Document:

EXHIBIT 10.6
                                  AMENDMENT TO
                      NOTICE OF RESTRICTED STOCK UNIT AWARD

                            BUFFALO WILD WINGS, INC.
                           2003 EQUITY INCENTIVE PLAN

         This Amendment to a Notice of Restricted Stock Unit Award dated (the
"Notice") by and between Buffalo Wild Wings, Inc., a Minnesota corporation (the
"Company"), and _______________ ("Participant") is effective as of
_______________, 2008 (the "Effective Date").

         A. As a key employee or officer of the Company or a Subsidiary of the
Company, Participant previously received a restricted stock unit award (the
"Award") pursuant to the Company's 2003 Equity Incentive Plan (As Amended and
Restated May 15, 2008) (the "Plan"), on the terms and conditions set forth in
the Notice and the Plan.

         B. The Company wishes to amend the Notice to specify the effect that a
Change in Control of the Company will have on the Award.

         The Notice is hereby amended as of the Effective Date as follows:

1.       Subparagraph 2.a. of the Notice is amended to read as follows:

                  "a. General. The restricted stock units subject to this Award
         shall remain forfeitable until the date the risks of forfeiture lapse
         with respect to a percentage of such units (the "Vesting Date"). Except
         as otherwise provided in subparagraphs 2.b. and 2.c., a Vesting Date
         shall be the last day of any fiscal year during the term of the Award
         in which the Company achieves its Annual Earnings Target (as defined
         herein). If, for any fiscal year ending on a Vesting Date, the Company
         achieves 95% of the earnings target as established by the Board of
         Directors for such fiscal year (each an "Annual Earnings Target"), the
         risks of forfeiture relating to 33-1/3% of the restricted stock units
         specified in Paragraph 1 shall lapse. The risks of forfeiture relating
         to the remaining restricted stock units shall continue to lapse in this
         manner until the risks of forfeiture relating to 100% of the restricted
         stock units specified in Paragraph 1 have lapsed, or until the
         expiration of this Award."

2.       Subparagraph 2.b. of the Notice is amended to read as follows:

                  "b. Termination of Employment. Except as provided in the
         following sentence and in subparagraph 2.c., if the Participant's
         employment with the Company and all its Subsidiaries ceases at any time
         during the term of the Award, this Award shall also terminate and all
         restricted stock units subject to this Award that remain subject to
         risks of forfeiture shall be forfeited by Participant. If, however, the
         Participant's employment with the Company and all of its Subsidiaries
         ceases due to death or Disability (as defined in Paragraph 5), then a
         portion of the restricted stock units subject to this Award shall
         immediately vest. That portion shall be equal to the number of
         restricted stock units subject to this Award that would vest as of the
         end of the fiscal year in which Participant's employment ended if the
         Company were to achieve the Annual Earnings Target for that fiscal
         year. It is understood that if the Participant's employment ceases for
         any reason during the period between a Vesting Date and the date shares
         of Stock are to be issued in settlement of restricted stock units that
         vested as of that most recent Vesting Date (including any delay in
         issuance resulting from the application of Section 17(f) of the Plan),
         then such Participant shall not forfeit any such restricted stock
         units.

<PAGE>

3.       A new subparagraph 2.c. is added to the Notice to read as follows:

                  "c. Change in Control. If a Change in Control (as defined in
         Section 12(c) of the Plan) occurs and the Participant holds restricted
         stock units subject to this Notice at the time, then one of the
         following shall occur:

                           (1) If, pending the Change in Control, the
         Administrator determines that this Award will not continue after the
         Change in Control or that the successor entity (or its parent) will not
         agree to provide for the assumption or replacement of this Award with a
         comparable equity-based award covering shares of the successor entity
         (or its parent) that would equitably preserve the compensation element
         of the Award at the time of the Change in Control, then a portion of
         the restricted stock units subject to this Award shall vest and be
         settled immediately prior to the consummation of the Change in Control.
         That portion shall be equal to the number of restricted stock units
         subject to this Award that would vest as of the end of the fiscal year
         in which the Change in Control occurred if the Company were to achieve
         the Annual Earnings Target for that fiscal year.

                           (2) If, in connection with the Change in Control,
         subparagraph 2.c.(1) is not applicable and this Notice is continued,
         assumed or replaced in the manner described in subparagraph 2.c.(1),
         and if within one year after that Change in Control the Participant's
         employment with the Company and all of its Subsidiaries (or with any
         successor entity) is terminated by the employer for reasons other than
         Cause (as defined in Paragraph 5), or is terminated by the Participant
         for Good Reason (as defined in Paragraph 5), then a portion of the
         restricted stock units subject to this Award shall immediately vest.
         That portion shall be equal to the number of Units subject to this
         Award that would vest as of the end of the fiscal year in which the
         Participant's employment ended if the Company were to achieve the
         Annual Earnings Target for that fiscal year."

4.       Paragraph 3 of the Notice is amended to read as follows:

                  "3. Issuance of Shares. As soon as practicable after any
         Vesting Date, but in no event later than March 15 of the year following
         the calendar year in which the Vesting Date occurs, the Company shall
         cause to be issued a stock certificate representing that number of
         shares of Stock which is equivalent to the percentage of restricted
         stock units for which the risks of forfeiture have lapsed, less any
         shares withheld for payment of taxes as provided in Paragraph 4(e)
         below, and shall deliver such certificate to Participant. Until the
         issuance of such shares, Participant shall not be entitled to vote the
         shares of Stock represented by such restricted stock units, shall not
         be entitled to receive dividends attributable to such shares of Stock,
         and shall not have any other rights as a shareholder with respect to
         such shares.

                                       2
<PAGE>

5.       A new Paragraph 5 is added to the Notice to read as follows:

                  "5. Definitions. The following terms used in this Notice will
         have the meanings indicated:

                      a. "Cause" means what the term is expressly defined to
         mean in a then-effective employment agreement between the Participant
         and the Company, or in the absence of any such then-effective agreement
         or definition, means:

                         (1) Participant's commission of any act constituting a
         felony, or Participant's conviction or guilty or no contest plea to any
         criminal misdemeanor or more serious act;

                         (2) gross misconduct or any act of fraud, disloyalty or
         dishonesty by Participant related to or connected with Participant's
         employment by the Company or otherwise likely to cause material harm to
         the Company or its reputation;

                         (3) a material violation by Participant of the
         Company's policies or codes of conduct; or

                         (4) the willful or material breach by Participant of
         any agreement between the Participant and the Company.

                      b. "Disability" means what the term is expressly defined
         to mean in a then-effective employment agreement between the
         Participant and the Company, or in the absence of any such
         then-effective agreement or definition, means any medically
         determinable physical or mental impairment that can be expected to
         result in death or can be expected to last for a continuous period of
         not less than six months, where such impairment causes the Participant
         to be unable to perform the duties of Participant's position of
         employment or any substantially similar position of employment.

                      c. "Good Reason" means what the term is expressly defined
         to mean in a then-effective employment agreement between the
         Participant and the Company, or in the absence of any such
         then-effective agreement or definition, means any of the following
         conditions arising without the consent of Participant, provided that
         Participant has first given written notice to the Company of the
         existence of the condition within 90 days of its first occurrence, and
         the Company has failed to remedy the condition within 30 days
         thereafter:

                         (1) a material diminution in the Participant's base
         salary;

                         (2) a material diminution in the Participant's
         authority, duties, or responsibilities;

                         (3) relocation of Participant's principal office more
         than 50 miles from its current location; or

                                       3
<PAGE>

                         (4) any other action or inaction that constitutes a
         material breach by the Company of any terms or conditions of any
         agreement between the Company and the participant, which breach has not
         been caused by Participant."

                              BUFFALO WILD WINGS, INC.

                              By:
                                 -----------------------------------------------

                                  Its:
                                      ------------------------------------------

                                       4ex10-18.htm

    
      

    

    Exhibit 10.18

     

    
      

      

      

      

       

      
        

        
        

         

        
          	 

        

         

         

      

      LaserCard
Corporation

       

      2004
Equity Incentive Compensation Plan

       

       (As
Amended by the Board on September 19, 2008)

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

       

      
        LASERCARD
Corporation

        2004
Equity Incentive Compensation Plan

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

      

       

      Table of
Contents

      Page

      
        
          	 	 
	
                  SECTION 1. ESTABLISHMENT AND
      PURPOSE

                	
                  1

                
	
                  SECTION 2.
      DEFINITIONS

                	
                  1

                
	
                  (a)

                	
                  “Affiliate”

                	
                  1

                
	
                  (b)

                	
                  “Award”

                	
                  1

                
	
                  (c)

                	
                  “Board of
      Directors”

                	
                  1

                
	
                  (d)

                	
                  “Change in
      Control”

                	
                  1

                
	
                  (e)

                	
                  “Code”

                	
                  2

                
	
                  (f)

                	
                  “Committee”

                	
                  2

                
	
                  (g)

                	
                  “Company”

                	
                  2

                
	
                  (h)

                	
                  “Consultant”

                	
                  2

                
	
                  (i)

                	
                  “Employee”

                	
                  2

                
	
                  (j)

                	
                  “Exchange
    Act”

                	
                  2

                
	
                  (k)

                	
                  “Exercise
      Price”

                	
                  2

                
	
                  (l)

                	
                  “Fair Market
      Value”

                	
                  2

                
	
                  (m)

                	
                  “ISO”

                	
                  3

                
	
                  (n)

                	
                  “Nonstatutory Option” or
      “NSO”

                	
                  3

                
	
                  (o)

                	
                  “Offeree”

                	
                  3

                
	
                  (p)

                	
                  “Option”

                	
                  3

                
	
                  (q)

                	
                  “Optionee”

                	
                  3

                
	
                  (r)

                	
                  “Outside
      Director”

                	
                  3

                
	
                  (s)

                	
                  “Parent”

                	
                  3

                
	
                  (t)

                	
                  “Participant”

                	
                  3

                
	
                  (u)

                	
                  “Plan”

                	
                  3

                
	
                  (v)

                	
                  “Purchase
      Price”

                	
                  3

                
	
                  (w)

                	
                  “Restricted
      Share”

                	
                  3

                
	
                  (x)

                	
                  “Restricted Share
      Agreement”

                	
                  3

                
	
                  (y)

                	
                  “SAR”

                	
                  3

                
	
                  (z)

                	
                  “SAR
    Agreement”

                	
                  3

                
	
                  (aa)

                	
                  “Service”

                	
                  3

                
	
                  (bb)

                	
                  “Share”

                	
                  4

                
	
                  (cc)

                	
                  “Stock”

                	
                  4

                
	
                  (dd)

                	
                  “Stock Option
      Agreement”

                	
                  4

                
	
                  (ee)

                	
                  “Stock
Unit”

                	
                  4

                
	
                  (ff)

                	
                  “Stock Unit
      Agreement”

                	
                  4

                
	
                  (gg)

                	
                  “Subsidiary”

                	
                  4

                
	
                  (hh)

                	
                  “Total and Permanent
      Disability”

                	
                  4

                
	
                  SECTION 3.
      ADMINISTRATION

                	
                  4

                
	
                  (a)

                	
                  Committee
      Composition

                	
                  4

                
	
                  (b)

                	
                  Committee for Non-Officer
      Grants

                	
                  4

                
	
                  (c)

                	
                  Committee
      Procedures

                	
                  4

                
	
                  (d)

                	
                  Committee
      Responsibilities

                	
                  4

                
	
                  SECTION 4.
      ELIGIBILITY

                	
                  5

                
	
                  (a)

                	
                  General
Rule

                	
                  5

                
	
                  (b)

                	
                  Automatic Grants to Outside
      Directors.

                	
                  6

                
	
                  (c)

                	
                  Ten-Percent
      Stockholders

                	
                  6

                
	
                  (d)

                	
                  Attribution
      Rules

                	
                  6

                
	
                  (e)

                	
                  Outstanding
      Stock

                	
                  6

                
	 	 	 

        

      

      
         

        LASERCARD
Corporation

        2004
Equity Incentive Compensation Plan

         

        
          
            
            

          

          
            -ii-

            
              

            

          

          
            
            

          

        

      

      
         

        
          
            	
                    SECTION 5. STOCK SUBJECT TO
      PLAN

                  	
                    6

                  
	
                    (a)

                  	
                    Basic
      Limitation

                  	
                    6

                  
	
                    (b)

                  	
                    Individual Award
      Limitation

                  	
                    6

                  
	
                    (c)

                  	
                    Additional
      Shares

                  	
                    7

                  
	
                    SECTION 6. RESTRICTED
      SHARES

                  	
                    7

                  
	
                    (a)

                  	
                    Restricted Stock
      Agreement

                  	
                    7

                  
	
                    (b)

                  	
                    Payment for
      Awards

                  	
                    7

                  
	
                    (c)

                  	
                    Vesting

                  	
                    7

                  
	
                    (d)

                  	
                    Voting and Dividend
      Rights

                  	
                    7

                  
	
                    (e)

                  	
                    Restrictions on Transfer of
      Shares

                  	
                    7

                  
	
                    SECTION 7. TERMS AND CONDITIONS OF
      OPTIONS

                  	
                    7

                  
	
                    (a)

                  	
                    Stock Option
      Agreement

                  	
                    7

                  
	
                    (b)

                  	
                    Number of
      Shares

                  	
                    7

                  
	
                    (c)

                  	
                    Exercise
    Price

                  	
                    8

                  
	
                    (d)

                  	
                    Withholding
      Taxes

                  	
                    8

                  
	
                    (e)

                  	
                    Exercisability and
      Term

                  	
                    8

                  
	
                    (f)

                  	
                    Exercise of Options Upon
      Termination of Service

                  	
                    8

                  
	
                    (g)

                  	
                    Effect of Change in
      Control

                  	
                    8

                  
	
                    (h)

                  	
                    Leaves of
      Absence

                  	
                    8

                  
	
                    (i)

                  	
                    No Rights as a
      Stockholder

                  	
                    8

                  
	
                    (j)

                  	
                    Modification, Extension and
      Renewal of Options

                  	
                    8

                  
	
                    (k)

                  	
                    Restrictions on Transfer of
      Shares

                  	
                    8

                  
	
                    SECTION 8. PAYMENT FOR
      SHARES

                  	
                    9

                  
	
                    (a)

                  	
                    General
Rule

                  	
                    9

                  
	
                    (b)

                  	
                    Surrender of
      Stock

                  	
                    9

                  
	
                    (c)

                  	
                    Services
      Rendered

                  	
                    9

                  
	
                    (d)

                  	
                    Cashless
      Exercise

                  	
                    9

                  
	
                    (e)

                  	
                    Exercise/Pledge

                  	
                    9

                  
	
                    (f)

                  	
                    Other Forms of
      Payment

                  	
                    9

                  
	
                    (g)

                  	
                    Limitations under Applicable
      Law

                  	
                    9

                  
	
                    SECTION 9. STOCK APPRECIATION
      RIGHTS

                  	
                    9

                  
	
                    (a)

                  	
                    SAR
    Agreement

                  	
                    9

                  
	
                    (b)

                  	
                    Number of
      Shares

                  	
                    
                      10

                    

                  
	
                    (c)

                  	
                    Exercise
    Price

                  	
                    10

                  
	
                    (d)

                  	
                    Exercisability and
      Term

                  	
                    
                      10

                    

                  
	
                    (e)

                  	
                    Effect of Change in
      Control

                  	
                    
                      10

                    

                  
	
                    (f)

                  	
                    Exercise of
      SARs

                  	
                    
                      10

                    

                  
	
                    (g)

                  	
                    Modification or Assumption of
      SARs

                  	
                    
                      10

                    

                  
	
                    SECTION 10. STOCK
      UNITS

                  	
                    
                      10

                    

                  
	
                    (a)

                  	
                    Stock Unit
      Agreement

                  	
                    
                      10

                    

                  
	
                    (b)

                  	
                    Payment for
      Awards

                  	
                    
                      10

                    

                  
	
                    (c)

                  	
                    Vesting
      Conditions

                  	
                    
                      10

                    

                  
	
                    (d)

                  	
                    Voting and Dividend
      Rights

                  	
                    
                      11

                    

                  
	
                    (e)

                  	
                    Form and Time of Settlement of
      Stock Units

                  	
                    
                      11

                    

                  
	
                    (f)

                  	
                    Death of
      Recipient

                  	
                    
                      11

                    

                  
	
                    (g)

                  	
                    Creditors’
      Rights

                  	
                    
                      11

                    

                  
	
                    SECTION 11. TRANSFERABILITY;
      PERFORMANCE GOALS

                  	
                    
                      11

                    

                  
	
                    (a)

                  	
                    Transferability

                  	
                    
                      11

                    

                  
	 
      	 
      	 
      

          

        

         

        
          LASERCARD
Corporation

          2004
Equity Incentive Compensation Plan

           

          
            
              
              

            

            
              -iii-

              
                

              

            

            
              
              

            

          

        

      

      
         

        
          
            	
                    (b)

                  	
                    Performance
      Goals

                  	
                    
                      11

                    

                  
	
                    SECTION 12. ADJUSTMENT OF
      SHARES

                  	
                    
                      12

                    

                  
	
                    (a)

                  	
                    Adjustments

                  	
                    
                      12

                    

                  
	
                    (b)

                  	
                    Dissolution or
      Liquidation

                  	
                    
                      12

                    

                  
	
                    (c)

                  	
                    Reorganizations

                  	
                    
                      12

                    

                  
	
                    (d)

                  	
                    Reservation of
      Rights

                  	
                    12

                  
	
                    SECTION 13. DEFERRAL OF
      AWARDS

                  	
                    
                      13

                    

                  
	
                    SECTION 14. AWARDS UNDER OTHER
      PLANS

                  	
                    
                      13

                    

                  
	
                    SECTION 15. PAYMENT OF DIRECTOR’S
      FEES IN SECURITIES

                  	
                    
                      13

                    

                  
	
                    (a)

                  	
                    Effective
    Date

                  	
                    
                      13

                    

                  
	
                    (b)

                  	
                    Elections to Receive NSOs,
      Restricted Shares or Stock Units

                  	
                    
                      13

                    

                  
	
                    (c)

                  	
                    Number and Terms of NSOs,
      Restricted Shares or Stock Units

                  	
                    13

                  
	
                    SECTION 16. LEGAL AND REGULATORY
      REQUIREMENTS

                  	
                    14

                  
	
                    SECTION 17. WITHHOLDING
      TAXES

                  	
                    14

                  
	
                    (a)

                  	
                    General

                  	
                    14

                  
	
                    (b)

                  	
                    Share
      Withholding

                  	
                    14

                  
	
                    SECTION 18. NO EMPLOYMENT
      RIGHTS

                  	
                    14

                  
	
                    SECTION 19. DURATION AND
      AMENDMENTS

                  	
                    14

                  
	
                    (a)

                  	
                    Term of the
      Plan

                  	
                    14

                  
	
                    (b)

                  	
                    Right to Amend or Terminate the
      Plan

                  	
                    14

                  
	
                    (c)

                  	
                    Effect of
      Termination

                  	
                    14

                  
	
                    SECTION 20.
      EXECUTION

                  	
                    15

                  
	 
      	 
      	 
      

          

        

         

        
          LASERCARD
Corporation

          2004
Equity Incentive Compensation Plan

           

        

      

      
        
          
          

        

        
          -iv-

          
            

          

        

        
          
          

        

      

       

      LaserCard
Corporation

      
         

        2004
Equity Incentive Compensation Plan

         

        
           SECTION
1.  ESTABLISHMENT AND PURPOSE.

        

         

        The Plan
was adopted by the Board of Directors on August 9, 2004, subject to stockholder
approval, which was effective on October 1, 2004 (the “Effective
Date”).  The plan is a successor to the Company’s Amended and Restated
Stock Option Plan (the “Prior Plan”).  As of the Effective Date, no
further awards shall be made under the Prior Plan.  However, the
provisions of the Prior Plan shall continue to apply to awards granted under the
Prior Plan prior to the Effective Date.  In the event that this Plan
is not approved by stockholders, awards shall continue to be made under the
Prior Plan in accordance with its terms.  The purpose of the Plan is
to promote the long-term success of the Company and the creation of stockholder
value by (a) encouraging Employees, Outside Directors and Consultants to focus
on critical long-range objectives, (b) encouraging the attraction and retention
of Employees, Outside Directors and Consultants with exceptional qualifications
and (c) linking Employees, Outside Directors and Consultants directly to
stockholder interests through increased stock ownership.  The Plan
seeks to achieve this purpose by providing for Awards in the form of restricted
shares, stock units, options (which may constitute incentive stock options or
nonstatutory stock options) or stock appreciation rights.

         

        SECTION
2.  DEFINITIONS.

         

        (a)           “Affiliate”
shall mean any entity other than a Subsidiary,
if the Company and/or one of more Subsidiaries own not less than 50% of such
entity.

         

        (b)           “Award”
shall mean any award of an Option, a SAR, a
Restricted Share or a Stock Unit under the Plan.

         

        (c)           “Board
of Directors” shall mean the Board of Directors
of the Company, as constituted from time to time.

         

        (d)           “Change
in Control” shall mean the occurrence of any of
the following events:

         

        (i)           A
change in the composition of the Board of Directors occurs, as a result of which
fewer than one-half of the incumbent directors are directors who
either:

         

        (A)           Had
been directors of the Company on the “look-back date” (as defined below) (the
“original directors”); or

         

        (B)           Were
elected, or nominated for election, to the Board of Directors with the
affirmative votes of at least a majority of the aggregate of the original
directors who were still in office at the time of the election or nomination and
the directors whose election or nomination was previously so approved (the
“continuing directors”); or

         

        (ii)           Any
“person” (as defined below) who by the acquisition or aggregation of securities,
is or becomes the “beneficial owner” (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of securities of the Company representing
50% or more of the combined voting power of the Company’s then outstanding
securities ordinarily (and apart from rights accruing under special
circumstances) having the right to vote at elections of directors (the “Base
Capital Stock”); except that any change in the relative beneficial ownership of
the Company’s securities by any person resulting solely from a reduction in the
aggregate number of outstanding shares of Base Capital Stock, and any decrease
thereafter in such person’s ownership of securities, shall be disregarded until
such person increases in any manner, directly or indirectly, such person’s
beneficial ownership of any securities of the Company; or

         

        (iii)           The
consummation of a merger or consolidation of the Company with or into another
entity or any other corporate reorganization, if persons who were not
stockholders of the Company immediately prior to such merger, consolidation or
other reorganization own immediately after such merger, consolidation or other
reorganization 50% or more of the voting power of the outstanding securities of
each of (A) the continuing or surviving entity and (B) any direct or indirect
parent corporation of such continuing or surviving entity; or

         

        
          
            
            

          

          
            1

            
              

            

          

          
            
            

          

           

        

        (iv)           The
sale, transfer or other disposition of all or substantially all of the Company’s
assets.

         

        For
purposes of subsection (d)(i) above, the term “look-back” date shall mean
the later of (1) the Effective Date or (2) the date 24 months prior to the
date of the event that may constitute a Change in Control.

         

        For
purposes of subsection (d)(ii) above, the term “person” shall have the same
meaning as when used in Sections 13(d) and 14(d) of the Exchange Act but shall
exclude (1) a trustee or other fiduciary holding securities under an employee
benefit plan maintained by the Company or a Parent or Subsidiary and (2) a
corporation owned directly or indirectly by the stockholders of the Company in
substantially the same proportions as their ownership of the Stock.

         

        Any other
provision of this Section 2(d) notwithstanding, a transaction shall not
constitute a Change in Control if its sole purpose is to change the state of the
Company’s incorporation or to create a holding company that will be owned in
substantially the same proportions by the persons who held the Company’s
securities immediately before such transaction.

         

        (e)           “Code”
shall mean the United States Internal Revenue
Code of 1986, as amended.

         

        (f)           “Committee”
shall mean the Compensation Committee as
designated by the Board of Directors, which is authorized to administer the
Plan, as described in Section 3 hereof.

         

        (g)           “Company”
shall means LaserCard Corporation, a Delaware
corporation.

         

        (h)           “Consultant”
shall mean a consultant or advisor who provides
bona fide services to the Company, a Parent, a Subsidiary or an Affiliate as an
independent contractor or a member of the board of directors of a Parent or a
Subsidiary who is not an Employee.  Service as a Consultant shall be
considered Service for all purposes of the Plan.

         

        (i)           “Employee”
shall mean any individual who is a common-law
employee of the Company, a Parent or a Subsidiary.

         

        (j)           
“Exchange Act” shall mean the United States
Securities Exchange Act of 1934, as amended.

         

        (k)           “Exercise
Price” shall mean, in the case of an Option,
the amount for which one Common Share may be purchased upon exercise of such
Option, as specified in the applicable Stock Option
Agreement.  “Exercise Price,” in the case of a SAR, shall mean an
amount, as specified in the applicable SAR Agreement, which is subtracted from
the Fair Market Value of one Common Share in determining the amount payable upon
exercise of such SAR.

         

        (l)           “Fair
Market Value” with respect to a Share, shall
mean the market price of one Share of Stock, determined by the Committee as
follows:

         

        (i)           If
the Stock was traded over-the-counter in the United Sates on the date in
question but was not traded on The United States Nasdaq Stock Market, then the
Fair Market Value shall be equal to the last transaction price quoted for such
date by the United States OTC Bulletin Board or, if not so quoted, shall be
equal to the mean between the last reported representative bid and asked prices
quoted for such date by the principal United States automated inter-dealer
quotation system on which the Stock is quoted or, if the Stock is not quoted on
any such system, by the Pink Sheets LLC;

         

        
          
            
            

          

          
            2

            
              

            

          

          
            
            

          

           

        

        (ii)           If
the Stock was traded on The United States Nasdaq Stock Market, then the Fair
Market Value shall be equal to the mean between the high and low reported sale
prices quoted for such date during normal (and not extended) trading hours by
The United States Nasdaq Stock Market;

         

        (iii)           If
the Stock was traded on a United States stock exchange on the date in question,
then the Fair Market Value shall be equal to the closing price reported for such
date by the applicable composite-transactions report; and

         

        (iv)           If
none of the foregoing provisions is applicable, then the Fair Market Value shall
be determined by the Committee in good faith on such basis as it deems
appropriate.

         

        In all
cases, the determination of Fair Market Value by the Committee shall be
conclusive and binding on all persons.

         

        (m)           “ISO”
shall mean an employee incentive stock option
described in Section 422 of the Code.

         

        (n)           “Nonstatutory
Option” or “NSO” shall mean an employee stock
option that is not an ISO.

         

        (o)           “Offeree”
shall mean an
individual to whom the Committee has offered the right to acquire Shares under
the Plan (other than upon exercise of an Option).

         

        (p)           “Option”
shall mean an ISO or Nonstatutory Option
granted under the Plan and entitling the holder to purchase
Shares.

         

        (q)           “Optionee”
shall mean an individual or estate who holds an
Option or SAR.

         

        (r)           “Outside
Director” shall mean a member of the Board of
Directors who is not a common-law employee of, or paid consultant to, the
Company, a Parent or a Subsidiary.  Service as an Outside Director
shall be considered Service for all purposes of the Plan, except as provided in
Section 4(a).

         

        (s)           “Parent”
shall mean any corporation (other than the
Company) in an unbroken chain of corporations ending with the Company, if each
of the corporations other than the Company owns stock possessing 50% or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain.  A corporation that attains the status of
a Parent on a date after the adoption of the Plan shall be a Parent commencing
as of such date.

         

        (t)           “Participant”
shall mean an individual or estate who holds an
Award.

         

        (u)           “Plan”
shall mean this 2004 Equity Incentive
Compensation Plan of LaserCard Corporation, as amended from time to
time.

         

        (v)           “Purchase
Price” shall mean the consideration for which
one Share may be acquired under the Plan (other than upon exercise of an
Option), as specified by the Committee.

         

        (w)           “Restricted
Share” shall mean a Share awarded under the
Plan.

         

        (x)           “Restricted
Share Agreement” shall mean the agreement
between the Company and the recipient of a Restricted Share which contains the
terms, conditions and restrictions pertaining to such Restricted
Shares.

         

        
          (y)          “SAR”
shall mean a stock appreciation right granted
under the Plan.

        

        
        

         

        (z)           “SAR
Agreement” shall mean the agreement between the
Company and an Optionee which contains the terms, conditions and restrictions
pertaining to his or her SAR.

         

        (aa)        “Service”
shall mean service as an Employee, Consultant
or Outside Director.

         

        
          
            
            

          

          
            3

            
              

            

          

          
            
            

          

           

        

        (bb)           “Share”
shall mean one share of Stock, as adjusted in
accordance with Section 8 (if applicable).

         

        (cc)           “Stock”
shall mean the Common Stock of the
Company.

         

        (dd)           “Stock
Option Agreement” shall mean the agreement
between the Company and an Optionee that contains the terms, conditions and
restrictions pertaining to his Option.

         

        (ee)           “Stock
Unit” shall mean a bookkeeping entry
representing the equivalent of one Share, as awarded under the
Plan.

         

        (ff)           “Stock
Unit Agreement” shall mean the agreement
between the Company and the recipient of a Stock Unit which contains the terms,
conditions and restrictions pertaining to such Stock Unit.

         

        (gg)           “Subsidiary”
shall mean any corporation, if the Company
and/or one or more other Subsidiaries own not less than 50% of the total
combined voting power of all classes of outstanding stock of such
corporation.  A corporation that attains the status of a Subsidiary on
a date after the adoption of the Plan shall be considered a Subsidiary
commencing as of such date.

         

        (hh)           “Total
and Permanent Disability” shall mean that the
Optionee is unable to engage in any substantial gainful activity by reason of
any medically determinable physical or mental impairment that can be expected to
result in death or that has lasted, or can be expected to last, for a continuous
period of not less than 12 months.

         

        (ii)           “GAAP Value” shall
mean the value of an Award on the date it is made for purposes of determining
compensation expense in accordance with U.S. generally accepted accounting
principles, assuming that the Award would vest in full.

         

        SECTION
3.  ADMINISTRATION.

         

        (a)           Committee
Composition.  The Plan shall be
administered by the Committee.  The Committee shall consist of two or
more directors of the Company, who shall be appointed by the
Board.  In addition, the composition of the Committee shall satisfy
(i) such requirements as the United States Securities and Exchange Commission
may establish for administrators acting under plans intended to qualify for
exemption under Rule 16b-3 (or its successor) under the Exchange Act; and (ii)
such requirements as the United States Internal Revenue Service may establish
for outside directors acting under plans intended to qualify for exemption under
Section 162(m)(4)(C) of the Code.

         

        (b)           Committee
for Non-Officer Grants.  The Board
may also appoint one or more separate committees of the Board, each composed of
one or more directors of the Company who need not satisfy the requirements of
Section 3(a), who may administer the Plan with respect to Employees who are
not considered officers or directors of the Company under Section 16 of the
Exchange Act, may grant Awards under the Plan to such Employees and may
determine all terms of such grants.  Within the limitations of the
preceding sentence, any reference in the Plan to the Committee shall include
such committee or committees appointed pursuant to the preceding
sentence.  The Board of Directors may also authorize one or more
officers of the Company to designate Employees, other than officers under
Section 16 of the Exchange Act, to receive Awards and/or to determine the
number of such Awards to be received by such persons; provided, however, that
the Board of Directors shall specify the total number of Awards that such
officers may so award.

         

        (c)           Committee
Procedures.  The Board of Directors
shall designate one of the members of the Committee as chairman.  The
Committee may hold meetings at such times and places as it shall
determine.  The acts of a majority of the Committee members present at
meetings at which a quorum exists, or acts reduced to or approved in writing by
all Committee members, shall be valid acts of the Committee.

         

        (d)           Committee
Responsibilities.  Subject to the
provisions of the Plan, the Committee shall have full authority and discretion
to take the following actions:

         

        
          
            
            

          

          
            4

            
              

            

          

          
            
            

          

           

        

        (i)           To
interpret the Plan and to apply its provisions;

         

        (ii)           To
adopt, amend or rescind rules, procedures and forms relating to the
Plan;

         

        (iii)           To
authorize any person to execute, on behalf of the Company, any instrument
required to carry out the purposes of the Plan;

         

        (iv)           To
determine when Awards are to be granted under the Plan;

         

        (v)           To
select the Offerees and Optionees;

         

        (vi)           To
determine the number of Shares to be made subject to each Award;

         

        (vii)           To
prescribe the terms and conditions of each Award, including (without limitation)
the Exercise Price or Purchase Price, and the vesting or duration of the Award
(including accelerating the vesting of Awards, either at the time of the Award
or thereafter, without the consent of the Participant), to determine whether an
Option is to be classified as an ISO or as a Nonstatutory Option, and to specify
the provisions of the agreement relating to such Award;

         

        (viii)           To
establish or verify the extent of satisfaction of any performance goals or other
conditions applicable to the grant, issuance, exercisability, vesting and/or
ability to retain any Award;

         

        (ix)           To
amend any outstanding Award agreement, subject to applicable legal restrictions
and to the consent of the Participant if the Participant’s rights or obligations
would be adversely affected;

         

        (x)           To
prescribe the consideration for the grant of each Award or other right under the
Plan and to determine the sufficiency of such consideration;

         

        (xi)           To
determine the disposition of each Award or other right under the Plan in the
event of a Participant’s divorce or dissolution of marriage;

         

        (xii)           To
determine whether Options or other rights under the Plan will be granted in
replacement of other grants under an incentive or other compensation plan of an
acquired business;

         

        (xiii)           To
correct any defect, supply any omission, or reconcile any inconsistency in the
Plan or any Award agreement; and

         

        (xiv)           To
take any other actions deemed necessary or advisable for the administration of
the Plan.

         

        Subject
to the requirements of applicable law, the Committee may designate persons other
than members of the Committee to carry out its responsibilities and may
prescribe such conditions and limitations as it may deem appropriate, except
that the Committee may not delegate its authority with regard to the selection
for participation of or the granting of Options or other rights under the Plan
to persons subject to Section 16 of the Exchange Act.  All
decisions, interpretations and other actions of the Committee shall be final and
binding on all Offerees, all Optionees, and all persons deriving their rights
from an Offeree or Optionee.  No member of the Committee shall be
liable for any action that he has taken or has failed to take in good faith with
respect to the Plan, any Option, or any right to acquire Shares under the
Plan.

         

        SECTION
4.  ELIGIBILITY.

         

        (a)           General
Rule.  Only Employees shall be
eligible for the grant of ISOs.  Only Employees, Consultants and
Outside Directors shall be eligible for the grant of Restricted Shares, Stock
Units, Nonstatutory Options or SARs.

         

        
          
            
            

          

          
            5

            
              

            

          

          
            
            

          

           

        

        (b)           Automatic Grants to Outside
Directors.  As of the date of each regular annual meeting of
the Company’s stockholders, each Outside Director who is elected or reelected or
is continuing to serve as a member of the Board of Directors as of the
adjournment of such meeting shall receive an Award of Shares with a GAAP Value
of $36,000 up to a maximum Award of 8,000 Shares, such maximum to include Shares
subject to Awards granted under Section 15 in the one-year period preceding or
following the Award under this Section 4(b), (with the 8,000 Share number
subject to adjustment under Section 12), provided that such Outside Director has
served on the Board of Directors for the immediately preceding six-month
period.   Each Outside Director who is newly elected as a member
of the Board of Directors other than at an annual meeting will similarly receive
an Award of Shares except that the $36,000 GAAP Value and 8,000 Share maximum
shall be pro-rated by the ratio of 365 minus the number of days elapsed since
the prior annual meeting (up to 365) divided by 365.  Each Award of
Shares granted under this Section (4)(b) shall require no payment for the Shares
and shall vest and become non-forfeitable in one installment at the end of the
eleven (11)-month anniversary of the date the Award was made; provided, however,
that each such Award shall become fully vested if a Change in Control occurs
with respect to the Company during the Outside Director’s Service (unless
otherwise provided by the Board in the Outside Director’s Restricted Stock
Agreement).

         

        (c)           Ten-Percent
Stockholders.  An Employee who owns
more than 10% of the total combined voting power of all classes of outstanding
stock of the Company, a Parent or Subsidiary shall not be eligible for the grant
of an ISO unless such grant satisfies the requirements of Section 422(c)(5)
of the Code.

         

        (d)           Attribution
Rules.  For purposes of
Section 4(c) above, in determining stock ownership, an Employee shall be
deemed to own the stock owned, directly or indirectly, by or for such Employee’s
brothers, sisters, spouse, ancestors and lineal descendants.  Stock
owned, directly or indirectly, by or for a corporation, partnership, estate or
trust shall be deemed to be owned proportionately by or for its stockholders,
partners or beneficiaries.

         

        (e)           Outstanding
Stock.  For purposes of
Section 4(c) above, “outstanding stock” shall include all stock actually
issued and outstanding immediately after the grant.  “Outstanding
stock” shall not include shares authorized for issuance under outstanding
options held by the Employee or by any other person (and therefore that may be
subject to ISOs granted under the Plan).

         

        SECTION
5.  STOCK SUBJECT TO PLAN.

         

        (a)           Basic
Limitation.  Shares offered under the
Plan shall be authorized but unissued Shares or treasury Shares.  The
maximum aggregate number of Shares that may be subject to Awards granted under
the Plan (and therefore that may be subject to ISOs granted under the Plan)
shall not exceed one million one hundred ninety thousand (1,190,000) Shares,
plus any Shares remaining available for grant of awards under the Prior Plan on
the Effective Date (including Shares subject to outstanding options under the
Prior Plan on the Effective Date that are subsequently forfeited or terminate
for any other reason before being exercised and unvested Shares that are
forfeited pursuant to such Prior Plan after the Effective Date).  Any
Shares granted as Options or SARs shall be counted against this limit as one (1)
Share for every one (1) Share granted.  In these regards, the number
of Shares counted against this limit shall be reduced by the number of Shares
covered by an SAR which is settled in Shares and by the number Shares covered by
an Option for which there is a net exercise or withholding in Shares (rather
than the number of Shares actually issued).  Any Shares granted as
Awards other than Options or SARs shall be counted against this limit as two (2)
Shares for every one (1) Share granted.  The limitations of this
Section 5(a) shall be subject to adjustment pursuant to
Section 12.  The number of Shares that are subject to Options or
other Awards outstanding at any time under the Plan shall not exceed the number
of Shares which then remain available for issuance under the
Plan.  The Company, during the term of the Plan, shall at all times
reserve and keep available sufficient Shares to satisfy the requirements of the
Plan.

         

        (b)           Individual
Award Limitation.  Subject to the
provisions of Section 12, no Participant may receive Options, SARs,
Restricted Shares or Stock Units under the Plan in any consecutive twelve-month
period that relate to more than 100,000 Shares; provided, however, that this
limit shall be increased to 200,000 Shares for grants in the first twelve months
of the Participant’s Service.

         

        
          
            
            

          

          
            6

            
              

            

          

          
            
            

          

           

        

        (c)           Additional
Shares.  If Restricted Shares or
Shares issued upon the exercise of Options are forfeited, then such Shares shall
again become available for Awards under the Plan.  If Stock Units,
Options or SARs are forfeited or terminate for any other reason before being
settled or exercised, then the corresponding Shares shall again become available
for Awards under the Plan.  If Stock Units are settled, then only the
number of Shares (if any) actually issued in settlement of such Stock Units
(multiplied by two) shall reduce the number available under Section 5(a)
and the balance shall again become available for Awards under the
Plan.

         

        SECTION
6.  RESTRICTED SHARES.

         

        (a)           Restricted
Stock Agreement.  Each grant of
Restricted Shares under the Plan shall be evidenced by a Restricted Stock
Agreement between the recipient and the Company.  Such Restricted
Shares shall be subject to all applicable terms of the Plan and may be subject
to any other terms that are not inconsistent with the Plan.  The
provisions of the various Restricted Stock Agreements entered into under the
Plan need not be identical.

         

        (b)           Payment
for Awards.  Subject to the following
sentence, Restricted Shares may be sold or awarded under the Plan for such
consideration as the Committee may determine, including (without limitation)
cash, cash equivalents, past services and future services; provided that payment
may not be made by delivery of a promissory note. 

         

        (c)           Vesting.  Each Award of Restricted Shares shall be subject to
vesting, with unvested Restricted Shares subject to forfeiture or
repurchase.  Vesting shall occur, in full or in installments, upon
satisfaction of the conditions specified in the Restricted Stock Agreement;
provided, however, that an Award of Restricted Shares will have at least
one-year vesting if such Award includes performance conditions and if the Award
does not include performance conditions, vesting no more rapidly than pro rata
installments over three years from the date the Award is made, other than upon
the death, disability or retirement of the Participant or with respect to such
Awards that are issued upon exercise or settlement of Stock Options or SARs, in
each case as specified in the agreement evidencing such Award.  A
Restricted Stock Agreement may provide for accelerated vesting in the event of
the Participant’s death, disability or retirement or other
events.  The Committee may determine, at the time of granting
Restricted Shares of thereafter, that all or part of such Restricted Shares
shall become vested in the event that a Change in Control occurs with respect to
the Company.

         

        (d)           Voting
and Dividend Rights.  The holders of
Restricted Shares awarded under the Plan shall have the same voting, dividend
and other rights as the Company’s other stockholders.  A Restricted
Stock Agreement, however, may require that the holders of Restricted Shares
invest any cash dividends received in additional Restricted
Shares.  Such additional Restricted Shares shall be subject to the
same conditions and restrictions as the Award with respect to which the
dividends were paid.

         

        (e)           Restrictions
on Transfer of Shares.  Restricted
Shares shall be subject to such rights of repurchase, rights of first refusal or
other restrictions as the Committee may determine.  Such restrictions
shall be set forth in the applicable Restricted Stock Agreement and shall apply
in addition to any general restrictions that may apply to all holders of
Shares.

         

        SECTION
7.  TERMS AND CONDITIONS OF OPTIONS.

         

        (a)           Stock
Option Agreement.  Each grant of an
Option under the Plan shall be evidenced by a Stock Option Agreement between the
Optionee and the Company.  Such Option shall be subject to all
applicable terms and conditions of the Plan and may be subject to any other
terms and conditions which are not inconsistent with the Plan and which the
Committee deems appropriate for inclusion in a Stock Option
Agreement.  The Stock Option Agreement shall specify whether the
Option is an ISO or an NSO.  The provisions of the various Stock
Option Agreements entered into under the Plan need not be
identical.  Options may be granted in consideration of a reduction in
the Optionee’s other compensation.

         

        (b)           Number
of Shares.  Each Stock Option
Agreement shall specify the number of Shares that are subject to the Option and
shall provide for the adjustment of such number in accordance with
Section 12.

         

        
          
            
            

          

          
            7

            
              

            

          

          
            
            

          

        

         

        (c)           Exercise
Price.  Each Stock Option Agreement
shall specify the Exercise Price.  The Exercise Price of an ISO shall
not be less than 100% of the Fair Market Value of a Share on the date of grant,
except as otherwise provided in Section 4(c), and the Exercise Price of an
NSO shall not be less 100% of the Fair Market Value of a Share on the date of
grant.  Subject to the foregoing in this Section 7(c), the
Exercise Price under any Option shall be determined by the Committee at its sole
discretion.  The Exercise Price shall be payable in one of the forms
described in Section 8

         

        (d)           Withholding
Taxes.  As a condition to the
exercise of an Option, the Optionee shall make such arrangements as the
Committee may require for the satisfaction of any federal, state, local or
foreign withholding tax obligations that may arise in connection with such
exercise.  The Optionee shall also make such arrangements as the
Committee may require for the satisfaction of any federal, state, local or
foreign withholding tax obligations that may arise in connection with the
disposition of Shares acquired by exercising an Option.

         

        (e)           Exercisability
and Term.  Each Stock Option
Agreement shall specify the date when all or any installment of the Option is to
become exercisable.  The Stock Option Agreement shall also specify the
term of the Option; provided that the term of Option shall in no event exceed 10
years from the date of grant (five years for ISOs granted to Employees described
in Section 4(c)).  A Stock Option Agreement may provide for
accelerated exercisability in the event of the Optionee’s death, disability, or
retirement or other events and may provide for expiration prior to the end of
its term in the event of the termination of the Optionee’s
Service.  Options may be awarded in combination with SARs, and such an
Award may provide that the Options will not be exercisable unless the related
SARs are forfeited.  Subject to the foregoing in this
Section 7(e), the Committee at its sole discretion shall determine when all
or any installment of an Option is to become exercisable and when an Option is
to expire.

         

        (f)           Exercise
of Options Upon Termination of Service.  Each Stock
Option Agreement shall set forth the extent to which the Optionee shall have the
right to exercise the Option following termination of the Optionee’s Service
with the Company and its Subsidiaries, and the right to exercise the Option of
any executors or administrators of the Optionee’s estate or any person who has
acquired such Option(s) directly from the Optionee by bequest or
inheritance.  Such provisions shall be determined in the sole
discretion of the Committee, need not be uniform among all Options issued
pursuant to the Plan, and may reflect distinctions based on the reasons for
termination of Service.

         

        (g)           Effect
of Change in Control.  The Committee
may determine, at the time of granting an Option or thereafter, that such Option
shall become exercisable as to all or part of the Shares subject to such Option
in the event that a Change in Control occurs with respect to the
Company.

         

        (h)           Leaves
of Absence.  An Employee’s Service shall cease when such
Employee ceases to be actively employed by, or a Consultant to, the Company (or
any subsidiary) as determined in the sole discretion of the Board of
Directors.  For purposes of Options, Service does not terminate when
an Employee goes on a bona fide leave of absence, that was approved by the
Company in writing, if the terms of the leave provide for continued service
crediting, or when continued service crediting is required by applicable
law.  However, for purposes of determining whether an Option is
entitled to ISO status, an Employee’s Service will be treated as terminating 90
days after such Employee went on leave, unless such Employee’s right to return
to active work is guaranteed by law or by a contract.  Service
terminates in any event when the approved leave ends, unless such Employee
immediately returns to active work.  The Company determines which
leaves count toward Service, and when Service terminates for all purposes under
the Plan.

         

        (i)           No
Rights as a Stockholder.  An Optionee, or a transferee of an
Optionee, shall have no rights as a stockholder with respect to any Shares
covered by his Option until the date of the issuance of a stock certificate for
such Shares.  No adjustments shall be made, except as provided in
Section 12.

         

        (j)           Modification,
Extension and Renewal of Options.  Within the limitations of
the Plan, the Committee may modify, extend or renew outstanding options or may
accept the cancellation of outstanding options (to the extent not previously
exercised), whether or not granted hereunder, in return for the grant of new
Options for the same or a different number of Shares..  The foregoing
notwithstanding, no modification of an Option shall, without the consent of the
Optionee, adversely affect his or her rights or obligations under such
Option.  In addition, notwithstanding any other provision of the Plan,
in no event shall the Committee cancel any outstanding Option for the purpose of
reissuing the Option to the Optionee at a lower exercise price or reduce the
exercise price of an outstanding Option.

         

        
          
            
            

          

          
            8

            
              

            

          

          
            
            

          

           

        

        (k)           Restrictions
on Transfer of Shares.  Any Shares issued upon exercise of an
Option shall be subject to such special forfeiture conditions, rights of
repurchase, rights of first refusal and other transfer restrictions as the
Committee may determine.  Such restrictions shall be set forth in the
applicable Stock Option Agreement and shall apply in addition to any general
restrictions that may apply to all holders of Shares.

         

        SECTION
8.  PAYMENT FOR SHARES.

         

        (a)           General
Rule.  The entire Exercise Price or Purchase Price of Shares
issued under the Plan shall be payable in lawful money of the United States of
America at the time when such Shares are purchased, except as provided in
Section 8(b) through Section 8(f) below.

         

        (b)           Surrender
of Stock.  To the extent that a Stock Option Agreement so
provides, payment may be made all or in part by surrendering, or attesting to
the ownership of, Shares which have already been owned by the Optionee or his
representative.  Such Shares shall be valued at their Fair Market
Value on the date when the new Shares are purchased under the
Plan.  The Optionee shall not surrender, or attest to the ownership
of, Shares in payment of the Exercise Price if such action would cause the
Company to recognize compensation expense (or additional compensation expense)
with respect to the Option for financial reporting purposes.

         

        (c)           Services
Rendered.  At the discretion of the Committee, Shares may be
awarded under the Plan in consideration of services rendered to the Company or a
Subsidiary prior to the award.  If Shares are awarded without the
payment of a Purchase Price in cash, the Committee shall make a determination
(at the time of the award) of the value of the services rendered by the Offeree
and the sufficiency of the consideration to meet the requirements of
Section 6(b).

         

        (d)           Cashless
Exercise.  To the extent that a Stock Option Agreement so
provides, payment may be made all or in part by delivery (on a form prescribed
by the Committee) of an irrevocable direction to a securities broker to sell
Shares and to deliver all or part of the sale proceeds to the Company in payment
of the aggregate Exercise Price.

         

        (e)           Exercise/Pledge.  To
the extent that a Stock Option Agreement so provides, payment may be made all or
in part by delivery (on a form prescribed by the Committee) of an irrevocable
direction to a securities broker or lender to pledge Shares, as security for a
loan, and to deliver all or part of the loan proceeds to the Company in payment
of the aggregate Exercise Price.

         

        (f)           Other
Forms of Payment.  To the extent that a Stock Option Agreement
or Restricted Stock Agreement so provides, payment may be made in any other form
that is consistent with applicable laws, regulations and rules; provided that
payment may not be made by delivery of a promissory note.

         

        (g)           Limitations
under Applicable Law.  Notwithstanding anything herein or in a
Stock Option Agreement or Restricted Stock Agreement to the contrary, payment
may not be made in any form that is unlawful, as determined by the Committee in
its sole discretion.

         

        SECTION
9.  STOCK APPRECIATION RIGHTS.

         

        (a)           SAR
Agreement.  Each grant of a SAR under the Plan shall be
evidenced by a SAR Agreement between the Optionee and the
Company.  Such SAR shall be subject to all applicable terms of the
Plan and may be subject to any other terms that are not inconsistent with the
Plan.  The provisions of the various SAR Agreements entered into under
the Plan need not be identical.  SARs may be granted in consideration
of a reduction in the Optionee’s other compensation.

         

        
          
            
            

          

          
            9

            
              

            

          

          
            
            

          

        

         

        (b)           Number
of Shares.  Each SAR Agreement shall specify the number of
Shares to which the SAR pertains and shall provide for the adjustment of such
number in accordance with Section 12.

         

        (c)           Exercise
Price.  Each SAR Agreement shall specify the Exercise
Price.  A SAR Agreement may specify an Exercise Price that varies in
accordance with a predetermined formula while the SAR is
outstanding.

         

        (d)           Exercisability
and Term.  Each SAR Agreement shall specify the date when all
or any installment of the SAR is to become exercisable.  The SAR
Agreement shall also specify the term of the SAR.  A SAR Agreement may
provide for accelerated exercisability in the event of the Optionee’s death,
disability or retirement or other events and may provide for expiration prior to
the end of its term in the event of the termination of the Optionee’s
service.  SARs may be awarded in combination with Options, and such an
Award may provide that the SARs will not be exercisable unless the related
Options are forfeited.  A SAR may be included in an ISO only at the
time of grant but may be included in an NSO at the time of grant or
thereafter.  A SAR granted under the Plan may provide that it will be
exercisable only in the event of a Change in Control.

         

        (e)           Effect
of Change in Control.  The Committee may determine, at the time
of granting a SAR or thereafter, that such SAR shall become fully exercisable as
to all Common Shares subject to such SAR in the event that a Change in Control
occurs with respect to the Company.

         

        (f)           Exercise
of SARs.  Upon exercise of a SAR, the Optionee (or any person
having the right to exercise the SAR after his or her death) shall receive from
the Company (a) Shares, (b) cash or (c) a combination of Shares and cash, as the
Committee shall determine.  The amount of cash and/or the Fair Market
Value of Shares received upon exercise of SARs shall, in the aggregate, be equal
to the amount by which the Fair Market Value (on the date of surrender) of the
Shares subject to the SARs exceeds the Exercise Price.

         

        (g)           Modification
or Assumption of SARs.  Within the limitations of the Plan, the
Committee may modify, extend or assume outstanding SARs or may accept the
cancellation of outstanding SARs (whether granted by the Company or by another
issuer) in return for the grant of new SARs for the same or a different number
of shares.  The foregoing notwithstanding, no modification of a SAR
shall, without the consent of the holder, may alter or impair his or her rights
or obligations under such SAR.  In addition, notwithstanding any other
provision of the Plan, in no event shall the Committee cancel any outstanding
SAR for the purpose of reissuing the SAR to the Optionee at a lower exercise
price or reduce the exercise price of an outstanding SAR.

         

        SECTION
10.  STOCK UNITS.

         

        (a)           Stock
Unit Agreement.  Each grant of Stock Units under the Plan shall
be evidenced by a Stock Unit Agreement between the recipient and the
Company.  Such Stock Units shall be subject to all applicable terms of
the Plan and may be subject to any other terms that are not inconsistent with
the Plan.  The provisions of the various Stock Unit Agreements entered
into under the Plan need not be identical.  Stock Units may be granted
in consideration of a reduction in the recipient’s other
compensation.

         

        (b)           Payment
for Awards.  To the extent that an Award is granted in the form
of Stock Units, no cash consideration shall be required of the Award
recipients.

         

        (c)           Vesting
Conditions.  Each Award of Stock Units shall be subject to
vesting.  Vesting shall occur, in full or in installments, upon
satisfaction of the conditions specified in the Stock Unit Agreement; provided,
however, that an Award of Stock Units will have at least one-year vesting if
such Award includes performance conditions and if the Award does not include
performance conditions, vesting no more rapidly than pro rata installments over
three years from the date the Award is made, other than upon the death,
disability or retirement of the Participant or with respect to such Awards that
are issued upon exercise or settlement of Stock Options or SARs, in each case as
specified in the agreement evidencing such Award.  Stock Unit
Agreement may provide for accelerated vesting in the event of the Participant’s
death, disability or retirement or other events.  The Committee may
determine, at the time of granting Stock Units or thereafter, that all or part
of such Stock Units shall become vested in the event that a Change in Control
occurs with respect to the Company.

         

        
          
            
            

          

          
            10

            
              

            

          

          
            
            

          

        

         

        (d)           Voting
and Dividend Rights.  The holders of Stock Units shall have no
voting rights.  Prior to settlement or forfeiture, any Stock Unit
awarded under the Plan may, at the Committee’s discretion, carry with it a right
to dividend equivalents.  Such right entitles the holder to be
credited with an amount equal to all cash dividends paid on one Share while the
Stock Unit is outstanding.  Dividend equivalents may be converted into
additional Stock Units.  Settlement of dividend equivalents may be
made in the form of cash, in the form of Shares, or in a combination of
both.  Prior to distribution, any dividend equivalents which are not
paid shall be subject to the same conditions and restrictions (including without
limitation, any forfeiture conditions) as the Stock Units to which they
attach.

         

        (e)           Form
and Time of Settlement of Stock Units.  Settlement of vested
Stock Units may be made in the form of (a) cash, (b) Shares or (c) any
combination of both, as determined by the Committee.  The actual
number of Stock Units eligible for settlement may be larger or smaller than the
number included in the original Award, based on predetermined performance
factors.  Methods of converting Stock Units into cash may include
(without limitation) a method based on the average Fair Market Value of Shares
over a series of trading days.  Vested Stock Units may be settled in a
lump sum or in installments.  The distribution may occur or commence
when all vesting conditions applicable to the Stock Units have been satisfied or
have lapsed, or it may be deferred to any later date.  The amount of a
deferred distribution may be increased by an interest factor or by dividend
equivalents.  Until an Award of Stock Units is settled, the number of
such Stock Units shall be subject to adjustment pursuant to
Section 12.

         

        (f)           Death
of Recipient.  Any Stock Unit Award that becomes payable after
the recipient’s death shall be distributed to the recipient’s beneficiary or
beneficiaries.  Each recipient of a Stock Unit Award under the Plan
shall designate one or more beneficiaries for this purpose by filing the
prescribed form with the Company.  A beneficiary designation may be
changed by filing the prescribed form with the Company at any time before the
Award recipient’s death.  If no beneficiary was designated or if no
designated beneficiary survives the Award recipient, then any Stock Unit Award
that becomes payable after the recipient’s death shall be distributed to the
recipient’s estate.

         

        (g)           Creditors’
Rights.  A holder of Stock Units shall have no rights other
than those of a general creditor of the Company.  Stock Units
represent an unfunded and unsecured obligation of the Company, subject to the
terms and conditions of the applicable Stock Unit Agreement.

         

        SECTION
11.  TRANSFERABILITY; PERFORMANCE GOALS.

         

        (a)           Transferability.  Except
to the extent determined by the Committee, no Award shall be assigned or
transferred by a Participant other than by will or the laws of descent and
distribution, and during the lifetime of the Participant may be exercised only
by such Participant or his or her guardian or legal representative.

         

        (b)           Performance
Goals.  The number of Shares or other benefits granted, issued,
retainable and/or vested under an Award may be made subject to the attainment of
performance goals for a specified period of time relating to one or more of the
following performance criteria, either individually, alternatively or in any
combination, applied to either the Company as a whole or to a business unit or
Subsidiary, either individually, alternatively or in any combination, and
measured either annually or cumulatively over a period of years, on an absolute
basis or relative to a pre-established target, to previous years’ results or to
a designated comparison group or index, in each case as specified by the
Committee in the Award: (a) cash flow, (b) earnings per share, (c) earnings
before interest, taxes and amortization, (d) return on equity, (e) total
stockholder return, (f) share price performance, (g) return on capital, (h)
return on assets or net assets, (i) revenue, (j) income or net income, (k)
operating income or net operating income, (l) operating profit or net operating
profit, (m) operating margin or profit margin, (n) return on operating revenue,
(o) return on invested capital, (p) market segment shares, (q) sales, (r) unit
openings or (s) customer satisfaction ("Qualifying Performance
Criteria").  The Committee may appropriately adjust any evaluation of
performance under a Qualifying Performance Criteria to exclude any of the
following events that occurs during a performance period: (i) asset write-downs,
(ii) litigation or claim judgments or settlements, (iii) the effect of changes
in tax law, accounting principles or other such laws or provisions affecting
reported results, (iv) accruals for reorganization and restructuring programs
and (v) any extraordinary nonrecurring items as described in Accounting
Principles Board Opinion No. 30 and/or in managements’ discussion and analysis
of financial condition and results of operations appearing in the Company’s
annual report to stockholders for the applicable year.  The Committee
shall determine the Qualifying Performance Criteria not later than the 90th
day of the performance period, and shall determine and certify, for each
Participant, the extent to which the Qualifying Performance Criteria have been
met.  The Committee may not in any event increase the amount of
compensation payable under the Plan upon the attainment of a Qualifying
Performance Goal to a Participant who is a "covered employee" within the meaning
of Section 162(m) of the Code.

         

        
          
            
            

          

          
            11

            
              

            

          

          
            
            

          

        

         

        SECTION
12.  ADJUSTMENT OF SHARES.

         

        (a)           Adjustments.  In the event of a subdivision of the outstanding
Stock, a declaration of a dividend payable in Shares, a declaration of a
dividend payable in a form other than Shares in an amount that has a material
effect on the price of Shares, a combination or consolidation of the outstanding
Stock (by reclassification or otherwise) into a lesser number of Shares, a
recapitalization, a spin-off or a similar occurrence, the Committee shall make
such adjustments as it, in its sole discretion, deems appropriate in one or more
of:

         

        (i)           The
number of Options, SARs, Restricted Shares and Stock Units available for future
Awards under Section 5;

         

        (ii)           The
limitations set forth in Section 5(a) and (b);

         

        (iii)           The
number of Shares covered by each outstanding Option and SAR;

         

        (iv)           The
Exercise Price under each outstanding Option and SAR; or

         

        (v)           The
number of Stock Units included in any prior Award which has not yet been
settled.

         

        Except as
provided in this Section 12, a Participant shall have no rights by reason
of any issue by the Company of stock of any class or securities convertible into
stock of any class, any subdivision or consolidation of shares of stock of any
class, the payment of any stock dividend or any other increase or decrease in
the number of shares of stock of any class.

         

        (b)           Dissolution
or Liquidation.  To the extent not previously exercised or settled,
Options, SARs and Stock Units shall terminate immediately prior to the
dissolution or liquidation of the Company.

         

        (c)           Reorganizations.  In the event that the Company is a party to a merger
or other reorganization, outstanding Awards shall be subject to the agreement of
merger or reorganization.  Such agreement shall provide
for:

         

        (i)           The
continuation of the outstanding Awards by the Company, if the Company is a
surviving corporation;

         

        (ii)           The
assumption of the outstanding Awards by the surviving corporation or its parent
or subsidiary;

         

        (iii)           The
substitution by the surviving corporation or its parent or subsidiary of its own
awards for the outstanding Awards;

         

        (iv)           Full
acceleration of the expiration date of the outstanding unexercised Awards to a
date not earlier than thirty (30) days after notice to the Participant;
or

         

        (v)           Settlement
of the full value of the outstanding Awards in cash or cash equivalents
(including deferred compensation pending vesting) followed by cancellation of
such Awards.

         

        (d)           Reservation
of Rights.  Except as provided in
this Section 12, an Optionee or Offeree shall have no rights by reason of
any subdivision or consolidation of shares of stock of any class, the payment of
any dividend or any other increase or decrease in the number of shares of stock
of any class.  Any issue by the Company of shares of stock of any
class, or securities convertible into shares of stock of any class, shall not
affect, and no adjustment by reason thereof shall be made with respect to, the
terms of any outstanding Award, including the number or Exercise Price of Shares
subject to an Award.  The grant of an Award pursuant to the Plan shall
not affect in any way the right or power of the Company to make adjustments,
reclassifications, reorganizations or changes of its capital or business
structure, to merge or consolidate or to dissolve, liquidate, sell or transfer
all or any part of its business or assets.

         

        
          
            
            

          

          
            12

            
              

            

          

          
            
            

          

        

         

        SECTION
13.  DEFERRAL OF AWARDS.

         

        The
Committee (in its sole discretion) may permit or require a Participant
to:

         

        (a)           Have
cash that otherwise would be paid to such Participant as a result of the
exercise of a SAR or the settlement of Stock Units credited to a deferred
compensation account established for such Participant by the Committee as an
entry on the Company’s books;

         

        (b)           Have
Shares that otherwise would be delivered to such Participant as a result of the
exercise of an Option or SAR converted into an equal number of Stock Units;
or

         

        (c)           Have
Shares that otherwise would be delivered to such Participant as a result of the
exercise of an Option or SAR or the settlement of Stock Units converted into
amounts credited to a deferred compensation account established for such
Participant by the Committee as an entry on the Company’s books.  Such
amounts shall be determined by reference to the Fair Market Value of such Shares
as of the date when they otherwise would have been delivered to such
Participant.

         

        A
deferred compensation account established under this Section 13 may be
credited with interest or other forms of investment return, as determined by the
Committee.  A Participant for whom such an account is established
shall have no rights other than those of a general creditor of the
Company.  Such an account shall represent an unfunded and unsecured
obligation of the Company and shall be subject to the terms and conditions of
the applicable agreement between such Participant and the Company.  If
the deferral or conversion of Awards is permitted or required, the Committee (in
its sole discretion) may establish rules, procedures and forms pertaining to
such Awards, including (without limitation) the settlement of deferred
compensation accounts established under this Section 13.

         

        SECTION
14.  AWARDS UNDER OTHER PLANS.

         

        The
Company may grant awards under other plans or programs.  Such awards
may be settled in the form of Shares issued under this Plan.  Such
Shares shall be treated for all purposes under the Plan like Shares issued in
settlement of Stock Units and shall, when issued, reduce the number of Shares
available under Section 5.

         

        SECTION
15.   PAYMENT OF DIRECTOR’S FEES IN SECURITIES.

         

        (a)           Effective
Date.  No provision of this Section 15 shall be effective
unless and until the Board has determined to implement such
provision.

         

        (b)           Elections
to Receive NSOs, Restricted Shares or Stock Units.  An Outside
Director may elect to receive his or her annual retainer payments and/or meeting
fees from the Company in the form of cash, NSOs, Restricted Shares or Stock
Units, or a combination thereof, as determined by the Board.  Such
NSOs, Restricted Shares and Stock Units shall be issued under the
Plan.  An election under this Section 15 shall be filed with the
Company on the prescribed form.

         

        (c)           Number
and Terms of NSOs, Restricted Shares or Stock Units.  The
number of NSOs, Restricted Shares or Stock Units to be granted to Outside
Directors in lieu of annual retainers and meeting fees that would otherwise be
paid in cash shall be calculated in a manner determined by the
Board.  The terms of such NSOs, Restricted Shares or Stock Units shall
also be determined by the Board.  Provided, however, that the
cumulative total Shares which may be subject to Awards granted under Section
4(b) and this Section 15 shall be limited to 8,000 Shares (subject to adjustment
under Section 12), in any consecutive twelve-month period.

         

        
          
            
            

          

          
            13

            
              

            

          

          
            
            

          

        

         

        SECTION
16.  LEGAL AND REGULATORY REQUIREMENTS.

         

        Shares
shall not be issued under the Plan unless the issuance and delivery of such
Shares complies with (or is exempt from) all applicable requirements of law,
including (without limitation) the United States Securities Act of 1933, as
amended, the rules and regulations promulgated thereunder, state securities laws
and regulations and the regulations of any stock exchange on which the Company’s
securities may then be listed, and the Company has obtained the approval or
favorable ruling from any governmental agency which the Company determines is
necessary or advisable.

         

        SECTION
17.  WITHHOLDING TAXES.

         

        (a)           General.  To
the extent required by applicable federal, state, local or foreign law, a
Participant or his or her successor shall make arrangements satisfactory to the
Company for the satisfaction of any withholding tax obligations that arise in
connection with the Plan.  The Company shall not be required to issue
any Shares or make any cash payment under the Plan until such obligations are
satisfied.

         

        (b)           Share
Withholding.  The Committee may permit a Participant to satisfy
all or part of his or her withholding or income tax obligations by having the
Company withhold all or a portion of any Shares that otherwise would be issued
to him or her or by surrendering all or a portion of any Shares that he or she
previously acquired.  Such Shares shall be valued at their Fair Market
Value on the date when taxes otherwise would be withheld in cash.  In
no event may a Participant have Shares withheld that would otherwise be issued
to him or her in excess of the number necessary to satisfy the legally required
minimum tax withholding.

         

        SECTION
18.  NO EMPLOYMENT RIGHTS.

         

        No
provision of the Plan, nor any right or Option granted under the Plan, shall be
construed to give any person any right to become, to be treated as, or to remain
an Employee.  The Company and its Subsidiaries reserve the right to
terminate any person’s Service at any time and for any reason, with or without
notice.

         

        SECTION
19.  DURATION AND AMENDMENTS.

         

        (a)           Term
of the Plan.  The Plan, as set forth herein, shall terminate
automatically ten (10) years after its adoption by the Board.  The
Plan may be terminated on any earlier date pursuant to Subsection (b)
below.

         

        (b)           Right
to Amend or Terminate the Plan.  The Board of Directors may
amend the Plan at any time and from time to time.  Rights and
obligations under any Award granted before amendment of the Plan shall not be
materially impaired by such amendment, except with consent of the
Participant.  An amendment of the Plan shall be subject to the
approval of the Company’s stockholders only to the extent required by applicable
laws, regulations or rules.

         

        (c)           Effect
of Termination.  No Awards shall be granted under the Plan
after the termination thereof.  The termination of the Plan shall not
affect any Award previously granted under the Plan.

         

        [Remainder
of this page intentionally left blank]

         

         

         

         

        
          
            
            

          

          
            14

            
              

            

          

          
            
            

          

        

         

        SECTION
20.  EXECUTION.

         

        To record
the adoption of the Plan by the Board of Directors, the Company has caused its
authorized officer to execute the same.

         

        
          
            	 	LaserCard
      Corporation	 
	 	 	 	 
	 	 	 	 
	 	
                    By

                  	 	 
	 	 	 	 
	 	Name	 	 
	 	 	 	 
	 	Title	 	 
	 	 	 	 

          

        

         

         

         

         

         

         

        15

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}]]