Document:

Exhibit 10.1

                            FORM SEPARATION AGREEMENT

                                  CONFIDENTIAL

                                 March 28, 2005

Ms. Anne Bruce
[Home Address]

                  Re:      Separation from Employment

Dear Anne:

            This  letter   ("Agreement")   sets  forth  the  agreement   reached
concerning the termination of your  employment  with Curative  Health  Services,
Inc.,  including its current and former  parents,  subsidiaries  and  affiliated
entities,   and  their  respective  current  and  former  successors,   assigns,
representatives,   agents,  attorneys,  shareholders,  officers,  directors  and
employees,  both  individually  and in their official  capacities  (collectively
"Curative").

            1. Your  employment  with Curative will terminate on March 28, 2005.
Curative  will continue to pay your salary,  less  applicable  withholdings  and
deductions,  and provide you with the benefits that you are currently  receiving
through March 28, 2005.  Curative will also provide you with a lump-sum payment,
less  applicable  withholdings  and deductions,  representing  the value of your
accrued unused  vacation,  if any,  through March 28, 2005. You  acknowledge and
agree that your  employment  with  Curative  ends for all  purposes on March 28,
2005.

            2.  As set  forth  in  your  Employment  Agreement  effective  as of
September  2,  2003,  as  amended  or  modified  ("Employment  Agreement"),   in
consideration  for signing  this  Agreement  and in exchange  for the  promises,
covenants and waivers set forth  herein,  Curative  will,  provided you have not
revoked this Agreement as set forth below, provide you with the following:

            (a)   Within  thirty  (30)  days  of  March  28,  2005,  a lump  sum
                  severance  payment equal to the sum of six (6) month's of your
                  annual  base  salary,   less   applicable   withholdings   and
                  deductions,

            (b)   Welfare   benefits   (including  life  and  health   insurance
                  benefits) of  substantially  similar design and cost to you as
                  the welfare  benefits  available  to you prior to your date of
                  termination for a period of six (6) months commencing on March
                  28, 2005, or until you obtain full-time  employment  providing
                  welfare benefits, whichever occurs first, and
<PAGE>

Ms. Anne Bruce
March 28, 2005
Page 2

            (c)   To the extent not otherwise  required under  Curative's  Stock
                  Option Plan,  any unvested  stock  options  awards which would
                  otherwise vest and become  exercisable  during the twelve (12)
                  month  period  commencing  on March 28,  2005,  shall vest and
                  become exercisable on March 28, 2005.

            3. In  consideration  of the benefits  described above and for other
good and valuable consideration,  you hereby release and forever discharge,  and
by this  instrument  release  and  forever  discharge  Curative  from all debts,
obligations,  promises, covenants, agreements,  contracts,  endorsements, bonds,
controversies,  suits, actions, causes of action, judgments,  damages, expenses,
claims or demands,  in law or in equity,  which you ever had, now have, or which
may arise in the future,  regarding any matter  arising on or before the date of
your  execution  of this  Agreement,  including  but not  limited  to all claims
(whether  known or unknown)  regarding  your  employment  at or  termination  of
employment  from  Curative,  any contract  (express or  implied),  any claim for
equitable  relief or recovery of  punitive,  compensatory,  or other  damages or
monies,  attorneys'  fees, any tort,  and all claims for alleged  discrimination
based upon age, race, color, sex, sexual orientation,  marital status, religion,
national  origin,  handicap,  disability,  or retaliation,  including any claim,
asserted or  unasserted,  which could arise under Title VII of the Civil  Rights
Act of 1964; the Equal Pay Act of 1963; the Age Discrimination in Employment Act
of 1967  ("ADEA");  the  Older  Workers  Benefit  Protection  Act of  1990;  the
Americans With Disabilities Act of 1990; the Civil Rights Act of 1866, 42 U.S.C.
ss. 1981; the Sarbanes-Oxley Act; the Employee Retirement Income Security Act of
1974;  the Family and Medical  Leave Act of 1993;  the Civil Rights Act of 1991;
the New York State Human Rights Law, the New York City Human Rights Law;  Worker
Adjustment and Retraining Notification Act of 1988; the California Family Rights
Act; the California Fair Employment and Housing Act; the California Minimum Wage
Law; the equal Pay Law for  California;  and any other  federal,  state or local
laws,  rules  or  regulations,   whether  equal  employment   opportunity  laws,
nondiscrimination statutes and regulations, or otherwise, or any right under any
Curative pension,  welfare,  or stock plans. This Agreement may not be cited as,
and does not  constitute any admission by Curative of, any violation of any such
law or legal  obligation  with  respect  to any  aspect  of your  employment  or
termination  therefrom,  or of the  applicability  of  any  such  law  or  legal
obligation to the rights and obligations of the parties hereunder.

            4.  You,  for  yourself  and  your  heirs,  legal   representatives,
successors-in-interest and assigns, do hereby expressly waive and relinquish all
rights and benefits afforded you by Section 1542 of the Civil Code of California
and do so understanding  and  acknowledging  the significance and consequence of
such  specific  waiver  of  Section  1542.  Section  1542 of the  Civil  Code of
California states as follows:

                  A general release does not extend to claims which the creditor
                  does not know or  suspect to exist in his favor at the time of
                  executing  the  release,  which  if  known  by him  must  have
                  materially affected his settlement with the debtor.
<PAGE>

Ms. Anne Bruce
March 28, 2005
Page 3

      Thus,  notwithstanding the provisions of Section 1542, and for the purpose
of  implementing  a full and complete  release and  discharge  of Curative,  you
expressly  acknowledge  that this  Agreement is also  intended to include in its
effect, without limitation, all claims which you do not know or suspect to exist
at the time of  execution  hereof,  and that  this  Agreement  contemplates  the
extinguishment of any such claim or claims.

            5. You  represent  and agree  that you have not  filed any  lawsuits
against  Curative,  or filed or  caused to be filed any  charges  or  complaints
against  Curative with any  municipal,  state or federal agency charged with the
enforcement of any law.  Pursuant to and as a part of your release and discharge
of  Curative,  as set  forth  herein,  you  agree,  not  inconsistent  with EEOC
Enforcement  Guidance  On  Non-Waivable   Employee  Rights  Under  EEOC-Enforced
Statutes dated April 11, 1997,  and to the fullest extent  permitted by law, not
to sue or file a charge, complaint,  grievance or demand for arbitration against
Curative  in  any  forum  or  assist  or  otherwise   participate  willingly  or
voluntarily in any claim,  arbitration,  suit,  action,  investigation  or other
proceeding of any kind which relates to any matter that involves  Curative,  and
that occurred up to and including the date of your execution of this  Agreement,
unless required to do so by court order, subpoena or other directive by a court,
administrative agency, arbitration panel or legislative body, or unless required
to enforce  this  Agreement.  To the extent any such  action may be brought by a
third  party,  you  expressly  waive any claim to any form of  monetary or other
damages,  or any other form of  recovery or relief in  connection  with any such
action.

            6. You represent and affirm that you have not reported any purported
improper, unethical or illegal conduct or activities to any supervisor, manager,
department  head,  Human Resources  representative  or other  representative  of
Curative,  and have no  knowledge  of any such  improper,  unethical  or illegal
conduct or activities.

            7. The provisions set forth in Section 5 of the Employment Agreement
are incorporated herein and remain in full force and effect.  Specifically,  you
agree  to  adhere  to  the   requirements  of  Section  5.1  Trade  Secrets  and
Confidential  Information,  Section  5.2  Transfer  of  Inventions,  Section 5.4
Covenant  Not to  Compete,  Section 5.5  Disclosure  to  Prospective  Employers,
Section 5.6  Non-Solicitation  and  Noninterference  and  Section  5.7  Indirect
Activity Precluded.  (A copy of the Employment Agreement is annexed hereto.) You
agree  that in the  event of a breach by you of any of the  covenants  set forth
above,  Curative  has no  adequate  remedy  at law  and  shall  be  entitled  to
injunctive and equitable relief, in addition to all other remedies available.

            8. You represent,  warrant and acknowledge that Curative owes you no
wages,  commissions,  bonuses,  sick pay,  personal  leave pay,  severance  pay,
vacation  pay  or  other  compensation  or  benefits  or  payments  or  form  of
remuneration of any kind or nature, other than that specifically provided for in
this Agreement.

            9.  You will not  disparage  or  criticize  Curative,  or issue  any
communication,  written or otherwise,  that reflects  adversely on or encourages
any adverse action against Curative,  except if testifying truthfully under oath
pursuant to any lawful  court order or subpoena or  otherwise  responding  to or
providing disclosures required by law.
<PAGE>

Ms. Anne Bruce
March 28, 2005
Page 4

            10. You agree not to disclose  the terms,  contents or  execution of
this  Agreement,  the claims  that have been or could have been  raised  against
Curative,  or the facts and circumstances  underlying this Agreement,  except in
the following circumstances:

            a.    You may disclose the terms of this Agreement to your immediate
                  family,  so long as such family  member  agrees to be bound by
                  the confidential nature of this Agreement;

            b.    You may disclose  the terms of this  Agreement to (i) your tax
                  advisors so long as such tax  advisors  agree in writing to be
                  bound by the confidential nature of this Agreement (ii) taxing
                  authorities  if requested by such  authorities  and so long as
                  they are advised in writing of the confidential nature of this
                  Agreement or (iii) your legal counsel; and

            c.    Pursuant  to the  order of a court or  governmental  agency of
                  competent   jurisdiction,   or  for   purposes   of   securing
                  enforcement  of the terms  and  conditions  of this  Agreement
                  should that ever be necessary.

            11.  Nothing in this  Agreement  shall prohibit or restrict you from
making  any   disclosure  of   information   required  by  law  or   testifying,
participating  or otherwise  assisting  in a  proceeding  relating to an alleged
violation of the Sarbanes-Oxley Act.

            12. Upon  service on you, or anyone  acting on your  behalf,  of any
subpoena,  order,  directive or other legal  process  requiring you to engage in
conduct  encompassed  within  paragraphs 10, 11 or 12 of this Agreement,  you or
your  attorney  shall  immediately  notify  Curative of such  service and of the
content  of any  testimony  or  information  to be  provided  pursuant  to  such
subpoena,  order,  directive or other legal  process and within two (2) business
days send to the undersigned  representative of Curative via overnight  delivery
(at Curative's expense) a copy of said documents served upon you.

            13. You agree that you will assist and  cooperate  with  Curative in
connection with the defense or prosecution of any claim or threatened claim that
may be made against or by Curative,  or in connection with any ongoing or future
investigation or dispute or claim of any kind involving Curative,  including any
proceeding before any arbitral, administrative,  judicial, legislative, or other
body or agency,  including  testifying  in any  proceeding  to the  extent  such
claims,  investigations or proceedings  relate to services performed or required
to be  performed  by you,  pertinent  knowledge  possessed by you, or any act or
omission by you.  You further  agree to perform all acts and execute and deliver
any documents  that may be reasonably  necessary to carry out the  provisions of
this paragraph.

            14. This Agreement constitutes the entire agreement between Curative
and you, and  supersedes and cancels all prior and  contemporaneous  written and
oral agreements  between  Curative and you,  including the Employment  Agreement
(with the sole exception of Section 5, which is  incorporated  in paragraph 8 of
this Agreement).  You affirm that, in entering into this Agreement,  you are not
relying upon any oral or written promise or statement made by anyone at any time
on behalf of Curative.
<PAGE>

Ms. Anne Bruce
March 28, 2005
Page 5

            15. This Agreement is binding upon you and your successors, assigns,
heirs, executors, administrators and legal representatives.

            16. If any of the provisions, terms or clauses of this Agreement are
declared  illegal,   unenforceable  or  ineffective  in  a  legal  forum,  those
provisions,  terms and clauses  shall be deemed  severable,  such that all other
provisions,  terms and clauses of this Agreement  shall remain valid and binding
upon both parties.

            17.  Without  detracting in any respect from any other  provision of
this Agreement:

            a.    You,  in  consideration  of the  benefits  provided  to you as
                  described in paragraphs 2 and 3 of this  Agreement,  agree and
                  acknowledge  that this  Agreement  constitutes  a knowing  and
                  voluntary  waiver of all rights or claims you have or may have
                  against  Curative  as set  forth  herein,  including,  but not
                  limited to, all claims of age  discrimination  in  employment,
                  all  claims  of  retaliation  and  all  claims  of  breach  of
                  contract; and you have no physical or mental impairment of any
                  kind  that  has  interfered  with  your  ability  to read  and
                  understand  the meaning of this  Agreement  or its terms,  and
                  that you are not acting under the influence of any  medication
                  or  mind-altering  chemical of any type in entering  into this
                  Agreement.

            b.    You understand  that, by entering into this Agreement,  you do
                  not waive  rights or claims  that may arise  after the date of
                  your execution of this Agreement, including without limitation
                  any rights or claims  that you may have to secure  enforcement
                  of the terms and conditions of this Agreement.

            c.    You agree and acknowledge that the  consideration  provided to
                  you under this  Agreement  is in addition to anything of value
                  to which you are already entitled.

            d.    Curative  hereby advises you to consult with an attorney prior
                  to executing this Agreement.

            e.    You acknowledge  that you have been given a reasonable time in
                  which to review and consider  this  Agreement,  and to consult
                  with an  attorney  regarding  the  terms  and  effect  of this
                  Agreement, and that you have freely, knowingly and voluntarily
                  decided to accept these  benefits,  and that the Agreement has
                  binding legal effect.

            18. You may revoke  this  Agreement  within  seven (7) days from the
date you sign this  Agreement,  in which case this  Agreement  shall be null and
void and of no force or effect on either Curative or you. Any revocation must be
in writing and received by Curative by 5:00 p.m. on or before the seventh  (7th)
day  after  this you  execute  Agreement.  Such  revocation  must be sent to the
undersigned  c/o Critical  Care Systems,  Inc.,  61 Spit Brook Road,  Suite 505,
Nashua New Hampshire 03060, Attention: Paul McConnell,  Chief Executive Officer,
with a copy to Curative Health Services, Inc., 150 Motor Parkway, Hauppauge, New
York 11788, Attention: Nancy Lanis, General Counsel.
<PAGE>

Ms. Anne Bruce
March 28, 2005
Page 6

            19.  This  Agreement  may not be  changed  or  altered,  except by a
writing  signed by Curative and you. This Agreement is entered into in the State
of New York and the laws of the  State  of New York  will  apply to any  dispute
concerning it.

            YOU EXPRESSLY ACKNOWLEDGE, REPRESENT, AND WARRANT THAT YOU HAVE READ
THIS AGREEMENT CAREFULLY;  THAT YOU FULLY UNDERSTAND THE TERMS, CONDITIONS,  AND
SIGNIFICANCE OF THIS AGREEMENT; THAT CURATIVE HAS ADVISED YOU TO CONSULT WITH AN
ATTORNEY  CONCERNING  THIS  AGREEMENT;  THAT YOU HAVE HAD A FULL  OPPORTUNITY TO
REVIEW THIS AGREEMENT WITH AN ATTORNEY;  THAT YOU UNDERSTAND THAT THIS AGREEMENT
HAS BINDING LEGAL EFFECT;  AND THAT YOU HAVE  EXECUTED  THIS  AGREEMENT  FREELY,
KNOWINGLY AND VOLUNTARILY.

            PLEASE  READ   CAREFULLY.   THIS   AGREEMENT  HAS  IMPORTANT   LEGAL
CONSEQUENCES.

You received this Agreement on April 15, 2005.

Date: April 18, 2005                              /s/ Anne Bruce
                                                      -----------------------
                                                      ANNE BRUCE

            On this  18th day of April  2005,  before  me  personally  came Anne
Bruce, to me known to be the individual  described in the foregoing  instrument,
who executed the foregoing instrument in my presence,  and who duly acknowledged
to me that she executed the same.

                                                  /s/ Sandra Ferrer
                                                      -----------------------
                                                      Notary Public

                                              CURATIVE HEALTH SERVICES, INC.

Date:                                         By: Paul McConnell
                                                  ---------------------------
                                                  Name:  Paul McConnell
                                                  Title: President and CEO<PAGE>

                             2005 STOCK OPTION PLAN

                                    ARTICLE I

                        PURPOSE AND ADOPTION OF THE PLAN

        1.01    PURPOSE. The purpose of the Treasure Mountain Holdings, Inc.
2005 Stock Option Plan (hereinafter referred to as the "Plan") is to assist the
Company (as defined below) in attracting and retaining highly competent
employees and to act as an incentive in motivating selected officers and other
employees of the Company and its subsidiaries, and directors and consultants of
the Company and its subsidiaries, to achieve long-term corporate objectives. The
purpose also is to provide for options initially granted by Vyteris, Inc.
("Vyteris") and assumed by the Company pursuant to the Merger Agreement and Plan
of Reorganization, dated as of July 8, 2004, as amended, by and among the
Company, a subsidiary of the Company and Vyteris.

        1.02    ADOPTION AND TERM. The Plan has been approved by the Board of
Directors and shareholders of the Company. The Plan is effective from the date
approved by the shareholders of the Company (the "Effective Date") and shall
remain in effect until terminated by action of the Board; PROVIDED, HOWEVER,
that no Option (as defined below) or Stock Purchase Right (as defined below) may
be granted hereunder after the tenth anniversary of the Effective Date.

                                   ARTICLE II

                                   DEFINITIONS

        For the purpose of this Plan, the following capitalized terms shall have
the following meanings:

        2.01    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 foreign country or jurisdiction where Options or Stock Purchase Rights are,
or will be, granted under the Plan.

        2.02    BENEFICIARY means an individual, trust or estate who or which,
by a written designation of the Participant filed with the Company or by
operation of law, succeeds to the rights and obligations of the Participant
under the Plan and the Option Agreement or Restricted Stock Purchase Agreement
upon the Participant's death.

        2.03    BOARD means the Board of Directors of the Company.

        2.04    CODE means the Internal Revenue Code of 1986, as amended.
References to a section of the Code shall include that section and any
comparable section or sections of any future legislation that amends,
supplements or supersedes said section

                                       1
<PAGE>

        2.05    COMMITTEE means the Committee defined in Section 3.01.

        2.06    COMPANY means Treasure Mountain Holdings, Inc., a Nevada
corporation, and its successors.

        2.07    COMMON STOCK means the Common Stock of the Company, par value
$.001 per share.

        2.08    DATE OF GRANT means the date designated by the Committee as the
date as of which it grants an Option or Stock Purchase Right, which shall not be
earlier than the date on which the Committee approves the granting of such
Option or Stock Purchase Right; provided, however, with respect to Options or
Grant Rights issued to replace options or Stock Purchase Rights which initially
were granted by Vyteris and subsequently assumed by the Company, the DATE OF
GRANT as provided for in the Vyteris, Inc. 2001 Stock Option Plan (the
"PREDECESSOR PLAN")

        2.09    EXCHANGE ACT means the Securities Exchange Act of 1934, as
amended.

        2.10    FAIR MARKET VALUE means, as of any applicable date, the fair
market value of the Common Stock as determined by the Board based upon such
evidence as it may think necessary or desirable.

        2.11    INCENTIVE STOCK OPTION means a stock option within the meaning
of Section 422 of the Code.

        2.12    MERGER means any merger, reorganization, consolidation,
exchange, transfer of assets or other transaction having similar effect
involving the Company.

        2.13    NONSTATUTORY STOCK OPTION means a stock option which is not an
Incentive Stock Option.

        2.14    OPTION AGREEMENT means a written agreement between the Company
and a Participant, specifically setting forth the terms and conditions of an
Option granted under the Plan, substantially in the form of EXHIBIT A attached
hereto or such other form as shall be determined from time to time by the
Committee; provided, however, that with respect to options granted by Vyteris,
the term OPTION AGREEMENT shall mean the option agreement entered into by the
applicable optionee with Vyteris, as it may be supplemented by the Company.

        2.15    OPTION PRICE, with respect to Options, shall have the meaning
set forth in Section 6.01(b).

        2.16    OPTION TERM means, with respect to an Option, the period of time
set forth in the Option Agreement during which the Option may be exercised.

        2.17    OPTIONS means all Nonstatutory Stock Options and Incentive Stock
Options granted at any time under the Plan or the Predecessor Plan.

                                        2
<PAGE>

        2.18    PARTICIPANT means a person designated to receive an Option or
Stock Purchase Right under the Plan in accordance with Section 4.03 or a person
designated to receive an option or stock purchase right pursuant to the
predecessor Plan.

        2.19    PLAN means the Treasure Mountain Holdings, Inc. 2005 Stock
Option Plan as described herein, as the same may be amended from time to time.

        2.20    RESTRICTED STOCK means shares of Common Stock acquired pursuant
to a grant of Stock Purchase Rights under Article V of the Plan or shares of
Vyteris' common stock acquired pursuant to a grant of stock purchase rights
under Article V of the Predecessor Plan.

        2.21    RESTRICTED STOCK PURCHASE AGREEMENT means a written agreement
between the Company and an Optionee evidencing the terms and restrictions
applying to stock purchased under a Stock Purchase Right; provided, however,
that with respect to stock purchase rights granted by Vyteris, the term
RESTRICTED STOCK PURCHASE AGREEMENT shall mean the restricted stock purchase
agreement entered into by the applicable optionee with Vyteris, as it may be
supplemented by the Company Each Restricted Stock Purchase Agreement is subject
to the terms and conditions of the Plan and shall be substantially in the form
of EXHIBIT B attached hereto or such other form as shall be determined from time
to time by the Committee.

        2.22    STOCK PURCHASE RIGHT means the right to purchase Common Stock
pursuant to Article V of the Plan, as evidenced by a notice of grant included
within the applicable Restricted Stock Purchase Agreement (the "Notice of
Grant") or, if applicable, a right to purchase Vyteris' common stock pursuant to
Article V of the Predecessor Plan.

        2.23    TEN PERCENT SHAREHOLDER means any individual who, at the time an
Option is granted, owns stock possessing more than 10 percent of the total
combined voting power of all classes of stock of the Company.

                                   ARTICLE III

                                 ADMINISTRATION

        The Plan shall be administered by the Board or, in the discretion of the
Board, by a committee of the Board (the "Committee") comprised of at least two
persons. The Committee or Board shall have exclusive and final authority in each
determination, interpretation or other action affecting the Plan and its
Participants. The Board or Committee shall have the sole discretionary authority
to interpret the Plan, to establish and modify administrative rules for the
plan, to impose such conditions and restrictions on Options and Stock Purchase
Rights as it determines appropriate, and to take such steps in connection with
the Plan and Options and Stock Purchase Rights granted hereunder as it may deem
necessary or advisable. The Board or Committee may delegate such of its powers
and authority under the Plan as it deems appropriate to designated officers or
employees of the Company. In the event of such delegation of authority or
exercise of authority by the Board or Committee, references in the Plan to the
Committee shall be deemed to refer to the delegate of the Board or the Committee
as the case may be. For purposes of this Plan, references to the Committee shall
be deemed references to the Board to the extent that the Board has not appointed
a Committee to administer the Plan.

                                       3
<PAGE>

                                   ARTICLE IV

                            SHARES AND PARTICIPATION

        4.01    NUMBER OF SHARES ISSUABLE. The total number of shares initially
authorized to be issued under the Plan shall be 2,901,902 shares of Common
Stock. The number of shares available for issuance under the Plan shall be
further subject to adjustment in accordance with Section 7.06. The shares to be
offered under the Plan shall be authorized and unissued Common Stock, or issued
Common Stock which shall have been reacquired by the Company,

        4.02    SHARES SUBJECT TO TERMINATED OPTIONS AND STOCK PURCHASE RIGHTS.
Common Stock covered by any unexercised portions of terminated Options and Stock
Purchase Rights (including canceled Options and Stock Purchase Rights) granted
under Articles V and VI of the Plan or the Predecessor Plan and Common Stock
subject to any Options and Stock Purchase Rights which are otherwise surrendered
by a Participant may again be subject to new Options and Stock Purchase Rights
under the Plan.

        4.03    PARTICIPATION. Participants in the Plan shall be such
consultants, directors, officers and other employees of the Company and its
subsidiaries as the Committee, in its sole discretion, may designate from time
to time. The Committee's designation of a Participant in any year shall not
require the Committee to designate such person to receive Options, Stock
Purchase Rights or grants in any other year. The Committee shall consider such
factors as it deems pertinent in selecting Participants and in determining the
type and amount of their respective Options and Stock Purchase Rights.

                                    ARTICLE V

                              STOCK PURCHASE RIGHTS

        5.01    RIGHTS TO PURCHASE. Stock Purchase Rights may be issued either
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan. After the Committee determines that
it will offer Stock Purchase Rights under the Plan, it shall advise the offeree
in writing or electronically, by means of a Restricted Stock Purchase Agreement,
of the terms, conditions and restrictions related to the offer, including the
number of shares of Common Stock that the offeree shall be entitled to purchase
and the price to be paid for such shares. The offer shall be accepted by
execution of the Restricted Stock Purchase Agreement.

        5.02    REPURCHASE OPTION. Unless the Committee 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
"Permanent Disability" (as defined in Section 6.03)). 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 a rate determined by the Committee. In the event that the Restricted Stock
Purchase Agreement does not provide for a lapsing schedule, the restrictions
shall lapse as to (a) one third of the shares subject to the Restricted Stock
Purchase Agreement on the first anniversary of the grant of

                                       4
<PAGE>

the Stock Purchase Right, (b) one third of the shares subject to the Restricted
Stock Purchase Agreement on the second anniversary of the grant of the Stock
Purchase Right and (c) one third of the shares subject to the Restricted Stock
Purchase Agreement on the third anniversary of the grant of the Stock Purchase
Right.

        5.03    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 Committee in its sole discretion.

        5.04    RIGHTS AS A SHAREHOLDER. Once the Stock Purchase Right is
exercised, the purchaser shall have the rights equivalent to those of a
shareholder, and shall be a shareholder when his or her purchase is entered upon
the records of the duly authorized transfer agent of the Company. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Stock Purchase Right is exercised; PROVIDED, HOWEVER, that
Participants are entitled to share adjustments to reflect capital changes under
Section 7.06.

                                   ARTICLE VI

                                  STOCK OPTIONS

        6.01    OPTION AWARDS.

                (A)     GENERAL. The Committee may grant, to such Participants
as the Committee may select, Options entitling the Participant to purchase
shares of Common Stock from the Company in such number, at such price, and on
such terms and subject to such conditions, not inconsistent with the terms of
this Plan, as may be established by the Committee. The terms of any Option
granted under this Plan shall be set forth in an Option Agreement.

                (B)     PURCHASE PRICE OF OPTIONS. The Option Price of each
share of Common Stock which may be purchased upon exercise of any Option granted
under the Plan shall be determined by the Committee; PROVIDED, HOWEVER, that (i)
with respect to Incentive Stock Options, the Option Price per share shall in all
cases be equal to or greater than the Fair Market Value of a share of Common
Stock on the Date of Grant as required under Section 422 of the Code, and (ii)
with respect to any Incentive Stock Option granted to any Ten Percent
Shareholder, the Option Price per share shall in all cases be equal to or
greater than 110 percent of the Fair Market Value of a share of Common Stock on
the Date of Grant as required under Section 422 of the Code.

                (C)     DESIGNATION OF OPTIONS. Except as otherwise expressly
provided in the Plan, the Committee may designate, at the time of the grant of
each Option, the Option as an Incentive Stock Option or a Nonstatutory Stock
Option.

                (D)     INCENTIVE STOCK OPTION LIMITATIONS. No Participant may
be granted Incentive Stock Options under the Plan (or any other plans of the
Company), which would result in shares with an aggregate Fair Market Value
(measured on the Date of Grant) of more than $100,000 first becoming exercisable
in any one calendar year. No Participant may be granted Incentive Stock Options
under the Plan (or any other plans of the Company) unless the Participant is an
employee of the Company or its Subsidiaries. An individual 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 and its
subsidiaries. For purposes of an Option initially granted as an

                                       5
<PAGE>

Incentive Stock Option, if a leave of absence of more than three months
precludes such Option from being treated as an Incentive Stock Option under the
Code, such Option thereafter shall be treated as a Nonstatutory Stock Option for
purposes of this Plan. Neither service as a director nor payment of a director's
fee by the Company shall be sufficient to constitute "employment" by the
Company.

                (E)     RIGHTS AS A SHAREHOLDER. A Participant or a transferee
of an Option pursuant to Section 7.04 shall have no rights as a shareholder with
respect to Common Stock covered by an Option until the Participant or transferee
shall have become the holder of record of any such shares, and no adjustment
shall be made for dividends in cash or other property or distributions or other
rights with respect to any such Common Stock for which the record date is prior
to the date on which the Participant or a transferee of the Option shall have
become the holder of record of any such shares covered by the Option; PROVIDED,
HOWEVER, that Participants are entitled to share adjustments to reflect capital
changes under Section 7.06.

                (f)     VESTING. In the event that an Option Agreement does not
provide for a vesting schedule, the Options covered thereby shall become
exercisable as to (a) one third of the shares subject to the Option Agreement on
the first anniversary of the grant of the Option, (b) one third of the shares
subject to the Option on the second anniversary of the grant of the Option and
(c) one third of the shares subject to the Option on the third anniversary of
the grant of the Option.

        6.02    TERMS OF STOCK OPTIONS.

                (A)     CONDITIONS ON EXERCISE. An Option Agreement with respect
to Options may contain such waiting periods, exercise dates and restrictions on
exercise (including, but not limited to, periodic installments) as may be
determined by the Committee as of the Date of Grant.

                (B)     DURATION OF OPTIONS. Options shall terminate after the
        first to occur of the following events:

                        (i)     Expiration of the Option as provided in the
        Option Agreement;

                        (ii)    Termination of the Option as provided in Section
        6.03, following the Participant's termination of employment; or

                        (iii)   Ten years from the Date of Grant (five years
        from the Date of Grant in the case of any Incentive Stock Option granted
        to a Ten Percent Shareholder).

                (C)     ACCELERATION OF EXERCISE TIME. The Committee, in its
sole discretion, shall have the right (but shall not in any case be obligated),
exercisable at any time after the Date of Grant, to permit the exercise of any
Option prior to the time such Option would otherwise become exercisable under
the terms of the Option Agreement.

                (D)     EXTENSION OF EXERCISE TIME. The Committee, in its sole
discretion, shall have the right (but shall not in any case be obligated),
exercisable on or at any time after the

                                       6
<PAGE>

Date of Grant, to permit any Option granted under this Plan to be exercised
after its expiration date, subject, however, to the limitation described in
Section 6.02(b)(iii).

        6.03    EXERCISE OF OPTIONS UPON TERMINATION OF EMPLOYMENT.

                (A)     GENERAL. In the event of the termination of employment
of the Participant by the Participant or the Company and its subsidiaries for
any reason whatsoever other than death, Permanent Disability (as defined in
Section 6.03(b)) or retirement after attainment of age 65, (i) any Options that
were not vested prior to the date of such termination of employment shall
terminate on such date and (ii) any Options that were vested prior to the date
of such termination of employment (and which were not previously exercised)
shall terminate on the ninetieth (90th) day following the date of such
termination of employment or the last day of the Option Term, whichever is
earlier.

                (b)     DEATH, PERMANENT DISABILITY OR RETIREMENT. In the event
of the termination of the employment of the Participant by reason of death,
Permanent Disability or retirement after attainment of age 65, any Options that
were vested prior to the date of such termination (and which were not previously
exercised), together with any other Options designated by the Committee, shall
terminate on the earlier of (i) the first anniversary of the date of such
termination and (ii) the last day of the Option Term. Any Options that were not
vested prior to the date of such termination and do not become vested pursuant
to the immediately preceding sentence shall terminate as of the date of such
termination. As used in this Plan, the term "Permanent Disability" means the
Participant being deemed to have suffered a disability that makes the
Participant eligible for immediate benefits under any long-term disability plan
of the Company, as in effect from time to time.

                (c)     TERMINATION OF EMPLOYMENT. For purposes of the Plan,
there shall have been a termination of employment of a Participant if such
Participant is no longer an employee, consultant, director or officer of the
Company or of any of its subsidiaries.

        6.04    EXERCISE PROCEDURES. Each Option granted under the Plan shall be
exercised by written notice to the Company which must be received by the officer
or employee of the Company designated in the Option Agreement on or before the
close of business on the expiration date of the Option. The Option Price of
shares purchased upon exercise of an Option granted under the Plan shall be paid
in full in cash by the Participant pursuant to the Option Agreement; PROVIDED,
HOWEVER, that the Committee may (but shall not be required to) permit payment to
be made by delivery to the Company of either (a) Common Stock (which may include
shares otherwise issuable in connection with the exercise of the Option, subject
to such rules as the Committee deems appropriate), (b) any combination of cash
and Common Stock, or (c) such other consideration as the Committee deems
appropriate. In the event that any Common Stock shall be transferred to the
Company to satisfy all or any part of the Option Price, the part of the Option
Price deemed to have been satisfied by such transfer of Common Stock shall be
equal to the product derived by multiplying the Fair Market Value of a share of
Common Stock as of the date of exercise times the number of shares of Common
Stock transferred to the Company. The Participant may not transfer to the
Company in satisfaction of the Option Price any fractional share of Common
Stock. Any part of the Option Price paid in cash upon the exercise of any Option
shall be added to the general funds of the Company and may be used for any
proper corporate purpose. Unless the Committee shall

                                       7
<PAGE>

otherwise determine, any Common Stock transferred to the Company as payment of
all or part of the Option Price upon the exercise of any Option shall be held as
treasury shares.

                                   ARTICLE VII

                                  MISCELLANEOUS

        7.01    PLAN PROVISIONS CONTROL OPTION AND STOCK PURCHASE RIGHT TERMS.
The terms of the Plan shall govern all Options and Stock Purchase Rights granted
under the Plan, and in no event shall the Committee have the power to grant any
option or stock purchase right under the Plan which is contrary to any of the
provision of the Plan. In the event any provision of any Options or Stock
Purchase Rights granted under the Plan shall conflict with any term in the Plan
as constituted on the Date of Grant of such Option or Stock Purchase Right, the
term in the Plan as constituted on the Date of Grant of such Option or Stock
Purchase Right shall control. Except as provided in Section 7.03 and Section
7.06, the terms of any Option or Stock Purchase Right granted under the Plan may
not be changed after the Date of Grant of such Option or Stock Purchase Right so
as to materially decrease the value of the Option or Stock Purchase Right
without the express written approval of the holder.

        7.02    OPTION AGREEMENT. No person shall have any rights under any
Option granted under the Plan unless and until the Company and the Participant
to whom such Option shall have been granted shall have executed and delivered an
Option Agreement or received any other Option acknowledgment authorized by the
Committee expressly granting the Option to such person and containing provisions
setting forth the terms of the Option.

        7.03    MODIFICATION OF OPTION AFTER GRANT. No Option or Stock Purchase
Right granted under the Plan to a participant may be modified (unless such
modification does not materially decrease the value of the Option or Stock
Purchase Right) after the Date of Grant except by express written agreement
between the Company and the Participant, provided that any such change (a) shall
not be inconsistent with the terms of the Plan, and (b) shall be approved by the
Committee.

        7.04    LIMITATION ON TRANSFER. Unless determined otherwise by the
Committee, a Participant's rights and interest under the Plan may not be
assigned or transferred other than by will or the laws of descent and
distribution, and during the lifetime of a Participant, only the Participant
personally (or the Participant's personal representative) may exercise rights
under the Plan. The Participant's Beneficiary may exercise the Participant's
rights to the extent they are exercisable under the Plan following the death of
the Participant. In the event that the Committee makes an Option or Stock
Purchase Right transferable, such Option or Stock Purchase Right shall contain
such additional terms and conditions as the Committee deems appropriate.

        7.05    TAXES. The Company shall be entitled, if the Committee deems it
necessary or desirable, to withhold (or secure payment from the Participant in
lieu of withholding) the amount of any withholding or other tax required by law
to be withheld or paid by the Company with respect to any amount payable and/or
shares issuable with respect to such Participant's Option or Stock Purchase
Right, or with respect to any income recognized upon a disqualifying disposition
of shares received pursuant to the exercise of an Incentive Stock Option, and
the Company may defer payment or issuance of shares upon exercise of an Option
or Stock Purchase Right unless

                                       8
<PAGE>

indemnified to its satisfaction against any liability for any such tax. The
amount of such withholding or tax payment shall be determined by the Committee
and shall be payable by the Participant at such time as the Committee
determines. The Participant shall meet his or her withholding requirement by
direct payment to the Company in cash of the amount of any taxes required to be
withheld with respect to such Option or Stock Purchase Right; provided, however,
that the Committee may (but shall not be required to) permit the Participant to
meet his or her withholding requirement by (i) having withheld from such Option
or Stock Purchase Right at the appropriate time that number of shares of Common
Stock, rounded up to the next whole share, whose Fair Market Value is equal to
the amount of withholding taxes due, or (ii) a combination of shares and cash.

        7.06    ADJUSTMENTS TO REFLECT CAPITAL CHANGES.

                (A)     RECAPITALIZATION. The number and kind of shares subject
to outstanding Options or Stock Purchase Rights, the Option Price for such
shares, the number and kind of shares available for Options and Stock Purchase
Rights subsequently granted under the Plan and the maximum number of shares in
respect of which Options can be granted to any Participant in any calendar year
shall be appropriately adjusted to reflect any stock dividend, stock split,
combination or exchange of shares, merger, consolidation or other change in
capitalization with a similar substantive effect upon the Plan or the Options or
Stock Purchase Rights granted under the Plan. The Committee shall have the power
and sole discretion to determine the amount of the adjustment to be made in each
case.

                (B)     MERGER. After any Merger in which the Company is the
surviving corporation, each Participant shall, at no additional cost, be
entitled upon any exercise of an Option or Stock Purchase Right to receive
(subject to any required action by shareholders), in lieu of the number of
shares of Common Stock receivable or exercisable pursuant to such Option or
Stock Purchase Right, the number and class of shares or other securities to
which such Participant would have been entitled pursuant to the terms of the
Merger if, at the time of the Merger, such participant had been the holder of
record of a number of shares equal to the number of shares receivable or
exercisable pursuant to such Option or Stock Purchase Right. Comparable rights
shall accrue to each Participant in the event of successive Mergers of the
character described above. In the event of a Merger in which the Company is not
the surviving corporation, the surviving, continuing, successor, or purchasing
corporation, as the case may be (the "Acquiring Corporation"), shall either
assume the Company's rights and obligations under outstanding Options and Stock
Purchase Rights or substitute comparable options and stock purchase rights in
respect of the Acquiring Corporation's stock for such outstanding Options and
Stock Purchase Rights. In the event the Acquiring Corporation elects not to
assume or substitute comparable options and stock purchase rights for such
outstanding Options and Stock Purchase Rights, the Board shall provide that any
unexercisable and/or unvested portion of the outstanding Options and Stock
Purchase Rights shall be immediately exercisable and vested as of a date prior
to such Merger or consolidation, as the Board so determines. The exercise and/or
vesting of any Option and any Stock Purchase Right that was permissible solely
by reason of this Section 7.07(b) shall be conditioned upon the consummation of
the Merger or consolidation. Any Options and Stock Purchase Rights which are
neither assumed by the Acquiring Corporation nor exercised as of the date of the
Merger shall terminate effective as of the effective date of the Merger.

                                       9
<PAGE>

        For purposes of the Plan, all outstanding Options and Stock Purchase
Rights will be considered assumed if, following the consummation of the Merger,
the option or stock purchase rights confers the right to purchase or receive,
for each share of stock subject to the Option or Stock Purchase Right
immediately prior to the consummation of the Merger, the consideration (whether
stock, cash, or other securities property) received in the Merger by holders of
Common Stock for each share of the Company's Common Stock held on the effective
date of the transaction (and if holders were offered a choice of consideration,
the type chosen by the holders of a majority of the outstanding shares of the
Company's Common Stock); provided, however, that if such consideration received
in the Merger is not solely common stock of the successor corporation or its
parent, the Committee 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 stock subject to the Option or Stock
Purchase Right, to be solely common stock of the successor corporation or its
parent or subsidiary equal in fair market value to the per share consideration
received by holders of the Company's Common Stock in the Merger.

                Any outstanding Option which is assumed or replaced in the event
of a Merger and does not otherwise accelerate at that time will automatically
accelerate in the event that the Participant's service terminates through an
"Involuntary Termination" effected within eighteen (18) months following the
effective date of such Merger. Any Option so accelerated will remain exercisable
until the earlier of (i) the expiration of the Option Term or (ii) the end of
the one-year period measured from the date of the Involuntary Termination.

                An Involuntary Termination will be deemed to occur upon (i) the
Participant's involuntary dismissal or discharge by the Company or its
subsidiaries or their successors for reasons other than cause or (ii) such
individual's voluntary resignation following (A) a reduction in his or her level
of compensation (including base salary, fringe benefits and any
corporate-performance based bonus or incentive programs) by more than ten
percent or (B) a relocation of such individual's place of employment by more
than fifty (50) miles, provided and only if such reduction or relocation is
effected by the Company or its subsidiaries or their successor without the
Participant's written consent.

                (C)     OPTIONS TO PURCHASE SHARES OF STOCK OF ACQUIRED
COMPANIES. After any Merger in which the Company shall be a surviving
corporation, the Committee may grant substituted options outside of the terms of
this Plan, pursuant to Section 424 of the Code, replacing old options granted
under a plan of another party to the Merger whose shares or stock subject to the
old options may no longer be issued following the Merger. The foregoing manner
of application of the foregoing provisions shall be determined by the Committee
in its sole discretion. Any such application may provide for the elimination of
any fractional shares, which might otherwise become subject to any Options.

        7.07    NO RIGHT TO EMPLOYMENT. No employee or other person shall have
any claim of right to be granted an Option under this Plan. Neither the Plan nor
any action taken hereunder shall be construed as giving any employee any right
to be retained in the employ of the Company or any of its subsidiaries.

        7.08    OPTIONS NOT INCLUDABLE FOR BENEFIT PURPOSES. Common Stock
received by a Participant pursuant to the provisions of the Plan shall not be
included in the determination of benefits under any pension, group insurance or
other benefit plan applicable to the Participant,

                                       10
<PAGE>

which is maintained by the Company, except as may be provided under the terms of
such plans or determined by the Board.

        7.09    GOVERNING LAW. All determinations made and actions taken
pursuant to the Plan shall be governed by the laws of the State of New Jersey
and construed in accordance therewith (except where the law of the state of
incorporation of the Company controls).

        7.10    NO STRICT CONSTRUCTION. No rule of strict construction shall be
implied against the Company, the Board, the Committee, or any other person in
the interpretation of any of the terms of the Plan, any Option or Stock Purchase
Right granted under the Plan or any rule or procedure established by the
Committee.

        7.11    CAPTIONS. The captions (i.e., all Section headings) used in the
Plan are for convenience only, do not constitute a part of the Plan, and shall
not be deemed to limit, characterize or affect in any way any provisions of the
Plan, and all provisions of the Plan shall be construed as if no captions have
been used in the Plan.

        7.12    SEVERABILITY. Whenever possible, each provision in the Plan and
every Option and Stock Purchase Right at any time granted under the Plan shall
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of the Plan or any Option or Stock Purchase Right at any
time granted under the Plan shall be held to be prohibited by or invalid under
applicable law, then (a) such provision shall be deemed amended to accomplish
the objectives of the provision as originally written to the fullest extent
permitted by law and (b) all other provisions of the Plan and every other Option
and Stock Purchase Right at any time granted under the Plan shall remain in full
force and effect.

        7.13    AMENDMENT AND TERMINATION.

                (A)     AMENDMENT. The Board shall have complete power and
authority to amend the Plan at any time. No termination or amendment of the Plan
may, without the consent of the Participant to whom any Option or Stock Purchase
Right shall theretofore have been granted under the Plan, adversely affect the
right of such individual under such Option or Stock Purchase Right.

                (B)     TERMINATION. The Board shall have the right and the
power to terminate the Plan at any time; provided, however, that the Plan shall
terminate no later than ten years after the adoption of the Plan by the Board.
No Option or Stock Purchase Right shall be granted under the Plan after the
termination of the Plan, but the termination of the Plan shall not have any
other effect and any Option or Stock Purchase Right outstanding at the time of
the termination of the Plan may be exercised after termination of the Plan at
any time prior to the expiration date of such Option or Stock Purchase Right to
the same extent such Option or Stock Purchase Right would have been exercisable
had the Plan not terminated.

        7.14    LIMITATIONS. The following limitations shall apply to grants of
Options:

                (i)     No Participant shall be granted, in any fiscal year of
the Company, Options to purchase more than 1,000,000 shares of Common Stock,
other than grants made to the chief executive officer of the Company pursuant to
an employment agreement approved by the

                                       11
<PAGE>

Board of Directors of the Company, in which case the maximum number of shares
covered by Options granted to such officer in any fiscal year shall not exceed
5% of the Company's outstanding common stock, calculated on a fully diluted
basis.

                (ii)    The foregoing limitation shall be adjusted
proportionately in connection with any change in the Company's capitalization as
described in Section 7.06(b).

                (iii)   If an Option is canceled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 7.06(b)), the canceled Option will be counted against the
limits set forth in subsections (i) and (ii) above.

        7.15    CONDITIONS UPON ISSUANCE OF SHARES.

                (A)     LEGAL COMPLIANCE. Shares of Common Stock shall not be
issued pursuant to the exercise of an Option or Stock Purchase Right unless the
exercise of such Option or Stock Purchase Right 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 or Stock Purchase Right, the Company may require the
person exercising such Option or Stock Purchase Right to represent and warrant
at the time of any such exercise that the shares of Common Stock 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.

                (C)     ADDITIONAL CONDITIONS. The Committee shall have the
authority to condition the grant of any Option or Stock Purchase Right in such
other manner that the Committee determines to be appropriate, provided that such
condition is not inconsistent with the terms of the Plan. Such conditions may
include, among other things, obligations of Optionees to execute lock-up
agreements and shareholder agreements in the future.

        7.16.   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 of Common Stock 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.

        7.17.   RESERVATION OF SHARES. The Company, during the term of this
Plan, will at all times reserve and keep available such number of shares of
Common Stock as shall be sufficient to satisfy the requirements of the Plan.

                                       12

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