Document:

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EXHIBIT 10.1 -- Amendment to Employment Agreement

                                  AMENDMENT TO
                              EMPLOYMENT AGREEMENT

         THIS AMENDMENT TO EMPLOYMENT AGREEMENT (the "Agreement"), dated
effective as of June 17, 2005, is made and entered into to amend the Employment
Agreement dated effective June 30, 2003 (the "Employment Agreement"), by and
between The Peoples Publishing Group, Inc., a Delaware corporation (the
"Company"), and James J. Peoples, an individual resident of the State of New
Jersey (the "Executive").

                                   WITNESSETH:

         WHEREAS, the Company and the Executive mutually desire to amend the
Employment Agreement as set forth in this Agreement.

         NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements herein contained, the Company and the Executive agree as follows:

         1.       Amendment. The Employment Agreement shall be amended as
provided in this Agreement. Capitalized terms not otherwise defined herein shall
have the meanings ascribed to them in the Employment Agreement.

         2.       Compensation. The table at the end of Section 4.01 of the
Employment Agreement which specifies annual salary in the event the Executive is
engaged in the "AP Senior Advisor" role shall be amended such that for the
contract year ending July 31, 2006, the salary shall be $100,000.

         3.       Incentive Compensation. The table in Section 4.02 of the
Employment Agreement shall be amended to provide that for the calendar year
2005, the Executive's incentive shall be equal to 30% of the amount paid to the
CEO.

         4.       Miscellaneous.

                  4.01 Governing Law. This Agreement is made under and shall be
governed by and construed in accordance with the laws of the State of New
Jersey, without regard to New Jersey's conflicts of law rules.

                  4.02 Prior Agreements. This Agreement and the Employment
Agreement contain the entire agreement of the parties relating to the subject
matter hereof and supersede all prior agreements and understandings with respect
to such subject matter, and the parties hereto have made no agreements,
representations or warranties relating to the subject matter of this Agreement
which are not set forth herein.

                  4.03 Amendments. No amendment or modification of this
Agreement shall be deemed effective unless made in writing signed and delivered
by the parties hereto.

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                  4.04 Assignment. This Agreement shall not be assignable, in
whole or in part, by either party without the written consent of the other
party.

                  4.05 No Waiver. No term or condition of this Agreement shall
be deemed to have been waived, nor shall there be any estoppel to enforce any
provisions of this Agreement, except by a statement in writing signed by the
party against whom enforcement of the waiver or estoppel is sought. Any written
waiver shall not be deemed a continuing waiver unless specifically stated, shall
operate only as to the specific term or condition waive and shall not constitute
a waiver of such term of condition for the future or as to any act other than
that specifically waived.

                  4.06 Counterparts. This Agreement may be signed in
counterparts, each of which, when executed and delivered, shall constitute one
and the same instrument.

         IN WITNESS WHEREOF, the parties have hereunto set their hands,
intending to be legally bound, as of the date first above written.

                                         THE PEOPLES PUBLISHING GROUP, INC.

                                         By:      /s/ BRIAN T. BECKWITH
                                             -----------------------------------
                                             Brian T. Beckwith
                                             Its:  President and Chief Executive
                                                   Officer

                                             /s/ JAMES J. PEOPLES
                                             -----------------------------------
                                             James J. Peoples

ACCEPTED AND AGREED TO
this 17th day of June, 2005.

PEOPLES EDUCATIONAL HOLDINGS, INC.

By:  /s/ BRIAN T. BECKWITH
   ----------------------------------
   Brian T. Beckwith
   Its: President and Chief Executive
        Officer

                                       2exv10w1

 

Exhibit 10.1

EXHIBIT A

HYBRIDON, INC.

2005 STOCK INCENTIVE PLAN

		
	1.	
    Purpose

     
The purpose of this 2005 Stock Incentive Plan (the
“Plan”) of Hybridon, Inc., a Delaware corporation (the
“Company”), is to advance the interests of the
Company’s stockholders by enhancing the Company’s
ability to attract, retain and motivate persons who are expected
to make important contributions to the Company and by providing
such persons with equity ownership opportunities and
performance-based incentives that are intended to align their
interests with those of the Company’s stockholders. Except
where the context otherwise requires, the term
“Company” shall include any of the Company’s
present or future parent or subsidiary corporations as defined
in Sections 424(e) or (f) of the Internal Revenue Code
of 1986, as amended, and any regulations promulgated thereunder
(the “Code”) and any other business venture
(including, without limitation, joint venture or limited
liability company) in which the Company has a controlling
interest, as determined by the Board of Directors of the Company
(the “Board”).

		
	2.	
    Eligibility

     
All of the Company’s employees, officers and directors and
all of the Company’s consultants and advisors that are
natural persons are eligible to receive options, stock
appreciation rights, restricted stock, restricted stock units
and other stock-based awards (each, an “Award”) under
the Plan. Each person who receives an Award under the Plan is
deemed a “Participant”.

		
	3.	
    Administration and Delegation

     
(a) Administration by Board of Directors. The Plan
will be administered by the Board. The Board shall have
authority to grant Awards and to adopt, amend and repeal such
administrative rules, guidelines and practices relating to the
Plan as it shall deem advisable. The Board may correct any
defect, supply any omission or reconcile any inconsistency in
the Plan or any Award in the manner and to the extent it shall
deem expedient to carry the Plan into effect and it shall be the
sole and final judge of such expediency. All decisions by the
Board shall be made in the Board’s sole discretion and
shall be final and binding on all persons having or claiming any
interest in the Plan or in any Award. No director or person
acting pursuant to the authority delegated by the Board shall be
liable for any action or determination relating to or under the
Plan made in good faith.

     
(b) Appointment of Committees. To the extent
permitted by applicable law, the Board may delegate any or all
of its powers under the Plan to one or more committees or
subcommittees of the Board (a “Committee”). All
references in the Plan to the “Board” shall mean the
Board or a Committee of the Board or the officers referred to in
Section 3(c) to the extent that the Board’s powers or
authority under the Plan have been delegated to such Committee
or officers.

     
(c) Delegation to Officers. To the extent permitted
by applicable law, the Board may delegate to one or more
officers of the Company the power to grant Awards to employees
or officers of the Company or any of its present or future
subsidiary corporations and to exercise such other powers under
the Plan as the Board may determine, provided that the Board
shall fix the terms of the Awards to be granted by such officers
(including the exercise price of such Awards, which may include
a formula by which the exercise price will be determined) and
the maximum number of shares subject to Awards that the officers
may grant; and provided further, however, that no officer shall
be authorized to grant Awards to any “executive
officer” of the Company (as defined by Rule 3b-7 under
the Securities Exchange Act of 1934, as amended (the
“Exchange Act”)) or to any “officer” of the
Company (as defined by Rule 16a-1 under the Exchange Act).

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	4.	
    Stock Available for Awards

     
(a) Number of Shares. Subject to adjustment under
Section 9, Awards may be made under the Plan for up to five
million (5,000,000) shares of common stock, $0.001 par
value per share, of the Company (the “Common Stock”).
If any Award expires or is terminated, surrendered or canceled
without having been fully exercised or is forfeited in whole or
in part (including as the result of shares of Common Stock
subject to such Award being repurchased by the Company at the
original issuance price pursuant to a contractual repurchase
right) or results in any Common Stock not being issued, the
unused Common Stock covered by such Award shall again be
available for the grant of Awards under the Plan. However, in
the case of Incentive Stock Options (as hereinafter defined),
the foregoing provisions shall be subject to any limitations
under the Code. Shares issued under the Plan may consist in
whole or in part of authorized but unissued shares or treasury
shares.

     
(b) Sub-limits. Subject to adjustment under
Section 9, the following sub-limits on the number of shares
subject to Awards shall apply:

		
	 	     
    (1) Section 162(m) Per-Participant Limit. The
    maximum number of shares of Common Stock with respect to which
    Awards may be granted to any Participant under the Plan shall be
    one million (1,000,000) per calendar year. For purposes of the
    foregoing limit, the combination of an Option in tandem with an
    SAR (as each term is hereafter defined) shall be treated as a
    single Award. The per-Participant limit described in this
    Section 4(b)(1) shall be construed and applied consistently
    with Section 162(m) of the Code or any successor provision
    thereto, and the regulations thereunder
    (“Section 162(m)”).
	 
	 	     
    (2) Limit on Awards that Vest Based Upon the Passage of
    Time Alone. The maximum number of shares of Common Stock
    with respect to which Restricted Stock Awards and Other Stock
    Unit Awards that either require no purchase by the Participant
    or vest on the basis of the passage of time alone may be granted
    shall be 500,000.

		
	5.	
    Stock Options

     
(a) General. The Board may grant options to purchase
Common Stock (each, an “Option”) and determine the
number of shares of Common Stock to be covered by each Option,
the exercise price of each Option and the conditions and
limitations applicable to the exercise of each Option, including
conditions relating to applicable federal or state securities
laws, as it considers necessary or advisable. An Option which is
not intended to be an Incentive Stock Option (as hereinafter
defined) shall be designated a “Nonstatutory Stock
Option”.

     
(b) Incentive Stock Options. An Option that the
Board intends to be an “incentive stock option” as
defined in Section 422 of the Code (an “Incentive
Stock Option”) shall only be granted to employees of
Hybridon, Inc., any of Hybridon Inc.’s present or future
parent or subsidiary corporations as defined in
Sections 424(e) or (f) of the Code, and any other
entities the employees of which are eligible to receive
Incentive Stock Options under the Code, and shall be subject to
and shall be construed consistently with the requirements of
Section 422 of the Code. The Company shall have no
liability to a Participant, or any other party, if an Option (or
any part thereof) that is intended to be an Incentive Stock
Option is not an Incentive Stock Option or for any action taken
by the Board pursuant to Section 10(f), including without
limitation the conversion of an Incentive Stock Option to a
Nonstatutory Stock Option.

     
(c) Exercise Price. The Board shall establish the
exercise price of each Option and specify such exercise price in
the applicable option agreement.

     
(d) Duration of Options. Each Option shall be
exercisable at such times and subject to such terms and
conditions as the Board may specify in the applicable option
agreement; provided, however, that no Option will be granted for
a term in excess of 10 years.

     
(e) No Reload Rights. No Option granted under the
Plan shall contain any provision entitling the optionee to the
automatic grant of additional Options in connection with any
exercise of the original Option.

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(f) Exercise of Option. Options may be exercised by
delivery to the Company of a written notice of exercise signed
by the proper person or by any other form of notice (including
electronic notice) approved by the Board together with payment
in full as specified in Section 5(g) for the number of
shares for which the Option is exercised. Shares of Common Stock
subject to the Option will be delivered by the Company following
exercise either as soon as practicable or, subject to such
conditions as the Board shall specify, on a deferred basis (with
the Company’s obligation to be evidenced by an instrument
providing for future delivery of the deferred shares at the time
or times specified by the Board).

     
(g) Payment Upon Exercise. Common Stock purchased
upon the exercise of an Option granted under the Plan shall be
paid for as follows:

		
	 	     
    (1) in cash, by check or by wire transfer, payable to the
    order of the Company;
	 
	 	     
    (2) except as the Board may otherwise provide in an option
    agreement, by (i) delivery of an irrevocable and
    unconditional undertaking by a creditworthy broker to deliver
    promptly to the Company sufficient funds to pay the exercise
    price and any required tax withholding or (ii) delivery by
    the Participant to the Company of a copy of irrevocable and
    unconditional instructions to a creditworthy broker to deliver
    promptly to the Company cash or a check sufficient to pay the
    exercise price and any required tax withholding;
	 
	 	     
    (3) for so long as the Common Stock is registered under the
    Exchange Act, by delivery of shares of Common Stock owned by the
    Participant valued at their fair market value as determined by
    (or in a manner approved by) the Board (“Fair Market
    Value”), provided (i) such method of payment is then
    permitted under applicable law, (ii) such Common Stock, if
    acquired directly from the Company, was owned by the Participant
    for such minimum period of time, if any, as may be established
    by the Board in its discretion and (iii) such Common Stock
    is not subject to any repurchase, forfeiture, unfulfilled
    vesting or other similar requirements;
	 
	 	     
    (4) to the extent permitted by applicable law and by the
    Board, by (i) delivery of a promissory note of the
    Participant to the Company on terms determined by the Board, or
    (ii) payment of such other lawful consideration as the
    Board may determine; or
	 
	 	     
    (5) by any combination of the above permitted forms of
    payment.

     
(h) Substitute Options. In connection with a merger
or consolidation of an entity with the Company or the
acquisition by the Company of property or stock of an entity,
the Board may grant Options in substitution for any options or
other stock or stock-based awards granted by such entity or an
affiliate thereof. Substitute Options may be granted on such
terms as the Board deems appropriate in the circumstances,
notwithstanding any limitations on Options contained in the
other sections of this Section 5 or in Section 2.
Substitute Options shall not count against the overall share
limit set forth in Section 4(a), except as may be required
by reason of Section 422 and related provisions of the Code.

		
	6.	
    Stock Appreciation Rights.

     
(a) General. A Stock Appreciation Right, or SAR, is
an Award entitling the holder, upon exercise, to receive an
amount in Common Stock determined by reference to appreciation,
from and after the date of grant, in the fair market value of a
share of Common Stock. The date as of which such appreciation or
other measure is determined shall be the exercise date.

     
(b) Grants. Stock Appreciation Rights may be granted
in tandem with, or independently of, Options granted under the
Plan.

		
	 	     
    (1) Tandem Awards. When Stock Appreciation Rights
    are expressly granted in tandem with Options, (i) the Stock
    Appreciation Right will be exercisable only at such time or
    times, and to the extent, that the related Option is exercisable
    (except to the extent designated by the Board in connection with
    a Reorganization Event) and will be exercisable in accordance
    with the procedure required for exercise of the related Option;
    (ii) the Stock Appreciation Right will terminate and no
    longer be exercisable upon the termination or exercise of the
    related Option, except to the extent designated by the

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    Board in connection with a Reorganization Event; provided that a
    Stock Appreciation Right granted with respect to less than the
    full number of shares covered by an Option will not be reduced
    until the number of shares as to which the related Option has
    been exercised or has terminated is less than the number of
    shares covered by the Stock Appreciation Right; (iii) the
    Option will terminate and no longer be exercisable upon the
    exercise of the related Stock Appreciation Right; and
    (iv) the Stock Appreciation Right will be transferable only
    with the related Option.
	 
	 	     
    (2) Independent SARs. A Stock Appreciation Right not
    expressly granted in tandem with an Option will become
    exercisable at such time or times, and on such conditions, as
    the Board may specify in the SAR Award.

     
(c) Exercise. Stock Appreciation Rights may be
exercised by delivery to the Company of a written notice of
exercise signed by the proper person or by any other form of
notice (including electronic notice) approved by the Board,
together with any other documents required by the Board.

		
	7.	
    Restricted Stock; Restricted Stock Units.

     
(a) General. The Board may grant Awards entitling
recipients to acquire shares of Common Stock (“Restricted
Stock”), subject to the right of the Company to repurchase
all or part of such shares at their issue price or other stated
or formula price (or to require forfeiture of such shares if
issued at no cost) from the recipient in the event that
conditions specified by the Board in the applicable Award are
not satisfied prior to the end of the applicable restriction
period or periods established by the Board for such Award.
Instead of granting Awards for Restricted Stock, the Board may
grant Awards entitling the recipient to receive shares of Common
Stock to be delivered at the time such shares of Common Stock
vest (“Restricted Stock Units”) (Restricted Stock and
Restricted Stock Units are each referred to herein as a
“Restricted Stock Award”).

     
(b) Terms and Conditions. The Board shall determine
the terms and conditions of a Restricted Stock Award, including
the conditions for repurchase (or forfeiture) and the issue
price, if any.

     
(c) Stock Certificates. Any stock certificates
issued in respect of a Restricted Stock Award shall be
registered in the name of the Participant and, unless otherwise
determined by the Board, deposited by the Participant, together
with a stock power endorsed in blank, with the Company (or its
designee). At the expiration of the applicable restriction
periods, the Company (or such designee) shall deliver the
certificates no longer subject to such restrictions to the
Participant or if the Participant has died, to the beneficiary
designated, in a manner determined by the Board, by a
Participant to receive amounts due or exercise rights of the
Participant in the event of the Participant’s death (the
“Designated Beneficiary”). In the absence of an
effective designation by a Participant, “Designated
Beneficiary” shall mean the Participant’s estate.

		
	8.	
    Other Stock-Based Awards.

     
Other Awards of shares of Common Stock, and other Awards that
are valued in whole or in part by reference to, or are otherwise
based on, shares of Common Stock or other property, may be
granted hereunder to Participants (“Other Stock Unit
Awards”), including without limitation Awards entitling
recipients to receive shares of Common Stock to be delivered in
the future. Such Other Stock Unit Awards shall also be available
as a form of payment in the settlement of other Awards granted
under the Plan or as payment in lieu of compensation to which a
Participant is otherwise entitled. Other Stock Unit Awards may
be paid in shares of Common Stock or cash, as the Board shall
determine. Subject to the provisions of the Plan, the Board
shall determine the conditions of each Other Stock Unit Awards,
including any purchase price applicable thereto.

		
	9.	
    Adjustments for Changes in Common Stock and Certain Other
    Events.

     
(a) Changes in Capitalization. In the event of any
stock split, reverse stock split, stock dividend,
recapitalization, combination of shares, reclassification of
shares, spin-off or other similar change in capitalization or
event, or any distribution to holders of Common Stock other than
an ordinary cash dividend, (i) the number and class of
securities available under this Plan, (ii) the sub-limits
set forth in Section 4(b), (iii) the number and class
of securities and exercise price per share of each outstanding
Option, (iv) the

A-4

 

share- and per-share provisions of each Stock Appreciation
Right, (v) the share- and per-share provisions and the
repurchase price per share subject to each outstanding
Restricted Stock Award and (vi) the share- and
per-share-related provisions of each outstanding Other Stock
Unit Award, shall be appropriately adjusted by the Company (or
substituted Awards may be made, if applicable) to the extent
determined by the Board.

     
(b) Reorganization Events.

     
(1) Definition. A “Reorganization Event”
shall mean: (a) any merger or consolidation of the Company
with or into another entity as a result of which all of the
Common Stock of the Company is converted into or exchanged for
the right to receive cash, securities or other property or is
cancelled, (b) any exchange of all of the Common Stock of
the Company for cash, securities or other property pursuant to a
share exchange transaction or (c) any liquidation or
dissolution of the Company.

     
(2) Consequences of a Reorganization Event on Awards
Other than Restricted Stock Awards. In connection with a
Reorganization Event, the Board shall take any one or more of
the following actions as to all or any outstanding Awards on
such terms as the Board determines: (i) provide that Awards
shall be assumed, or substantially equivalent Awards shall be
substituted, by the acquiring or succeeding corporation (or an
affiliate thereof), (ii) upon written notice to a
Participant, provide that the Participant’s unexercised
Options or other unexercised Awards shall become exercisable in
full and will terminate immediately prior to the consummation of
such Reorganization Event unless exercised by the Participant
within a specified period following the date of such notice,
(iii) provide that outstanding Awards shall become
realizable or deliverable, or restrictions applicable to an
Award shall lapse, in whole or in part prior to or upon such
Reorganization Event, (iv) in the event of a Reorganization
Event under the terms of which holders of Common Stock will
receive upon consummation thereof a cash payment for each share
surrendered in the Reorganization Event (the “Acquisition
Price”), make or provide for a cash payment to a
Participant equal to (A) the Acquisition Price times the
number of shares of Common Stock subject to the
Participant’s Options or other Awards (to the extent the
exercise price does not exceed the Acquisition Price) minus
(B) the aggregate exercise price of all such outstanding
Options or other Awards, in exchange for the termination of such
Options or other Awards, (v) provide that, in connection
with a liquidation or dissolution of the Company, Awards shall
convert into the right to receive liquidation proceeds (if
applicable, net of the exercise price thereof) and (vi) any
combination of the foregoing.

     
For purposes of clause (i) above, an Option shall be
considered assumed if, following consummation of the
Reorganization Event, the Option confers the right to purchase,
for each share of Common Stock subject to the Option immediately
prior to the consummation of the Reorganization Event, the
consideration (whether cash, securities or other property)
received as a result of the Reorganization Event by holders of
Common Stock for each share of Common Stock held immediately
prior to the consummation of the Reorganization Event (and if
holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the
outstanding shares of Common Stock); provided, however, that if
the consideration received as a result of the Reorganization
Event is not solely common stock of the acquiring or succeeding
corporation (or an affiliate thereof), the Company may, with the
consent of the acquiring or succeeding corporation, provide for
the consideration to be received upon the exercise of Options to
consist solely of common stock of the acquiring or succeeding
corporation (or an affiliate thereof) equivalent in value (as
determined by the Board) to the per share consideration received
by holders of outstanding shares of Common Stock as a result of
the Reorganization Event.

     
(3) Consequences of a Reorganization Event on Restricted
Stock Awards. Upon the occurrence of a Reorganization Event
other than a liquidation or dissolution of the Company, the
repurchase and other rights of the Company under each
outstanding Restricted Stock Award shall inure to the benefit of
the Company’s successor and shall apply to the cash,
securities or other property which the Common Stock was
converted into or exchanged for pursuant to such Reorganization
Event in the same manner and to the same extent as they applied
to the Common Stock subject to such Restricted Stock Award. Upon
the occurrence of a Reorganization Event involving the
liquidation or dissolution of the Company, except to the extent
specifically provided to the contrary in the instrument
evidencing any Restricted Stock Award or any other agreement

A-5

 

between a Participant and the Company, all restrictions and
conditions on all Restricted Stock Awards then outstanding shall
automatically be deemed terminated or satisfied.

		
	10.	
    General Provisions Applicable to Awards

     
(a) Transferability of Awards. Except as the Board
may otherwise determine or provide in an Award, Awards shall not
be sold, assigned, transferred, pledged or otherwise encumbered
by the person to whom they are granted, either voluntarily or by
operation of law, except by will or the laws of descent and
distribution or, other than in the case of an Incentive Stock
Option, pursuant to a qualified domestic relations order, and,
during the life of the Participant, shall be exercisable only by
the Participant. References to a Participant, to the extent
relevant in the context, shall include references to authorized
transferees.

     
(b) Documentation. Each Award shall be evidenced in
such form (written, electronic or otherwise) as the Board shall
determine. Each Award may contain terms and conditions in
addition to those set forth in the Plan.

     
(c) Board Discretion. Except as otherwise provided
by the Plan, each Award may be made alone or in addition or in
relation to any other Award. The terms of each Award need not be
identical, and the Board need not treat Participants uniformly.

     
(d) Termination of Status. The Board shall determine
the effect on an Award of the disability, death, retirement,
authorized leave of absence or other change in the employment or
other status of a Participant and the extent to which, and the
period during which, the Participant, or the Participant’s
legal representative, conservator, guardian or Designated
Beneficiary, may exercise rights under the Award.

     
(e) Withholding. Each Participant shall pay to the
Company, or make provision satisfactory to the Company for
payment of, any taxes required by law to be withheld in
connection with an Award to such Participant. Except as the
Board may otherwise provide in an Award, for so long as the
Common Stock is registered under the Exchange Act, Participants
may satisfy such tax obligations in whole or in part by delivery
of shares of Common Stock, including shares retained from the
Award creating the tax obligation, valued at their Fair Market
Value; provided, however, except as otherwise provided by the
Board, that the total tax withholding where stock is being used
to satisfy such tax obligations cannot exceed the Company’s
minimum statutory withholding obligations (based on minimum
statutory withholding rates for federal and state tax purposes,
including payroll taxes, that are applicable to such
supplemental taxable income). Shares surrendered to satisfy tax
withholding requirements cannot be subject to any repurchase,
forfeiture, unfulfilled vesting or other similar requirements.
The Company may, to the extent permitted by law, deduct any such
tax obligations from any payment of any kind otherwise due to a
Participant.

     
(f) Amendment of Award. The Board may amend, modify
or terminate any outstanding Award, including but not limited
to, substituting therefor another Award of the same or a
different type, changing the date of exercise or realization,
and converting an Incentive Stock Option to a Nonstatutory Stock
Option, provided that the Participant’s consent to such
action shall be required unless the Board determines that the
action, taking into account any related action, would not
materially and adversely affect the Participant.

     
(g) Conditions on Delivery of Stock. The Company
will not be obligated to deliver any shares of Common Stock
pursuant to the Plan or to remove restrictions from shares
previously delivered under the Plan until (i) all
conditions of the Award have been met or removed to the
satisfaction of the Company, (ii) in the opinion of the
Company’s counsel, all other legal matters in connection
with the issuance and delivery of such shares have been
satisfied, including any applicable securities laws and any
applicable stock exchange or stock market rules and regulations,
and (iii) the Participant has executed and delivered to the
Company such representations or agreements as the Company may
consider appropriate to satisfy the requirements of any
applicable laws, rules or regulations.

     
(h) Acceleration. The Board may at any time provide
that any Award shall become immediately exercisable in full or
in part, free of some or all restrictions or conditions, or
otherwise realizable in full or in part, as the case may be.

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(i) Performance Conditions.

		
	 	     
    (1) This Section 10(i) shall be administered by a
    Committee approved by the Board, all of the members of which are
    “outside directors” as defined by Section 162(m)
    (the “Section 162(m) Committee”).
	 
	 	     
    (2) Notwithstanding any other provision of the Plan, if the
    Section 162(m) Committee determines, at the time a
    Restricted Stock Award or Other Stock Unit Award is granted to a
    Participant, that such Participant is, or may be as of the end
    of the tax year in which the Company would claim a tax deduction
    in connection with such Award, a Covered Employee (as defined in
    Section 162(m)), then the Section 162(m) Committee may
    provide that this Section 10(i) is applicable to such Award.
	 
	 	     
    (3) If a Restricted Stock Award or Other Stock Unit Award
    is subject to this Section 10(i), then the lapsing of
    restrictions thereon and the distribution of cash or Shares
    pursuant thereto, as applicable, shall be subject to the
    achievement of one or more objective performance goals
    established by the Section 162(m) Committee, which shall be
    based on the relative or absolute attainment of specified levels
    of one or any combination of the following: (a) earnings
    per share, (b) return on average equity or average assets
    with respect to a pre-determined peer group, (c) earnings,
    (d) earnings growth, (e) revenues, (f) expenses,
    (g) stock price, (h) market share, (i) return on
    sales, assets, equity or investment, (j) regulatory
    compliance, (k) achievement of balance sheet or income
    statement objectives, (l) total shareholder return,
    (m) net operating profit after tax, (n) pre-tax or
    after-tax income, (o) cash flow, (p) achievement of
    research, development, clinical or regulatory milestones,
    (q) product sales and (r) business development
    activities, and may be absolute in their terms or measured
    against or in relationship to other companies comparably,
    similarly or otherwise situated. Such performance goals may be
    adjusted to exclude any one or more of (i) extraordinary
    items, (ii) gains or losses on the dispositions of
    discontinued operations, (iii) the cumulative effects of
    changes in accounting principles, (iv) the writedown of any
    asset, and (v) charges for restructuring and
    rationalization programs. Such performance goals: (i) may
    vary by Participant and may be different for different Awards;
    (ii) may be particular to a Participant or the department,
    branch, line of business, subsidiary or other unit in which the
    Participant works and may cover such period as may be specified
    by the Section 162(m) Committee; and (iii) shall be
    set by the Section 162(m) Committee within the time period
    prescribed by, and shall otherwise comply with the requirements
    of, Section 162(m).
	 
	 	     
    (4) Notwithstanding any provision of the Plan, with respect
    to any Restricted Stock Award or Other Stock Unit Award that is
    subject to this Section 10(i), the Section 162(m)
    Committee may adjust downwards, but not upwards, the cash or
    number of Shares payable pursuant to such Award, and the
    Section 162(m) Committee may not waive the achievement of
    the applicable performance goals except in the case of the death
    or disability of the Participant.
	 
	 	     
    (5) The Section 162(m) Committee shall have the power
    to impose such other restrictions on Awards subject to this
    Section 10(i) as it may deem necessary or appropriate to
    ensure that such Awards satisfy all requirements for
    “performance-based compensation” within the meaning of
    Section 162(m)(4)(C) of the Code, or any successor
    provision thereto.

		
	11.	
    Miscellaneous

     
(a) No Right To Employment or Other Status. No
person shall have any claim or right to be granted an Award, and
the grant of an Award shall not be construed as giving a
Participant the right to continued employment or any other
relationship with the Company. The Company expressly reserves
the right at any time to dismiss or otherwise terminate its
relationship with a Participant free from any liability or claim
under the Plan, except as expressly provided in the applicable
Award.

     
(b) No Rights As Stockholder. Subject to the
provisions of the applicable Award, no Participant or Designated
Beneficiary shall have any rights as a stockholder with respect
to any shares of Common Stock to be distributed with respect to
an Award until becoming the record holder of such shares.
Notwithstanding the foregoing, in the event the Company effects
a split of the Common Stock by means of a stock dividend and the

A-7

 

exercise price of and the number of shares subject to such
Option are adjusted as of the date of the distribution of the
dividend (rather than as of the record date for such dividend),
then an optionee who exercises an Option between the record date
and the distribution date for such stock dividend shall be
entitled to receive, on the distribution date, the stock
dividend with respect to the shares of Common Stock acquired
upon such Option exercise, notwithstanding the fact that such
shares were not outstanding as of the close of business on the
record date for such stock dividend.

     
(c) Effective Date and Term of Plan. The Plan shall
become effective on the date on which it is adopted by the
Board, but no Award may be granted unless and until the Plan has
been approved by the Company’s stockholders. No Awards
shall be granted under the Plan after the completion of
10 years from the earlier of (i) the date on which the
Plan was adopted by the Board or (ii) the date the Plan was
approved by the Company’s stockholders, but Awards
previously granted may extend beyond that date.

     
(d) Amendment of Plan. The Board may amend, suspend
or terminate the Plan or any portion thereof at any time;
provided that, to the extent determined by the Board, no
amendment requiring stockholder approval under any applicable
legal, regulatory or listing requirement shall become effective
until such stockholder approval is obtained. No Award shall be
made that is conditioned upon stockholder approval of any
amendment to the Plan.

     
(e) Provisions for Foreign Participants. The Board
may modify Awards or Options granted to Participants who are
foreign nationals or employed outside the United States or
establish subplans or procedures under the Plan to recognize
differences in laws, rules, regulations or customs of such
foreign jurisdictions with respect to tax, securities, currency,
employee benefit or other matters.

     
(f) Compliance With Code Section 409A. No Award
shall provide for deferral of compensation that does not comply
with Section 409A of the Code, unless the Board, at the
time of grant, specifically provides that the Award is not
intended to comply with Section 409A of the Code.

     
(g) Governing Law. The provisions of the Plan and
all Awards made hereunder shall be governed by and interpreted
in accordance with the laws of the State of Delaware, excluding
choice-of-law principles of the law of such state that would
require the application of the laws of a jurisdiction other than
such state.

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