the aggregate Exercise Price of the Shares being exercised and the lesser of (1) the Fair Market Value of the Shares being exercised on the date of exercise, or (2) the sale price of the Shares. Any additional gain will be taxed
as capital gain, short-term or long-term depending on the period that the ISO Shares were held. 
  

 -4- 

 d. Notice of Disqualifying Disposition of ISO Shares. If the Option granted to the Optionee herein
is an ISO, and if the Optionee sells or otherwise disposes of any of the Shares acquired pursuant to the ISO on or before the later of (1) the date two years after the Date of Grant, or (2) the date one year after the date of exercise, the Optionee
shall immediately notify the Company in writing of such disposition. The Optionee agrees that the Optionee may be subject to income tax withholding by the Company on the compensation income recognized by the Optionee. 
  
 10. Entire Agreement; Governing Law. The Plan is incorporated herein
by reference. The Plan and this Option Agreement (including the exhibits attached hereto) constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements
of the Company and the Optionee with respect to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and the Optionee. This agreement is governed by the
internal substantive laws, but not the choice of law rules, of the State of California. 
  
 11. No Guarantee of Continued Service. THE OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF
THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). THE OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH
HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE IN ANY WAY WITH THE OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO
TERMINATE THE OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE. 
  
 * * * * * 
  

 -5- 

 The Optionee acknowledges receipt of a copy of the Plan and represents that he or she is familiar with
the terms and provisions thereof, and hereby accepts this Option subject to all of the terms and provisions thereof. The Optionee has reviewed the Plan and this Option in their entirety, has had an opportunity to obtain the advice of counsel prior
to executing this Option and fully understands all provisions of the Option. The Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions arising under the Plan or
this Option. The Optionee further agrees to notify the Company upon any change in the residence address indicated below. 
  

					
	 OPTIONEE
	  	 PICASA, INC.

		
	 __________________________________
	  	 __________________________________

	 Signature
	  	 By
	  	 
		
	 __________________________________
	  	 __________________________________

	 Print Name
	  	 Title
	  	 
			
	 __________________________________
	  	 	  	 
			
	 __________________________________
	  	 	  	 
	 Residence Address
	  	 	  	 

  

 EXHIBIT A 
  
 2001 STOCK PLAN 
 EXERCISE NOTICE 
  
 PICASA, INC.

 130 West Union Street 
 Pasadena, CA 91103 
  
 Attention: President

  
 1. Exercise of Option. Effective as of today,
                    ,             , the undersigned (“Optionee”)
hereby elects to exercise Optionee’s option to purchase              shares of the Common Stock (the “Shares”) of Picasa, Inc. (the “Company”) under and
pursuant to the 2001 Stock Plan (the “Plan”) and the Stock Option Agreement dated                     ,
             (the “Option Agreement”). 
  
 2. Delivery of Payment. Optionee herewith delivers to the Company the full purchase price of the Shares, as set forth in the Option Agreement.

  
 3. Representations of Optionee. Optionee acknowledges
that Optionee has received, read and understood the Plan and the Option Agreement and agrees to abide by and be bound by their terms and conditions. 
  
 4. Rights as Stockholder. Until the issuance of the Shares (as evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a stockholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Shares shall be issued to the
Optionee as soon as practicable after the Option is exercised. No adjustment shall be made for a dividend or other right for which the record date is prior to the date of issuance except as provided in Section 12 of the Plan. 
  
 5. Company’s Right of First Refusal. Before any Shares held by
Optionee or any transferee (either being sometimes referred to herein as the “Holder”) may be sold or otherwise transferred (including transfer by gift or operation of law), the Company or its assignee(s) shall have a right of first
refusal to purchase the Shares on the terms and conditions set forth in this Section (the “Right of First Refusal”). 
  
 a. Notice of Proposed Transfer. The Holder of the Shares shall deliver to the Company a written notice (the “Notice”) stating: (i) the
Holder’s bona fide intention to sell or otherwise transfer such Shares; (ii) the name of each proposed purchaser or other transferee (“Proposed Transferee”); (iii) the number of Shares to be transferred to each Proposed Transferee;
and (iv) the bona fide cash price or other consideration for which the Holder proposes to transfer the Shares (the “Offered Price”), and the Holder shall offer the Shares at the Offered Price to the Company or its assignee(s). 

 b. Exercise of Right of First Refusal. At any time within thirty (30) days after receipt of the
Notice, the Company and/or its assignee(s) may, by giving written notice to the Holder, elect to purchase all, but not less than all, of the Shares proposed to be transferred to any one or more of the Proposed Transferees, at the purchase price
determined in accordance with subsection (c) below. 
  
 c.
Purchase Price. The purchase price (“Purchase Price”) for the Shares purchased by the Company or its assignee(s) under this Section shall be the Offered Price. If the Offered Price includes consideration other than cash, the cash
equivalent value of the non-cash consideration shall be determined by the Board of Directors of the Company in good faith. 
  
 d. Payment. Payment of the Purchase Price shall be made, at the option of the Company or its assignee(s), in cash (by check), by cancellation of
all or a portion of any outstanding indebtedness of the Holder to the Company (or, in the case of repurchase by an assignee, to the assignee), or by any combination thereof within 30 days after receipt of the Notice or in the manner and at the times
set forth in the Notice. 
  
 e. Holder’s Right to
Transfer. If all of the Shares proposed in the Notice to be transferred to a given Proposed Transferee are not purchased by the Company and/or its assignee(s) as provided in this Section, then the Holder may sell or otherwise transfer such
Shares to that Proposed Transferee at the Offered Price or at a higher price, provided that such sale or other transfer is consummated within 120 days after the date of the Notice, that any such sale or other transfer is effected in accordance with
any applicable securities laws and that the Proposed Transferee agrees in writing that the provisions of this Section shall continue to apply to the Shares in the hands of such Proposed Transferee. If the Shares described in the Notice are not
transferred to the Proposed Transferee within such period, a new Notice shall be given to the Company, and the Company and/or its assignees shall again be offered the Right of First Refusal before any Shares held by the Holder may be sold or
otherwise transferred. 
  
 f. Exception for Certain Family
Transfers. Anything to the contrary contained in this Section notwithstanding, the transfer of any or all of the Shares during the Optionee’s lifetime or on the Optionee’s death by will or intestacy to the Optionee’s immediate
family or a trust for the benefit of the Optionee’s immediate family shall be exempt from the provisions of this Section. “Immediate Family” as used herein shall mean spouse, lineal descendant or antecedent, father, mother, brother or
sister. In such case, the transferee or other recipient shall receive and hold the Shares so transferred subject to the provisions of this Section, and there shall be no further transfer of such Shares except in accordance with the terms of this
Section. 
  
 g. Termination of Right of First Refusal. The
Right of First Refusal shall terminate as to any Shares upon the first sale of Common Stock of the Company to the general public pursuant to a registration statement filed with and declared effective by the Securities and Exchange Commission under
the Securities Act of 1933, as amended. 
  

 -2- 

 6. Tax Consultation. Optionee understands that Optionee may suffer adverse tax consequences as a
result of Optionee’s purchase or disposition of the Shares. Optionee represents that Optionee has consulted with any tax consultants Optionee deems advisable in connection with the purchase or disposition of the Shares and that Optionee is not
relying on the Company for any tax advice. 
  
 7. Restrictive
Legends and Stop-Transfer Orders. 
  
 a. Legends.
Optionee understands and agrees that the Company shall cause the legends set forth below or legends substantially equivalent thereto, to be placed upon any certificate(s) evidencing ownership of the Shares together with any other legends that may be
required by the Company or by state or federal securities laws: 
  
 THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”). SUCH SECURITIES MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS A REGISTRATION STATEMENT
UNDER THE ACT IS IN EFFECT AS TO SUCH OFFER, SALE, TRANSFER, PLEDGE OR HYPOTHECATION, OR UNLESS THE ISSUER RECEIVES AN OPINION OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH OFFER, SALE, TRANSFER, PLEDGE OR HYPOTHECATION MAY BE MADE PURSUANT TO
RULE 144 OR IS OTHERWISE IN COMPLIANCE WITH THE ACT. 
  
 THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A LOCKUP PERIOD OF UP TO 180 DAYS FOLLOWING THE EFFECTIVE DATE OF A REGISTRATION STATEMENT OF THE COMPANY FILED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AS SET FORTH IN AN AGREEMENT BETWEEN
THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH LOCKUP PERIOD IS BINDING ON TRANSFEREES OF THESE SHARES. 
  
 THE SALE OF THE SECURITIES WHICH ARE THE SUBJECT OF THIS AGREEMENT, IF NOT YET QUALIFIED WITH THE CALIFORNIA CORPORATIONS
COMMISSIONER, IS SUBJECT TO SUCH QUALIFICATION OR AN EXEMPTION BEING AVAILABLE, AND THE ISSUANCE OF SUCH SECURITIES, OR THE RECEIPT OF ANY PART OF THE CONSIDERATION PRIOR TO SUCH QUALIFICATION IS UNLAWFUL. THE RIGHTS OF THE PARTIES TO THE AGREEMENT
PURSUANT TO WHICH THESE SECURITIES HAVE BEEN ISSUED ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED OR AN EXEMPTION BEING AVAILABLE. 
  

 -3- 

 b. Stop-Transfer Notices. Optionee agrees that, in order to ensure compliance with the
restrictions referred to herein, the Company may issue appropriate “stop transfer” instructions to its transfer agent, if any, and that, if the Company transfers its own securities, it may make appropriate notations to the same effect in
its own records. 
  
 c. Refusal to Transfer. The Company
shall not be required (i) to transfer on its books any Shares that have been sold or otherwise transferred in violation of any of the provisions of this Agreement or (ii) to treat as owner of such Shares or to accord the right to vote or pay
dividends to any purchaser or other transferee to whom such Shares shall have been so transferred. 
  
 8. Successors and Assigns. The Company may assign any of its rights under this Agreement to single or multiple assignees, and this Agreement shall
inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer herein set forth, this Agreement shall be binding upon Optionee and his or her heirs, executors, administrators, successors and assigns.

  
 9. Interpretation. Any dispute regarding the
interpretation of this Agreement shall be submitted by Optionee or by the Company forthwith to the Administrator which shall review such dispute at its next regular meeting. The resolution of such a dispute by the Administrator shall be final and
binding on all parties. 
  
 10. Governing Law;
Severability. This Agreement is governed by the internal substantive laws but not the choice of law rules, of the State of California. 
  
 11. Entire Agreement. The Plan and Option Agreement are incorporated herein by reference. This Agreement, the Plan, the Option Agreement and the
Investment Representation Statement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirety all prior undertakings and agreements of the Company and Optionee with respect to the
subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by the Company and Optionee. 
  
 * * * * * 
  

 -4- 

			
	 Submitted by:
	  	 Accepted by:

		
	 OPTIONEE:
	  	 PICASA, INC.

		
	 _______________________________
	  	 __________________________________

	 Signature
	  	 By

		
	 __________________________________
	  	 __________________________________

	 Print Name
	  	 Its

		
	 	  	 
	 Address:
	  	 Address:

		
	  
 __________________________________
	  	 130 West Union Street
 Pasadena, CA 91103

		
	 __________________________________
	  	 
	 	  	 __________________________________

	 	  	 Date Received

  

 EXHIBIT B 
  
 INVESTMENT REPRESENTATION STATEMENT 
  

					
	 OPTIONEE:
	 	 	  	 
			
	 COMPANY:
	 	 PICASA, INC.
	  	 
			
	 SECURITIES:
	 	 COMMON STOCK
	  	 
			
	 AMOUNT:
	 	 	  	 
			
	 DATE:
	 	 	  	 

  
 In connection with the
purchase of the above-listed Securities, the undersigned Optionee represents to the Company the following: 
  
 a. Optionee is aware of the Company’s business affairs and financial condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the Securities. Optionee is acquiring these Securities for investment for Optionee’s own account only and not with a view to, or for resale in connection with, any “distribution” thereof
within the meaning of the Securities Act of 1933, as amended (the “Securities Act”). 
  
 b. Optionee acknowledges and understands that the Securities constitute “restricted securities” under the Securities Act and have not been registered under the Securities Act in reliance upon a specific
exemption therefrom, which exemption depends upon, among other things, the bona fide nature of Optionee’s investment intent as expressed herein. In this connection, Optionee understands that, in the view of the Securities and Exchange
Commission, the statutory basis for such exemption may be unavailable if Optionee’s representation was predicated solely upon a present intention to hold these Securities for the minimum capital gains period specified under tax statutes, for a
deferred sale, for or until an increase or decrease in the market price of the Securities, or for a period of one year or any other fixed period in the future. Optionee further understands that the Securities must be held indefinitely unless they
are subsequently registered under the Securities Act or an exemption from such registration is available. Optionee further acknowledges and understands that the Company is under no obligation to register the Securities. Optionee understands that the
certificate evidencing the Securities will be imprinted with a legend which prohibits the transfer of the Securities unless they are registered or such registration is not required in the opinion of counsel satisfactory to the Company, a legend
prohibiting their transfer without the consent of the Commissioner of Corporations of the State of California and any other legend required under applicable state securities laws. 
  
 c. Optionee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under the Securities Act, which, in
substance, permit limited public resale of “restricted securities” 

 
acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the satisfaction of certain conditions. Rule 701 provides that
if the issuer qualifies under Rule 701 at the time of the grant of the Option to the Optionee, the exercise will be exempt from registration under the Securities Act. In the event the Company becomes subject to the reporting requirements of Section
13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days thereafter (or such longer period as any market stand-off agreement may require) the Securities exempt under Rule 701 may be resold, subject to the satisfaction of certain of the
conditions specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited “broker’s transaction” or in transactions directly with a market maker (as said term is defined under the Securities Exchange
Act of 1934); and, in the case of an affiliate, (2) the availability of certain public information about the Company, (3) the amount of Securities being sold during any three month period not exceeding the limitations specified in Rule 144(e), and
(4) the timely filing of a Form 144, if applicable. 
  
 In the
event that the Company does not qualify under Rule 701 at the time of grant of the Option, then the Securities may be resold in certain limited circumstances subject to the provisions of Rule 144, which requires the resale to occur not less than one
year after the later of the date the Securities were sold by the Company or the date the Securities were sold by an affiliate of the Company, within the meaning of Rule 144; and, in the case of acquisition of the Securities by an affiliate, or by a
non-affiliate who subsequently holds the Securities less than two years, the satisfaction of the conditions set forth in sections (1), (2), (3) and (4) of the paragraph immediately above. 
  
 d. Optionee further understands that in the event all of the applicable requirements of Rule 701 or 144 are not satisfied,
registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required; and that, notwithstanding the fact that Rules 144 and 701 are not exclusive, the Staff of the Securities and Exchange
Commission has expressed its opinion that persons proposing to sell private placement securities other than in a registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden of proof in establishing that an
exemption from registration is available for such offers or sales, and that such persons and their respective brokers who participate in such transactions do so at their own risk. Optionee understands that no assurances can be given that any such
other registration exemption will be available in such event. 
  

			
	 Signature of Optionee:

	
	 ___________________________________________

	
	 Date:
                    ,             

  

 -2-

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