Document:

EXHIBIT 10.2

TORREYPINES
THERAPEUTICS, INC.

2006 EQUITY INCENTIVE PLAN

STOCK OPTION
AGREEMENT

(INCENTIVE STOCK OPTION OR NONSTATUTORY STOCK OPTION)

Pursuant to your Stock Option
Grant Notice (“Grant Notice”) and this Stock Option Agreement, TorreyPines Therapeutics, Inc. (the “Company”) has granted you an option
under its 2006 Equity Incentive Plan
(the “Plan”) to purchase the number of shares of the Company’s Common Stock
indicated in your Grant Notice at the exercise price indicated in your Grant
Notice.  Defined terms not explicitly
defined in this Stock Option Agreement but defined in the Plan shall have the
same definitions as in the Plan.

The details of your option are
as follows:

1.             VESTING.  Subject to the limitations contained herein,
your option will vest as provided in your Grant Notice, provided that vesting
will cease upon the termination of your Continuous Service.

2.             NUMBER OF SHARES AND EXERCISE PRICE.  The number of shares of Common Stock subject
to your option and your exercise price per share referenced in your Grant
Notice may be adjusted from time to time for Capitalization Adjustments.

3.             METHOD OF PAYMENT.  Payment of the exercise price is due in full
upon exercise of all or any part of your option.  You may elect to make payment of the exercise
price in cash or by check or in any other manner permitted
by your Grant Notice, which may include one or more of the
following:

(a)           In
the Company’s sole discretion at the time your option is exercised and provided
that at the time of exercise the Common Stock is publicly traded and quoted
regularly in The Wall Street Journal, pursuant
to a program developed under Regulation T as promulgated by the Federal Reserve
Board that, prior to the issuance of Common Stock, results in either the
receipt of cash (or check) by the Company or the receipt of irrevocable
instructions to pay the aggregate exercise price to the Company from the sales
proceeds.

(b)           Provided
that at the time of exercise the Common Stock is publicly traded and quoted
regularly in The Wall Street Journal, by
delivery of already-owned shares of Common Stock either that you have held for
the period required to avoid a charge to the Company’s reported earnings
(generally six (6) months) or that you did not acquire, directly or indirectly
from the Company, that are owned free and clear of any liens, claims,
encumbrances or security interests, and that are valued at Fair Market Value on
the date of exercise.  “Delivery” for
these purposes, in the sole discretion of the Company at the time you exercise
your option, shall include delivery to the Company of your attestation of
ownership of such shares of Common Stock in a form approved by the
Company.  Notwithstanding the foregoing,
you may not exercise your option by tender to the Company of Common Stock to
the extent such tender

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would violate the provisions of any law, regulation or
agreement restricting the redemption of the Company’s stock.

(c)           Provided
that at the time of exercise the Company has established procedures for “net exercise,”
by an arrangement pursuant to which the Company will reduce the number of
shares of Common Stock issued upon exercise of your option by the largest whole
number of shares with a Fair Market Value that does not exceed the aggregate
exercise price; provided, however, the Company shall accept a cash or other
payment from you to the extent of any remaining balance of the aggregate
exercise price not satisfied by such holding back of whole shares; provided,
however, shares of Common Stock will no longer be outstanding under your option
and will not be exercisable thereafter to the extent that (1) shares are used
to pay the exercise price pursuant to the “net exercise,” (2) shares are
delivered to you as a result of such exercise, and (3) shares are withheld to
satisfy tax withholding obligations.

4.             WHOLE SHARES.  You may exercise your option only for whole
shares of Common Stock.

5.             SECURITIES LAW COMPLIANCE.  Notwithstanding anything to the contrary
contained herein, you may not exercise your option unless the shares of Common
Stock issuable upon such exercise are then registered under the Securities Act
or, if such shares of Common Stock are not then so registered, the Company has
determined that such exercise and issuance would be exempt from the registration
requirements of the Securities Act.  The
exercise of your option also must comply with other applicable laws and
regulations governing your option, and you may not exercise your option if the
Company determines that such exercise would not be in material compliance with
such laws and regulations.

6.             TERM.  You may not exercise your option before the
commencement of its term or after its term expires.  The term of your option commences on the Date
of Grant and expires upon the earliest of the following:

(a)           immediately
upon the termination of your Continuous Service for Cause;

(b)           three
(3) months after the termination of your Continuous Service for any reason
other than Cause, Disability, or death, provided that if during any part of
such three- (3-) month period you may not exercise your option solely because
of the condition set forth in Section 5 relating to “Securities Law Compliance,”
your option shall not expire until the earlier of the Expiration Date or until
it shall have been exercisable for an aggregate period of three (3) months
after the termination of your Continuous Service;

(c)           twelve
(12) months after the termination of your Continuous Service due to your
Disability;

(d)           eighteen
(18) months after your death if you die either during your Continuous Service
or within three (3) months after your Continuous Service terminates for any
reason other than Cause;

(e)           the
Expiration Date indicated in your Grant Notice; or

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(f)            the
day before the tenth (10th) anniversary of the Date of Grant.

If your option is an Incentive
Stock Option, note that to obtain the federal income tax advantages associated
with an Incentive Stock Option, the Code requires that at all times beginning
on the date of grant of your option and ending on the day three (3) months
before the date of your option’s exercise, you must be an employee of the
Company or an Affiliate, except in the event of your death or your permanent
and total disability, as defined in Section 22(e) of the Code.  (The definition of disability in Section
22(e) of the Code is different from the definition of the Disability under the
Plan).  The Company has provided for
extended exercisability of your option under certain circumstances for your
benefit but cannot guarantee that your option will necessarily be treated as an
Incentive Stock Option if you continue to provide services to the Company or an
Affiliate as a Consultant or Director after your employment terminates or if
you otherwise exercise your option more than three (3) months after the date your
employment with the Company or an Affiliate terminates.

7.             EXERCISE.

(a)           You
may exercise the vested portion of your option during its term by delivering a
Notice of Exercise (in a form designated by the Company) together with the
exercise price to the Secretary of the Company, or to such other person as the
Company may designate, during regular business hours, together with such
additional documents as the Company may then require.

(b)           By
exercising your option you agree that, as a condition to any exercise of your
option, the Company may require you to enter into an arrangement providing for
the payment by you to the Company of any tax withholding obligation of the
Company arising by reason of (1) the exercise of your option, or (2) the
disposition of shares of Common Stock acquired upon such exercise.

(c)           If
your option is an Incentive Stock Option, by exercising your option you agree
that you will notify the Company in writing within fifteen (15) days after the
date of any disposition of any of the shares of the Common Stock issued upon
exercise of your option that occurs within two (2) years after the date of your
option grant or within one (1) year after such shares of Common Stock are
transferred upon exercise of your option.

8.             TRANSFERABILITY.

(a)           If
your option is an Incentive Stock Option, your option is not transferable,
except by will or by the laws of descent and distribution, and is exercisable
during your life only by you. 
Notwithstanding the foregoing, by delivering written notice to the Company,
in a form satisfactory to the Company, you may designate a third party who, in
the event of your death, shall thereafter be entitled to exercise your option.

(b)           If
your option is a Nonstatutory Stock Option, your option is not transferable,
except (i) by will or by the laws of descent and distribution, (ii) with the
prior written approval of the Company, by instrument to an inter vivos or
testamentary trust, in a form accepted by the Company, in which the option is
to be passed to beneficiaries upon the death of

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the trustor (settlor) and (iii) with the prior written
approval of the Company, by gift, in a form accepted by the Company, to a
permitted transferee under Rule 701 of the Securities Act.

9.             OPTION NOT A SERVICE CONTRACT.  Your option is not an employment or service
contract, and nothing in your option shall be deemed to create in any way
whatsoever any obligation on your part to continue in the employ of the Company
or an Affiliate, or of the Company or an Affiliate to continue your employment.  In addition, nothing in your option shall
obligate the Company or an Affiliate, their respective stockholders, Boards of
Directors, Officers or Employees to continue any relationship that you might
have as a Director or Consultant for the Company or an Affiliate.

10.          WITHHOLDING OBLIGATIONS.

(a)           At
the time you exercise your option, in whole or in part, or at any time
thereafter as requested by the Company, you hereby authorize withholding from
payroll and any other amounts payable to you, and otherwise agree to make
adequate provision for (including by means of a “cashless exercise” pursuant to
a program developed under Regulation T as promulgated by the Federal Reserve
Board to the extent permitted by the Company), any sums required to satisfy the
federal, state, local and foreign tax withholding obligations of the Company or
an Affiliate, if any, which arise in connection with the exercise of your
option.

(b)           Upon
your request and subject to approval by the Company, in its sole discretion,
and compliance with any applicable legal conditions or restrictions, the
Company may withhold from fully vested shares of Common Stock otherwise
issuable to you upon the exercise of your option a number of whole shares of
Common Stock having a Fair Market Value, determined by the Company as of the
date of exercise, not in excess of the minimum amount of tax required to be
withheld by law (or such lower amount as may be necessary to avoid adverse
accounting consequences).

(c)           You
may not exercise your option unless the tax withholding obligations of the
Company and/or any Affiliate are satisfied. 
Accordingly, you may not be able to exercise your option when desired
even though your option is vested, and the Company shall have no obligation to
issue a certificate for such shares of Common Stock unless such obligations are
satisfied.

11.          NOTICES.  Any notices provided for in your option or
the Plan shall be given in writing and shall be deemed effectively given upon
receipt or, in the case of notices delivered by mail by the Company to you,
five (5) days after deposit in the United States mail, postage prepaid,
addressed to you at the last address you provided to the Company.

12.          GOVERNING PLAN DOCUMENT.  Your option is subject to all the provisions
of the Plan, the provisions of which are hereby made a part of your option, and
is further subject to all interpretations, amendments, rules and regulations,
which may from time to time be promulgated and adopted pursuant to the
Plan.  In the event of any conflict
between the provisions of your option and those of the Plan, the provisions of
the Plan shall control.

 4Exhibit 4.4

NEW
YORK & COMPANY, INC.

2006 LONG-TERM INCENTIVE PLAN

ARTICLE I

ESTABLISHMENT, PURPOSE AND TERM

1.1   Establishment.   The
New York & Company, Inc. 2006 Long Term Incentive Plan (“Plan”) is hereby established by New York & Company, Inc.
(“Company”), effective as of the Effective
Date. Subject to Section 13.1, Awards may be
granted as provided herein for the term of the Plan.

1.2   Purposes.   The
purposes of the Plan are to foster and promote the long-term financial
success of the Company and materially increase shareholder value by motivating
performance through incentive compensation. The Plan also is intended to
encourage Participant ownership in the Company, attract and retain talent, and
enable Participants to participate in the long-term growth and financial
success of the Company. In addition, the Plan provides the ability to make
Awards linked to the profitability of the Company’s businesses and increases in
shareholder value.

1.3   Term.   The
term of the Plan shall extend from the Effective Date until the tenth
anniversary thereof. No additional Awards shall be made after the expiration of
such term, but outstanding awards shall be administered in accordance with the
provisions thereof. The Plan shall continue in effect until all matters
relating to the settlement of Awards and administration of the Plan have been
completed.

ARTICLE II

DEFINITIONS

For purposes of
the Plan, the following terms are defined as set forth below:

2.1   “2002 Plan” means
the New York & Company, Inc. Amended and Restated 2002 Stock
Option Plan.

2.2   “Affiliate” means
any individual, corporation, partnership, association, limited liability
company, joint-stock company, trust, unincorporated association or other
entity that directly or indirectly through one or more intermediaries,
controls, is controlled by, or is under control with, the Company.

2.3   “Agreement” means
any agreement entered into pursuant to the Plan by which an Award is granted to
a Participant.

2.4   “Award” means
any Stock Option, Stock Appreciation Right, Restricted Stock, Deferred Stock,
or Performance Award granted to a Participant under the Plan. Awards shall be
subject to the terms and conditions of the Plan and shall be evidenced by an
Agreement containing such additional terms and conditions, not inconsistent
with the provisions of the Plan, as the Committee shall deem desirable.

2.5   “Beneficiary” means
any person or other entity, which has been designated by a Participant in his
or her most recent written beneficiary designation filed with the Committee to
receive the compensation, specified under the Plan to the extent permitted. If
there is no designated beneficiary, then the term means any person or other
entity entitled by will or the laws of descent and distribution to receive such
compensation.

2.6   “Board of Directors”
or “Board” means the Board of Directors of
the Company.

2.7   “Cause” means,
unless otherwise specifically provided in an Agreement, any act or omission
which permits the Company to terminate the written employment agreement or
arrangement between the Participant and the Company or an Affiliate for “cause”
as defined in such agreement or arrangement, or in the event there is no such
agreement or arrangement or the agreement or arrangement does not define the
term “Cause,” then “Cause” means the occurrence of one or more of the following
events:

(1)         misappropriation of the Company’s
assets or business opportunities;

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(2)         alcoholism or drug addiction which
impairs one’s ability to perform his duties and responsibilities hereunder or
is injurious to the business of the Company;

(3)         the commission by such Participant of,
or the plea of nolo contendere with respect to, a felony or crime involving
moral turpitude;

(4)         intentionally causing the Company to
violate a local, state or federal law in any material respect;

(5)         gross negligence or willful misconduct
in the conduct or management of the Company not remedied within 10 days after
receipt of written notice from the Company; or willful refusal to comply with
any significant policy, directive or decision of the Board in furtherance of a
legitimate business purpose or willful refusal to perform the duties reasonably
assigned to the individual by the Board consistent with the functions, duties
and responsibilities of his position and only if not remedied within 10 days
after receipt of written notice from the Company; or

(6)         such other meaning as may be specified
with respect to any particular Award or in any employment or other agreement
entered into at or before the time the Award is granted (or, with the consent
of the Participant, after such time).

2.8   “Code” means the
Internal Revenue Code of 1986, as amended from time to time, and any successor
thereto.

2.9   “Commission” means
the Securities and Exchange Commission or any successor thereto.

2.10   “Committee” means
the committee of the Board responsible for granting and administering Awards
under the Plan, which initially shall be the Compensation Committee of the
Board, until such time as the Board may designate another committee. The
Committee shall consist solely of two or more directors and each member of the
Committee shall be a “non-employee director” within the meaning of Rule 16b-3
and also an “outside director” under Section 162(m) of the Code. In
addition, each member of the Compensation Committee shall satisfy any
independence or other corporate governance standards imposed by the New York
Stock Exchange or other securities market on which the Stock shall be listed
from time to time.

2.11   “Company” means
New York and Company, Inc., a Delaware corporation, and includes any
successor or assignee corporation or corporations into which the Company may be
merged, changed or consolidated; any corporation for whose securities the
securities of the Company shall be exchanged; and any assignee of or successor
to substantially all of the assets of the Company. Wherever the context of the
Plan so admits or requires, “Company” also
means “Affiliate.”

2.12   “Covered Employee”
means a Participant who is a “covered employee” within the meaning of Section 162(m) of
the Code.

2.13   “Deferred Stock”
means a right granted to a Participant under Section 9.1
hereof to receive Stock at the end of a specified deferral period.

2.14   “Domestic Relations Order”
has the meaning set forth in the Code.

2.15   “Effective Date”
means the date that the Plan is approved by the Company’s shareholders.

2.16   “Exchange Act” means
the Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder.

2.17   “Exercise Price”
means the price that a Participant must pay to exercise an Award or the amount
upon which the value of an Award is based.

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2.18   “Fair Market Value”
means, as of any given date, the closing market price on the New York Stock
Exchange or such other public trading market on
which the Stock is traded on that date. If there is no regular public trading
market for such Stock, the Fair Market Value of the Stock shall be determined
by the Committee in good faith. In each case, the Fair Market Value shall be
determined without regard to whether the Stock is restricted or represents a
minority interest.

2.19   “Grant Date” means
the date as of which an Award is granted pursuant to the Plan. In no event may
the Grant Date be earlier than the Effective Date.

2.20   “Incentive Stock Option”
means any Option that is intended to be, is designated as, and actually qualifies
as, an “incentive stock option” within the meaning of Section 422 of the
Code.

2.21   “Non-Qualified Stock
Option” means a Stock Option that is not an Incentive Stock Option.

2.22   “Option Period” means
the period during which the Option shall be exercisable in accordance with an
Agreement and Article VI.

2.23   “Participant” means
a person who satisfies the eligibility conditions of Article V
and to whom an Award has been granted by the Committee under the Plan. In the
event that a Representative is appointed for a Participant, then the term “Participant”
shall mean such appointed Representative. Notwithstanding the appointment of a
Representative, the term “Termination of Employment”
shall mean the Termination of Employment of the Participant.

2.24   “Performance Award”
means an Award consisting of Performance Shares, Performance Units or other
Award described in Article X
that is dependent upon the achievement of Performance Goals.

2.25   “Performance Goals”
mean the level of performance established by the Committee as the Performance
Goal with respect to a Performance Measure. Performance Goals may vary from
Performance Period to Performance Period and from Participant to Participant
and may be established on a stand-alone basis, in tandem or in the
alternative.

2.26   “Performance Measure”
means any measure based on any of the performance criteria set out in this
Section, either alone or in any combination, and, if not based on individual
performance, on either a consolidated or a division or business unit level, as
the Committee may determine: individual Participant financial or non-financial
performance goals; sales; cash flow; cash flow from operations; operating
profit or income; net income; operating margin; net income margin; return on
net assets; four-wall contribution; economic value added; return on total
assets; return on  equity; return on total capital; total shareholder
return; revenue; revenue growth; earnings before interest, taxes, depreciation
and amortization (“EBITDA”);
EBITDA growth; basic earnings per share; diluted earnings per share; funds from
operations per share and per share growth; cash available for distribution;
cash available for distribution per share and per share growth; share price
performance on an absolute basis and relative to an index of earnings per share
or improvements in the Company’s attainment of expense levels; or implementing
or completion of critical projects. The foregoing criteria shall have any
reasonable definitions that the Committee may specify, which may include or exclude
any or all of the following items as the Committee may specify: extraordinary,
unusual or non-recurring items; effects of accounting changes; effects of
financing activities; expenses for restructuring or productivity initiatives;
other non-operating items; spending for acquisitions; effects of
divestitures; and effects of litigation activities and settlements. Any such
performance criterion or combination of such criteria may apply to the
Participant’s Award opportunity in its entirety or to any designated portion or
portions of the Award opportunity, as the Committee may specify. In the event
Code Section 162(m) or applicable tax or other laws change to
permit the Committee discretion to alter the governing performance measures
without obtaining shareholder approval of such changes, the Committee shall
have sole discretion to make such changes without obtaining shareholder
approval. Performance Measures may vary from Performance Period to Performance
Period and from Participant to Participant.

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2.27   “Performance Period”
means the time period during which a Performance Award shall be earned shall be
the “Performance Period,” and shall be at least one (1) fiscal year in
length, unless otherwise determined by the Committee. Performance Awards shall
be subject to Performance Goals which shall be established by the Committee.

2.28   “Performance Unit”
means a right granted pursuant to the terms and conditions established by the
Committee which is described in Section 10.1.

2.29   “Performance Share”
means a right granted pursuant to the terms and conditions established by the
Committee which is described in Section 10.1.

2.30   “Plan” means the
New York & Company, Inc. 2006 Long Term Incentive Plan, as herein
set forth and as may be amended from time to time.

2.31   “Representative”
means (a) the person or entity acting as the executor or administrator of
a Participant’s estate pursuant to the last will and testament of a Participant
or pursuant to the laws of the jurisdiction in which the Participant had the
Participant’s primary residence at the date of the Participant’s death; (b) the
person or entity acting as the guardian or temporary guardian of a Participant;
or (c) the person or entity which is the Beneficiary of the Participant
upon or following the Participant’s death; provided that only one of the
foregoing shall be the Representative at any point in time as determined under
applicable law and recognized by the Committee.

2.32   “Restricted Stock”
means  Stock granted to a Participant under Section 8.1
hereof and which is subject to certain restrictions and to a risk of forfeiture
or repurchase by the Company.

2.33   “Rule 16b-3”
means Rule 16b-3, as from time to time in effect and applicable to
the Plan and Participants, promulgated by the Commission under Section 16
of the Exchange Act.

2.34   “Stock” means
the Company’s common stock, $0.001 par value per share, whether presently or
hereafter issued, and any other stock or security resulting from adjustment
thereof as described hereinafter.

2.35   “Stock Appreciation Right”
means a right granted under Section 7.1.

2.36   “Stock Option”
or “Option” means a right, granted to a
Participant under Section 6.1 hereof, to
purchase Stock at a specified price during specified time periods.

2.37   “Termination of Employment”
means the occurrence of any act or event whether pursuant to an employment
agreement or otherwise that actually or effectively causes or results in the
person’s ceasing, for whatever reason, to be an officer or employee of the
Company or of any Affiliate, including, without limitation, death, disability,
dismissal, severance at the election of the Participant, retirement, or
severance as a result of the discontinuance, liquidation, sale or transfer by
the Company or its Affiliates of a business owned or operated by the Company or
its Affiliates. With respect to any non-employee member of the Board,
Termination of Employment means the termination of a Participant’s status as a
non-employee director of the Board. With respect to any other person who
is not an employee with respect to the Company or an Affiliate, the Agreement
shall establish what act or event shall constitute a Termination of Employment
for purposes of the Plan. A Termination of Employment shall occur with respect
to an employee who is employed by an Affiliate if the Affiliate shall cease to
be an Affiliate and the Participant shall not immediately thereafter become an
employee of the Company or an Affiliate.

In addition, certain other terms used herein have
definitions given to them in the first place in which they are used.

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ARTICLE III

COMPENSATION COMMITTEE ADMINISTRATION

3.1   Committee Structure.   The Plan shall be administered by
the Committee, but any action that may be taken by the Committee may also be
taken by the full Board of Directors of the Company.

3.2   Committee Actions.   Subject to the Committee’s charter,
the Committee may authorize any one or more of its members or an officer of the
Company to execute and deliver documents on behalf of the Committee or the
Committee may allocate among one or more of its members, or may delegate to one
or more of its agents, such duties and responsibilities as it determines,
provided that the Committee shall not delegate the authority to grant Awards. A
member of the Committee shall be recused from Committee action regarding an
Award granted or to be granted to such member.

3.3   Committee Authority.   Subject to applicable law, the
Company’s certificate of incorporation and by-laws, the Committee’s
charter or the terms of the Plan, the Committee shall have the authority:

(1)             to select those persons to whom
Awards may be granted from time to time;

(2)             to determine whether and to what
extent Awards are to be granted hereunder;

(3)             to determine the number of shares
of Stock to be covered by each Award granted hereunder;

(4)             to determine the terms and
conditions of any Award granted hereunder (including any provisions deemed by
the Committee in good faith to be necessary or appropriate for a “nonqualified
deferred compensation plan,” as defined in Code Section 409A(d)(1), to
avoid being subject to taxation under Code Section 409A(a)(1)), provided
that the Exercise Price of any Option or Stock Appreciation Right shall not be
less than the Fair Market Value per share of the underlying stock as of the
Grant Date;

(5)             to adjust the terms and conditions,
at any time or from time to time, of any Award, subject to the limitations
contained elsewhere herein, including but not limited to Sections 13.1
and 13.11;

(6)             to determine to what extent and
under what circumstances Stock and other amounts payable with respect to an
Award shall be deferred, subject to compliance in good faith with the
requirements of the Plan and Code Section 409A to avoid the Award being
subject to taxation under Code Section 409A(a)(1);

(7)             to provide for the forms of
Agreement to be utilized in connection with this Plan;

(8)             to determine what legal
requirements are applicable to the Plan, Awards, and the issuance of Stock, and
to require of a Participant that appropriate action be taken with respect to
such requirements;

(9)             to cancel, with the consent of the
Participant or as otherwise provided in the Plan or an Agreement, outstanding
Awards;

(10)           to require as a condition of the
exercise of an Award or the issuance or transfer of a certificate (or other
representation of title) of Stock, the withholding from a Participant of the
amount of any taxes as may be necessary in order for the Company or any other
employer to obtain a deduction or as may be otherwise required by law;

(11)           to determine whether and with what
effect an individual has incurred a Termination of Employment;

(12)           to determine the restrictions or
limitations on the transfer of Stock;

(13)           to determine whether an Award is to
be adjusted, modified or purchased, or is to become fully or partially
exercisable, under the Plan or the terms of an Agreement;

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(14)           to determine the permissible methods
of Award exercise and payment within the terms and conditions of the Plan and
the particular Agreement;

(15)           to adopt, amend and rescind such rules and
regulations as, in its opinion, may be advisable in the administration of this
Plan;

(16)           to appoint and compensate agents,
counsel, auditors or other specialists to aid it in the discharge of its
duties; and

(17)           to make all other determinations
which may be necessary or advisable for the administration of the Plan.

The Committee
shall have the authority to adopt, alter and repeal such administrative rules,
guidelines and practices governing the Plan as it shall, from time to time,
deem advisable, to interpret the terms and provisions of the Plan and any Award
issued under the Plan (and any Agreement) and to otherwise supervise the
administration of the Plan. The Committee’s policies and procedures may differ
with respect to Awards granted at different times and may differ with respect
to a Participant from time to time, or with respect to different Participants
at the same or different times.

3.4   Committee Determinations and Decisions.   Any
determination made by the Committee pursuant to the provisions of the Plan
shall be made in its sole discretion, and in the case of any determination
relating to an Award may be made at the time of the grant of the Award or,
unless in contravention of any express term of the Plan or an Agreement, at any
time thereafter. All decisions made by the Committee pursuant to the provisions
of the Plan shall be final and binding on all persons, including the Company
and Participants unless revised by the Committee, subject to any ratifications
or approvals of the Board that the Committee or Board may request. Any
determination shall not be subject to de novo review if challenged in court.
Neither the Committee (including any member thereof) nor the Company shall have
any liability to any Participant for any matter it determined in good faith as
being in compliance with the Code even if such determination was later proved
incorrect.

ARTICLE IV

SHARES SUBJECT TO PLAN

4.1   Number of Shares.   The maximum number
of shares of Stock which may be used for Awards under this Plan (all of which
may, in the discretion of the Company, be Incentive Stock Options) shall be
equal to 2,168,496; provided that in any case the maximum number of such shares
which may be used for Awards other than Stock Options or Stock Appreciation
Rights shall be 750,000 shares. Upon approval of the Plan by shareholders, the
2002 Plan will immediately cease to be available for use for the grant of new
incentive awards other than awards granted wholly from shares returned to the
2002 Plan by forfeiture after May 5, 2006. The shares of Stock available
under the Plan may be authorized and unissued shares, treasury shares or a
combination thereof, as the Committee shall determine.

4.2   Release of Shares.   Subject to Section 4.1,
the Committee shall have full authority to determine the number of shares of
Stock available for Awards. In its discretion the Committee may include
(without limitation), as available for distribution, (a) shares of Stock
subject to any Award that have been previously forfeited; or (b) shares
under an Award that otherwise terminates without issuance of Stock being made
to a Participant. Any shares that are available immediately prior to the
termination of the Plan, or any shares of Stock returned to the Company for any
reason subsequent to the termination of the Plan, may be transferred to a
successor plan.

4.3   Restrictions on Shares.   Stock issued upon
exercise of an Award shall be subject to the terms and conditions specified
herein and to such other terms, conditions and restrictions as the Committee in
its discretion may determine or provide in the Award Agreement. The Company
shall not be required to issue or deliver any certificates for  Stock,
cash or other property prior to (i) the completion of any registration 

 B-6
 

or qualification of such
shares under federal, state or other law, or any ruling or regulation of any
government body which the Committee determines to be necessary or advisable; (ii) the
satisfaction of any applicable withholding obligation in order for the Company
or an Affiliate to obtain a deduction or discharge its legal obligation with
respect to the exercise of an Award and (iii) satisfaction of any other terms,
conditions or restrictions specified herein. The Company may cause any
certificate (or other representation of title) for any shares of Stock to be delivered
to be properly marked with a legend or other notation reflecting the
limitations on transfer of such Stock as provided in this Plan, any stockholder
agreement then in effect, or as the Committee may otherwise require. The
Committee may require any person exercising an Award to make such
representations and furnish such information as it may consider appropriate in
connection with the issuance or delivery of the Stock in compliance with
applicable law or otherwise. Fractional shares shall not be delivered, but
shall be rounded to the next lower whole number of shares.

4.4   Shareholder Rights.   No person shall
have any rights of a shareholder as to Stock subject to an Award until, after
proper exercise of the Award or other action required, such shares shall have
been recorded on the Company’s official shareholder records as having been
issued and transferred. Upon exercise of the Award or any portion thereof, the
Company will have a reasonable period in which to issue and transfer the
shares, and a Participant will not be treated as a shareholder for any purpose
whatsoever prior to such issuance and transfer. No adjustment shall be made for
cash dividends or other rights for which the record date is prior to the date
such shares are recorded as issued and transferred in the Company’s official
shareholder records, except as provided herein or in an Agreement.

4.5   Effect of Certain Corporate Changes.   Notwithstanding
anything to the contrary herein, in the event of any share dividend, share
split, combination or exchange of shares, recapitalization or other change in
the capital structure of the Company, corporate separation or division of the
Company (including, but not limited to, a split-up, spin-off, split-off
or distribution to Company shareholders other than a normal cash dividend),
reorganization, rights offering, a partial or complete liquidation, or any
other corporate transaction, Company securities offering or event involving the
Company and having an effect similar to any of the foregoing, then the
Committee may make appropriate adjustments or substitutions as described below
in this Section and in compliance with the Code. The adjustments or
substitutions may relate to the number of shares of  Stock available for
Awards under the Plan, the number of shares of  Stock covered by
outstanding Awards, the Exercise Price per share of outstanding Awards, and any
other characteristics or terms of the Awards as the Committee may deem
necessary or appropriate to reflect equitably the effects of such changes to
the Participants; provided, however, that to the extent that Code Section 409A
shall apply to an Award, any such adjustments or substitutions shall only be
made to the extent that, in the Committee’s good faith determination, they
comply with the requirements of Code Section 409A to avoid being subject
to taxation under Code Section 409A(a)(1). Notwithstanding the foregoing,
any fractional shares resulting from such adjustment shall be eliminated by
rounding down to the nearest whole share.

ARTICLE V

ELIGIBILITY

5.1   Eligibility.   Except
as herein provided, the persons who shall be eligible to participate in the
Plan and be granted Awards shall be those persons who are employees of, or
consultants or advisors to, the Company or any Affiliate, or non-employee
members of the Board of Directors. Of those persons described in the preceding
sentence, the Committee may, from time to time, select persons to be granted
Awards and shall determine the terms and conditions with respect thereto. In
making any such selection and in determining the form of the Award, the
Committee shall give consideration to such factors deemed appropriate by the
Committee.

 B-7

ARTICLE VI

STOCK OPTIONS

6.1   General.   The
Committee shall have authority to grant Options under the Plan at any time or
from time to time. The Committee shall consider the potential impact of Code Section 409A
on each grant of Options and, if necessary, shall make the terms and conditions
of the Options, in its good faith determination, comply with the requirements
of Code Section 409A to avoid being subject to taxation under Code Section 409A(a)(1).
An Option shall entitle the Participant to receive Stock upon exercise of
such Option, subject to the Participant’s satisfaction in full of any
conditions, restrictions or limitations imposed in accordance with the Plan or
an Agreement (the terms and provisions of which may differ from other
Agreements) including, without limitation, payment of the Exercise Price.

6.2   Grant.   The
grant of an Option shall occur as of the Grant Date determined by the
Committee, provided that the Grant Date shall not be earlier than the date upon
which the Committee acts to grant the Option. Options may be granted alone or
in connection with other Awards. An Award of Options shall be evidenced by, and
subject to the terms of, an Agreement. Only a person who is a common-law
employee of the Company, any “parent corporation” of the Company, or a “subsidiary
corporation” of the Company (each term as defined in Section 424 of the
Code) on the date of grant shall be eligible to be granted an Incentive Stock
Option. To the extent that any Option is not designated as an Incentive Stock
Option or even if so designated does not qualify as an Incentive Stock Option,
it shall constitute a Non-Qualified Stock Option.

6.3   Terms and Conditions.   Options
shall be subject to such terms and conditions as shall be determined by the
Committee, including and subject to the following:

(1)    Exercise Price.   The Exercise Price per share shall not
be less than the Fair Market Value per share on the Grant Date. If an Option
which is intended to qualify as an Incentive Stock Option is granted to an
individual (a “10% Owner”) who owns or who is
deemed to own shares possessing more than ten percent (10%) of the combined
voting power of all classes of shares of the Company, a parent corporation or
any subsidiary corporation (each term as defined in Section 6.2),
the Exercise Price per share shall not be less than one hundred ten percent
(110%) of the Fair Market Value per share on the Grant Date.

(2)    Option Period.   The Option Period of each Option shall
be fixed by the Committee. In the case of an Incentive Stock Option granted to
a 10% Owner, the Option Period shall not exceed ten (10) years from the
date the Option is granted. No Option which is intended to be an Incentive
Stock Option shall be granted more than ten (10) years from the date the
Plan is adopted by the Company or the date the Plan is approved by the
shareholders of the Company, whichever is earlier.

(3)    Exercisability.   Subject to Section 11.1
and Section 6.4, an Option shall be
exercisable in whole or in such installments and at such times, as established
by the Committee in an Agreement. The Committee may provide in an Agreement for
an accelerated exercise of all or part of an Option upon such events or
standards that it may determine, including one or more Performance Measures. In
addition, the Committee may at any time accelerate the exercisability of all or
part of any Option. If an Option is designated as an Incentive Stock Option,
the aggregate Fair Market Value (determined at the date of grant of the Option)
of the Stock as to which such Incentive Stock Option which is exercisable for
the first time during any calendar year (under the Plan or any other plan of
the Company or any parent corporation or subsidiary corporation) shall not
exceed $100,000. Except as otherwise provided in Article XI in connection
with acceleration events, or certain occurrences of termination, no Award
granted under this Plan to an officer or director of the Company may be
exercised, and no restrictions relating thereto may lapse, within six months of
the date of such grant if 

 B-8
 

(i) the requirements
of Exchange Act Rule 16b-3(d)(1) were not satisfied with
respect to the issuance of such Award and (ii) the Committee has not
otherwise waived such limitation.

(4)    Method of Exercise.   Subject to the provisions of this Article VI and the Agreement, a Participant may
exercise Options, in whole or in part, during the Option Period by giving
written notice of exercise on a form provided by the Committee to the Company
specifying the number of shares of Stock subject to the Option to be purchased.
Such notice shall be accompanied by payment in full of the purchase price by
cash or certified check or such other form of payment as the Company may
accept. If permitted in the applicable Agreement, payment in full or in part
may also be made by (i) delivering Stock already owned by the
Participant (for any minimum period required by the Committee) having a total
Fair Market Value on the date of such delivery equal to the Exercise Price; (ii) the
delivery of cash by a broker-dealer as a “cashless” exercise, provided
such method of payment may not be used by an executive officer of the Company
or a member of the Board to the extent such payment method would violate Rule 16b-3
or the Exchange Act; (iii) withholding by the Company of Stock
subject to the Option having a total Fair Market Value as of the date of
delivery equal to the Exercise Price; or (iv) any combination of the
foregoing.

(5)    Conditions for Issuance of Shares.   No shares of Stock
shall be issued until full payment therefore has been made. A Participant shall
have all of the rights of a shareholder of the Company holding the class of
shares that is subject to such Option (including, if applicable, the right to vote
the shares and the right to receive dividends) when the Participant has given
written notice of exercise, has paid in full for such shares, and such shares
have been recorded on the Company’s official shareholder records as having been
issued and transferred.

(6)    Non-transferability of Options.   Unless otherwise
specifically provided in an Agreement, no Option shall be sold, assigned,
margined, transferred, encumbered, conveyed, gifted, alienated, hypothecated,
pledged, or otherwise disposed of, other than by will or by the laws of descent
and distribution, and all Options shall be exercisable during the Participant’s
lifetime only by the Participant; provided, however, under no circumstances may
a Participant assign, transfer, convey or otherwise dispose of an Option for
consideration unless pursuant to a Domestic Relations Order.

6.4   Termination of Employment.   Except
as otherwise provided by the Committee in an Award Agreement, any portion of
the Option that was not vested and exercisable on the date of Termination of
Employment shall expire and be forfeited on such date, and any portion of the
Option that was vested and exercisable on date of Termination of Employment
shall also expire and be forfeited on such date; provided that if the
Termination of Employment was other than for Cause, the portion of the Option
that is vested as of the date of Termination of Employment shall expire and be
forfeited at midnight ninety (90) days from the date of such termination.

ARTICLE VII

STOCK APPRECIATION RIGHTS

7.1   General.   The
Committee shall have authority to grant Stock Appreciation Rights under the
Plan at any time or from time to time. Stock Appreciation Rights may be awarded
alone or in tandem with other Awards granted under the Plan. The Committee
shall consider the potential impact of Code Section 409A on each grant of
Stock Appreciation Rights and, if determined to be necessary, shall make the
terms of conditions of the Stock Appreciation Rights, in its good faith
determination, comply with the requirements of Code Section 409A to avoid
being subject to taxation under Code Section 409A(a)(1). Subject to the
Participant’s satisfaction in full of any conditions, restrictions or
limitations imposed in accordance with the Plan or an Agreement, a Stock
Appreciation Right shall entitle the Participant to surrender to the Company
the Stock Appreciation Right and to receive in Stock the number of shares
described in Section 7.3(2).

 B-9
 

7.2   Grant.   The
grant of a Stock Appreciation Right shall occur as of the Grant Date determined
by the Committee. A Stock Appreciation Right entitles a Participant to receive
Stock as described in Section 7.3(2).
An Award of Stock Appreciation Rights shall be evidenced by, and subject to the
terms of an Agreement, which shall become effective upon execution by the
Participant.

7.3   Terms and Conditions.   Stock
Appreciation Rights shall be subject to such terms and conditions as shall be
determined by the Committee and set forth in an Agreement, including (but not
limited to) the following:

(1)    Period and Exercise.   The term of a Stock Appreciation
Right shall be established by the Committee. A Stock Appreciation Right shall
be for such period and, subject to Section 11.1
and Section 7.3(4), shall be
exercisable in whole or in installments and at such times as established by the
Committee in an Agreement. The Committee may provide in an Agreement for an
accelerated exercise of all or part of a Stock Appreciation Right upon such
events or standards that it may determine, including one or more Performance
Measures. In addition, the Committee may at any time accelerate the
exercisability of all or part of any Stock Appreciation Right. Stock
Appreciation Rights shall be exercised by the Participant’s giving written
notice of exercise, on a form provided by the Committee, to the Company specifying
the portion of the Stock Appreciation Right to be exercised.

(2)    Delivery of Stock.   Upon the exercise of a Stock
Appreciation Right, a Participant shall receive a number of shares of Stock
equal in value to the excess of the Fair Market Value per share of Stock over
the Exercise Price per share of Stock specified in the related Agreement,
multiplied by the number of shares in respect of which the Stock Appreciation
Right is exercised. The Exercise Price per share shall not be less than the
Fair Market Value per share on the Grant Date. The aggregate Fair Market Value
per share of Stock shall be determined as of the date of exercise of such Stock
Appreciation Right.

(3)    Non-transferability of Stock Appreciation Rights.   Except
as specifically provided in the Plan or in an Agreement, no Stock Appreciation
Rights shall be sold, assigned, margined, transferred, encumbered, conveyed,
gifted, alienated, hypothecated, pledged or otherwise disposed of, other than
by will or the laws of descent and distribution, and all Stock Appreciation
Rights shall be exercisable during the Participant’s lifetime only by the
Participant; provided, however, under no circumstances may a Participant assign
or transfer a Stock Appreciation Right for consideration unless pursuant to a
Domestic Relations Order.

(4)    Termination of Employment.   A Stock Appreciation Right
shall be forfeited or terminated at such time as an Option would be forfeited
or terminated under the Plan, unless otherwise specifically provided in an
Agreement.

ARTICLE VIII

RESTRICTED STOCK

8.1   General.   The
Committee shall have authority to grant Restricted Stock under the Plan at any
time or from time to time. The Committee shall consider the potential impact of
Code Section 409A on each grant of Restricted Stock and, if determined to
be necessary, shall make the terms and conditions of the Restricted Stock, in
its good faith determination, comply with the requirements of Code Section 409A
to avoid being subject to taxation under Code Section 409A(a)(1). The
Committee may also require the recipient of the grant to make an election under
Section 83(b) of the Code if the restricted stock so granted is
subject to transfer restrictions or a substantial risk of forfeiture. The
Committee shall determine the number of shares of Restricted Stock to be
awarded to any Participant, the time or times within which such Awards may be
subject to forfeiture, and any other terms and conditions of the Awards. Each
Award 

 B-10
 

shall be confirmed by,
and be subject to the terms of, an Agreement which contains the applicable
terms and conditions of the Award, including the rate or times provided by the
Committee for the lapse of any forfeiture restrictions or other conditions
regarding the Award. The Committee may provide in an Agreement for an
accelerated lapse of any such restrictions upon such events or standards that
it may determine, including one or more Performance Measures. In addition, the
Committee may at any time accelerate the lapse of any such restrictions with
respect to all or part of any Restricted Stock. Each Award of Restricted Stock shall
become effective upon execution by the Participant of an Agreement.

8.2   Grant, Awards and
Certificates.   The grant of an Award of Restricted Stock shall
occur as of the Grant Date determined by the Committee. Restricted Stock may be
awarded either alone or in addition to other Awards granted under the Plan.
Notwithstanding the limitations on issuance of Stock otherwise provided in the
Plan, each Participant receiving an Award of Restricted Stock shall be issued a
certificate (or other representation of title) in respect of such Restricted
Stock. Such certificate shall be registered in the name of such Participant and
shall bear an appropriate legend referring to the terms, conditions, and
restrictions applicable to such Award as determined by the Committee and any
restrictions the Stock may be subject to, including any shareholder agreement
then in effect. The Committee may require that the certificates evidencing such
shares be held in custody by the Company until the restrictions thereon shall
have lapsed and that, as a condition of any Award of Restricted Stock, the
Participant shall have delivered a share power, endorsed in blank, relating to
the Stock covered by such Award.

8.3   Terms and Conditions.   Restricted
Stock shall be subject to such terms and conditions as shall be determined by
the Committee, including the following:

(1)    Rights.   Except as provided in Section 8.3(3) and
notwithstanding Section 4.4, the Participant
shall have, with respect to the Restricted Stock, all of the rights of a
shareholder of the Company holding the class of Stock that is the subject of
the Restricted Stock, including, if applicable, the right to vote the shares
and the right to receive any dividends. If any dividends or other distributions
are paid in shares of Stock, all such shares shall be subject to the same
restrictions on transferability as the shares of Restricted Stock with respect
to which they were paid.

(2)    Criteria.   As described in Section 8.1
above, the Committee may provide in an Agreement for the lapse of restrictions
in installments and may accelerate the vesting of all or any part of any Award
and waive the restrictions for all or any part of such Award; such provisions
of an Agreement or Committee action may be based on service, performance by the
Participant or by the Company or the Affiliate, including any division or
department for which the Participant is employed or such other factors or
criteria as the Committee may determine.

(3)    Limitations on Transferability.   Subject to the
provisions of the Plan and the Agreement, during a period set by the Committee,
commencing with the date of such Award (the “Restriction
Period”), the Participant shall not be permitted to sell, assign,
margin, transfer, encumber, convey, gift, alienate, hypothecate, pledge or
otherwise dispose of Restricted Stock; provided, however, under no
circumstances may a Participant assign, transfer, convey or otherwise dispose
of Restricted Stock for consideration unless pursuant to a Domestic Relations
Order.

(4)    Termination of Employment.   Unless otherwise provided
in an Agreement or determined by the Committee, if the Participant incurs a
Termination of Employment all shares of Restricted Stock still subject to
restriction shall be forfeited by the Participant, except the Committee shall have
the discretion to waive in whole or in part any or all remaining restrictions
with respect to any or all of such Participant’s Restricted Stock.

 B-11
 

ARTICLE IX

DEFERRED STOCK

9.1   General.   The
Committee shall have authority to grant an Award of Deferred Stock under the
Plan at any time or from time to time. Deferred Stock may be awarded either
alone or in addition to other Awards granted under the Plan. The Committee may
denominate a Deferred Stock Award in either shares or units. The Committee
shall consider the impact of Code Section 409A on each grant of Deferred
Stock and, if determined to be necessary, shall make the terms and conditions
of the Deferred Stock, in its good faith determination, comply with the
requirements of Code 409A to avoid being subject to taxation under Code Section 409A(a)(1). The
Committee shall determine the number of shares of Deferred Stock to be awarded
to any Participant, the duration of the period (the “Deferral
Period”) prior to which the Common Stock will be delivered, and the
conditions under which receipt of the Stock will be deferred and any other
terms and conditions of the Awards. Each Deferred Stock Award shall be
evidenced by, and subject to the terms of, an Agreement, which will become
effective upon execution by the Participant.

9.2   Terms and Conditions.   Deferred
Stock Awards shall be subject to such terms and conditions as shall be
determined by the Committee, including the following:

(1)    Rights.   Any rights, other than any rights explicitly
set forth herein, with respect to Deferred Stock shall be provided for in an
Agreement.

(2)    Criteria.   Based on service, performance by the
Participant or by the Company or the Affiliate, including any division or
department for which the Participant is employed, or such other factors or
criteria as the Committee may determine, the Committee may provide for the
lapse of deferral limitations in installments and may accelerate the vesting of
all or any part of any Award and waive the deferral limitations for all or any
part of such Award.

(3)    Limitations on Transferability.   Subject to the
provisions of the Plan and the Agreement, Deferred Stock Awards may not be
sold, assigned, margined, transferred, encumbered, conveyed, gifted, alienated,
hypothecated, pledged, or otherwise disposed of during the Deferral Period;
provided, however, under no circumstances may a Participant assign, transfer,
convey or otherwise dispose of Deferred Stock Award for consideration unless
pursuant to a Domestic Relations Order. Subject to the provisions of an
Agreement, at the expiration of the Deferral Period, the Committee shall
deliver Stock to the Participant pursuant to the Deferred Stock Award.

(4)    Termination of Employment.   Unless otherwise provided
in an Agreement or determined by the Committee, if the Participant incurs a
Termination of Employment the rights to the shares still covered by the Award
shall be forfeited by the Participant, except the Committee shall have the discretion
to waive in whole or in part any or all remaining deferral limitations with
respect to any or all of such Participant’s Deferred Stock.

(5)    Delivery.   Subject to the provisions of an Agreement,
at the expiration of the Deferral Period, the Committee shall deliver Stock to
the Participant pursuant to the Deferred Stock Award.

(6)    Election.   A Participant may elect to further defer
receipt of the Deferred Stock payable under an Award (or an installment of an
Award) for a specified time (or pursuant to a fixed schedule) or until the
occurrence of a permissible distribution event under Code Section 409A,
subject to such terms and conditions determined by the Committee. Any such
election must be made no later than the time provided by Section 409A(a)(4) of
the Code, as determined by the Committee.

 B-12
 

ARTICLE X

PERFORMANCE AWARDS

10.1   General.   The Committee shall have authority to grant
Performance Awards under the Plan at any time or from time to time. The
Committee shall consider the impact of Code Section 409A on each grant of
a Performance Award and, if determined to be necessary, shall make the terms
and conditions of the Performance Awards, in its good faith determination,
comply with the requirements of Code Section 409A to avoid being subject
to taxation under Code Section 409A(a)(1). A Performance Unit and a
Performance Share each consist of the right to receive shares of Stock or cash,
as provided in the particular Award Agreement, upon achievement of certain
Performance Goals and may be awarded either alone or in addition to other
Awards granted under the Plan. Performance Units shall be denominated in units
of value (including dollar value of shares of Stock) and Performance Shares
shall be denominated in a number of shares of Stock.

Subject to the terms of
the Plan, the Committee shall have complete discretion to determine the number
of Performance Units and Performance Shares, if any, granted to each
Participant. Each Performance Award shall be evidenced by, and be subject to
the terms of, an Agreement which will become effective upon execution by the
Participant.

10.2   Earning Performance Awards.   After the applicable
Performance Period shall have ended, the Committee shall determine the extent
to which the established Performance Goals have been achieved.

10.3   Termination of Employment.   Unless otherwise
specifically provided in an Agreement or determined by the Committee, in the
event that a Participant’s incurs a Termination of Employment, all Performance
Awards shall be forfeited by the Participant to the Company. Any distribution
of earned Performance Awards authorized by an Agreement or determined by the
Committee may be made at the same time payments are made to Participants who
did not incur a Termination of Employment during the applicable Performance
Period.

10.4   Nontransferability.   Unless otherwise specifically
provided in an Agreement, Performance Awards may not be sold, assigned,
margined, transferred, encumbered, conveyed, gifted, alienated, hypothecated,
pledged, or otherwise disposed of, other than by will or by the laws of descent
and distribution; provided, however, under no circumstances may a Participant
assign, transfer, convey or otherwise dispose of a Performance Award for
consideration unless pursuant to a Domestic Relations Order.

ARTICLE XI

CHANGE IN CONTROL PROVISIONS

11.1   Impact of Event.   Notwithstanding
any other provision of the Plan to the contrary, other than Section 11.2, and unless otherwise specifically
provided in an Agreement, in the event of a company sale or a registered public
offering of equity securities, the Committee may provide, in its discretion,
that (i) the Stock Options, Stock Appreciation Rights, Restricted Stock
and Deferred Stock shall immediately vest and any Performance Goal or other
condition with respect to any Performance Shares or Performance Units shall be
deemed satisfied for such Participants who are employed by the Company at the
time of such event or (ii) the Committee may also, in its discretion,
determine that any Stock Option, Stock Appreciation Right or Restricted Stock
shall terminate or be cancelled if not exercised as of the date of such event.

11.2   Additional Discretion.   The
Committee shall have full discretion, notwithstanding anything herein or in an
Agreement to the contrary, with respect to an outstanding Award upon a company
sale to provide that the securities of another entity be substituted hereunder
for the Stock and to make equitable adjustment with respect thereto.

 B-13

ARTICLE XII

PROVISIONS APPLICABLE TO SHARES ACQUIRED UNDER THIS PLAN

12.1   No Company Obligation.   Except
to the extent specifically required by applicable securities laws, none of the
Company, an Affiliate or the Committee shall have any duty or obligation to
affirmatively disclose material information to a record or beneficial holder of
Stock or an Award, and such holder shall have no right to be advised of any
material information regarding the Company or any Affiliate at any time prior
to, upon, or in connection with receipt or the exercise or distribution of an
Award. The Company makes no representation or warranty as to the future value
of the Stock issued or acquired in accordance with the provisions of the Plan.

ARTICLE XIII

MISCELLANEOUS

13.1   Amendments and Termination.   The
Board may amend, alter, or discontinue the Plan at any time, but no amendment,
alteration or discontinuation shall be made which would materially impair the
rights of a Participant under an Award theretofore granted without the
Participant’s consent. Notwithstanding the immediately preceding sentence, an
amendment may be made without a Participant’s consent to (a) cause the
Plan or an Award to comply with applicable law (including, but not limited to,
any changes needed to avoid taxation of an Award as a “nonqualified deferred
compensation plan” under Code Section 409A or Code Section 280G) or (b) permit
the Company or an Affiliate a tax deduction under applicable law including,
without limitation, Section 162(m) of the Code. The Committee may
amend, alter or discontinue the terms of any Award theretofore granted,
prospectively or retroactively, on the same conditions and limitations (and
exceptions to limitations) as apply to the Board, and further subject to any
approval or limitations the Board may impose. Notwithstanding the foregoing,
any amendments to the Plan shall require shareholder approval to the extent
required by Federal or state law or any regulations or rules promulgated
thereunder or the rules of the national securities exchange or market on
which shares of Stock are listed.

13.2   Unfunded Status of Plan.   It
is intended that the Plan be an “unfunded” plan for incentive compensation. The
Company may create trusts or other arrangements to meet the obligations created
under the Plan to deliver Stock or make payments; provided, however, that the
existence of such trusts or other arrangements is consistent with the “unfunded”
status of the Plan and all property held thereunder and income thereon shall
remain solely the property and rights of the Company (without being restricted
to satisfying the obligations created under the Plan) and shall be subject to
the claims of the Company’s general creditors. The Company’s obligations
created under the Plan shall constitute a general, unsecured obligation,
payable solely out of its general assets.

13.3   Listing, Registration and
Compliance with Laws and Regulations.   All Awards made under
this Plan shall be subject to the requirement that if at any time the Committee
shall determine, in its discretion, that the listing, registration or
qualification of the Stock subject to such Award upon any securities exchange
or under any state or federal securities or other law or regulation, or the
consent or approval of any governmental regulatory body, is necessary or
desirable as a condition to or in connection with the granting of the Awards or
the issuance or purchase of shares thereunder, no Awards may be granted or
exercised and no restrictions of Restricted Stock or Deferred Stock be lifted,
in whole or in part, unless such listing, registration, qualification, consent
or approval shall have been effected or obtained free of any conditions not
acceptable to the Committee. The holders of such Awards shall supply the
Company with such certificates, representations and information as the Company
shall request and shall otherwise cooperate with the Company in obtaining such
listing, registration, qualification, consent or approval. In the case of
officers and other Persons subject to Section 16(b) of the Exchange
Act, the Committee may at any time impose any limitations upon the exercise of
an Option, Stock Appreciation Right or Restricted Stock or the lifting of
restrictions on an Award of Deferred Stock or a Performance Award that, in the 

 B-14
 

Committee’s discretion,
are necessary or desirable in order to comply with such Section 16(b) and
the rules and regulations thereunder. If the Company, as part of an
offering of securities or otherwise, finds it desirable because of federal or
state regulatory requirements to reduce the period during which any Options,
Stock Appreciation Rights or Restricted Stock may be exercised, the Committee,
may, in its discretion and without the Participant’s consent, so reduce such
period on not less than 15 days written notice to the holders thereof.

13.4   Provisions Relating to
Internal Revenue Code Section 162(m).   To the extent that Section
162(m) of the Code applies with respect to Awards to Covered Employees under
the Plan, the Plan shall be administered, and the provisions of the Plan shall
be interpreted, in a manner consistent with Code Section 162(m). If any
provision of the Plan or any Agreement relating to such an Award does not
comply or is inconsistent with the requirements of Code Section 162(m),
such provision shall be construed or deemed amended to the extent necessary to
conform to such applicable requirements. In addition, the following provisions
shall apply to the Plan or an Award to the extent necessary to obtain a tax
deduction for the Company or an Affiliate:

(1)    Determination of Awards.   Not later than the date
required or permitted for “qualified performance-based compensation”
under Code Section 162(m), the Committee shall determine the Participants
who are Covered Employees who will receive Awards that are intended as
qualified performance-based compensation and the amount or method for
determining the amount of such compensation.

(2)    Limitations on Awards.   During any one calendar year
period, the maximum number of shares of Stock for which Options and Stock
Appreciation Rights, in the aggregate, may be granted to any Covered Employee
shall not exceed 750,000 shares. For Performance Awards that are intended to
constitute “performance-based compensation” (as that term is used in Code Section 162(m)),
no more than $1,000,000 (based upon fair market value, if applicable, on the
date of grant) may be subject to such Awards granted to any Covered Employee
during any three-consecutive calendar year period. Further, for any
Restricted Stock Awards that are intended to constitute performance-based
compensation, no more than $1,000,000 (based upon fair market value, if
applicable, on the date of grant) may be subject to such Awards granted to any
Covered Employee during any three-consecutive calendar year period. The
limitations on Awards under this Section are subject to adjustment as
provided in Section 4.5 to the extent that
needed to obtain tax deductibility under Code Section 162(m).

(3)    Earning Performance Awards.   Subject to the provisions
of Section 13.4(4) below, payment
with respect to Performance Awards for Covered Employees shall be a direct
function of the extent to which the Company’s Performance Goals have been
achieved. A Performance Award to a Participant who is a Covered Employee shall
(unless the Committee determines otherwise) provide that in the event of the
Participant’s Termination of Employment prior to the end of the Performance
Period for any reason, such Award will be payable only (a) if the applicable
Performance Goals are achieved and (b) to the extent, if any, as the
Committee shall determine.

(4)    Other Section 162(m) Provisions.   In the
manner required by Section 162(m) of the Code, the Committee shall,
promptly after the date on which the necessary financial and other information
for a particular Performance Period becomes available, certify the extent to
which Performance Goals have been achieved with respect to any Performance
Award or Restricted Stock Award intended to qualify as performance-based
compensation under Section 162(m) of the Code. In addition, the
Committee may, in its discretion, reduce or eliminate the amount of any
Performance Award payable to any Participant, based on such factors as the
Committee may deem relevant, but the Committee may not increase the amount of
any Performance Award payable to any Participant above the amount 

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established in accordance
with the relevant Performance Goals with respect to any Performance Award
intended to qualify as performance-based compensation.

13.5   Misconduct of a
Participant.   Notwithstanding anything to the contrary in the
Plan, the Committee, in its sole discretion, may establish procedures, at or
before the time that an Award is granted (or, with the consent of the
Participant, after such time), in the applicable Award Agreement or in a
separate agreement, providing for the forfeiture or cancellation of such Award
(whether vested or unvested), or the disgorgement of gains from the exercise,
vesting or settlement of the Award, in each case to be applied if the
Participant incurs a Termination of Employment for Cause.

13.6   No Additional Obligation.   Nothing
contained in the Plan shall prevent the Company or an Affiliate from adopting,
other or additional compensation or benefit arrangements for its employees.

13.7   Withholding.   No
later than the date as of which an amount first becomes includible in the gross
income of the Participant for federal income tax purposes with respect to any
Award, the Participant shall pay to the Company (or other entity identified by
the Committee), or make arrangements satisfactory to the Company or other
entity identified by the Committee regarding the payment of, any federal,
state, or local taxes of any kind (including any employment taxes) required by
law to be withheld with respect to such income. The obligations of the Company
under the Plan shall be conditional on such payment or arrangements, and the
Company and its Affiliates shall, to the extent permitted by law, have the
right to deduct any such taxes from any payment otherwise due to the
Participant. Subject to approval by the Committee, a Participant may elect to
have such tax withholding obligation satisfied, in whole or in part, by (i) authorizing
the Company to withhold from shares of Stock to be issued pursuant to any Award
a number of shares with an aggregate Fair Market Value (as of the date the
withholding is effected) that would satisfy the required statutory minimum (but
no more than such required minimum) with respect to the Company’s withholding
obligation, or (ii) transferring to the Company shares of Stock owned by
the Participant with an aggregate Fair Market Value (as of the date the
withholding is effected) that would satisfy the required statutory minimum (but
no more than such required minimum) with respect to the Company’s withholding
obligation.

13.8   Controlling Law.   The
Plan and all Awards made and actions taken thereunder shall be governed by and
construed in accordance with the laws of the state of Delaware (other than its
law respecting choice of law). The Plan shall be construed to comply with all
applicable law and to avoid liability to the Company, an Affiliate or a
Participant. In the event of litigation arising in connection with actions
under the Plan, the parties to such litigation shall submit to the jurisdiction
of courts located in New York County, New York, or to the federal district
court that encompasses said county.

13.9   Offset.   Any
amounts owed to the Company or an Affiliate by the Participant of whatever
nature may be offset by the Company from the value of any Award to be
transferred to the Participant, and Stock, cash or other thing of value under
this Plan or an Agreement may be held by the Company and not transferred to
such Participant unless and until all disputes between the Company and the
Participant have been fully and finally resolved and the Participant has waived
all claims to such against the Company or an Affiliate.

13.10   No Rights with Respect to
Continuance of Employment.   Nothing contained herein shall be
deemed to alter the relationship between the Company or an Affiliate and a
Participant, or the contractual relationship between a Participant and the
Company or an Affiliate if there is a written contract regarding such
relationship. Nothing contained herein shall be construed to constitute a
contract of employment between the Company or an Affiliate and a Participant.
The Company or an Affiliate and each of the Participants continue to have the
right to terminate the employment or service relationship at any time for any
reason, except as provided in a written contract. The Company or an Affiliate
shall have no obligation to retain the Participant in its employ or service as
a result of this Plan. There shall be no inference as to the length of
employment or service hereby, and the Company or an Affiliate reserves the same
rights to 

 B-16
 

terminate the Participant’s
employment or service as existed prior to the individual becoming a Participant
in this Plan.

13.11   Limits on Repricing and
Regranting of Awards.   Notwithstanding anything else contained
herein except Sections 4.5, 11.2 and 13.12 hereof,
unless approved by the Company’s shareholders; in no event may the Exercise
Price per share of Stock covered by an Option, or the Exercise Price of a Stock
Appreciation Right, be reduced, directly or indirectly, through the technique
commonly known as “repricing” or through the cancellation and regrant of such
Award; and no outstanding Award may be substituted for another type of Award.

13.12   Awards in Substitution for
Awards Granted by Other Corporations.   Awards may be granted
under the Plan from time to time in substitution for awards held by employees,
directors or service providers of other corporations who are about to become
officers or employees of the Company or an Affiliate as the result of a merger
or consolidation of the employing corporation with the Company or an Affiliate,
or the acquisition by the Company or an Affiliate of the assets of the
employing corporation, or the acquisition by the Company or Affiliate of the
share of the employing corporation, as the result of which it becomes an
Affiliate. The terms and conditions of the Awards so granted may vary from the
terms and conditions set forth in this Plan at the time of such grant as the
Committee may deem appropriate to conform, in whole or in part, to the
provisions of the awards in substitution for which they are granted and to
ensure that the requirements imposed under Code Sections 409A and 424 are met.

13.13   Delivery of Stock
Certificates.   To the extent the Company uses certificates to
represent shares of Stock, certificates to be delivered to Participants under
this Plan shall be deemed delivered for all purposes when the Company or a
stock transfer agent of the Company shall have mailed such certificates in the
United States mail, addressed to the Participant, at the Participant’s last
known address on file with the Company. Any reference in this Section or
elsewhere in the Plan or an Agreement to actual stock certificates and/or the
delivery of actual stock certificates shall be deemed satisfied by the
electronic record-keeping and electronic delivery of shares of Stock or
other mechanism then utilized by the Company and its agents for reflecting
ownership of such shares.

13.14   Indemnification.   To
the maximum extent permitted under the Company’s Restated Articles of
Incorporation and by-laws, each person who is or shall have been a member
of the Committee, or of the Board, shall be indemnified and held harmless by
the Company against and from (a) any loss, cost, liability or expense
(including attorneys’ fees) that may be imposed upon or reasonably incurred by
him or her in connection with or resulting from any claim, action, suit or
proceeding to which he or she may be a party or in which he or she may be
involved by reason of any action taken or failure to act under this Plan or any
Award Agreement, and (b) from any and all amounts paid by him or her in
settlement thereof, with the Company’s prior written approval, or paid by him
or her in satisfaction of any judgment in any such claim, action, suit or
proceeding against him or her; provided, however, that he or she shall give the
Company an opportunity, at its own expense, to handle and defend the same
before he or she undertakes to handle and defend it on his or her own behalf.
The foregoing right of indemnification shall not be exclusive of any other
rights of indemnification to which such persons may be entitled under the
Company’s Restated Articles of Incorporation or by-laws, by contract, as
a matter of law or otherwise, or under any power that the Company may have to
indemnify them or hold them harmless.

13.15   Severability.   If
any provision of this Plan shall for any reason be held to be invalid or
unenforceable, such invalidity or unenforceability shall not effect any other
provision hereby, and this Plan shall be construed as if such invalid or
unenforceable provision were omitted.

13.16   Successors and Assigns.   This
Plan shall inure to the benefit of and be binding upon each successor and
assign of the Company. All obligations imposed upon a Participant, and all
rights granted to the Company hereunder, shall be binding upon the Participant’s
heirs, legal representatives and successors.

 B-17
 

13.17   Entire Agreement.   This
Plan and the Agreements constitute the entire agreement with respect to the
subject matter hereof and thereof, provided that in the event of any
inconsistency between the Plan and the Agreement, the terms and conditions of
this Plan shall control.

13.18   Term.   No
Award shall be granted under the Plan after the tenth anniversary of the
Effective Date.

13.19   Gender and Number.   Except
where otherwise indicated by the context, any masculine term used herein also
shall include the feminine, the plural shall include the singular, and the
singular shall include the plural.

13.20   Headings.   The headings contained in this Plan are for
reference purposes only and shall not affect the meaning or interpretation of
this Plan.

 

 B-18

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