Document:

EXHIBIT
4.2

    

    Warrant
Certificate No. ___

    

    NEITHER
THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES ISSUABLE UPON
THE EXERCISE OF THIS WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH
SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, ASSIGNED OR OTHERWISE
TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS
EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) AN
EXEMPTION FROM SUCH REGISTRATION EXISTS AND THE COMPANY RECEIVES AN OPINION OF
COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE
SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED,
ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT OR APPLICABLE STATE SECURITIES
LAWS.

    

    
      
        	
                Effective
      Date: [   ], 2009

              	
                Void
      After: [   ],
2014

              

      

    

    

    LI3
ENERGY, INC.

    

    WARRANT
TO PURCHASE COMMON STOCK

    

    Li3
Energy, Inc., a Nevada corporation (the “Company”), for value received
on [  ], 2009 (the “Effective Date”), hereby
issues to [          ] (the “Holder”) this Warrant (the
“Warrant”) to purchase,
[        ] shares (each such share as
from time to time adjusted as hereinafter provided being a “Warrant Share” and all such
shares being the “Warrant
Shares”) of the Company’s Common Stock (as defined below), at the
Exercise Price (as defined below), as adjusted from time to time as provided
herein, on or before [   ], 2014 (the “Expiration Date”), all subject
to the following terms and conditions. Unless otherwise defined in this Warrant,
terms appearing in initial capitalized form shall have the meaning ascribed to
them in that certain Subscription Agreement between the Company and the
purchaser signatory thereto pursuant to which this Warrant was issued (the
“Subscription
Agreement”).  This Warrant is one of a series of Warrants
issued in accordance with the terms of the Offering (collectively, the “Warrants”) to the Holder and
additional investors (collectively, the “Holders”).

    

    As used
in this Warrant, (i) “Business
Day” means any day other than Saturday, Sunday or any other day on which
commercial banks in the City of New York, New York, are authorized or required
by law or executive order to close; (ii) “Common Stock” means the common
stock of the Company, par value $0.001 per share, including any securities
issued or issuable with respect thereto or into which or for which such shares
may be exchanged for, or converted into, pursuant to any stock dividend, stock
split, stock combination, recapitalization, reclassification, reorganization or
other similar event; (iii) “Exercise Price” means $1.00
per share of Common Stock, subject to adjustment as provided herein; (iv) “Trading Day” means any day on
which the Common Stock is traded on the primary national or regional stock
exchange on which the Common Stock is listed, or if not so listed, the OTC
Bulletin Board, if quoted thereon, is open for the transaction of business;
and (v) “Affiliate”
means any person that, directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with, a
person, as such terms are used and construed in Rule 144 promulgated under the
Securities Act of 1933, as amended (the “Securities
Act”).

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
              1.

            	
              DURATION,
      REDEMPTION AND EXERCISE OF WARRANTS

            

    

    

    (a)           Exercise
Period. Subject to Paragraph (b) of this section, the Holder may
exercise this Warrant in whole or in part on any Business Day on or before 5:00
P.M., Eastern Time, on the Expiration Date, at which time this Warrant shall
become void and of no value.

    

    (b)           Redemption. At
any  time and from time to time following the forty-fifth (45th) day after
a registration statement under the Securities Act covering the resale of the
Warrant Shares has been declared effective, and only if such registration
statement remains effective at all times during the Call  Exercise
Period (as defined below), the Company, at its option, may, upon written notice
to the Holder (the "Call  Notice"), call up to one hundred percent (100%)
of the Warrant Shares if within twenty (20) days prior to the date
the Company calls the Warrant, there is a single trading day on which the
closing bid price of the Common Stock on the principal market is equal to
or greater than $1.50 per share. To be effective, the Call Notice must be
given within twenty (20) business days after the aforementioned single trading
day. The rights and privileges granted pursuant to this Warrant with
respect to such Warrant Shares subject to the Call Notice shall terminate if
this Warrant is not exercised by the Holder with respect to the Warrant
Shares subject to the Call Notice by the Holder within ten (10)  business
days after the Call Notice is received by the Holder  (the
"Call Exercise Period"). In the event that this Warrant is not exercised by
the Holder with respect to the Warrant Shares subject to the Call Notice within
the Call Exercise Period, this Warrant shall automatically expire at 5:00 p.m.
New York time on the last day of the Call Exercise Period, and the Company will
remit to the Holder $0.001 per Warrant Share and a new Warrant
certificate representing the number of Warrant Shares, if any, with respect
to which this Warrant has not been exercised or subject to a Call Notice upon
such Holder tendering to the Company the expired Warrant
certificate.

    

    
      	
               
      

            	
              (c)

            	
              Exercise
      Procedures.

            

    

    

    (i)           While
this Warrant remains outstanding and exercisable in accordance with Section
1(a), in addition to the manner set forth in Section 1(b)(ii) below, the Holder
may exercise this Warrant in whole or in part at any time and from time to time
by:

    

    (A)           delivery
to the Company of a duly completed and executed copy of the notice of exercise
attached as Exhibit A
(the “Notice of
Exercise”);

    

    (B)           surrender
of this Warrant to the Secretary of the Company at its principal offices or at
such other office or agency as the Company may specify in writing to the Holder;
and

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

    

    (C)           payment
of the then-applicable Exercise Price per share multiplied by the number of
Warrant Shares being purchased upon exercise of the Warrant (such amount, the
“Aggregate Exercise
Price”) made in the form of cash, or by certified check, wire transfer,
bank draft or money order payable in lawful money of the United States of
America or in the form of a Cashless Exercise to the extent permitted in Section
1(b)(ii) below.

    

    (ii)           While
this Warrant remains outstanding and exercisable in accordance with Section
1(a), if we default in honoring the Holder’s “piggyback” registration
rights (as defined in that certain Registration Rights Section of related
agreement(s) of even date herewith executed by the Holder in connection with the
Offering, the “Registration Rights Agreement”) with respect to the Warrant
Shares at any time, the Holder may, in its sole discretion, exercise all or any
part of the Warrant in a “cashless” or “net-issue” exercise (a “Cashless Exercise”) by
delivering to the Company (1) the Notice of Exercise and (2) the original
Warrant, pursuant to which the Holder shall surrender the right to receive upon
exercise of this Warrant, a number of Warrant Shares having a value (as
determined below) equal to the Aggregate Exercise Price, in which case, the
number of Warrant Shares to be issued to the Holder upon such exercise shall be
calculated using the following formula:

    

    
      
        	
                X

              	
                =

              	
                Y
      * (A - B)

              
	 
      	 
      	
                A

              

      

    

    

    
      
        	
                with:

              	
                X
      =

              	
                the
      number of Warrant Shares to be issued to the Holder

              
	 
      	 
      	 
      
	 
      	
                Y
      =

              	
                the
      number of Warrant Shares with respect to which the Warrant is being
      exercised

              
	 
      	 
      	 
      
	 
      	
                A
      =

              	
                the
      fair market value per share of Common Stock on the date of exercise of
      this Warrant

              
	 
      	 
      	 
      
	 
      	
                B
      =

              	
                the
      then-current Exercise Price of the
Warrant

              

      

    

    

    Solely
for the purposes of this paragraph, “fair market value” per share of Common
Stock shall mean (A) the average of the closing sales prices, as quoted on the
primary national or regional stock exchange on which the Common Stock is listed,
or, if not listed, the OTC Bulletin Board if quoted thereon, on the twenty (20)
trading days immediately preceding the date on which the Notice of Exercise is
deemed to have been sent to the Company, or (B) if the Common Stock is not
publicly traded as set forth above, as reasonably and in good faith determined
by the Board of Directors of the Company as of the date which the Notice of
Exercise is deemed to have been sent to the Company.

    

    Notwithstanding
the foregoing provisions of this Section 1(b)(ii), the Holder may not make a
Cashless Exercise if and to the extent that such exercise would require the
Company to issue a number of shares of Common Stock in excess of its authorized
but unissued shares of Common Stock, less all amounts of Common Stock that have
been reserved for issue upon the conversion of all outstanding securities
convertible into shares of Common Stock and the exercise of all outstanding
options, warrants and other rights exercisable for shares of Common
Stock.  If the Company does not have the requisite number of
authorized but unissued shares of Common Stock to permit the Holder to make a
Cashless Exercise, the Company shall use commercially reasonable efforts to
obtain the necessary stockholder consent to increase the authorized number of
shares of Common Stock to permit such Holder to make a Cashless Exercise
pursuant to this Section 1(b)(ii).

    
      
         

      

      
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    (iii)           Upon
the exercise of this Warrant in compliance with the provisions of this Section
1(b), and except as limited pursuant to the last paragraph of Section 1(b)(ii),
the Company shall promptly issue and cause to be delivered to the Holder a
certificate for the Warrant Shares purchased by the Holder.  Each
exercise of this Warrant shall be effective immediately prior to the close of
business on the date (the “Date
of Exercise”) that the conditions set forth in Section 1(b) have been
satisfied, as the case may be.  On the first Business Day following
the date on which the Company has received each of the Notice of Exercise and
the Aggregate Exercise Price (or notice of a Cashless Exercise in accordance
with Section 1(b)(ii)) (the “Exercise Delivery Documents”),
the Company shall transmit an acknowledgment of receipt of the Exercise Delivery
Documents to the Company’s transfer agent (the “Transfer Agent”). On or before
the fifth Business Day following the date on which the Company has received all
of the Exercise Delivery Documents (the “Share Delivery Date”), the
Company shall (X) provided that the Transfer Agent is participating in The
Depository Trust Company (“DTC”) Fast Automated
Securities Transfer Program, upon the request of the Holder, credit such
aggregate number of shares of Common Stock to which the Holder is entitled
pursuant to such exercise to the Holder’s or its designee’s balance account with
DTC through its Deposit Withdrawal Agent Commission system, or (Y) if the
Transfer Agent is not participating in the DTC Fast Automated Securities
Transfer Program, issue and dispatch by overnight courier to the address as
specified in the Notice of Exercise, a certificate, registered in the Company’s
share register in the name of the Holder or its designee, for the number of
shares of Common Stock to which the Holder is entitled pursuant to such
exercise.  Upon delivery of the Exercise Delivery Documents, the
Holder shall be deemed for all corporate purposes to have become the holder of
record of the Warrant Shares with respect to which this Warrant has been
exercised, irrespective of the date of delivery of the certificates evidencing
such Warrant Shares. If this Warrant is submitted in connection with any
exercise pursuant to Section 1(a) and the number of Warrant Shares represented
by this Warrant submitted for exercise is greater than the actual number of
Warrant Shares being acquired upon such an exercise, then the
Company shall as soon as practicable and in no event later than five (5)
Business Days after any exercise and at its own expense, issue a new Warrant of
like tenor representing the right to purchase the number of Warrant Shares
purchasable immediately prior to such exercise under this Warrant, less the
number of Warrant Shares with respect to which this Warrant is
exercised.

    

    (iv)           If
the Company shall fail for any reason or for no reason to issue to the Holder,
within five (5) Business Days of receipt of the Exercise Delivery Documents, a
certificate for the number of shares of Common Stock to which the Holder is
entitled and register such shares of Common Stock on the Company’s share
register or to credit the Holder’s balance account with DTC for such number of
shares of Common Stock to which the Holder is entitled upon the Holder’s
exercise of this Warrant, and if on or after such Business Day the Holder
purchases (in an open market transaction or otherwise) shares of Common Stock to
deliver in satisfaction of a sale by the Holder of shares of Common Stock
issuable upon such exercise that the Holder anticipated receiving from the
Company (a “Buy-In”),
then the Company shall, within five (5) Business Days after the Holder’s request
and in the Holder’s discretion, either (i) pay cash to the Holder in an amount
equal to the Holder’s total purchase price (including brokerage commissions, if
any) for the shares of Common Stock so purchased (the “Buy-In Price”), at which point
the Company’s obligation to deliver such certificate (and to issue such shares
of Common Stock) shall terminate, or (ii) promptly honor its obligation to
deliver to the Holder a certificate or certificates representing such shares of
Common Stock and pay cash to the Holder in an amount equal to the excess (if
any) of the Buy-In Price over the product of (A) such number of shares of Common
Stock, times (B) the closing bid price on the date of exercise.

    
      
         

      

      
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    (d)           Partial
Exercise.  This Warrant shall be exercisable, either in its
entirety or, from time to time, for part only of the number of Warrant Shares
referenced by this Warrant. If this Warrant is exercised in part, the Company
shall issue, at its expense, a new Warrant, in substantially the form of this
Warrant, referencing such reduced number of Warrant Shares that remain subject
to this Warrant.

    

    (e)           Disputes.  In
the case of a dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall promptly issue
to the Holder the number of Warrant Shares that are not disputed and resolve
such dispute in accordance with Section 15.

    

    
      	
              2.

            	
              ISSUANCE
      OF WARRANT SHARES

            

    

    

    (a)           The
Company covenants that all Warrant Shares will, upon issuance in accordance with
the terms of this Warrant, be (i) duly authorized, fully paid and
non-assessable, and (ii) free from all liens, charges and security interests,
with the exception of claims arising through the acts or omissions of any Holder
and except as arising from applicable Federal and state securities
laws.

    

    (b)           The
Company shall register this Warrant upon records to be maintained by the Company
for that purpose in the name of the record holder of such Warrant from time to
time. The Company may deem and treat the registered Holder of this Warrant as
the absolute owner thereof for the purpose of any exercise thereof, any
distribution to the Holder thereof and for all other purposes.

    

    (c)           The
Company will not, by amendment of its articles of incorporation, by-laws or
through any reorganization, transfer of assets, consolidation, merger,
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms to be observed
or performed hereunder by the Company, but will at all times in good faith
assist in the carrying out of all the provisions of this Warrant and in the
taking of all action necessary or appropriate in order to protect the rights of
the Holder to exercise this Warrant, or against impairment of such
rights.

    
      
         

      

      
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              3.

            	
              ADJUSTMENTS
      OF EXERCISE PRICE, NUMBER AND TYPE OF WARRANT
  SHARES

            

    

    

    (a)           The
Exercise Price and the number of shares purchasable upon the exercise of this
Warrant shall be subject to adjustment from time to time upon the occurrence of
certain events described in this Section 3(a); provided, that
notwithstanding the provisions of this Section 3, the Company shall not be
required to make any adjustment if and to the extent that such adjustment would
require the Company to issue a number of shares of Common Stock in excess of its
authorized but unissued shares of Common Stock, less all amounts of Common Stock
that have been reserved for issue upon the conversion of all outstanding
securities convertible into shares of Common Stock and the exercise of all
outstanding options, warrants and other rights exercisable for shares of Common
Stock.  If the Company does not have the requisite number of
authorized but unissued shares of Common Stock to make any adjustment, the
Company shall use its commercially reasonable efforts to obtain the necessary
stockholder consent to increase the authorized number of shares of Common Stock
to make such an adjustment pursuant to this Section 3(a).

    

    (i)           Subdivision or Combination
of Stock. In case the Company shall at any time subdivide (whether by way
of stock dividend, stock split or otherwise) its outstanding shares of Common
Stock into a greater number of shares, the Exercise Price in effect immediately
prior to such subdivision shall be proportionately reduced and the number of
Warrant Shares shall be proportionately increased, and conversely, in case the
outstanding shares of Common Stock of the Company shall be combined
(whether by way of stock combination, reverse stock split or otherwise) into a
smaller number of shares, the Exercise Price in effect immediately prior to such
combination shall be proportionately increased and the number of Warrant Shares
shall be proportionately decreased.  The Exercise Price and the
Warrant Shares, as so adjusted, shall be readjusted in the same manner upon the
happening of any successive event or events described in this Section
3(a)(i).

    

    (ii)           Dividends in Stock,
Property,
Reclassification. If at any time, or from time to time, the holders of
Common Stock (or any shares of stock or other securities at the time receivable
upon the exercise of this Warrant) shall have received or become entitled to
receive, without payment therefore:

    

    (A)           any
shares of stock or other securities that are at any time directly or indirectly
convertible into or exchangeable for Common Stock, or any rights or options to
subscribe for, purchase or otherwise acquire any of the foregoing by way of
dividend or other distribution, or

    

    (B)           additional
stock or other securities or property (including cash) by way of spin-off,
split-up, reclassification, combination of shares or similar corporate
rearrangement (other than shares of Common Stock issued as a stock split or
adjustments in respect of which shall be covered by the terms of Section 3(a)(i)
above),

     

    
      
         

      

      
        6

        
          

        

      

      
         

      

    

    then and
in each such case, the Exercise Price and the number of Warrant Shares to be
obtained upon exercise of this Warrant shall be adjusted proportionately, and
the Holder hereof shall, upon the exercise of this Warrant, be entitled to
receive, in addition to the number of shares of Common Stock receivable
thereupon, and without payment of any additional consideration therefor, the
amount of stock and other securities and property (including cash in the
cases referred to above) that such Holder would hold on the date of such
exercise had such Holder been the holder of record of such Common Stock as of
the date on which holders of Common Stock received or became entitled to receive
such shares or all other additional stock and other securities and
property.  The Exercise Price and the Warrant Shares, as so adjusted,
shall be readjusted in the same manner upon the happening of any successive
event or events described in this Section 3(a)(ii).

    

    (iii)           Reorganization,
Reclassification, Consolidation, Merger or Sale. If any recapitalization,
reclassification or reorganization of the capital stock of the Company, or any
consolidation or merger of the Company with another corporation, or the sale of
all or substantially all of its assets or other transaction shall be effected in
such a way that holders of Common Stock shall be entitled to receive stock,
securities or other assets or property (an “Organic Change”), then lawful and adequate
provisions shall be made by the Company whereby the Holder hereof shall
thereafter have the right to purchase and receive (in lieu of the shares of the
Common Stock of the Company immediately theretofore purchasable and receivable
upon the exercise of the rights represented by this Warrant) such shares of
stock, securities or other assets or property as may be issued or payable with
respect to or in exchange for a number of outstanding shares of such Common
Stock equal to the number of shares of such stock immediately theretofore
purchasable and receivable assuming the full exercise of the rights represented
by this Warrant. In the event of any Organic Change, appropriate provision shall
be made by the Company with respect to the rights and interests of the Holder of
this Warrant to the end that the provisions hereof (including, without
limitation, provisions for adjustments of the Exercise Price and of the number
of shares purchasable and receivable upon the exercise of this Warrant) shall
thereafter be applicable, in relation to any shares of stock, securities or
assets thereafter deliverable upon the exercise hereof. To the extent necessary
to effect the foregoing provisions, the successor corporation (if other than the
Company) resulting from such consolidation or merger or the corporation
purchasing such assets shall assume by written instrument reasonably
satisfactory in form and substance to the Holder executed and mailed or
delivered to the registered Holder hereof at the last address of such Holder
appearing on the books of the Company, the obligation to deliver to such Holder
such shares of stock, securities or assets as, in accordance with the foregoing
provisions, such Holder may be entitled to purchase. If there is an Organic
Change, then the Company shall cause to be mailed to the Holder at its last
address as it shall appear on the books and records of the Company, at least 10
calendar days before the effective date of the Organic Change, a notice stating
the date on which such Organic Change is expected to become effective or
close, and the date as of which it is expected that holders of the Common Stock
of record shall be entitled to exchange their shares for securities, cash, or
other property delivered upon such Organic Change; provided, that the
failure to mail such notice or any defect therein or in the mailing thereof
shall not affect the validity of the corporate action required to be specified
in such notice.  The Holder is entitled to exercise this Warrant
during the 10-day period commencing on the date of such notice to the effective
date of the event triggering such notice.  In any event, the successor
corporation (if other than the Company) resulting from such consolidation or
merger or the corporation purchasing such assets shall be deemed to assume such
obligation to deliver to such Holder such shares of stock, securities or assets
even in the absence of a written instrument assuming such obligation to the
extent such assumption occurs by operation of law. 

    
      
         

      

      
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    (b)           Certificate as to
Adjustments. Upon the occurrence of each adjustment or readjustment
pursuant to this Section 3, the Company at its expense shall promptly compute
such adjustment or readjustment in accordance with the terms hereof and furnish
to each Holder of this Warrant a certificate setting forth such adjustment or
readjustment and showing in detail the facts upon which such adjustment or
readjustment is based. The Company shall promptly furnish or cause to be
furnished to such Holder a like certificate setting forth: (i) such adjustments
and readjustments; and (ii) the number of shares and the amount, if any, of
other property which at the time would be received upon the exercise of the
Warrant.

    

    (c)           Certain Events. If
any event occurs as to which the other provisions of this Section 3 are not
strictly applicable but the lack of any adjustment would not fairly protect the
purchase rights of the Holder under this Warrant in accordance with the basic
intent and principles of such provisions, or if strictly applicable would
not fairly protect the purchase rights of the Holder under this Warrant in
accordance with the basic intent and principles of such provisions, then the
Company's Board of Directors will, in good faith and subject to applicable law,
make an appropriate adjustment to protect the rights of the Holder; provided, that no
such adjustment pursuant to this Section 3(c) will increase the Exercise Price
or decrease the number of Warrant Shares as otherwise determined pursuant to
this Section 3.

    

    (d)           Adjustment of Exercise Price
Upon Issuance of Additional Shares of Common Stock.  In the
event the Company shall at any time prior to the Expiration Date issue
Additional Shares of Common Stock, as defined below, without consideration or
for a consideration per share less than the Exercise Price in effect immediately
prior to such issue, then the Exercise Price shall be reduced, concurrently with
such issue, to a price (calculated to the nearest cent) determined by
multiplying such Exercise Price by a fraction, (A) the numerator of which shall
be (1) the number of shares of Common Stock outstanding immediately prior to
such issue plus (2) the number of shares of Common Stock which the aggregate
consideration received or to be received by the Company for the total number of
Additional Shares of Common Stock so issued would purchase at such Exercise
Price; and (B) the denominator of which shall be the number of shares of Common
Stock outstanding immediately prior to such issue plus the number of such
Additional Shares of Common Stock so issued; provided that, (i)
for the purpose of this Section 3(d), all shares of Common Stock issuable upon
conversion or exchange of convertible securities outstanding immediately prior
to such issue shall be deemed to be outstanding, and (ii) the number of shares
of Common Stock deemed issuable upon conversion or exchange of such outstanding
convertible securities shall be determined without giving effect to any
adjustments to the conversion or exchange price or conversion or exchange rate
of such convertible securities resulting from the issuance of Additional Shares
of Common Stock that is the subject of this calculation.  For purposes
of this Warrant, “Additional Shares of Common Stock” shall mean all shares of
Common Stock issued by the Company after the Effective Date (including without
limitation any shares of Common Stock issuable upon conversion or exchange of
any convertible securities or upon exercise of any option or warrant, on an
as-converted basis), other than: (i) shares of Common Stock issued or
issuable upon conversion or exchange of any convertible securities or exercise
of any options outstanding on the Effective Date; (ii) shares of Common Stock
issued or issuable upon conversion of the warrants issued in connection with the
Offering; (iii) shares of Common Stock issued or issuable by reason of a
dividend, stock split, split-up or other distribution on shares of Common Stock
that is covered by Sections 3(a)(i) through 3(a)(iii) above; (iv) shares of
Common Stock issued in a registered public offering under the Securities Act;
(v) shares of Common Stock issued or issuable pursuant to the acquisition of
another corporation by the Corporation by merger, purchase of substantially all
of the assets or other reorganization or to a joint venture agreement; or
(vi) shares of Common Stock issued or issuable to officers, directors and
employees of, or consultants to, the Company pursuant to stock grants, option
plans, purchase plans or other employee stock incentive programs or arrangements
approved by the Board of Directors, or upon exercise of options or warrants
granted to such parties pursuant to any such plan or
arrangement;.  The provisions of this Section 3(d) shall not operate
to increase the Exercise Price.

    
      
         

      

      
        8

        
          

        

      

      
         

      

    

     

    
      	
              4.

            	
              TRANSFERS
      AND EXCHANGES OF WARRANT AND WARRANT
SHARES

            

    

    

    (a)           Registration of Transfers
and Exchanges. Subject to Section 4(c), upon the Holder’s surrender of
this Warrant, with a duly executed copy of the Form of Assignment attached as
Exhibit B, to the
Secretary of the Company at its principal offices or at such other office or
agency as the Company may specify in writing to the Holder, the Company shall
register the transfer of all or any portion of this Warrant. Upon such
registration of transfer, the Company shall issue a new Warrant, in
substantially the form of this Warrant, evidencing the acquisition rights
transferred to the transferee and a new Warrant, in similar form, evidencing the
remaining acquisition rights not transferred, to the Holder requesting the
transfer.

    

    (b)           Warrant Exchangeable for
Different Denominations. The Holder may exchange this Warrant for a new
Warrant or Warrants, in substantially the form of this Warrant, evidencing in
the aggregate the right to purchase the number of Warrant Shares, which may then
be purchased hereunder, each of such new Warrants to be dated the date of such
exchange and to represent the right to purchase such number of Warrant Shares as
shall be designated by the Holder. The Holder shall surrender this Warrant with
duly executed instructions regarding such re-certification of this Warrant to
the Secretary of the Company at its principal offices or at such other office or
agency as the Company may specify in writing to the Holder.

    

    (c)           Restrictions on
Transfers. This Warrant may
not be transferred at any time without (i) registration under the Securities Act
or (ii) an exemption from such registration and a written opinion of legal
counsel addressed to the Company that the proposed transfer of the Warrant may
be effected without registration under the Securities Act, which opinion will be
in form and from counsel reasonably satisfactory to the Company.

    

    (d)           Permitted Transfers and
Assignments.  Notwithstanding any provision to the contrary in
this Section 4, the Holder may transfer, with or without consideration, this
Warrant or any of the Warrant Shares (or a portion thereof) to the Holder’s
Affiliates (as such term is defined under Rule 144 of the Securities Act)
without obtaining the opinion from counsel that may be required by Section
4(c)(ii), provided, that the
Holder delivers to the Company and its counsel certification, documentation, and
other assurances reasonably required by the Company’s counsel to enable the
Company’s counsel to render an opinion to the Company’s Transfer Agent that such
transfer does not violate applicable securities laws.

    
      
         

      

      
        9

        
          

        

      

      
         

      

    

     

    
      	
              5.

            	
              MUTILATED
      OR MISSING WARRANT CERTIFICATE

            

    

    

    If this Warrant is mutilated, lost,
stolen or destroyed, upon request by the Holder, the Company will, at its
expense, issue, in exchange for and upon cancellation of the mutilated Warrant,
or in substitution for the lost, stolen or destroyed Warrant, a new Warrant, in
substantially the form of this Warrant, representing the right to acquire the
equivalent number of Warrant Shares; provided, that, as a
prerequisite to the issuance of a substitute Warrant, the Company may require
satisfactory evidence of loss, theft or destruction as well as an indemnity from
the Holder of a lost, stolen or destroyed Warrant.

    

    
      	
              6.

            	
              PAYMENT
      OF TAXES

            

    

    

    The
Company will pay all transfer and stock issuance taxes attributable to the
preparation, issuance and delivery of this Warrant and the Warrant Shares (and
replacement Warrants) including, without limitation, all documentary and stamp
taxes; provided, however, that the
Company shall not be required to pay any tax in respect of the transfer of this
Warrant, or the issuance or delivery of certificates for Warrant Shares or other
securities in respect of the Warrant Shares to any person or entity other than
to the Holder.

    

    7.           FRACTIONAL
WARRANT SHARES

    

    No
fractional Warrant Shares shall be issued upon exercise of this Warrant. The
Company, in lieu of issuing any fractional Warrant Share, shall round up the
number of Warrant Shares issuable to nearest whole share.

    

    
      	
              8.

            	
              NO
      STOCK RIGHTS AND LEGEND

            

    

    

    No holder
of this Warrant, as such, shall be entitled to vote or be deemed the holder of
any other securities of the Company that may at any time be issuable on the
exercise hereof, nor shall anything contained herein be construed to confer upon
the holder of this Warrant, as such, the rights of a stockholder of the Company
or the right to vote for the election of directors or upon any matter submitted
to stockholders at any meeting thereof, or give or withhold consent to any
corporate action or to receive notice of meetings or other actions affecting
stockholders (except as provided herein), or to receive dividends or
subscription rights or otherwise (except as provide herein).

    

    Each certificate for Warrant Shares
initially issued upon the exercise of this Warrant, and each certificate for
Warrant Shares issued to any subsequent transferee of any such certificate,
shall be stamped or otherwise imprinted with a legend in substantially the
following form:

    
      
         

      

      
        10

        
          

        

      

      
         

      

    

    “THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”), OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH SECURITIES
NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR OTHERWISE
TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH  RESPECT THERETO
IS EFFECTIVE UNDER THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS, OR (2) AN
EXEMPTION FROM SUCH REGISTRATION EXISTS AND THE COMPANY RECEIVES AN OPINION OF
COUNSEL TO THE HOLDER OF SUCH SECURITIES, WHICH COUNSEL AND OPINION ARE
REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED,
SOLD, PLEDGED, ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR   APPLICABLE
STATE SECURITIES LAWS.”

    

    
      	
              9.

            	
              REGISTRATION
      UNDER THE SECURITIES ACT OF 1933

            

    

    

    The Company agrees to provide
registration rights for the resale of the Warrant Shares under the Securities
Act on the terms and subject to the conditions set forth in the Registration
Rights Agreement between the Company and each of the investors party to the
subscription agreements substantially similar to the Subscription
Agreement, pursuant to which this Warrant was issued.

    

    10.           NOTICES

    

    All notices, consents, waivers, and
other communications under this Warrant must be in writing and will be deemed
given to a party when (a) delivered to the appropriate address by hand or by
nationally recognized overnight courier service (costs prepaid); (b) sent by
facsimile or e-mail with confirmation of transmission by the transmitting
equipment; (c) received or rejected by the addressee, if sent by certified mail,
return receipt requested, if to the registered Holder hereof; or (d) seven days
after the placement of the notice into the mails (first class postage prepaid),
to the Holder at the address, facsimile number, or e-mail address furnished by
the registered Holder to the Company in accordance with the Subscription
Agreement by and between the Company and the Holder, or if to the Company, to it
at Luis Francisco Saenz, Chief Executive Officer, 1640 Terrace Way, Walnut
Creek, CA 94597 (or to such other address, facsimile number, or e-mail address
as the Holder or the Company as a party may designate by notice the other party)
with a copy to Gottbetter & Partners, 488 Madison Avenue, New York, New York
10022, Attention: Adam S. Gottbetter.

    

    
      	
              11.

            	
              SEVERABILITY

            

    

    

    If a
court of competent jurisdiction holds any provision of this Warrant invalid or
unenforceable, the other provisions of this Warrant will remain in full force
and effect. Any provision of this Warrant held invalid or unenforceable only in
part or degree will remain in full force and effect to the extent not held
invalid or unenforceable.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    

    
      	
              12.

            	
              BINDING
      EFFECT

            

    

    

    This
Warrant shall be binding upon and inure to the sole and exclusive benefit of the
Company, its successors and assigns, the registered Holder or Holders from time
to time of this Warrant and the Warrant Shares.

    

    
      	
              13.

            	
              SURVIVAL
      OF RIGHTS AND DUTIES

            

    

    

    This
Warrant shall terminate and be of no further force and effect on the earlier of
5:00 P.M., Eastern Time, on the Expiration Date or the date on which this
Warrant has been exercised in full.

    

    
      	
              14.

            	
              GOVERNING
      LAW

            

    

    

    This
Warrant will be governed by and construed under the laws of the State of [New
York] without regard to conflicts of laws principles that would require the
application of any other law.

    

    
      	
              15.

            	
              DISPUTE
      RESOLUTION

            

    

    

    In the
case of a dispute as to the determination of the Exercise Price or the
arithmetic calculation of the Warrant Shares, the Company shall submit the
disputed determinations or arithmetic calculations via facsimile within five (5)
Business Days of receipt of the Notice of Exercise giving rise to such dispute,
as the case may be, to the Holder. If the Holder and the Company are unable to
agree upon such determination or calculation of the Exercise Price or the
Warrant Shares within three Business Days of such disputed determination or
arithmetic calculation being submitted to the Holder, then the Company shall, at
its sole discretion, within five (5) Business Days, submit via facsimile (a) the
disputed determination of the Exercise Price to an independent, reputable
investment bank selected by the Company and approved by the Holder, or (b) the
disputed arithmetic calculation of the Warrant Shares to the Company’s
independent, outside accountant. The Company shall cause at its expense the
investment bank or the accountant, as the case may be, to perform the
determinations or calculations and notify the Company and the Holder of the
results no later than ten (10) Business Days from the time it receives the
disputed determinations or calculations; provided that, if such disputed
determination or arithmetic calculation being submitted by the Holder is
determined to be incorrect, then the expense of the investment bank or the
accountant shall be the responsibility of the Holder. Such investment bank’s or
accountant’s determination or calculation, as the case may be, shall be final,
binding and conclusive upon the parties thereto.

    

    
      	
              16.

            	
              NOTICES
      OF RECORD DATE

            

    

    

    Upon (a)
any establishment by the Company of a record date of the holders of any class of
securities for the purpose of determining the holders thereof who are entitled
to receive any dividend or other distribution, or right or option to acquire
securities of the Company, or any other right, or (b) any capital
reorganization, reclassification, recapitalization, merger or consolidation of
the Company with or into any other corporation, any transfer of all or
substantially all the assets of the Company, or any voluntary or involuntary
dissolution, liquidation or winding up of the Company, or the sale, in a single
transaction, of a majority of the Company’s voting stock (whether newly issued,
or from treasury, or previously issued and then outstanding, or any combination
thereof), the Company shall mail to the Holder at least ten (10) Business Days,
or such longer period as may be required by law, prior to the record date
specified therein, a notice specifying (i) the date established as the record
date for the purpose of such dividend, distribution, option or right and a
description of such dividend, option or right, (ii) the date on which any such
reorganization, reclassification, transfer, consolidation, merger, dissolution,
liquidation or winding up, or sale is expected to become effective and (iii) the
date, if any, fixed as to when the holders of record of Common Stock shall be
entitled to exchange their shares of Common Stock for securities or other
property deliverable upon such reorganization, reclassification, transfer,
consolation, merger, dissolution, liquidation or winding up.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    

    
      	
              17.

            	
              RESERVATION
      OF SHARES

            

    

    

    The
Company shall reserve and keep available out of its authorized but unissued
shares of Common Stock for issuance upon the exercise of this Warrant, free from
pre-emptive rights, such number of shares of Common Stock for which this Warrant
shall from time to time be exercisable.  The Company will take all
such reasonable action as may be necessary to assure that such Warrant Shares
may be issued as provided herein without violation of any applicable law or
regulation. Without limiting the generality of the foregoing, the Company
covenants that it will use commercially reasonable efforts to take all such
action as may be necessary or appropriate in order that the Company may validly
and legally issue fully paid and non-assessable Warrant Shares upon the exercise
of this Warrant and use commercially reasonable efforts to obtain all such
authorizations, exemptions or consents, including but not limited to consents
from the Company’s stockholders or Board of Directors or any public regulatory
body, as may be necessary to enable the Company to perform its obligations under
this Warrant.

    

    
      	
              18.

            	
              HEADINGS

            

    

    

    The headings used in this Warrant are
for the convenience of reference only and shall not, for any purpose, be deemed
a part of this Warrant.

    

    
      	
              19.

            	
              AMENDMENT
      AND WAIVERS

            

    

    

    Any term of this Warrant may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance and either retroactively or prospectively), with the
written consent of the Company and the Holders of a majority of the Warrant
Shares issuable upon exercise of the Warrants.

    

    
      	
              20.

            	
              NO
      THIRD PARTY RIGHTS

            

    

    

    This
Warrant is not intended, and will not be construed, to create any rights in any
parties other than the Company and the Holder, and no person or entity may
assert any rights as third-party beneficiary hereunder.

     

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    IN WITNESS WHEREOF, the Company has
caused this Warrant to be duly executed as of the date first set forth
above.

     

    
      
        
          
            	
                    LI3
      ENERGY, INC.

                  
	 
      	 
      
	
                    By:

                  	 
      
	
                    Name:

                  
	
                    Title:       
      Chief Executive
Officer

                  

          

        

      

    

     

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

    EXHIBIT
A

    

    NOTICE OF
EXERCISE

    

    (To be
executed by the Holder of Warrant if such Holder desires to exercise
Warrant)

    

    To Li3
Energy, Inc.:

    

    The
undersigned hereby irrevocably elects to exercise this Warrant and to purchase
thereunder, ___________________ full shares of Li3 Energy, Inc. common stock
issuable upon exercise of the Warrant and delivery of:

    

    (1)                 $_________
(in cash as provided for in the foregoing Warrant) and any applicable taxes
payable by the undersigned pursuant to such Warrant; and

    

    (2)                 __________
shares of Common Stock (pursuant to a Cashless Exercise in accordance with
Section 1(b)(ii) of the Warrant) (check here if the undersigned desires to
deliver an unspecified number of shares equal the number sufficient to effect a
Cashless Exercise [___]).

    

    The undersigned requests that
certificates for such shares be issued in the name of:

    

    _________________________________________

    (Please
print name, address and social security or federal employer

    identification
number (if applicable))

    

    _________________________________________

    

    _________________________________________

    

    If the shares issuable upon this
exercise of the Warrant are not all of the Warrant Shares which the Holder is
entitled to acquire upon the exercise of the Warrant, the undersigned requests
that a new Warrant evidencing the rights not so exercised be issued in the name
of and delivered to:

    

    _________________________________________

    (Please
print name, address and social security or federal employer

    identification
number (if applicable))

    

    _________________________________________

    

    _________________________________________

     

    
      
        	 
      	
                Name
      of Holder (print):   
    _________________________

              
	 
      	
                (Signature):  
      __________________________________

              
	 
      	
                (By:)  
      _______________________________________

              
	 
      	
                (Title:)  ______________________________________

              
	 
      	
                Dated: 
      ______________________________________

              

      

    

     

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

    

    EXHIBIT
B

    

    FORM OF
ASSIGNMENT

    

    FOR VALUE
RECEIVED, ___________________________________ hereby sells, assigns and
transfers to each assignee set forth below all of the rights of the undersigned
under the Warrant (as defined in and evidenced by the attached Warrant) to
acquire the number of Warrant Shares set opposite the name of such assignee
below and in and to the foregoing Warrant with respect to said acquisition
rights and the shares issuable upon exercise of the Warrant:

    

    
      
        
          
            
              
                
                  
                    	
                            Name of Assignee

                          	 	
                            Address

                          	 	
                            Number of Shares

                          
	 
      	 	 
      	 	 
      
	 
      	 	 
      	 	 
      
	 
      	 	 
      	 	 
      
	 
      	 	 
      	 	 
      

                  

                

              

            

          

        

      

    

     

    If the
total of the Warrant Shares are not all of the Warrant Shares evidenced by the
foregoing Warrant, the undersigned requests that a new Warrant evidencing the
right to acquire the Warrant Shares not so assigned be issued in the name of and
delivered to the undersigned.

     

    
      	
            	
              Name
      of Holder (print):   
    _________________________

            
	 
      	
              (Signature):  
      __________________________________

            
	 
      	
              (By:)  
      _______________________________________

            
	 
      	
              (Title:)  ______________________________________

            
	 
      	
              Dated: 
      ______________________________________

            

    

     

    
      
         

      

      
        16Exhibit
10.1

     

    Li3
ENERGY, INC.

     

    2009
EQUITY INCENTIVE PLAN

     

    1.           Purposes of the
Plan.  The purposes of this Plan are:

     

    
      	
               
      

            	
              ·

            	
              to
      attract and retain the best available personnel for positions of
      substantial responsibility,

            

    

     

    
      	
               
      

            	
              ·

            	
              to
      provide incentives to individuals who perform services to the Company,
      and

            

    

     

    
      	
               
      

            	
              ·

            	
              to
      promote the success of the Company’s
business.

            

    

     

    The Plan
permits the grant of Incentive Stock Options, Nonstatutory Stock Options, Stock
Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance
Units, Performance Shares and other stock or cash awards as the Administrator
may determine.

     

    2.           Definitions.  As
used herein, the following definitions will apply:

     

    (a)           “Administrator” means
the Board or any of its Committees as will be administering the Plan, in
accordance with Section 4 hereof.

     

    (b)           “Affiliate” means any
corporation or any other entity (including, but not limited to, partnerships and
joint ventures) controlling, controlled by, or under common control with the
Company.

     

    (c)           “Applicable Laws”
means the requirements relating to the administration of equity-based awards
under U.S. federal and state corporate laws, U.S. federal and state securities
laws, the Code, any stock exchange or quotation system on which the Common Stock
is listed or quoted and the applicable laws of any foreign country or
jurisdiction where Awards are, or will be, granted under the Plan.

     

    (d)           “Award” means,
individually or collectively, a grant under the Plan of Options, Stock
Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance
Units, Performance Shares and other stock or cash awards as the Administrator
may determine.

     

    (e)           “Award Agreement”
means the written or electronic agreement setting forth the terms and provisions
applicable to each Award granted under the Plan.  The Award Agreement
is subject to the terms and conditions of the Plan.

     

    (f)           “Board” means the
Board of Directors of the Company.

     

    (g)           “Change in Control”
means the occurrence of any of the following events:

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              (i)

            	
              A
      change in the ownership of the Company which occurs on
      the date that any one person, or more than one person acting as a group,
      (“Person”)
      acquires ownership of the stock of the Company that, together with the
      stock held by such Person, constitutes more than 50% of the total voting
      power of the stock of the Company; provided, however, that for purposes of
      this subsection (i), the
      acquisition of additional stock by any one Person, who is considered to
      own more than 50% of the total voting power of the stock of the Company
      will not be considered a Change in Control;
  or

            

    

     

    
      	
               
      

            	
              (ii)

            	
              A
      change in the effective control of the Company which occurs on the date
      that a majority of members of the Board is replaced during any twelve (12)
      month period by Directors whose appointment or election is not endorsed by
      a majority of the members of the Board prior to the date of the
      appointment or election.  For purposes of this clause (ii), if
      any Person is considered to effectively control the Company, the
      acquisition of additional control of the Company by the same Person will
      not be considered a Change in Control;
or

            

    

     

    
      	
               
      

            	
              (iii)

            	
              A
      change in the ownership of a substantial portion of the Company’s assets
      which occurs on the date that any Person acquires (or has acquired during
      the twelve (12) month period ending on the date of the most recent
      acquisition by such person or persons) assets from the Company that have a
      total gross fair market value equal to or more than 50% of the total gross
      fair market value of all of the assets of the Company immediately prior to
      such acquisition or acquisitions; provided, however, that for purposes of
      this subsection (iii), the following will not constitute a change in the
      ownership of a substantial portion of the Company’s assets: (A) a transfer
      to an entity that is controlled by the Company’s stockholders immediately
      after the transfer, or (B) a transfer of assets by the Company to: (1) a
      stockholder of the Company (immediately before the asset transfer) in
      exchange for or with respect to the Company’s stock, (2) an entity, 50% or
      more of the total value or voting power of which is owned, directly or
      indirectly, by the Company, (3) a Person, that owns, directly or
      indirectly, 50% or more of the total value or voting power of all the
      outstanding stock of the Company, or (4) an entity, at least 50% of the
      total value or voting power of which is owned, directly or indirectly, by
      a Person described in this subsection (iii)(B)(3).  For purposes
      of this subsection (iii), gross fair market value means the value of the
      assets of the Company, or the value of the assets being disposed of,
      determined without regard to any liabilities associated with such
      assets.

            

    

     

    For
purposes of this Section 2(g), persons will be considered to be acting as a
group if they are owners of a corporation that enters into a merger,
consolidation, purchase or acquisition of stock, or similar business transaction
with the Company.

     

    (h)          “Code” means the
Internal Revenue Code of 1986, as amended.  Any reference to a section
of the Code herein will be a reference to any successor or amended section of
the Code.

     

    (i)           “Committee” means a
committee of Directors or of other individuals satisfying Applicable Laws
appointed by the Board in accordance with Section 4 hereof.

     

    
      
         

      

      
        -2-

        
          

        

      

      
         

      

    

     

    (j)           “Common Stock” means
the common stock, par value $0.001 per share, of the Company.

     

    (k)          “Company” means Li3
Energy, Inc., a Nevada corporation, or any successor thereto.

     

    (l)           “Consultant” means any
person, including an advisor, engaged by the Company or a Parent, Subsidiary or
Affiliate to render services to such entity.

     

    (m)         “Determination Date”
means the latest possible date that will not jeopardize the qualification of an
Award granted under the Plan as “performance-based compensation” under Section
162(m) of the Code.

     

    (n)          “Director” means a
member of the Board.

     

    (o)          “Disability” means
total and permanent disability as defined in Section 22(e)(3) of the Code,
provided that in the case of Awards other than Incentive Stock Options, the
Administrator in its discretion may determine whether a permanent and total
disability exists in accordance with uniform and non-discriminatory standards
adopted by the Administrator from time to time.

     

    (p)          “Employee” means any
person, including Officers and Directors, employed by the Company or any Parent,
Subsidiary or Affiliate of the Company.  Neither service as a Director
nor payment of a director’s fee by the Company will be sufficient to constitute
“employment” by the Company.

     

    (q)          “Exchange Act” means
the Securities Exchange Act of 1934, as amended.

     

    (r)           “Exchange Program”
means a program under which (i) outstanding Awards are surrendered or cancelled
in exchange for Awards of the same type (which may have lower exercise prices
and different terms), Awards of a different type, and/or cash, (ii) Participants
would have the opportunity to transfer any outstanding Awards to a financial
institution or other person or entity selected by the Administrator, and/or
(iii) the exercise price of an outstanding Award is reduced.  The
Administrator will determine the terms and conditions of any Exchange Program in
its sole discretion.

     

    (s)          “Fair Market Value”
means, as of any date, the value of the Common Stock as the Administrator may
determine in good faith by reference to the closing price of such stock on any
established stock exchange or a national market system on the day of
determination if the Common Stock is so listed on any established stock exchange
or a national market system.  If the Common Stock is not listed on any
established stock exchange or a national market system, the value of the Common
Stock will be determined as the Administrator may determine in good
faith.

     

    (t)           “Fiscal Year” means
the fiscal year of the Company.

     

    
      
         

      

      
        -3-

        
          

        

      

      
         

      

    

     

    (u)          “Incentive Stock
Option” means an Option that by its terms qualifies and is otherwise
intended to qualify as an incentive stock option within the meaning of
Section 422 of the Code and the regulations promulgated
thereunder.

     

    (v)          “Nonstatutory Stock
Option” means an Option that by its terms does not qualify or is not
intended to qualify as an Incentive Stock Option.

     

    (w)         “Officer” means a
person who is an officer of the Company within the meaning of Section 16 of
the Exchange Act and the rules and regulations promulgated
thereunder.

     

    (x)           “Option” means a stock
option granted pursuant to Section 6 hereof.

     

    (y)          “Parent” means a
“parent corporation,” whether now or hereafter existing, as defined in
Section 424(e) of the Code.

     

    (z)           “Participant” means
the holder of an outstanding Award.

     

    (aa)        “Performance Goals”
will have the meaning set forth in Section 11 hereof.

     

    (bb)        “Performance Period”
means any Fiscal Year of the Company or such other period as determined by the
Administrator in its sole discretion.

     

    (cc)        “Performance Share”
means an Award denominated in Shares which may be earned in whole or in part
upon attainment of Performance Goals or other vesting criteria as the
Administrator may determine pursuant to Section 10 hereof.

     

    (dd)        “Performance Unit”
means an Award which may be earned in whole or in part upon attainment of
Performance Goals or other vesting criteria as the Administrator may determine
and which may be settled for cash, Shares or other securities or a combination
of the foregoing pursuant to Section 10 hereof.

     

    (ee)        “Period of
Restriction” means the period during which the transfer of Shares of
Restricted Stock are subject to restrictions and therefore, the Shares are
subject to a substantial risk of forfeiture.  Such restrictions may be
based on the passage of time, the achievement of target levels of performance,
or the occurrence of other events as determined by the
Administrator.

     

    (ff)          “Plan” means this 2009
Equity Incentive Plan.

     

    (gg)        “Restricted Stock”
means Shares issued pursuant to an Award of Restricted Stock under
Section 8 hereof, or issued pursuant to the early exercise of an
Option.

     

    (hh)        “Restricted Stock
Unit” means a bookkeeping entry representing an amount equal to the Fair
Market Value of one Share, granted pursuant to Section 9
hereof.  Each Restricted Stock Unit represents an unfunded and
unsecured obligation of the Company.

     

    (ii)          “Rule 16b-3” means
Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3, as in effect when
discretion is being exercised with respect to the Plan.

     

    
      
         

      

      
        -4-

        
          

        

      

      
         

      

    

     

    (jj)          “Section 16(b)”
means Section 16(b) of the Exchange Act.

     

    (kk)        “Service Provider”
means an Employee, Director, or Consultant.

     

    (ll)          “Share” means a share
of the Common Stock, as adjusted in accordance with Section 14
hereof.

     

    (mm)      “Stock Appreciation
Right” means an Award, granted alone or in connection with an Option,
that pursuant to Section 7 is designated as a Stock Appreciation
Right.

     

    (nn)     
   “Subsidiary” means a
“subsidiary corporation,” whether now or hereafter existing, as defined in
Section 424(f) of the Code.

     

    3.           Stock Subject to the Plan.

     

    (a)           Subject
to the provisions of Section 14 hereof, the maximum aggregate number of
Shares that may be awarded and sold under the Plan is 5,000,000 Shares. The
Shares may be authorized, but unissued, or reacquired Common Stock.

     

    (b)           Lapsed
Awards.  If an Award expires or becomes unexercisable without
having been exercised in full, or, with respect to Restricted Stock, Restricted
Stock Units, Performance Shares or Performance Units, is forfeited to or
repurchased by the Company, the unpurchased Shares (or for Awards other than
Options and Stock Appreciation Rights, the forfeited or repurchased Shares)
which were subject thereto will become available for future grant or sale under
the Plan (unless the Plan has terminated).  Upon exercise of a Stock
Appreciation Right settled in Shares, the gross number of Shares covered by the
portion of the Award so exercised will cease to be available under the
Plan.  Shares that have actually been issued under the Plan under any
Award will not be returned to the Plan and will not become available for future
distribution under the Plan; provided, however, that if unvested Shares of
Restricted Stock, Restricted Stock Units, Performance Shares or Performance
Units are repurchased by the Company or are forfeited to the Company, such
Shares will become available for future grant under the Plan.  Shares
used to pay the tax and/or exercise price of an Award will become available for
future grant or sale under the Plan.  To the extent an Award under the
Plan is paid out in cash rather than Shares, such cash payment will not result
in reducing the number of Shares available for issuance under the
Plan.  Notwithstanding the foregoing provisions of this Section 3(b),
subject to adjustment provided in Section 14 hereof, the maximum number of
Shares that may be issued upon the exercise of Incentive Stock Options will
equal the aggregate Share number stated in Section 3(a) above, plus, to the
extent allowable under Section 422 of the Code, any Shares that become
available for issuance under the Plan under this Section 3(b).

     

    (c)           Share
Reserve.  The Company, during the term of this Plan, will at
all times reserve and keep available such number of Shares as will be sufficient
to satisfy the requirements of the Plan.

     

    
      
         

      

      
        -5-

        
          

        

      

      
         

      

    

     

    4.           Administration of the
Plan.

     

    (a)           Procedure.

     

    
      	
               
      

            	
              (i)

            	
              Multiple
      Administrative Bodies.  Different Committees with respect
      to different groups of Service Providers may administer the
      Plan.

            

    

     

    
      	
               
      

            	
              (ii)

            	
              Section 162(m).  To
      the extent that the Administrator determines it to be desirable to qualify
      Awards granted hereunder as “performance-based compensation” within the
      meaning of Section 162(m) of the Code, the Plan will be administered
      by a Committee of two (2) or more “outside directors” within the meaning
      of Section 162(m) of the Code.

            

    

     

    
      	
               
      

            	
              (iii)

            	
              Rule
      16b-3.  To the extent desirable to qualify transactions
      hereunder as exempt under Rule 16b-3, the transactions contemplated
      hereunder will be structured to satisfy the requirements for exemption
      under Rule 16b-3.

            

    

     

    
      	
               
      

            	
              (iv)

            	
              Other
      Administration.  Other than as provided above, the Plan
      will be administered by (A) the Board or (B) a Committee, which
      committee will be constituted to satisfy Applicable
  Laws.

            

    

     

    (b)           Powers of the
Administrator.  Subject to the provisions of the Plan, and in
the case of a Committee, subject to the specific duties delegated by the Board
to such Committee, the Administrator will have the authority, in its
discretion:

     

    
      	
               
      

            	
                  
      (i)

            	
              to
      determine the Fair Market Value;

            

    

     

    
      	
               
      

            	
                 
      (ii)

            	
              to
      select the Service Providers to whom Awards may be granted
      hereunder;

            

    

     

    
      	
               
      

            	
                (iii)

            	
              to
      determine the terms and conditions, not inconsistent with the terms of the
      Plan, of any Award granted
hereunder;

            

    

     

    
      	
               
      

            	
               
      (iv)

            	
              to
      determine the terms and conditions of any and to institute an Exchange
      Program;

            

    

     

    
      	
               
      

            	
                
      (v)

            	
              to
      construe and interpret the terms of the Plan and Awards granted pursuant
      to the Plan;

            

    

     

    
      	
               
      

            	
               
      (vi)

            	
              to
      prescribe, amend and rescind rules and regulations relating to the Plan,
      including rules and regulations relating to sub-plans established for the
      purpose of satisfying applicable foreign
laws;

            

    

     

    
      	
               
      

            	
               (vii)

            	
              to
      modify or amend each Award (subject to Section 19(c)
      hereof);

            

    

     

    
      	
               
      

            	
              (viii)

            	
              to
      authorize any person to execute on behalf of the Company any instrument
      required to effect the grant of an Award previously granted by the
      Administrator;

            

    

     

    
      
         

      

      
        -6-

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
                
      (ix)

            	
              to
      allow a Participant to defer the receipt of the payment of cash or the
      delivery of Shares that would otherwise be due to such Participant under
      an Award pursuant to such procedures as the Administrator may determine;
      and

            

    

     

    
      	
               
      

            	
                 
      (x)

            	
              to
      make all other determinations deemed necessary or advisable for
      administering the Plan.

            

    

     

    (c)           Effect of
Administrator’s Decision.  The Administrator’s decisions,
determinations, and interpretations will be final and binding on all
Participants and any other holders of Awards.

     

    5.           Eligibility.  Nonstatutory
Stock Options, Restricted Stock, Restricted Stock Units, Stock Appreciation
Rights, Performance Units, Performance Shares, and such other cash or stock
awards as the Administrator determines may be granted to Service
Providers.  Incentive Stock Options may be granted only to
Employees.

     

    6.           Stock
Options.

     

    (a)           Limitations.

     

    
      	
               
      

            	
              (i)

            	
              Each
      Option will be designated in the Award Agreement as either an Incentive
      Stock Option or a Nonstatutory Stock Option.  However,
      notwithstanding such designation, to the extent that the aggregate Fair
      Market Value of the Shares with respect to which Incentive Stock Options
      are exercisable for the first time by the Participant during any calendar
      year (under all plans of the Company and any Parent or Subsidiary) exceeds
      $100,000 (U.S.), such Options will be treated as Nonstatutory Stock
      Options.  For purposes of this Section 6(a), Incentive
      Stock Options will be taken into account in the order in which they were
      granted.  The Fair Market Value of the Shares will be determined
      as of the time the Option with respect to such Shares is
      granted.

            

    

     

    
      	
               
      

            	
              (ii)

            	
              The
      Administrator will have complete discretion to determine the number of
      Shares subject to an Option granted to any
  Participant.

            

    

     

    (b)           Term of
Option.  The Administrator will determine the term of each
Option in its sole discretion; provided, however, that the term will be no more
than ten (10) years from the date of grant thereof.  Moreover, in the
case of an Incentive Stock Option granted to a Participant who, at the time the
Incentive Stock Option is granted, owns stock representing more than 10% of the
total combined voting power of all classes of stock of the Company or any Parent
or Subsidiary, the term of the Incentive Stock Option will be five (5) years
from the date of grant or such shorter term as may be provided in the Award
Agreement.

     

    
      
         

      

      
        -7-

        
          

        

      

      
         

      

    

     

    (c)           Option Exercise Price and
Consideration.

     

    
      	
               
      

            	
              (i)

            	
              Exercise
      Price.  The per share exercise price for the Shares to be
      issued pursuant to exercise of an Option will be determined by the
      Administrator, but will be no less than 100% of the Fair Market Value per
      Share on the date of grant.  In addition, in the case of an
      Incentive Stock Option granted to an Employee who, at the time the
      Incentive Stock Option is granted, owns stock representing more than 10%
      of the voting power of all classes of stock of the Company or any Parent
      or Subsidiary, the per Share exercise price will be no less than 110% of
      the Fair Market Value per Share on the date of
      grant.  Notwithstanding the foregoing provisions of this Section
      6(c), Options may be granted with a per Share exercise price of less than
      100% of the Fair Market Value per Share on the date of grant pursuant to a
      transaction described in, and in a manner consistent with,
      Section 424(a) of the Code.

            

    

     

    
      	
               
      

            	
              (ii)

            	
              Waiting Period and
      Exercise Dates.  At the time an Option is granted, the
      Administrator will fix the period within which the Option may be exercised
      and will determine any conditions that must be satisfied before the Option
      may be exercised.

            

    

     

    
      	
               
      

            	
              (iii)

            	
              Form of
      Consideration.  The Administrator will determine the
      acceptable form(s) of consideration for exercising an Option, including
      the method of payment, to the extent permitted by Applicable
      Laws.

            

    

     

    (d)           Exercise of
Option.

     

    
      	
               
      

            	
              (i)

            	
              Procedure for
      Exercise; Rights as a Stockholder.  Any Option granted
      hereunder will be exercisable according to the terms of the Plan and at
      such times and under such conditions as determined by the Administrator
      and set forth in the Award Agreement.  An Option may not be
      exercised for a fraction of a
Share.

            

    

     

    An Option
will be deemed exercised when the Company receives: (i) notice of exercise
(in such form as the Administrator specifies from time to time) from the person
entitled to exercise the Option, and (ii) full payment for the Shares with
respect to which the Option is exercised (together with any applicable
withholding taxes).  No adjustment will be made for a dividend or
other right for which the record date is prior to the date the Shares are
issued, except as provided in Section 14 hereof.

     

    
      	
               
      

            	
              (ii)

            	
              Termination of
      Relationship as a Service Provider.  If a Participant
      ceases to be a Service Provider, other than upon the Participant’s
      termination as the result of the Participant’s death or Disability, the
      Participant may exercise his or her Option within such period of time as
      is specified in the Award Agreement to the extent that the Option is
      vested on the date of termination (but in no event later than the
      expiration of the term of such Option as set forth in the Award
      Agreement).  In the absence of a specified time in the Award
      Agreement, the Option will remain exercisable for three (3) months
      following the Participant’s termination.  Unless otherwise
      provided by the Administrator, if on the date of termination the
      Participant is not vested as to his or her entire Option, the Shares
      covered by the unvested portion of the Option will revert to the
      Plan.  If after termination the Participant does not exercise
      his or her Option within the time specified by the Administrator, the
      Option will terminate, and the Shares covered by such Option will revert
      to the Plan.

            

    

     

    
      
         

      

      
        -8-

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              (iii)

            	
              Disability of
      Participant.  If a Participant ceases to be a Service
      Provider as a result of the Participant’s Disability, the Participant may
      exercise his or her Option within such period of time as is specified in
      the Award Agreement to the extent the Option is vested on the date of
      termination (but in no event later than the expiration of the term of such
      Option as set forth in the Award Agreement).  In the absence of
      a specified time in the Award Agreement, the Option will remain
      exercisable for six (6) months following the Participant’s
      termination.  Unless otherwise provided by the Administrator, if
      on the date of termination the Participant is not vested as to his or her
      entire Option, the Shares covered by the unvested portion of the Option
      will revert to the Plan.  If after termination the Participant
      does not exercise his or her Option within the time specified herein, the
      Option will terminate, and the Shares covered by such Option will revert
      to the Plan.

            

    

     

    
      	
               
      

            	
              (iv)

            	
              Death of
      Participant.  If a Participant dies while a Service
      Provider, the Option may be exercised within such period of time as is
      specified in the Award Agreement to the extent that the Option is vested
      on the date of death (but in no event may the option be exercised later
      than the expiration of the term of such Option as set forth in the Award
      Agreement), by the Participant’s designated beneficiary, provided such
      beneficiary has been designated prior to Participant’s death in a form
      acceptable to the Administrator.  If no such beneficiary has
      been designated by the Participant, then such Option may be exercised by
      the personal representative of the Participant’s estate or by the
      person(s) to whom the Option is transferred pursuant to the Participant’s
      will or in accordance with the laws of descent and
      distribution.  In the absence of a specified time in the Award
      Agreement, the Option will remain exercisable for six (6) months following
      Participant’s death.  Unless otherwise provided by the
      Administrator, if at the time of death Participant is not vested as to his
      or her entire Option, the Shares covered by the unvested portion of the
      Option will immediately revert to the Plan.  If the Option is
      not so exercised within the time specified herein, the Option will
      terminate, and the Shares covered by such Option will revert to the
      Plan.

            

    

     

    7.           Stock Appreciation
Rights.

     

    (a)           Grant of Stock Appreciation
Rights.  Subject to the terms and conditions of the Plan, a
Stock Appreciation Right may be granted to Service Providers at any time and
from time to time as will be determined by the Administrator, in its sole
discretion.

     

    (b)           Number of
Shares.  The Administrator will have complete discretion to
determine the number of Stock Appreciation Rights granted to any
Participant.

     

    (c)           Exercise Price and Other
Terms.  The Administrator, subject to the provisions of the
Plan, will have complete discretion to determine the terms and conditions of
Stock Appreciation Rights granted under the Plan; provided, however, that the
exercise price will be not less than 100% of the Fair Market Value of a Share on
the date of grant.

     

    
      
         

      

      
        -9-

        
          

        

      

      
         

      

    

     

    (d)           Stock Appreciation Right
Agreement.  Each Stock Appreciation Right grant will be
evidenced by an Award Agreement that will specify the exercise price, the term
of the Stock Appreciation Right, the conditions of exercise, and such other
terms and conditions as the Administrator, in its sole discretion, will
determine.

     

    (e)           Expiration of Stock
Appreciation Rights.  A Stock Appreciation Right granted under
the Plan will expire upon the date determined by the Administrator, in its sole
discretion, and set forth in the Award Agreement; provided, however, that the
term will be no more than ten (10) years from the date of grant
thereof.  Notwithstanding the foregoing, the rules of
Section 6(d) above also will apply to Stock Appreciation
Rights.

     

    (f)           Payment of Stock
Appreciation Right Amount.  Upon exercise of a Stock
Appreciation Right, a Participant will be entitled to receive payment from the
Company in an amount determined by multiplying:

     

    
      	
               
      

            	
              (i)

            	
              The
      difference between the Fair Market Value of a Share on the date of
      exercise over the exercise price;
times

            

    

     

    
      	
               
      

            	
              (ii)

            	
              The
      number of Shares with respect to which the Stock Appreciation Right is
      exercised.

            

    

     

    At the
discretion of the Administrator, the payment upon Stock Appreciation Right
exercise may be in cash, in Shares of equivalent value, or in some combination
thereof.

     

    8.           Restricted
Stock.

     

    (a)           Grant of Restricted
Stock.  Subject to the terms and provisions of the Plan, the
Administrator, at any time and from time to time, may grant Shares of Restricted
Stock to Service Providers in such amounts as the Administrator, in its sole
discretion, will determine.

     

    (b)           Restricted Stock
Agreement.  Each Award of Restricted Stock will be evidenced by
an Award Agreement that will specify the Period of Restriction, the number of
Shares granted, and such other terms and conditions as the Administrator, in its
sole discretion, will determine.

     

    (c)           Transferability.  Except
as provided in this Section 8, Shares of Restricted Stock may not be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated until the
end of the applicable Period of Restriction.

     

    (d)           Other
Restrictions.  The Administrator, in its sole discretion, may
impose such other restrictions on Shares of Restricted Stock as it may deem
advisable or appropriate.

     

    (e)           Removal of
Restrictions.  Except as otherwise provided in this Section 8,
Shares of Restricted Stock covered by each Restricted Stock grant made under the
Plan will be released from escrow as soon as practicable after the last day of
the Period of Restriction.  The Administrator, in its discretion, may
accelerate the time at which any restrictions will lapse or be
removed.

     

    
      
         

      

      
        -10-

        
          

        

      

      
         

      

    

     

    (f)           Voting
Rights.  During the Period of Restriction, Service Providers
holding Shares of Restricted Stock granted hereunder may exercise full voting
rights with respect to those Shares, unless the Administrator determines
otherwise.

     

    (g)           Dividends and Other
Distributions.  During the Period of Restriction, Service
Providers holding Shares of Restricted Stock will be entitled to receive all
dividends and other distributions paid with respect to such Shares unless
otherwise provided in the Award Agreement.  If any such dividends or
distributions are paid in Shares, the Shares will be subject to the same
restrictions on transferability and forfeitability as the Shares of Restricted
Stock with respect to which they were paid.

     

    (h)           Return of Restricted Stock
to Company.  On the date set forth in the Award Agreement, the
Restricted Stock for which restrictions have not lapsed will revert to the
Company and again will become available for grant under the Plan.

     

    (i)           Section 162(m) Performance
Restrictions.  For purposes of qualifying grants of Restricted
Stock as “performance-based compensation” under Section 162(m) of the Code,
the Administrator, in its discretion, may set restrictions based upon the
achievement of Performance Goals.  The Performance Goals will be set
by the Administrator on or before the Determination Date.  In granting
Restricted Stock which is intended to qualify under Section 162(m) of the
Code, the Administrator will follow any procedures determined by it from time to
time to be necessary or appropriate to ensure qualification of the Award under
Section 162(m) of the Code (e.g., in determining the Performance
Goals).

     

    9.           Restricted Stock
Units.

     

    (a)           Grant.  Restricted
Stock Units may be granted at any time and from time to time as determined by
the Administrator.  Each Restricted Stock Unit grant will be evidenced
by an Award Agreement that will specify such other terms and conditions as the
Administrator, in its sole discretion, will determine, including all terms,
conditions, and restrictions related to the grant, the number of Restricted
Stock Units and the form of payout, which, subject to Section 9(d) hereof,
may be left to the discretion of the Administrator.

     

    (b)           Vesting Criteria and Other
Terms.  The Administrator will set vesting criteria in its
discretion, which, depending on the extent to which the criteria are met, will
determine the number of Restricted Stock Units that will be paid out to the
Participant.  After the grant of Restricted Stock Units, the
Administrator, in its sole discretion, may reduce or waive any restrictions for
such Restricted Stock Units.  Each Award of Restricted Stock Units
will be evidenced by an Award Agreement that will specify the vesting criteria,
and such other terms and conditions as the Administrator, in its sole discretion
will determine.  The Administrator, in its discretion, may accelerate
the time at which any restrictions will lapse or be removed.

     

    (c)           Earning Restricted Stock
Units.  Upon meeting the applicable vesting criteria, the
Participant will be entitled to receive a payout as specified in the Award
Agreement.

     

    
      
         

      

      
        -11-

        
          

        

      

      
         

      

    

     

    (d)           Form and Timing of
Payment.  Payment of earned Restricted Stock Units will be made
as soon as practicable after the date(s) set forth in the Award
Agreement.  The Administrator, in its sole discretion, may pay earned
Restricted Stock Units in cash, Shares, or a combination
thereof.  Shares represented by Restricted Stock Units that are fully
paid in cash again will be available for grant under the Plan.

     

    (e)           Cancellation.  On
the date set forth in the Award Agreement, all unearned Restricted Stock Units
will be forfeited to the Company.

     

    (f)           Section 162(m) Performance
Restrictions.  For purposes of qualifying grants of Restricted
Stock Units as “performance-based compensation” under Section 162(m) of the
Code, the Administrator, in its discretion, may set restrictions based upon the
achievement of Performance Goals.  The Performance Goals will be set
by the Administrator on or before the Determination Date.  In granting
Restricted Stock Units which are intended to qualify under Section 162(m)
of the Code, the Administrator will follow any procedures determined by it from
time to time to be necessary or appropriate to ensure qualification of the Award
under Section 162(m) of the Code (e.g., in determining the Performance
Goals).

     

    10.           Performance Units and
Performance Shares.

     

    (a)           Grant of Performance
Units/Shares.  Performance Units and Performance Shares may be
granted to Service Providers at any time and from time to time, as will be
determined by the Administrator, in its sole discretion.  The
Administrator will have complete discretion in determining the number of
Performance Units/Shares granted to each Participant.

     

    (b)           Value of Performance
Units/Shares.  Each Performance Unit will have an initial value
that is established by the Administrator on or before the date of
grant.  Each Performance Share will have an initial value equal to the
Fair Market Value of a Share on the date of grant.

     

    (c)           Performance Objectives and
Other Terms.  The Administrator will set performance objectives
or other vesting provisions.  The Administrator may set vesting
criteria based upon the achievement of Company-wide, business unit, or
individual goals (including, but not limited to, continued employment), or any
other basis determined by the Administrator in its discretion.  Each
Award of Performance Units/Shares will be evidenced by an Award Agreement that
will specify the Performance Period, and such other terms and conditions as the
Administrator, in its sole discretion, will determine.

     

    (d)           Earning of Performance
Units/Shares.  After the applicable Performance Period has
ended, the holder of Performance Units/Shares will be entitled to receive a
payout of the number of Performance Units/Shares earned by the Participant over
the Performance Period, to be determined as a function of the extent to which
the corresponding performance objectives or other vesting provisions have been
achieved.  After the grant of a Performance Unit/Share, the
Administrator, in its sole discretion, may reduce or waive any performance
objectives or other vesting provisions for such Performance
Unit/Share.

     

    (e)           Form and Timing of Payment
of Performance Units/Shares.  Payment of earned Performance
Units/Shares will be made as soon as practicable after the expiration of the
applicable Performance Period.  The Administrator, in its sole
discretion, may pay earned Performance Units/Shares in the form of cash, in
Shares (which have an aggregate Fair Market Value equal to the value of the
earned Performance Units/Shares at the close of the applicable Performance
Period) or in a combination thereof.

     

    
      
         

      

      
        -12-

        
          

        

      

      
         

      

    

     

    (f)           Cancellation of Performance
Units/Shares.  On the date set forth in the Award Agreement,
all unearned or unvested Performance Units/Shares will be forfeited to the
Company, and again will be available for grant under the Plan.

     

    (g)           Section 162(m) Performance
Restrictions.  For purposes of qualifying grants of Performance
Units/Shares as “performance-based compensation” under Section 162(m) of
the Code, the Administrator, in its discretion, may set restrictions based upon
the achievement of Performance Goals.  The Performance Goals will be
set by the Administrator on or before the Determination Date.  In
granting Performance Units/Shares which are intended to qualify under
Section 162(m) of the Code, the Administrator will follow any procedures
determined by it from time to time to be necessary or appropriate to ensure
qualification of the Award under Section 162(m) of the Code (e.g., in
determining the Performance Goals).

     

    11.          Performance-Based
Compensation Under Code Section 162(m).

     

    (a)           General.  If
the Administrator, in its discretion, decides to grant an Award intended to
qualify as “performance-based compensation” under Code Section 162(m), the
provisions of this Section 11 will control over any contrary provision in the
Plan; provided, however, that the Administrator may in its discretion grant
Awards that are not intended to qualify as “performance-based compensation”
under Section 162(m) of the Code to such Participants that are based on
Performance Goals or other specific criteria or goals but that do not satisfy
the requirements of this Section 11.

     

    (b)           Performance
Goals.  The granting and/or vesting of Awards of Restricted
Stock, Restricted Stock Units, Performance Shares and Performance Units and
other incentives under the Plan may be made subject to the attainment of
performance goals relating to one or more business criteria within the meaning
of Code Section 162(m) and may provide for a targeted level or levels of
achievement (“Performance Goals”)
including (i) earnings per Share, (ii) operating cash flow,
(iii) operating income, (iv) profit after-tax, (v) profit
before-tax, (vi) return on assets, (vii) return on equity,
(viii) return on sales, (ix) revenue, and (x) total shareholder
return.  Any Performance Goals may be used to measure the performance
of the Company as a whole or a business unit of the Company and may be measured
relative to a peer group or index.  The Performance Goals may differ
from Participant to Participant and from Award to Award.  Prior to the
Determination Date, the Administrator will determine whether any significant
element(s) will be included in or excluded from the calculation of any
Performance Goal with respect to any Participant.

     

    
      
         

      

      
        -13-

        
          

        

      

      
         

      

    

     

    (c)           Procedures.  To
the extent necessary to comply with the performance-based compensation
provisions of Code Section 162(m), with respect to any Award granted subject to
Performance Goals, within the first twenty-five percent (25%) of the Performance
Period, but in no event more than ninety (90) days following the commencement of
any Performance Period (or such other time as may be required or permitted by
Code Section 162(m)), the Administrator will, in writing, (i) designate one or
more Participants to whom an Award will be made, (ii) select the Performance
Goals applicable to the Performance Period, (iii) establish the Performance
Goals, and amounts of such Awards, as applicable, which may be earned for such
Performance Period, and (iv) specify the relationship between Performance
Goals and the amounts of such Awards, as applicable, to be earned by each
Participant for such Performance Period.  Following the completion of
each Performance Period, the Administrator will certify in writing whether the
applicable Performance Goals have been achieved for such Performance
Period.  In determining the amounts earned by a Participant, the
Administrator will have the right to reduce or eliminate (but not to increase)
the amount payable at a given level of performance to take into account
additional factors that the Administrator may deem relevant to the assessment of
individual or corporate performance for the Performance Period.  A
Participant will be eligible to receive payment pursuant to an Award for a
Performance Period only if the Performance Goals for such period are
achieved.

     

    (d)           Additional
Limitations.  Notwithstanding any other provision of the Plan,
any Award which is granted to a Participant and is intended to constitute
qualified performance based compensation under Code Section 162(m) will be
subject to any additional limitations set forth in the Code (including any
amendment to Section 162(m)) or any regulations and ruling issued thereunder
that are requirements for qualification as qualified performance-based
compensation as described in Section 162(m) of the Code, and the Plan will be
deemed amended to the extent necessary to conform to such
requirements.

     

    12.          Leaves of
Absence.  Unless the Administrator provides otherwise, vesting
of Awards granted hereunder will be suspended during any unpaid leave of
absence.  A Service Provider will not cease to be an Employee in the
case of (i) any leave of absence approved by the Company, or
(ii) transfers between locations of the Company or between the Company, its
Parent, or any Subsidiary.  For purposes of Incentive Stock Options,
no such leave may exceed three (3) months, unless reemployment upon expiration
of such leave is guaranteed by statute or contract.  If reemployment
upon expiration of a leave of absence approved by the Company is not so
guaranteed, then six (6) months and one day following the commencement of such
leave any Incentive Stock Option held by the Participant will cease to be
treated as an Incentive Stock Option and will be treated for tax purposes as a
Nonstatutory Stock Option.

     

    13.          Transferability of
Awards.  Unless determined otherwise by the Administrator, an
Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed
of in any manner other than by will or by the laws of descent or distribution
and may be exercised, during the lifetime of the Participant, only by the
Participant.  If the Administrator makes an Award transferable, such
Award may only be transferred (i) by will, (ii) by the laws of descent and
distribution, (iii) to a revocable trust, or (iii) as permitted by Rule 701 of
the Securities Act of 1933, as amended.

     

    14.          Adjustments; Dissolution or
Liquidation; Merger or Change in Control.

     

    (a)           Adjustments.  In
the event that any dividend or other distribution (whether in the form of cash,
Shares, other securities, or other property), recapitalization, stock split,
reverse stock split, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase, or exchange of Shares or other securities of the
Company, or other change in the corporate structure of the Company affecting the
Shares occurs, the Administrator, in order to prevent diminution or enlargement
of the benefits or potential benefits intended to be made available under the
Plan, will adjust the number and class of Shares that may be delivered under the
Plan and/or the number, class, and price of Shares covered by each outstanding
Award, and the numerical Share limits set forth in Sections 3, 6, 7, 8, 9
and 10 hereof.

     

    
      
         

      

      
        -14-

        
          

        

      

      
         

      

    

     

    (b)           Dissolution or
Liquidation.  In the event of the proposed dissolution or
liquidation of the Company, the Administrator will notify each Participant as
soon as practicable prior to the effective date of such proposed
transaction.  To the extent it has not been previously exercised, an
Award will terminate immediately prior to the consummation of such proposed
action.

     

    (c)           Change in
Control.  In the event of a merger or Change in Control, each
outstanding Award will be treated as the Administrator determines, including,
without limitation, that each Award will be assumed or an equivalent option or
right substituted by the successor corporation or a Parent or Subsidiary of the
successor corporation (the “Successor
Corporation”).  The Administrator will not be required to treat
all Awards similarly in the transaction.

     

    In the
event that the Successor Corporation does not assume or substitute for the
Award, the Participant will fully vest in and have the right to exercise all of
his or her outstanding Options and Stock Appreciation Rights, including Shares
as to which such Awards would not otherwise be vested or exercisable, all
restrictions on Restricted Stock will lapse, and, with respect to Restricted
Stock Units, Performance Shares and Performance Units, all Performance Goals or
other vesting criteria will be deemed achieved at target levels and all other
terms and conditions met.  In addition, if an Option or Stock
Appreciation Right is not assumed or substituted for in the event of a Change in
Control, the Administrator will notify the Participant in writing or
electronically that the Option or Stock Appreciation Right will be fully vested
and exercisable for a period of time determined by the Administrator in its sole
discretion, and the Option or Stock Appreciation Right will terminate upon the
expiration of such period.

     

    For the
purposes of this subsection (c), an Award will be considered assumed if,
following the Change in Control, the Award confers the right to purchase or
receive, for each Share subject to the Award immediately prior to the Change in
Control, the consideration (whether stock, cash, or other securities or
property) or, in the case of a Stock Appreciation Right upon the exercise of
which the Administrator determines to pay cash or a Performance Share or
Performance Unit which the Administrator can determine to pay in cash, the fair
market value of the consideration received in the merger or Change in Control by
holders of Common Stock for each Share held on the effective date of the
transaction (and if holders were offered a choice of consideration, the type of
consideration chosen by the holders of a majority of the outstanding Shares);
provided, however, that if such consideration received in the Change in Control
is not solely common stock of the Successor Corporation, the Administrator may,
with the consent of the Successor Corporation, provide for the consideration to
be received upon the exercise of an Option or Stock Appreciation Right or upon
the payout of a Performance Share or Performance Unit, for each Share subject to
such Award (or in the case of Performance Units, the number of implied shares
determined by dividing the value of the Performance Units by the per share
consideration received by holders of Common Stock in the Change in Control), to
be solely common stock of the Successor Corporation equal in fair market value
to the per share consideration received by holders of Common Stock in the Change
in Control.

     

    
      
         

      

      
        -15-

        
          

        

      

      
         

      

    

     

    Notwithstanding
anything in this Section 14(c) to the contrary, an Award that vests, is earned
or paid-out upon the satisfaction of one or more Performance Goals will not be
considered assumed if the Company or its successor modifies any of such
Performance Goals without the Participant’s consent; provided, however, a
modification to such Performance Goals only to reflect the Successor
Corporation’s post-Change in Control corporate structure will not be deemed to
invalidate an otherwise valid Award assumption.

     

    15.          Tax
Withholding

     

    (a)           Withholding
Requirements.  Prior to the delivery of any Shares or cash
pursuant to an Award (or exercise thereof), the Company will have the power and
the right to deduct or withhold, or require a Participant to remit to the
Company, an amount sufficient to satisfy federal, state, local, foreign or other
taxes (including the Participant’s FICA obligation) required to be withheld with
respect to such Award (or exercise thereof).

     

    (b)           Withholding
Arrangements.  The Administrator, in its sole discretion and
pursuant to such procedures as it may specify from time to time, may permit a
Participant to satisfy such tax withholding obligation, in whole or in part by
(without limitation) (i) paying cash, (ii) electing to have the Company
withhold otherwise deliverable cash or Shares having a Fair Market Value equal
to the minimum amount required to be withheld, (iii) delivering to the Company
already-owned Shares having a Fair Market Value equal to the amount required to
be withheld, or (iv) selling a sufficient number of Shares otherwise
deliverable to the Participant through such means as the Administrator may
determine in its sole discretion (whether through a broker or otherwise) equal
to the amount required to be withheld.  The amount of the withholding
requirement will be deemed to include any amount which the Administrator agrees
may be withheld at the time the election is made, not to exceed the amount
determined by using the maximum federal, state or local marginal income tax
rates applicable to the Participant with respect to the Award on the date that
the amount of tax to be withheld is to be determined.  The Fair Market
Value of the Shares to be withheld or delivered will be determined as of the
date that the taxes are required to be withheld.

     

    16.          No Effect on Employment or
Service.  Neither the Plan nor any Award will confer upon a
Participant any right with respect to continuing the Participant’s relationship
as a Service Provider with the Company, nor will they interfere in any way with
the Participant’s right or the Company’s right to terminate such relationship at
any time, with or without cause, to the extent permitted by Applicable
Laws.

     

    17.          Date of
Grant.  The date of grant of an Award will be, for all
purposes, the date on which the Administrator makes the determination granting
such Award, or such other later date as is determined by the
Administrator.  Notice of the determination will be provided to each
Participant within a reasonable time after the date of such grant.

     

    
      
         

      

      
        -16-

        
          

        

      

      
         

      

    

     

    18.          Term of
Plan.  Subject to Section 22 hereof, the Plan will
become effective upon its adoption by the Board.  It will continue in
effect for a term of ten (10) years unless terminated earlier under
Section 19 hereof.

     

    19.          Amendment and Termination of
the Plan.

     

    (a)           Amendment and
Termination.  The Administrator may at any time amend, alter,
suspend or terminate the Plan.

     

    (b)           Stockholder
Approval.  The Company will obtain stockholder approval of any
Plan amendment to the extent necessary and desirable to comply with Applicable
Laws.

     

    (c)           Effect of Amendment or
Termination.  No amendment, alteration, suspension, or
termination of the Plan will impair the rights of any Participant, unless
mutually agreed otherwise between the Participant and the Administrator, which
agreement must be in writing and signed by the Participant and the
Company.  Termination of the Plan will not affect the Administrator’s
ability to exercise the powers granted to it hereunder with respect to Awards
granted under the Plan prior to the date of such termination.

     

    20.          Conditions Upon Issuance of
Shares.

     

    (a)           Legal
Compliance.  Shares will not be issued pursuant to the exercise
of an Award unless the exercise of such Award and the issuance and delivery of
such Shares will comply with Applicable Laws and will be further subject to the
approval of counsel for the Company with respect to such
compliance.

     

    (b)           Investment
Representations.  As a condition to the exercise of an Award,
the Company may require the person exercising such Award to represent and
warrant at the time of any such exercise that the Shares are being purchased
only for investment and without any present intention to sell or distribute such
Shares if, in the opinion of counsel for the Company, such a representation is
required.

     

    21.          Inability to Obtain
Authority.  The inability of the Company to obtain authority
from any regulatory body having jurisdiction, which authority is deemed by the
Company’s counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, will relieve the Company of any liability in respect of the failure
to issue or sell such Shares as to which such requisite authority will not have
been obtained.

     

    22.          Stockholder
Approval.  The Plan will be subject to approval by the
stockholders of the Company within twelve (12) months after the date the Plan is
adopted.  Such stockholder approval will be obtained in the manner and
to the degree required under Applicable Laws.

     

    
      
         

      

      
        -17-

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